ETFS SILVER TRUST (Form: S-1/A, Received: 07/21/2009 06:06:30)

As filed with the Securities and Exchange Commission on July 21, 2009

Registration No. 333-156307

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

Amendment No. 3
to

F ORM S-1
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933

ETFS SILVER TRUST
Sponsored by ETF Securities USA LLC
(Exact name of Registrant as specified in its charter)


New York (State or other jurisdiction of incorporation or organization)		1040 (Primary Standard Industrial Classification Code Number)		26-4586763 (I.R.S. Employer Identification No.)

48 Wall Street
11th Floor
New York, NY 10005
(212) 918-4954
(Address, including zip code, and telephone number, including area code,
of Registrant’s principal executive offices)

Corporation Service Company
80 State Street
Albany NY 12207-2543
800 927-9800

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

Copies to:


Kathleen H. Moriarty, Esq. Katten Muchin Rosenman LLP 575 Madison Avenue New York, NY 10022		Peter J. Shea, Esq. Katten Muchin Rosenman LLP 575 Madison Avenue New York, NY 10022

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

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

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. £

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act of 1933, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. £

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act of 1933, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. £

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer £		Accelerated filer £
Non-accelerated filer S		Smaller reporting company £
(Do not check if a smaller reporting company)


Title of each class of securities to be registered	Amount to be registered		Proposed maximum offering price per Share(1)			Proposed maximum aggregate offering price(1)			Amount of registration fee(2)

ETFS Physical Silver Shares		50,000,000		$	9.46		$	473,000,000		$	18,590


(1)				Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(d) under the Securities Act of 1933. The initial Baskets of Shares will be offered at a per Share price equal to the value of one ounce of silver based on the price of an ounce of silver. The price of silver is based upon the London Fix of $9.46 per ounce on December 5, 2008.

(2)				$18,590 was previously paid in the initial filing of the registration statement on Form S-1, filed on December 19, 2008.

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

50,000,000 ETFS Silver Shares

ETFS Silver Trust

The ETFS Silver Trust (Trust) will issue ETFS Physical Silver Shares (Shares) which represent units of fractional undivided beneficial interest in and ownership of the Trust. ETF Securities USA LLC is the sponsor of the Trust (Sponsor), The Bank of New York Mellon is the trustee of the Trust (Trustee), and HSBC Bank USA, National Association is the custodian of the Trust (Custodian). The Trust intends to issue additional Shares on a continuous basis.

The Shares may be purchased from the Trust only in one or more blocks of 100,000 Shares (a block of 100,000 Shares is called a Basket). The Trust will issue Shares in Baskets to certain authorized participants (Authorized Participants) on an ongoing basis as described in “Plan of Distribution.” Baskets will be offered continuously at the net asset value (NAV) for 100,000 Shares on the day that an order to create a Basket is accepted by the Trustee. The Trust will not issue fractions of a Basket.

Prior to this offering, there has been no public market for the Shares. The Shares will trade on the NYSE Arca under the symbol “SIVR.”

Investing in the Shares involves significant risks. See “Risk Factors” starting on page 6.

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

The Shares are neither interests in nor obligations of the Sponsor or the Trustee.

The Trust will issue Shares from time to time in Baskets, as described in “Creation and Redemption of Shares.” It is expected that the Shares will be sold to the public at varying prices to be determined by reference to, among other considerations, the price of silver and the trading price of the Shares on the NYSE Arca at the time of each sale.

On July 20, 2009, an Initial Purchaser, subject to conditions, has purchased 100,000 Shares, which comprise the initial Basket, as described in “Plan of Distribution.” Delivery of the initial Basket will be made on or about July 24, 2009. The Trust received all proceeds from the offering of the initial Basket in silver in an amount equal to the full price for the initial Basket.


	Per Share ⁽¹⁾			Per Basket
Public offering price for the initial Basket ⁽²⁾		$	13.74		$	1,374,000


(1)				The initial Basket was created at a per Share price equal to the value of one ounce of silver on the date of formation of the ETFS Silver Trust.

(2)				The Initial Purchaser may receive commissions/fees from investors who purchase Shares from the initial Basket through their commission/fee-based brokerage accounts.

The date of this prospectus is July 20, 2009

TABLE OF CONTENTS


	Page
Statement Regarding Forward-Looking Statements		ii
Glossary of Defined Terms		ii
Prospectus Summary		1
The Offering		3
Risk Factors		6
Use of Proceeds		12
Overview of the Silver Industry		13
Business of the Trust		19
Description of the Trust		21
The Sponsor		22
The Trustee		23
The Custodian		24
Description of the Shares		24
Custody of the Trust’s Silver		25
Description of the Custody Agreements		26
Creation and Redemption of Shares		29
Description of the Trust Agreement		34
United States Federal Income Tax Consequences		44
ERISA and Related Considerations		48
Plan of Distribution		48
Legal Matters		50
Experts		50
Where You Can Find More Information		50
Report of Independent Registered Public Accounting Firm		F-1
Statement of Financial Condition		F-2

This prospectus contains information you should consider when making an investment decision about the Shares. You may rely on the information contained in this prospectus. The Trust and the Sponsor have not authorized any person to provide you with different information and, if anyone provides you with different or inconsistent information, you should not rely on it. This prospectus is not an offer to sell the Shares in any jurisdiction where the offer or sale of the Shares is not permitted.

The Shares are not registered for public sale in any jurisdiction other than the United States.

STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This prospectus contains “forward-looking statements” with respect to the Trust’s financial conditions, results of operations, plans, objectives, future performance and business. Statements preceded by, followed by or that include words such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or similar expressions are intended to identify some of the forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are included, along with this statement, for purposes of complying with the safe harbor provisions of that Act. All statements (other than statements of historical fact) included in this prospectus that address activities, events or developments that will or may occur in the future, including such matters as changes in commodity prices and market conditions (for silver and the Shares), the Trust’s operations, the Sponsor’s plans and references to the Trust’s future success and other similar matters are forward-looking statements. These statements are only predictions. Actual events or results may differ materially. These statements are based upon certain assumptions and analyses the Sponsor made based on its perception of historical trends, current conditions and expected future developments, as well as other factors appropriate in the circumstances. Whether or not actual results and developments will conform to the Sponsor’s expectations and predictions, however, is subject to a number of risks and uncertainties, including the special considerations discussed in this prospectus, general economic, market and business conditions, changes in laws or regulations, including those concerning taxes, made by governmental authorities or regulatory bodies, and other world economic and political developments. See “Risk Factors.” Consequently, all the forward-looking statements made in this prospectus are qualified by these cautionary statements, and there can be no assurance that the actual results or developments the Sponsor anticipates will be realized or, even if substantially realized, that they will result in the expected consequences to, or have the expected effects on, the Trust’s operations or the value of the Shares. Moreover, neither the Sponsor nor any other person assumes responsibility for the accuracy or completeness of the forward-looking statements. Neither the Trust nor the Sponsor is under a duty to update any of the forward-looking statements to conform such statements to actual results or to reflect a change in the Sponsor’s expectations or predictions.

GLOSSARY OF DEFINED TERMS

In this prospectus, each of the following quoted terms have the meanings set forth after such term:

“Allocated Account Agreement”—The agreement among the Trustee, the Sponsor and the Custodian which establishes the Trust Allocated Account. The Allocated Account Agreement and the Unallocated Account Agreement are sometimes referred to together as the “Custody Agreements.”

“ANAV”—Adjusted NAV. See “Description of the Trust Agreement—Valuation of Silver, Definition of Net Asset Value and Adjusted Net Asset Value” for a description of how the ANAV of the Trust is calculated. The ANAV of the Trust is used to calculate the fees of the Trustee and the Sponsor.

“Authorized Participant”—A person who (1) 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, (2) is a participant in DTC, (3) has entered into an Authorized Participant Agreement with the Trustee and (4) has established an Authorized Participant Unallocated Account with the Custodian. Only Authorized Participants may place orders to create or redeem one or more Baskets.

“Authorized Participant Agreement”—An agreement entered into by each Authorized Participant, the Sponsor and the Trustee which provides the procedures for the creation and redemption of Baskets and for the delivery of the silver and any cash required for such creations and redemptions.

“Authorized Participant Unallocated Account”—An unallocated silver account established with the Custodian by an Authorized Participant. Each Authorized Participant’s Authorized Participant

Unallocated Account will be used to facilitate the transfer of silver deposits and silver redemption distributions between the Authorized Participant and the Trust in connection with the creation and redemption of Baskets.

“Authorized Participant Unallocated Bullion Account Agreement”—The agreement between an Authorized Participant and the Custodian which establishes the Authorized Participant Unallocated Account.

“Basket”—A block of 100,000 Shares are called “Baskets.”

“Book Entry System”—The Federal Reserve Treasury Book Entry System for United States and federal agency securities.

“CEA”—Commodity Exchange Act of 1936, as amended.

“CFTC”—Commodity Futures Trading Commission, an independent agency with the mandate to regulate commodity futures and option markets in the United States.

“Clearing Agency”—Any clearing agency or similar system other than the Book Entry System or DTC.

“Code”—The United States Internal Revenue Code of 1986, as amended.

“Creation Basket Deposit”—The total deposit required to create a Basket. The deposit will be an amount of silver and cash, if any, that is in the same proportion to the total assets of the Trust (net of estimated accrued but unpaid fees, expenses and other liabilities) on the date an order to purchase one or more Baskets is properly received as the number of Shares comprising the number of Baskets to be created in respect of the deposit bears to the total number of Shares outstanding on the date such order is properly received.

“Custodian” or “HSBC”—HSBC Bank USA, National Association, a national banking association and a market maker, clearer and approved weigher under the rules of the LBMA. HSBC is the custodian of the Trust’s silver.

“Custody Agreements”—The Allocated Account Agreement together with the Unallocated Account Agreement.

“Custody Rules”—The rules, regulations, practices and customs of the LBMA, the Bank of England or any applicable regulatory body which apply to silver made available in physical form by the Custodian.

“DTC”—The Depository Trust Company. DTC is a limited purpose trust company organized under New York law, a member of the US Federal Reserve System and a clearing agency registered with the SEC. DTC will act as the securities depository for the Shares.

“DTC Participant”—Participants in DTC, such as banks, brokers, dealers and trust companies.

“Evaluation Time”—The time at which the Trustee will evaluate the silver held by the Trust and determine both the NAV and the ANAV of the Trust, which is currently as promptly as practicable after 4:00 p.m., New York time, on each day other than (1) a Saturday or Sunday or (2) any day on which the NYSE Arca is not open for regular trading.

“Exchange” or “NYSE Arca”—NYSE Arca, Inc. the venue where Shares are listed and traded.

“FINRA”—The Financial Industry Regulatory Authority, Inc.

“FSA”—The Financial Services Authority, an independent non-governmental body which exercises statutory regulatory power under the FSM Act and which regulates the major participating members of the LBMA in the United Kingdom.

“FSM Act”—The Financial Services and Markets Act 2000.

“Indirect Participants”—Those banks, brokers, dealers, trust companies and others who maintain, either directly or indirectly, a custodial relationship with a DTC Participant.

“Initial Purchaser”—Kellogg Specialist Group LLC, the purchaser of the Seed Basket and also known as the Lead Market Maker.

iii

“LBMA”—The London Bullion Market Association. The LBMA is the trade association that acts as the coordinator for activities conducted on behalf of its members and other participants in the London bullion market. In addition to coordinating market activities, the LBMA acts as the principal point of contact between the market and its regulators. A primary function of the LBMA is its involvement in the promotion of refining standards by maintenance of the “London Good Delivery Lists,” which are the lists of LBMA accredited melters and assayers of silver. Further, the LBMA coordinates market clearing and vaulting, promotes good trading practices and develops standard documentation. The major participating members of the LBMA are regulated by the FSA in the United Kingdom under the FSM Act.

“Lead Market Maker”—The designated market maker on the NYSE Arca for the Shares.

“London Good Delivery Bar”—A bar of silver meeting the London Good Delivery Standards.

“London Good Delivery Standards”—The specifications for weight, dimensions, fineness (or purity), identifying marks and appearance of silver bars as set forth in “The Good Delivery Rules for Silver and Silver Bars” published by the LBMA. The London Good Delivery Standards are described in “Operation of the Silver Bullion Market—The London Bullion Market.”

“London Fix”—means the price for an ounce of silver set by three market making members of the LBMA at approximately 12:00 noon London time, on each working day. See “Operation of the Silver Bullion Market–The London Bullion Market” for a description of the operation of the London PM Fix.

“NAV”—Net asset value. See “Description of the Trust Agreement—Valuation of Silver, Definition of Net Asset Value and Adjusted Net Asset Value” for a description of how the NAV of the Trust and the NAV per Share are calculated.

“OTC”—The global Over-the-Counter market for the trading of silver which consists of transactions in spot, forwards, and options and other derivatives.

“Securities Act”—The Securities Act of 1933, as amended.

“Seed Basket” or “initial Basket”—The single Basket issued to the Lead Market Maker in exchange for the deposit into the Trust of 100,000 ounces of silver in connection with the formation of the Trust.

“Shareholders”—Owners of beneficial interests in the Shares.

“Shares”—Units of fractional undivided beneficial interest in and ownership of the Trust which are issued by the Trust and named “ETFS Physical Silver Shares”

“Sponsor”—ETF Securities USA LLC, a Delaware limited liability company.

“tonne”—One metric tonne which is equivalent to 1,000 kilograms or 32,150.7465 troy ounces.

“Trust”—The ETFS Silver Trust, a common law trust, formed on July 20, 2009 under New York law pursuant to the Trust Agreement.

“Trust Agreement”—The Depository Trust Agreement between the Sponsor and the Trustee under which the Trust is formed and which sets forth the rights and duties of the Sponsor, the Trustee and Custodian.

“Trust Allocated Account”—The allocated silver account of the Trust established with the Custodian by the Allocated Account Agreement. The Trust Allocated Account will be used to hold the silver deposited with the Trust in allocated form (i.e., as individually identified bars of silver).

“Trustee” or “BNYM”—The Bank of New York Mellon, a banking corporation organized under the laws of the State of New York with trust powers. BNYM is the trustee of the Trust.

“Trust Unallocated Account”—The unallocated silver account of the Trust established with the Custodian by the Unallocated Account Agreement. The Trust Unallocated Account will be used to facilitate the transfer of silver deposits and silver redemption distributions between Authorized Participants and the Trust in connection with the creation and redemption of Baskets and the sales of silver made by the Trustee for the Trust.

“Unallocated Account Agreement”—The agreement among the Trustee, the Sponsor and the Custodian which establishes the Trust Unallocated Account. The Allocated Account Agreement and the Unallocated Account Agreement are sometimes referred to together as the “Custody Agreements.”

“US Shareholder”—A Shareholder that is (1) an individual who is treated as a citizen or resident of the United States for US federal income tax purposes; (2) a corporation or partnership created or organized in or under the laws of the United States or any political subdivision thereof; (3) an estate, the income of which is includible in gross income for US federal income tax purposes regardless of its source; or (4) a trust, if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more US persons have the authority to control all substantial decisions of the trust.

PROSPECTUS SUMMARY

This is only a summary of the prospectus and, while it contains material information about the Trust and its Shares, it does not contain or summarize all of the information about the Trust and the Shares contained in this prospectus which is material and/or which may be important to you. You should read this entire prospectus, including “Risk Factors” beginning on page 6, before making an investment decision about the Shares.

Trust Structure

The Trust’s Sponsor is ETF Securities USA LLC. The Sponsor is a Delaware limited liability company, was formed on June 17, 2009, and is wholly-owned by ETF Securities Limited. Under the Delaware Limited Liability Company Act and the governing documents of the Sponsor, ETF Securities Limited, the sole member of the Sponsor, is not responsible for the debts, obligations and liabilities of the Sponsor solely by reason of being the sole member of the Sponsor.

The Sponsor will arrange for the creation of the Trust, the registration of the Shares for their public offering in the United States and the listing of the Shares on the NYSE Arca. The Sponsor has agreed to assume the following administrative and marketing expenses incurred by the Trust: the Trustee’s monthly fee and out-of-pocket expenses, the Custodian’s fee and expenses reimbursable under the Custody Agreements, exchange listing fees, SEC registration fees, printing and mailing costs, audit fees and up to $100,000 per annum in legal expenses. The Sponsor will also pay the costs of the Trust’s organization and the initial sale of the Shares, including the applicable SEC registration fees.

The Trustee is The Bank of New York Mellon. The Trustee is generally responsible for the day-to-day administration of the Trust. This includes (1) transferring the Trust’s silver as needed to pay the Sponsor’s fee in silver (silver transfers are expected to occur approximately monthly in the ordinary course), (2) calculating the NAV of the Trust and the NAV per Share, (3) receiving and processing orders from Authorized Participants to create and redeem Baskets and coordinating the processing of such orders with the Custodian and The Depository Trust Company (DTC) and (4) selling the Trust’s silver as needed to pay any extraordinary Trust expenses that are not assumed by the Sponsor. The general role, responsibilities and regulation of the Trustee are further described in “The Trustee.”

The Custodian is HSBC Bank USA, National Association. The Custodian is responsible for the safekeeping of the Trust’s silver deposited with it by Authorized Participants in connection with the creation of Baskets. The Custodian also facilitates the transfer of silver in and out of the Trust through silver accounts it will maintain for Authorized Participants and the Trust. The Custodian is a market maker, clearer and approved weigher under the rules of the London Bullion Market Association (LBMA). The general role, responsibilities and regulation of the Custodian are further described in “The Custodian” and “Custody of the Trust’s Silver.”

Detailed descriptions of certain specific rights and duties of the Trustee and the Custodian are set forth in “Description of the Trust Agreement” and “Description of the Custody Agreements.”

Trust Overview

The investment objective of the Trust is for the Shares to reflect the performance of the price of silver bullion, less the expenses of the Trust’s operations. The Shares are designed for investors

who want a cost-effective and convenient way to invest in silver with minimal credit risk. Advantages of investing in the Shares include:

•

Ease and Flexibility of Investment. The Shares will trade on the NYSE Arca and will provide institutional and retail investors with indirect access to the silver bullion market. The Shares are expected to be bought and sold on the NYSE Arca like any other exchange-listed securities. The close of the NYSE Arca trading session is 4:00 PM New York time.

•

Expenses. The Sponsor expects that, for many investors, costs associated with buying and selling the Shares in the secondary market and the payment of the Trust’s ongoing expenses will be lower than the costs associated with buying and selling silver bullion and storing and insuring silver bullion in a traditional allocated silver bullion account.

•

Minimal Credit Risk. The Shares represent an interest in physical bullion owned by the Trust (other than an amount held in unallocated form which is not sufficient to make up a whole bar or which is held temporarily to effect a creation or redemption of Shares). Physical bullion of the Trust in the Custodian’s possession is not subject to borrowing arrangements with third parties. Other than the silver temporarily being held in an unallocated silver account with the Custodian, the physical bullion of the Trust is not subject to counterparty or credit risks. See “Risk Factors—Silver held in the Trust’s unallocated silver account and any Authorized Participant’s unallocated silver account will not be segregated from the Custodian’s assets....” This contrasts with most other financial products that gain exposure to bullion through the use of derivatives that are subject to counterparty and credit risks.

Investing in the Shares does not insulate the investor from certain risks, including price volatility. See “Risk Factors.”

Principal Offices

The Trust’s office is located at 48 Wall Street, 11th Floor, New York, New York 10005. The Sponsor’s office is located at ETF Securities Representative Office, 2 London Wall Buildings, 6th Floor, London, EC2M 5UU, United Kingdom and its telephone number is 011-44-207-448-4330. The Trustee has a trust office at 2 Hanson Place, Brooklyn, New York 11217. The Custodian’s custody office is located at 8 Canada Square, London, E14 5HQ, United Kingdom.

THE OFFERING


Offering		The Shares represent units of fractional undivided beneficial interest in and ownership of the Trust.
Use of proceeds		Proceeds received by the Trust from the issuance and sale of Baskets, including the single Basket (Seed Basket) issued to the Initial Purchaser, who is the Lead Market Maker, in connection with the formation of the Trust, and the Shares (as described on the front page of this prospectus) will consist of silver deposits and, possibly from time to time, cash. Pursuant to the Trust Agreement, during the life of the Trust such proceeds will only be (1) held by the Trust, (2) distributed to Authorized Participants in connection with the redemption of Baskets or (3) disbursed to pay the Sponsor’s Fee or sold as needed to pay the Trust’s expenses not assumed by the Sponsor.
Exchange symbol		SIVR
CUSIP		26922X107
Creation and redemption		The Trust expects to create and redeem the Shares from time to time, but only in one or more Baskets (a Basket equals a block of 100,000 Shares). The creation and redemption of Baskets requires the delivery to the Trust or the distribution by the Trust of the amount of silver and any cash represented by the Baskets being created or redeemed, the amount of which will be based on the combined NAV of the number of Shares included in the Baskets being created or redeemed. The initial amount of silver required for deposit with the Trust to create Shares is 100,000 ounces per Basket. The number of ounces of silver required to create a Basket or to be delivered upon the redemption of a Basket will gradually decrease over time, due to the accrual of the Trust’s expenses and the sale or delivery of the Trust’s silver to pay the Trust’s expenses. See “Business of the Trust—Trust Expenses.” Baskets may be created or redeemed only by Authorized Participants, who will pay a transaction fee for each order to create or redeem Baskets and may sell the Shares included in the Baskets they create to other investors. The Trust will not issue fractional Baskets. See “Creation and Redemption of Shares” for more details.
Net Asset Value		The NAV of the Trust is the aggregate value of the Trust’s assets less its liabilities (which include estimated accrued but unpaid fees and expenses). In determining the NAV of the Trust, the Trustee will value the silver held by the Trust on the basis of the price of an ounce of silver as set by the daily fix price of an ounce of silver announced at approximately 12:00 noon London, England time and is performed by the three members of the London silver fix (London Fix). See “Operation of the Silver Bullion Market—The London Bullion Market” for a description of the operation of the London silver price fix. The Trustee will determine the NAV of the Trust on each day the NYSE Arca is open for regular trading, as promptly as practicable after 4:00 p.m. New York time. If no London Fix is made on a particular evaluation day or has not been announced by 4:00 p.m. New York time on a particular evaluation day, the next most recent London Fix will be used in the determination of the NAV of the Trust, unless the Sponsor determines that such price is inappropriate to use as basis for such determination. The Trustee will also determine the NAV per Share,

which equals the NAV of the Trust, divided by the number of outstanding Shares

Trust expenses

The Trust’s only ordinary recurring charge is expected to be the remuneration due to the Sponsor (Sponsor’s Fee). In exchange for the Sponsor’s Fee, the Sponsor has agreed to assume the ordinary administrative and marketing expenses that the Trust is expected to incur. The Sponsor will also pay the costs of the Trust’s organization and the initial sale of the Shares, including the applicable SEC registration fees.

Sponsor’s fee

The Sponsor’s Fee will be accrued daily and will be payable in-kind in silver monthly in arrears. The Sponsor, from time to time, may waive all or a portion of the Sponsor’s Fee at its discretion for stated periods of time. The Sponsor is under no obligation to continue a waiver after the end of such stated period, and, if such waiver is not continued, the Sponsor’s Fee will thereafter be paid in full. The Trustee will from time to time deliver silver in such quantity as may be necessary to permit payment of the Sponsor’s Fee and sell silver in such quantity as may be necessary to permit payment in cash of Trust expenses not assumed by the Sponsor. The Trustee is authorized to sell silver at such times and in the smallest amounts required to permit such cash payments as they become due, it being the intention to avoid or minimize the Trust’s holdings of assets other than silver. Accordingly, the amount of silver to be sold will vary from time to time depending on the level of the Trust’s expenses and the market price of silver. See “Business of the Trust—Trust Expenses.”

Each delivery or sale of silver by the Trust to pay the Sponsor’s Fee or other expenses will be a taxable event to Shareholders. See “United States Federal Tax Consequences—Taxation of US Shareholders.”

Termination events

The Trustee will terminate and liquidate the Trust if one of the following events occurs:

Ø

the Shares are delisted from the NYSE Arca and are not approved for listing on another national securities exchange within five business days of their delisting;

Ø

Shareholders acting in respect of at least 75% of the outstanding Shares notify the Trustee that they elect to terminate the Trust;

Ø

60 days have elapsed since the Trustee notified the Sponsor of the Trustee’s election to resign and a successor trustee has not been appointed and accepted its appointment;

Ø

the SEC determines that the Trust is an investment company under the Investment Company Act of 1940 and the Trustee has actual knowledge of that determination;

Ø

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

Ø

the CFTC determines that the Trust is a commodity pool under the Commodity Exchange Act of 1936 and the Trustee has actual knowledge of that determination;

Ø

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

Ø

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

Ø

the Trustee elects to terminate the Trust after the Sponsor is deemed conclusively to have resigned effective immediately as a result of the Sponsor being adjudged bankrupt or insolvent, or a receiver of the Sponsor or of its property being appointed, or a trustee or liquidator or any public officer taking charge or control of the Sponsor or of its property or affairs for the purpose of rehabilitation, conservation or liquidation.

Upon the termination of the Trust, the Trustee will sell the Trust’s silver and, after paying or making provision for the Trust’s liabilities, distribute the proceeds to Shareholders surrendering Shares. See “Description of the Trust Agreement—Termination of the Trust.”

Authorized Participants

Baskets may be created or redeemed only by Authorized Participants. Each Authorized Participant must (1) be 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, (2) be a participant in DTC, (3) have entered into an agreement with the Trustee and the Sponsor (Authorized Participant Agreement) and (4) have established an unallocated silver account with the Custodian (Authorized Participant Unallocated Account). The Authorized Participant Agreement provides the procedures for the creation and redemption of Baskets and for the delivery of silver and any cash required for such creations or redemptions. A list of the current Authorized Participants can be obtained from the Trustee or the Sponsor. See “Creation and Redemption of Shares” for more details.

Clearance and settlement

The Shares will be evidenced by one or more global certificates that the Trustee will issue to DTC. The Shares will be available only in book-entry form. Shareholders may hold their Shares through DTC, if they are participants in DTC, or indirectly through entities that are participants in DTC.

Summary of Financial Condition

As of the close of business on July 20, 2009, the date of the formation of the Trust, the NAV of the Trust, which represents the value of the silver deposited into the Trust in exchange for the Seed Basket, was $1,374,000 and the NAV per Share was $13.74. See “Statement of Financial Condition” elsewhere in this prospectus.

RISK FACTORS

You should consider carefully the risks described below before making an investment decision. You should also refer to the other information included in this prospectus, including the Trust’s financial statements and the related notes.

The value of the Shares relates directly to the value of the silver held by the Trust and fluctuations in the price of silver could materially adversely affect an investment in the Shares.

The Shares are designed to mirror as closely as possible the performance of the price of silver bullion, and the value of the Shares relates directly to the value of the silver held by the Trust, less the Trust’s liabilities (including estimated accrued but unpaid expenses). The price of silver has fluctuated widely over the past several years. Several factors may affect the price of silver, including:

•

A change in economic conditions, such as a recession, can adversely affect the price of silver. Silver is used in a wide range of industrial applications, and an economic downturn could have a negative impact on its demand and, consequently, its price and the price of the Shares;

•

Investors’ expectations with respect to the rate of inflation;

•

Currency exchange rates;

•

Interest rates;

•

Investment and trading activities of hedge funds and commodity funds; and

•

Global or regional political, economic or financial events and situations.

In addition, investors should be aware that there is no assurance that silver will maintain its long-term value in terms of purchasing power in the future. In the event that the price of silver declines, the Sponsor expects the value of an investment in the Shares to decline proportionately.

The Shares may trade at a price which is at, above or below the NAV per Share and any discount or premium in the trading price relative to the NAV per Share may widen as a result of non-concurrent trading hours between the NYSE Arca and London and Commodity Exchange, Inc., a subsidiary of New York Mercantile Exchange, Inc. (COMEX).

The Shares may trade at, above or below the NAV per Share. The NAV per Share will fluctuate with changes in the market value of the Trust’s assets. The trading price of the Shares will fluctuate in accordance with changes in the NAV per Share as well as market supply and demand. The amount of the discount or premium in the trading price relative to the NAV per Share may be influenced by non-concurrent trading hours between the NYSE Arca and the major silver markets. While the Shares will trade on the NYSE Arca until 4:00 PM New York time, liquidity in the market for silver will be reduced after the close of the major world silver markets, including London and the COMEX. As a result, during this time, trading spreads, and the resulting premium or discount on Shares, may widen.

Purchasing activity in the silver market associated with the purchase of Baskets from the Trust may cause a temporary increase in the price of silver. This increase may adversely affect an investment in the Shares.

Purchasing activity associated with acquiring the silver required for deposit into the Trust in connection with the creation of Baskets may temporarily increase the market price of silver, which will result in higher prices for the Shares. Temporary increases in the market price of silver may also occur as a result of the purchasing activity of other market participants. Other market participants may attempt to benefit from an increase in the market price of silver that may result from increased purchasing activity of silver connected with the issuance of Baskets. Consequently, the market price of silver may decline immediately after Baskets are created. If the price of silver declines, the trading price of the Shares may also decline.

As the Sponsor and its management have no history of operating an investment vehicle like the Trust, their experience may be inadequate or unsuitable to manage the Trust.

The Sponsor was expressly formed to be the Sponsor of the Trust and has no history of past performance. The past performances of the Sponsor’s management in other positions are no indication of their ability to manage an investment vehicle such as the Trust. If the experience of the Sponsor and its management is not adequate or suitable to manage an investment vehicle such as the Trust, the operations of the Trust may be adversely affected.

The Shares and their value could decrease if unanticipated operational or trading problems arise.

There may be unanticipated problems or issues with respect to the mechanics of the Trust’s operations and the trading of the Shares that could have a material adverse effect on an investment in the Shares. In addition, although the Trust is not actively “managed” by traditional methods, to the extent that unanticipated operational or trading problems or issues arise, the Sponsor’s past experience and qualifications may not be suitable for solving these problems or issues.

If the process of creation and redemption of Baskets encounters any unanticipated difficulties, the possibility for arbitrage transactions intended to keep the price of the Shares closely linked to the price of silver may not exist and, as a result, the price of the Shares may fall.

If the processes of creation and redemption of Shares (which depend on timely transfers of silver to and by the Custodian) encounter any unanticipated difficulties, potential market participants who would otherwise be willing to purchase or redeem Baskets to take advantage of any arbitrage opportunity arising from discrepancies between the price of the Shares and the price of the underlying silver may not take the risk that, as a result of those difficulties, they may not be able to realize the profit they expect. If this is the case, the liquidity of Shares may decline and the price of the Shares may fluctuate independently of the price of silver and may fall.

The liquidity of the Shares may also be affected by the withdrawal from participation of one or more Authorized Participants.

In the event that one or more Authorized Participants having substantial interests in Shares or otherwise responsible for a significant portion of the Shares’ daily trading volume on the Exchange withdraw from participation, the liquidity of the Shares will likely decrease which could adversely affect the market price of the Shares and result in your incurring a loss on your investment.

Shareholders will not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act of 1940 or the protections afforded by the Commodity Exchange Act of 1936.

The Trust is not registered as an investment company under the Investment Company Act of 1940 and is not required to register under such act. Consequently, Shareholders will not have the regulatory protections provided to investors in investment companies. The Trust will not hold or trade in commodity futures contracts regulated by the CEA, as administered by the CFTC. Furthermore, the Trust is not a commodity pool for purposes of the CEA, and neither the Sponsor nor the Trustee is subject to regulation by the CFTC as a commodity pool operator or a commodity trading advisor in connection with the Shares. Consequently, Shareholders will not have the regulatory protections provided to investors in CEA-regulated instruments or commodity pools.

The Trust may be required to terminate and liquidate at a time that is disadvantageous to Shareholders.

If the Trust is required to terminate and liquidate, such termination and liquidation could occur at a time which is disadvantageous to Shareholders, such as when silver prices are lower than the silver prices at the time when Shareholders purchased their Shares. In such a case, when the Trust’s silver is sold as part of the Trust’s liquidation, the resulting proceeds distributed to Shareholders will

be less than if silver prices were higher at the time of sale. See “Description of the Trust Agreement—Termination of the Trust” for more information about the termination of the Trust, including when the termination of the Trust may be triggered by events outside the direct control of the Sponsor, the Trustee or the Shareholders.

The lack of a market for the Shares may limit the ability of Shareholders to sell the Shares.

Prior to the date of this prospectus, there has been no market for the Shares, and there can be no assurance that an active public market for the Shares will develop. If an active public market for the Shares does not exist or continue, the market prices and liquidity of the Shares may be adversely affected.

Shareholders will not have the rights enjoyed by investors in certain other vehicles.

As interests in an investment trust, the Shares have none of the statutory rights normally associated with the ownership of shares of a corporation (including, for example, the right to bring “oppression” or “derivative” actions). In addition, the Shares have limited voting and distribution rights (for example, Shareholders do not have the right to elect directors and will not receive dividends). See “Description of the Shares” for a description of the limited rights of holders of Shares.

An investment in the Shares may be adversely affected by competition from other methods of investing in silver.

The Trust will compete with other financial vehicles, including traditional debt and equity securities issued by companies in the silver industry and other securities backed by or linked to silver, direct investments in silver and investment vehicles similar to the Trust. Market and financial conditions, and other conditions beyond the Sponsor’s control, may make it more attractive to invest in other financial vehicles or to invest in silver directly, which could limit the market for the Shares and reduce the liquidity of the Shares.

The price of silver may be affected by the sale of ETVs tracking silver markets.

To the extent existing exchange traded vehicles (ETVs) tracking silver markets represent a significant proportion of demand for physical silver bullion, large redemptions of the securities of these ETVs could negatively affect physical silver bullion prices and the price and NAV of the Shares.

Crises may motivate large-scale sales of silver which could decrease the price of silver and adversely affect an investment in the Shares.

The possibility of large-scale distress sales of silver in times of crisis may have a short-term negative impact on the price of silver and adversely affect an investment in the Shares. For example, the 2008 financial credit crisis resulted in significant depressed prices of silver largely due to a slowdown in demand in silver for industrial use and forced sales and deleveraging from institutional investors. Crises in the future may impair silver’s price performance which would, in turn, adversely affect an investment in the Shares.

Several factors may have the effect of causing a decline in the prices of silver and a corresponding decline in the price of Shares. Among them:

A significant increase in silver hedging activity by silver producers. Should there be an increase in the level of hedge activity of silver producing companies, it could cause a decline in world silver prices, adversely affecting the price of the Shares.

A significant change in the attitude of speculators and investors towards silver. Should the speculative community take a negative view towards silver, it could cause a decline in world silver prices, negatively impacting the price of the Shares.

A widening of interest rate differentials between the cost of money and the cost of silver could negatively affect the price of silver which, in turn, could negatively affect the price of the Shares.

A combination of rising money interest rates and a continuation of the current low cost of borrowing silver could improve the economics of selling silver forward. This could result in an increase in hedging by silver mining companies and short selling by speculative interests, which would negatively affect the price of silver. Under such circumstances, the price of the Shares would be similarly affected.

The Trust’s silver may be subject to loss, damage, theft or restriction on access.

There is a risk that part or all of the Trust’s silver could be lost, damaged or stolen. Access to the Trust’s silver could also be restricted by natural events (such as an earthquake) or human actions (such as a terrorist attack). Any of these events may adversely affect the operations of the Trust and, consequently, an investment in the Shares.

The Trust’s lack of insurance protection and the Shareholders’ limited rights of legal recourse against the Trust, the Trustee, the Sponsor, the Custodian and any subcustodian exposes the Trust and its Shareholders to the risk of loss of the Trust’s silver for which no person is liable.

The Trust will not insure its silver. The Custodian will maintain insurance with regard to its business on such terms and conditions as it considers appropriate in connection with its custodial obligations and will be responsible for all costs, fees and expenses arising from the insurance policy or policies. The Trust will not be a beneficiary of any such insurance and does not have the ability to dictate the existence, nature or amount of coverage. Therefore, Shareholders cannot be assured that the Custodian will maintain adequate insurance or any insurance with respect to the silver held by the Custodian on behalf of the Trust. In addition, the Custodian and the Trustee will not require any direct or indirect subcustodians to be insured or bonded with respect to their custodial activities or in respect of the silver held by them on behalf of the Trust. Further, Shareholders’ recourse against the Trust, the Trustee and the Sponsor, under New York law, the Custodian, under English law, and any subcustodians under the law governing their custody operations is limited. Consequently, a loss may be suffered with respect to the Trust’s silver which is not covered by insurance and for which no person is liable in damages.

The Custodian’s limited liability under the Custody Agreements and English law may impair the ability of the Trust to recover losses concerning its silver and any recovery may be limited, even in the event of fraud, to the market value of the silver at the time the fraud is discovered.

The liability of the Custodian is limited under the Custody Agreements. Under the agreements between the Trustee and the Custodian which establish the Trust’s unallocated silver account (Unallocated Account Agreement) and the Trust’s allocated silver account (Allocated Account Agreement), the Custodian is only liable for losses that are the direct result of its own negligence, fraud or willful default in the performance of its duties. Any such liability is further limited, in the case of the Allocated Account Agreement, to the market value of the silver held in the Trust Allocated Account at the time such negligence, fraud or willful default is discovered by the Custodian and, in the case of the Unallocated Account Agreement, to the amount of silver credited to the Trust Unallocated Account at the time such negligence, fraud or willful default is discovered by the Custodian. Under each Authorized Participant Unallocated Bullion Account Agreement (between the Custodian and an Authorized Participant), the Custodian is not contractually or otherwise liable for any losses suffered by any Authorized Participant or Shareholder that are not the direct result of its own gross negligence, fraud or willful default in the performance of its duties under such agreement, and in no event will its liability exceed the market value of the balance in the Authorized Participant Unallocated Account at the time such gross negligence, fraud or willful default is discovered by the Custodian. In addition, the Custodian will not be liable for any delay in performance or any non-performance of any of its obligations under the Allocated Account Agreement, the Unallocated Account Agreement or the Authorized Participant Unallocated Bullion Account Agreement by reason of any cause beyond its reasonable control, including acts of God,

war or terrorism. As a result, the recourse of the Trustee or the investor, under English law, is limited. Furthermore, under English common law, the Custodian or any subcustodian will not be liable for any delay in the performance or any non-performance of its custodial obligations by reason of any cause beyond its reasonable control.

The obligations of the Custodian and English subcustodians are governed by English law, which may frustrate the Trust in attempting to receive legal redress against the Custodian or any subcustodian concerning its silver.

The obligations of the Custodian under the Custody Agreements and the Authorized Participant Unallocated Bullion Account Agreement are governed by English law. The Custodian may enter into arrangements with English subcustodians, which arrangements may also be governed by English law. The Trust is a New York common law trust. Any United States, New York or other court situated in the United States may have difficulty interpreting English law (which, insofar as it relates to custody arrangements, is largely derived from court rulings rather than statute), LBMA rules or the customs and practices in the London custody market. It may be difficult or impossible for the Trust to sue a subcustodian in a United States, New York or other court situated in the United States. In addition, it may be difficult, time consuming and/or expensive for the Trust to enforce in a foreign court a judgment rendered by a United States, New York or other court situated in the United States.

The Trust may not have adequate sources of recovery if its silver is lost, damaged, stolen or destroyed.

If the Trust’s silver is lost, damaged, stolen or destroyed under circumstances rendering a party liable to the Trust, the responsible party may not have the financial resources sufficient to satisfy the Trust’s claim. For example, as to a particular event of loss, the only source of recovery for the Trust might be limited to the Custodian or one or more subcustodians or, to the extent identifiable, other responsible third parties (e.g., a thief or terrorist), any of which may not have the financial resources (including liability insurance coverage) to satisfy a valid claim of the Trust.

Shareholders and Authorized Participants lack the right under the Custody Agreements to assert claims directly against the Custodian and any subcustodian.

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

Because neither the Trustee nor the Custodian oversees or monitors the activities of subcustodians who may hold the Trust’s silver, failure by the subcustodians to exercise due care in the safekeeping of the Trust’s silver could result in a loss to the Trust.

Under the Allocated Account Agreement described in “Description of the Custody Agreements,” the Custodian may appoint from time to time one or more subcustodians to hold the Trust’s silver on a temporary basis pending delivery to the Custodian. The subcustodians which the Custodian currently uses are LBMA market-making members that provide bullion vaulting and clearing services to third parties. The Custodian is required under the Allocated Account Agreement to use reasonable care in appointing its subcustodians, making the Custodian liable only for negligence or bad faith in the selection of such subcustodians, and has an obligation to use commercially reasonable efforts to obtain delivery of the Trust’s silver from any subcustodians appointed by the Custodian. Otherwise, the Custodian is not liable for the acts or omissions of its subcustodians. These subcustodians may in turn appoint further subcustodians, but the Custodian is not responsible for the appointment of these further subcustodians. The Custodian does not undertake to monitor the performance by subcustodians of their custody functions or their selection of further subcustodians. The Trustee does not monitor the performance of the Custodian other than to review the reports provided by the Custodian pursuant to the Custody Agreements and does not

undertake to monitor the performance of any subcustodian. Furthermore, the Trustee may have no right to visit the premises of any subcustodian for the purposes of examining the Trust’s silver or any records maintained by the subcustodian, and no subcustodian will be obligated to cooperate in any review the Trustee may wish to conduct of the facilities, procedures, records or creditworthiness of such subcustodian. In addition, the ability of the Trustee to monitor the performance of the Custodian may be limited because under the Allocated Account Agreement and the Unallocated Account Agreement the Trustee has only limited rights to visit the premises of the Custodian for the purpose of examining the Trust’s silver and certain related records maintained by the Custodian. See “Custody of the Trust’s Silver” for more information about subcustodians that may hold the Trust’s silver.

The obligations of any subcustodian of the Trust’s silver are not determined by contractual arrangements but by LBMA rules and London bullion market customs and practices, which may prevent the Trust’s recovery of damages for losses on its silver custodied with subcustodians.

There are expected to be no written contractual arrangements between subcustodians that hold the Trust’s silver and the Trustee or the Custodian because traditionally such arrangements are based on the LBMA’s rules and on the customs and practices of the London bullion market. In the event of a legal dispute with respect to or arising from such arrangements, it may be difficult to define such customs and practices. The LBMA’s rules may be subject to change outside the control of the Trust. Under English law, neither the Trustee nor the Custodian would have a supportable breach of contract claim against a subcustodian for losses relating to the safekeeping of silver. If the Trust’s silver is lost or damaged while in the custody of a subcustodian, the Trust may not be able to recover damages from the Custodian or the subcustodian. Whether a subcustodian will be liable for the failure of subcustodians appointed by it to exercise due care in the safekeeping of the Trust’s silver will depend on the facts and circumstances of the particular situation. Shareholders cannot be assured that the Trustee will be able to recover damages from subcustodians whether appointed by the Custodian or by another subcustodian for any losses relating to the safekeeping of silver by such subcustodian.

Silver bullion allocated to the Trust in connection with the creation of a Basket may not meet the London Good Delivery Standards and, if a Basket is issued against such silver, the Trust may suffer a loss.

Neither the Trustee nor the Custodian independently confirms the fineness of the silver allocated to the Trust in connection with the creation of a Basket. The silver bullion allocated to the Trust by the Custodian may be different from the reported fineness or weight required by the LBMA’s standards for silver bars delivered in settlement of a silver trade (London Good Delivery Standards), the standards required by the Trust. If the Trustee nevertheless issues a Basket against such silver, and if the Custodian fails to satisfy its obligation to credit the Trust the amount of any deficiency, the Trust may suffer a loss. The London Good Delivery Standards are described in “Operation of the Silver Bullion Market—The London Bullion Market.” The Custodian’s responsibility for the allocation to the Trust of silver meeting LBMA standards is described in “Description of the Custody Agreements—Transfers from the Trust Unallocated Account.”

Silver held in the Trust’s unallocated silver account and any Authorized Participant’s unallocated silver account will not be segregated from the Custodian’s assets. If the Custodian becomes insolvent, its assets may not be adequate to satisfy a claim by the Trust or any Authorized Participant. In addition, in the event of the Custodian’s insolvency, there may be a delay and costs incurred in identifying the bullion held in the Trust’s allocated silver account.

Silver which is part of a deposit for a purchase order or part of a redemption distribution will be held for a time in the Trust’s unallocated silver account (Trust Unallocated Account) and, previously or subsequently in, the Authorized Participant Unallocated Account of the purchasing or redeeming Authorized Participant. During those times, the Trust and the Authorized Participant, as the case may be, will have no proprietary rights to any specific bars of silver held by the Custodian

and will each be an unsecured creditor of the Custodian with respect to the amount of silver held in such unallocated accounts. In addition, if the Custodian fails to allocate the Trust’s silver in a timely manner, in the proper amounts or otherwise in accordance with the terms of the Unallocated Account Agreement, or if a subcustodian fails to so segregate silver held by it on behalf of the Trust, unallocated silver will not be segregated from the Custodian’s assets, and the Trust will be an unsecured creditor of the Custodian with respect to the amount so held in the event of the insolvency of the Custodian. In the event the Custodian becomes insolvent, the Custodian’s assets might not be adequate to satisfy a claim by the Trust or the Authorized Participant for the amount of silver held in their respective unallocated silver accounts.

In the case of the insolvency of the Custodian, a liquidator may seek to freeze access to the silver held in all of the accounts held by the Custodian, including the Trust’s allocated account (Trust Allocated Account). Although the Trust would be able to claim ownership of properly allocated silver, the Trust could incur expenses in connection with asserting such claims, and the assertion of such a claim by the liquidator could delay creations and redemptions of Baskets.

In issuing Baskets, the Trustee will rely on certain information received from the Custodian which is subject to confirmation after the Trustee has relied on the information. If such information turns out to be incorrect, Baskets may be issued in exchange for an amount of silver which is more or less than the amount of silver which is required to be deposited with the Trust.

The Custodian’s definitive records are prepared after the close of its business day. However, when issuing Baskets, the Trustee will rely on information reporting the amount of silver credited to the Trust’s accounts which it receives from the Custodian during the business day and which is subject to correction during the preparation of the Custodian’s definitive records after the close of business. If the information relied upon by the Trustee is incorrect, the amount of silver actually received by the Trust may be more or less than the amount required to be deposited for the issuance of Baskets.

The sale of the Trust’s silver to pay expenses not assumed by the Sponsor at a time of low silver prices could adversely affect the value of the Shares.

The Trustee will sell silver held by the Trust to pay Trust expenses not assumed by the Sponsor on an as-needed basis irrespective of then-current silver prices. The Trust is not actively managed and no attempt will be made to buy or sell silver to protect against or to take advantage of fluctuations in the price of silver. Consequently, the Trust’s silver may be sold at a time when the silver price is low, resulting in a negative effect on the value of the Shares.

The value of the Shares will be adversely affected if the Trust is required to indemnify the Sponsor or the Trustee under the Trust Agreement.

Under the Trust Agreement, each of the Sponsor and the Trustee has a right to be indemnified from the Trust for any liability or expense it incurs without negligence, bad faith or willful misconduct on its part. That means the Sponsor or the Trustee may require the assets of the Trust to be sold in order to cover losses or liability suffered by it. Any sale of that kind would reduce the net asset value of the Trust and the value of the Shares.

USE OF PROCEEDS

Proceeds received by the Trust from the issuance and sale of Baskets, including the Seed Basket and the Shares (which are described on the front page of this prospectus), will consist of silver deposits and, possibly from time to time, cash. Pursuant to the Trust Agreement, during the life of the Trust such proceeds will only be (1) held by the Trust, (2) distributed to Authorized Participants in connection with the redemption of Baskets or (3) disbursed to pay the Sponsor’s Fee or sold as needed to pay the Trust’s expenses not assumed by the Sponsor.

OVERVIEW OF THE SILVER INDUSTRY

Introduction

This section provides a brief introduction to the silver industry by looking at some of the key participants, detailing the primary sources of demand and supply and outlining the role of the “official” sector (i.e., central banks) in the market.

Market Participants

The participants in the world silver market may be classified in the following sectors: the mining and producer sector, the banking sector, the official sector, the investment sector, and the manufacturing sector. A brief description of each follows.

Mining and Producer Sector

This group includes mining companies that specialize in silver and silver production, mining companies that produce silver as a by-product of other production (such as a copper or gold producer), scrap merchants and recyclers.

Banking Sector

Bullion banks provide a variety of services to the silver market and its participants, thereby facilitating interactions between other parties. Services provided by the bullion banking community include traditional banking products as well as mine financing, physical silver purchases and sales, hedging and risk management, inventory management for industrial users and consumers and silver leasing.

The Official Sector

Unlike gold, there are no official statistics published by the International Monetary Fund, Bank of International Settlements, or national banks on silver holdings by national governments. The main reason for this is that silver is generally not recognized as a reserve asset. Consequently, there are very limited silver stocks held by governments. According to GFMS Limited in World Silver Survey 2008, at the end of 2007, government held silver bullion stocks total 95.7 million ounces.

The Investment Sector

This sector includes the investment and trading activities of both professional & private investors and speculators. These participants range from large hedge and mutual funds to day-traders on futures exchanges, and retail-level coin collectors.

The Manufacturing Sector

The fabrication and manufacturing sector represents all the commercial and industrial users of silver. Industrial applications comprise the largest use of silver. The jewelry and silverware sector is the second largest, followed by the photographic industry (although the latter has been declining over the past several years as a result of the spread of digital photography).

World Silver Supply and Demand 1998–2007 (million ounces)

The following table sets forth a summary of the world silver supply and demand for the last 10 years and is based on information reported in the World Silver Survey 2008, the Silver Institute and GFMS Limited.

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

Supply

Mine production

542.2

556.9

591.0

606.2

593.6

600.6

621.1

643.8

647.4

670.6

Net Government Sales

33.5

97.2

60.3

62.6

60.3

88.4

60.2

67.5

78.2

42.3

Old silver scrap

193.9

181.6

180.7

182.7

187.5

184.0

183.7

186.0

188.0

181.6

Net producer hedging

6.5

0.0

0.0

18.9

0.0

0.0

9.6

27.6

0.0

0.0

Implied Net Disinvestment

48.2

44.8

87.2

0.0

10.8

0.0

0.0

0.0

0.0

0.0

Total Supply

824.3

880.4

919.1

870.4

852.2

872.9

874.6

925.0

913.7

894.5

Demand

Fabrication

Industrial Application

316.3

339.0

374.3

335.2

339.2

349.8

367.3

405.3

424.8

455.3

Photography

225.4

227.9

218.3

213.1

204.3

192.9

178.8

160.3

144.0

128.3

Jewelry & Silverware

254.8

268.4

267.0

280.4

252.4

263.1

242.2

241.6

227.5

222.2

Coins & Medals

27.8

29.1

32.1

30.5

31.6

35.7

42.4

40.0

39.8

37.8

Total Fabrication

824.3

864.4

891.7

859.2

827.4

841.5

830.7

847.4

836.0

843.7

Net Government Purchases

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

0.0

Producer De-hedging

0.0

16.0

27.4

0.0

24.8

20.9

0.0

0.0

6.8

25.0

Implied Net Investment

0.0

0.0

0.0

11.2

0.0

10.5

44.0

77.6

70.8

25.8

Total Demand

824.3

880.4

919.1

870.4

852.2

872.9

874.6

925.0

913.7

894.5

The following are some of the main characteristics of the silver market illustrated by the table:

Silver supply over the period shown, including mine production, net government sales, old silver scrap, producer hedging and implied net disinvestment averaged 882.7 million ounces (Moz) per year. Mine production averages 69 percent of total silver supply between 1998-2007.

During the period shown, old silver scrap was the second largest contributor to supply, averaging approximately 185.0 Moz per year, which averages 21 percent over the 10 year period 1998-2007.

In 2007, producer de-hedging rose by 18.2 Moz.

Net government sales were 42.3 Moz in 2007, and of total supply, accounted for 5 percent last year.

The biggest source of demand for silver is in industrial applications. For the sixth consecutive year, industrial applications grew to reach a record 455.3 Moz in 2007. Silver is among the best electrical and thermal conductor of all metals and is therefore used in many electrical applications, particularly in a conductor, switches, contacts, and fuses. Silver is also used in the manufacture of batteries, featuring silver alloys as the cathode. Silver, a well-known bactericide, is used in a number of applications, including water purification systems, air-handling systems, and in a wide-range of textile and plastic consumer products. Silver is also used to join metals through brazing and soldering. In the last ten years, industrial applications averaged 370.7 Moz per year.

Silver is also used in the manufacturing of jewelry and silverware. This application for silver consumed an average of 252.0 Moz per year over the period shown.

Silver’s role in photography has been a regular component of silver demand, although photographic use has decreased each year since 1999. Silver use in photography averaged 189.3 Moz per year over the period shown. Silver is also used in the fabrication of coins and medals. Silver was once widely used in coinage, and many nations were on a silver standard until the 19th century. Today silver is in limited use for circulating coinage, and is used in bullion coins issued by national governments for use by investors wishing to own physical silver in small quantities and in commemorative coins. Silver’s use in coinage has averaged over 34.7 Moz per year from 1998-2007.

Historical Chart of the Price of Silver

The price of silver is volatile and fluctuations are expected to have a direct impact on the value of the Shares. However, movements in the price of silver in the past are not a reliable indicator of future movements. Movements may be influenced by various factors, including announcements from central banks regarding a country’s reserve silver holdings, agreements among central banks, political uncertainties around the world, and economic concerns. The following chart illustrates the movements in the price of an ounce of silver in dollars from January 1998 through October 2008:

Source: The Silver Institute

Since 2002, the price of silver increased due to a number of factors. Among such factors are the decline in the US dollar against other currencies, the poor performance of US and other major equities markets, a surge in investment demand in commodities as an asset class generally, strength in fabrication demand, and the low level of forward selling by mining companies. In 2006, the silver price experienced a 58 percent increase over the average 2005 price of $7.31 per ounce. The average price in 2006 was $11.55 per ounce. While prices gyrated around the $14 level (though as much as $16 and as low as $11) throughout much of 2007, 2008 experienced larger swings in price movements between $9 and $21, before settling around $11 at the end of December. For the first two months of 2009, prices averaged around $12 per ounce. While a number of factors are in play, the current concerns over inflation acceleration and a weakening US dollar are cited as largely behind this recent situation.

Operation of the Silver Bullion Market

The global trade in silver consists of Over-the-Counter (OTC) transactions in spot, forwards, and options and other derivatives, together with exchange-traded futures and options.

Global Over-The-Counter Market

The OTC silver market includes spot, forward, and option and other derivative transactions conducted on a principal-to-principal basis. While this is a global, nearly 24-hour per day market, its main centers are London (the biggest venue) and New York.

Market makers, as well as others in the OTC market, trade with each other and with their clients on a principal-to-principal basis. All risks and issues of credit are between the parties directly involved in the transaction. Market makers include the market-making members of the LBMA, the trade association that acts as the coordinator for activities conducted on behalf of its members and other participants in the London bullion market. The eleven market-making members of the LBMA are: Barclays Bank plc, Deutsche Bank AG, HSBC Bank USA, National Association (through its London branch), Goldman Sachs International, JPMorgan Chase Bank, ScotiaMocatta (a division of the Bank of Nova Scotia), Société Générale, Mitsui & Co Precious Metals Inc, Bear Stearns Forex Inc., Royal Bank of Canada, and UBS AG. The OTC market provides a relatively flexible market in terms of quotes, price, size, destinations for delivery and other factors. Bullion dealers customize

transactions to meet clients’ requirements. The OTC market has no formal structure and no open-outcry meeting place.

The main centers of the OTC market are London and New York. Mining companies, central banks, manufacturers of jewelry and industrial products, together with investors and speculators, tend to transact their business through one of these market centers. Centers such as Dubai and several cities in the Far East also transact substantial OTC market business, typically involving jewelry and small bars (1 kilogram or less). Bullion dealers have offices around the world and most of the world’s major bullion dealers are either members or associate members of the LBMA. Of the eleven market-making members of the LBMA, six offer clearing services. There are a further 59 full members, plus a number of associate members around the world. These numbers may change from time to time as new members are added and existing members drop out.

Unlike a futures exchange, where trading is based around standard contract units, settlement dates and delivery specifications, the OTC market allows flexibility. It also provides confidentiality, as transactions are conducted solely between the two principals involved.

The London Bullion Market

Although the market for physical silver is distributed globally, most OTC market trades are cleared through London. In addition to coordinating market activities, the LBMA acts as the principal point of contact between the market and its regulators. A primary function of the LBMA is its involvement in the promotion of refining standards by maintenance of the “London Good Delivery Lists,” which are the lists of LBMA accredited melters and assayers of silver. The LBMA also coordinates market clearing and vaulting, promotes good trading practices and develops standard documentation.

The term “loco London” silver refers to silver physically held in London that meets the specifications for weight, dimensions, fineness (or purity), identifying marks (including the assay stamp of a LBMA acceptable refiner) and appearance set forth in “The Good Delivery Rules for Gold and Silver Bars” published by the LBMA. Silver bars meeting these requirements are described in this prospectus from time to time as “London Good Delivery Bars.” The unit of trade in London is the troy ounce, whose conversion between grams is: 1,000 grams = 32.1507465 troy ounces and 1 troy ounce = 31.1034768 grams. A London Good Delivery Bar is acceptable for delivery in settlement of a transaction on the OTC market. A London Good Delivery must contain between 750 ounces and 1100 ounces of silver with a minimum fineness (or purity) of 999.0 parts per 1000. A London Good Delivery Bar must also bear the stamp of one of the refiners who are on the LBMA-approved list. Unless otherwise specified, the silver spot price always refers to that of a London Good Delivery Bar. Business is generally conducted over the phone and through electronic dealing systems.

Once daily during London trading hours there is a fix which provides reference silver prices for that day’s trading. Many long-term contracts will be priced on the basis of the London Fix, and market participants will usually refer to this price when looking for a basis for valuations. The London Fix is the most widely used benchmark for daily silver prices and is quoted by various financial information sources.

Three Market Making members of the LBMA conduct the Silver Fixing meeting under the chairmanship of The Bank of Nova Scotia—ScotiaMocatta by telephone at 12:00 noon London time each working day. The other two members of the Silver Fixing are Deutsche Bank AG and HSBC Bank USA, National Association.

Orders are placed either with one of the three fixing members or with another bullion dealer who will then be in contact with a fixing member during the fixing. The fixing members net-off all orders when communicating their net interest at the fixing. The fix begins with the fixing chairman suggesting a “trying price,” reflecting the market price prevailing at the opening of the fix. This is relayed by the fixing members to their dealing rooms which have direct communication with all interested parties. Any market participant may enter the fixing process at any time, or adjust or withdraw his order. The silver price is adjusted up or down until all the buy and sell orders are

matched, at which time the price is declared fixed. All fixing orders are transacted on the basis of this fixed price, which is instantly relayed to the market through various media. The London Fix is widely viewed as a full and fair representation of all market interest at the time of the fix.

Futures Exchanges

The most significant silver futures exchanges are the COMEX and the Tokyo Commodity Exchange (TOCOM).

Future exchanges seek to provide a neutral, regulated marketplace for the trading of derivatives contracts for commodities. Future contracts are defined by the exchange for each commodity. For each commodity traded, this contract specifies the precise quality and quantity standards. The contract’s terms and conditions also define the location and timing of physical delivery.

An exchange does not buy or sell those contracts, but seeks to offer a transparent forum where members, on their own behalf or on the behalf of customers, can trade the contracts in a safe, efficient and orderly manner. During regular trading hours at the COMEX, the commodity contracts are traded through open outcry; a verbal auction in which all bids, offers and trades must be publicly announced to all members. Electronic trading is offered by the exchange after regular market hours. Except for brief breaks to switch between open outcry and electronic trading in the evening and the morning, silver futures trade almost 24 hours a day, five business days a week.

In addition to the public nature of the pricing, futures exchanges in the United States are regulated at two levels: internal and external governmental supervision. The internal is performed through self-regulation and consists of regular monitoring of the following: the open-outcry process to insure that it is conducted in conformance with all exchange rules; the financial condition of all exchange member firms to insure that they continuously meet financial commitments; and the positions of commercial and non-commercial customers to insure that physical delivery and other commercial commitments can be met, and that pricing is not being improperly affected by the size of any particular customer positions. External governmental oversight is performed by the CFTC, which reviews all the rules and regulations of United States futures exchanges and monitors their enforcement.

Market Regulation

The global silver markets are overseen and regulated by both governmental and self-regulatory organizations. In addition, certain trade associations have established rules and protocols for market practices and participants. In the United Kingdom, responsibility for the regulation of the financial market participants, including the major participating members of the LBMA, falls under the authority of the Financial Services Authority (FSA) as provided by the Financial Services and Markets Act 2000 (FSM Act). Under this act, all UK-based banks, together with other investment firms, are subject to a range of requirements, including fitness and properness, capital adequacy, liquidity, and systems and controls.

The FSA is responsible for regulating investment products, including derivatives, and those who deal in investment products. Regulation of spot, commercial forwards, and deposits of gold and silver not covered by the FSM Act is provided for by The London Code of Conduct for Non-Investment Products, which was established by market participants in conjunction with the Bank of England.

The TOCOM has authority to perform financial and operational surveillance on its members’ trading activities, scrutinize positions held by members and large-scale customers, and monitor the price movements of futures markets by comparing them with cash and other derivative markets’ prices. To act as a Futures Commission Merchant Broker, a broker must obtain a license from Japan’s Ministry of Economy, Trade and Industry (METI), the regulatory authority that oversees the operations of the TOCOM.

Not A Regulated Commodity Pool

The Trust will not trade in silver futures contracts on the COMEX or on any other futures exchange. The Trust will take delivery of physical silver that complies with the LBMA silver delivery rules. Because the Trust will not trade in silver futures contracts on any futures exchange, the Trust with not be regulated by the CFTC under the Commodity Exchange Act as a “commodity pool,” and will not be operated by a CFTC-regulated commodity pool operator. Investors in the Trust will not receive the regulatory protections afforded to investors in regulated commodity pools, nor may the COMEX or any futures exchange enforce its rules with respect to the Trust’s activities. In addition, investors in the Trust will not benefit from the protections afforded to investors in silver futures contracts on regulated futures exchanges.

BUSINESS OF THE TRUST

The activities of the Trust will be limited to (1) issuing Baskets in exchange for the silver deposited with the Custodian as consideration, (2) delivering silver as necessary to cover the Sponsor’s Fee and selling silver as necessary to pay Trust expenses not assumed by the Sponsor and other liabilities and (3) delivering silver in exchange for Baskets surrendered for redemption. The Trust will not be actively managed. It will not engage in any activities designed to obtain a profit from, or to ameliorate losses caused by, changes in the price of silver.

Trust Objective

The investment objective of the Trust is for the Shares to reflect the performance of the price of silver bullion, less the Trust’s expenses. The Shares are intended to constitute a simple and cost-effective means of making an investment similar to an investment in silver. An investment in physical silver requires expensive and sometimes complicated arrangements in connection with the assay, transportation, warehousing and insurance of the metal. Although the Shares will not be the exact equivalent of an investment in silver, they provide investors with an alternative that allows a level of participation in the silver market through the securities market.

Strategy Behind the Shares

The Shares are intended to offer investors an opportunity to participate in the silver market through an investment in securities. The logistics of storing and insuring silver are dealt with by the Custodian and the related expenses are built into the price of the Shares. Therefore, the investor does not have any additional tasks or costs over and above those associated with dealing in any other publicly traded security.

The Shares are intended to provide institutional and retail investors with a simple and cost-efficient means, with minimal credit risk, of gaining investment benefits similar to those of holding silver bullion. The Shares offer an investment that is:

•

Easily Accessible and Relatively Cost Efficient . Investors can access the silver market through a traditional brokerage account. The Sponsor believes that investors will be able to more effectively implement strategic and tactical asset allocation strategies that use silver by using the Shares instead of using the traditional means of purchasing, trading and holding silver and for many investors, transaction costs related to the Shares will be lower than those associated with the purchase, storage and insurance of physical silver.

•

Exchange Traded and Transparent. The Shares will trade on the NYSE Arca, providing investors with an efficient means to implement various investment strategies. Upon effectiveness of the registration statement of which this prospectus is a part, the Shares will be eligible for margin accounts and will be backed by the assets of the Trust and the Trust will not hold or employ any derivative securities. Furthermore, the value of the Trust’s holdings will be reported on the Trust’s website daily.

•

Minimal Credit Risk . The Shares represent an interest in physical bullion owned by the Trust (other than an amount held in unallocated form which is not sufficient to make up a whole bar or which is held temporarily to effect a creation or redemption of Shares). Physical bullion of the Trust in the Custodian’s possession is not subject to borrowing arrangements with third parties. Other than the silver temporarily being held in an unallocated silver account with the Custodian, the physical bullion of the Trust is not subject to counterparty or credit risks. See “Risk Factors—Silver held in the Trust’s unallocated silver account and any Authorized Participant’s unallocated silver account will not be segregated from the Custodian’s assets....” This contrasts with most other financial products that gain exposure to bullion through the use of derivatives that are subject to counterparty and
credit risks.

Secondary Market Trading

While the Trust’s investment objective is for the Shares to reflect the performance of silver bullion, less the expenses of the Trust, the Shares may trade in the secondary market on the NYSE Arca at prices that are lower or higher relative to their NAV per Share. The amount of the discount or premium in the trading price relative to the NAV per Share may be influenced by non-concurrent trading hours between the NYSE Arca and the COMEX and London. While the Shares will trade on the NYSE Arca until 4:00 PM New York time, liquidity in the global silver market will be reduced after the close of the COMEX at 1:30 PM New York time. As a result, during this time, trading spreads, and the resulting premium or discount, on the Shares may widen.

Trust Expenses

The Trust’s only ordinary recurring expense is expected to be equal to the Sponsor’s Fee. In exchange for the Sponsor’s Fee, the Sponsor has agreed to assume the following administrative and marketing expenses incurred by the Trust: the Trustee’s monthly fee and out-of-pocket expenses, the Custodian’s fee and reimbursement of the Custodian’s expenses under the Custody Agreements, Exchange listing fees, SEC registration fees, printing and mailing costs, audit fees and up to $100,000 per annum in legal expenses. The Sponsor will also pay the costs of the Trust’s organization and the initial sale of the Shares, including the applicable SEC registration fees.

The Sponsor’s Fee will accrue daily at an annualized rate equal to 0.45% of the adjusted net asset value of the Trust and will be payable monthly in arrears. The Sponsor, from time to time, may temporarily waive all or a portion of the Sponsor’s Fee at its discretion for a stated period of time. Presently, the Sponsor intends to waive a portion of its fee and reduce the Sponsor’s Fee to 0.30% for the first year of the Trust’s operations beginning on the Trust’s inception date and ending on July 24, 2010. After July 24, 2010, the Sponsor may renew its fee waiver, waive a larger or smaller portion of its fee or not renew its fee waiver. If the Sponsor does not continue its partial fee waiver after July 24, 2010, the full Sponsor’s Fee will accrue and be paid to the Sponsor for subsequent periods. The Sponsor is under no obligation to continue to waive all or part of the Sponsor’s Fee after the fixed end date of its waiver.

The Sponsor’s Fee shall be paid by delivery of silver to an account maintained by the Custodian for the Sponsor on an unallocated basis, monthly on the first business day of the month in respect of fees payable for the prior month. The delivery shall be of that number of ounces of silver which equals the daily accrual of the Sponsor’s Fee for such prior month calculated at the London Fix.

The Trustee will, when directed by the Sponsor, and, in the absence of such direction, may, in its discretion, sell silver in such quantity and at such times as may be necessary to permit payment in cash of Trust expenses not assumed by the Sponsor. The Trustee is authorized to sell silver at such times and in the smallest amounts required to permit such payments as they become due, it being the intention to avoid or minimize the Trust’s holdings of assets other than silver. Accordingly, the amount of silver to be sold will vary from time to time depending on the level of the Trust’s expenses and the market price of silver. The Custodian has agreed to purchase from the Trust, at the request of the Trustee, silver needed to cover Trust expenses not assumed by the Sponsor at a price at least equal to the price used by the Trustee to determine the value of the silver held by the Trust on the date of the sale.

Cash held by the Trustee pending payment of the Trust’s expenses will not bear any interest. Each delivery or sale of silver by the Trust to pay the Sponsor’s Fee or other Trust expenses will be a taxable event to Shareholders. See “United States Federal Income Tax Consequences—Taxation of US Shareholders.”

Impact of Trust Expenses on the Trust’s Net Asset Value

The Trust will deliver silver to the Sponsor to pay the Sponsor’s Fee and sell silver to raise the funds needed for the payment of all Trust expenses not assumed by the Sponsor. The purchase price received as consideration for such sales will be the Trust’s sole source of funds to cover its liabilities. The Trust will not engage in any activity designed to derive a profit from changes in the price of

silver. Silver not needed to redeem Baskets, or to cover the Sponsor’s Fee and Trust expenses not assumed by the Sponsor, will be held in physical form by the Custodian (except for residual amounts not exceeding 1100 ounces of silver, the maximum weight to make one Good Delivery Bar, which will be held in unallocated form by the Custodian on behalf of the Trust). As a result of the recurring deliveries of silver necessary to pay the Sponsor’s Fee in kind and potential sales of silver to pay in cash the Trust expenses not assumed by the Sponsor, the net asset value of the Trust and, correspondingly, the fractional amount of physical silver represented by each Share will decrease over the life of the Trust. New deposits of silver, received in exchange for additional new Baskets issued by the Trust, will not reverse this trend.

Hypothetical Expense Example

The following table, prepared by the Sponsor, illustrates the anticipated impact of the deliveries and sales of silver discussed above on the fractional amount of silver represented by each outstanding Share for three years. It assumes that the only dispositions of silver will be those deliveries needed to pay the Sponsor’s Fee and that the price of silver and the number of Shares remain constant during the three-year period covered. The table does not show the impact of any extraordinary expenses the Trust may incur. Any such extraordinary expenses, if and when incurred, will accelerate the decrease in the fractional amount of silver represented by each Share. In addition, the table does not show the effect of any waivers of the Sponsor’s Fee that may be in effect from time to time.


	Year
	1				2				3
Hypothetical silver price per ounce		$	10.00			$	10.00			$	10.00
Sponsor’s Fee			0.30	%			0.45	%			0.45	%
Shares of Trust, beginning			100,000				100,000				100,000
Ounces of silver in Trust, beginning			100,000				99,700				99,251.35
Beginning adjusted net asset value of the Trust		$	1,000,000			$	997,000			$	992,514
Ounces of silver to be delivered to cover the Sponsor’s Fee			300				448.65				446.63
Ounces of silver in Trust, ending			99,700				99,251.35				98.804.72
Ending adjusted net asset value of the Trust		$	997,000			$	992,514			$	988,047
Ending NAV per share		$	9.97			$	9.93			$	9.88

DESCRIPTION OF THE TRUST

The Trust is a common law trust, formed on July 20, 2009 under New York law pursuant to the Trust Agreement. The Trust holds silver and is expected from time to time to issue Baskets in exchange for deposits of silver and to distribute silver in connection with redemptions of Baskets. The investment objective of the Trust is for the Shares to reflect the performance of the price of silver bullion, less the Trust’s expenses. The Sponsor believes that, for many investors, the Shares will represent a cost-effective investment relative to traditional means of investing in silver. The material terms of the Trust Agreement are discussed under “Description of the Trust Agreement.” The Shares represent units of fractional undivided beneficial interest in and ownership of the Trust. The Trust is not managed like a corporation or an active investment vehicle. The silver held by the Trust will only be delivered to pay the Sponsor’s Fee, distributed to Authorized Participants in connection with the redemption of Baskets or sold (1) on an as-needed basis to pay Trust expenses not assumed by the Sponsor, (2) in the event the Trust terminates and liquidates its assets, or (3) as otherwise required by law or regulation. The delivery or sale of silver to pay fees and expenses by the Trust is a taxable event to Shareholders. See “United States Federal Income Tax Consequences—Taxation of US Shareholders.”

The Trust is not registered as an investment company under the Investment Company Act of 1940 and is not required to register under such act. The Trust will not hold or trade in commodity futures contracts regulated by the CEA, as administered by the CFTC. The Trust is not a commodity pool for purposes of the CEA, and none of the Sponsor, or the Trustee is subject to

regulation as a commodity pool operator or a commodity trading adviser in connection with the Shares.

The Trust expects to create and redeem Shares from time to time but only in Baskets (a Basket equals a block of 100,000 Shares). The number of outstanding Shares is expected to increase and decrease from time to time as a result of the creation and redemption of Baskets. The creation and redemption of Baskets requires the delivery to the Trust or the distribution by the Trust of the amount of silver and any cash represented by the Baskets being created or redeemed. The total amount of silver and any cash required for the creation of Baskets will be based on the combined NAV of the number of Baskets being created or redeemed. The initial amount of silver required for deposit with the Trust to create Shares is 100,000 ounces per Basket. The number of ounces of silver required to create a Basket or to be delivered upon a redemption of a Basket will gradually decrease over time. This is because the Shares comprising a Basket will represent a decreasing amount of silver due to the delivery or sale of the Trust’s silver to pay the Trust’s expenses. Baskets may be created or redeemed only by Authorized Participants, who will pay a transaction fee of $500 for each order to create or redeem Baskets. Authorized Participants may sell to other investors all or part of the Shares included in the Baskets they purchase from the Trust. See “Plan of Distribution.”

The Trustee will determine the NAV of the Trust on each day that the NYSE Arca is open for regular trading, as promptly as practicable after 4:00 p.m. New York time. The NAV of the Trust is the aggregate value of the Trust’s assets less its estimated accrued but unpaid liabilities (which include accrued expenses). In determining the Trust’s NAV, the Trustee will value the silver held by the Trust based on the London Fix price for an ounce of silver or such other publicly available price as the Sponsor may deem fairly represents the commercial value of the Trust’s silver. The Trustee will also determine the NAV per Share. If on a day when the Trust’s NAV is being calculated the London Fix is not available or has not been announced by 4:00 p.m. New York time, the silver price from the next most recent London Fix will be used, unless the Sponsor determines that such price is inappropriate to use.

The Trust’s assets will consist of allocated silver bullion, silver credited to an unallocated silver account and, from time to time, cash, which will be used to pay expenses not assumed by the Sponsor. Except for the transfer of silver in or out of the Trust Unallocated Account in connection with the creation or redemption of Baskets, upon a delivery of silver to pay the Sponsor’s Fee or upon a sale of silver to pay the Trust’s expenses not assumed by the Sponsor, it is anticipated that only a small amount of unallocated silver will be held in the Trust Unallocated Account. Cash held by the Trust will not generate any income. Each Share will represent a proportional interest, based on the total number of Shares outstanding, in the silver and any cash held by the Trust, less the Trust’s liabilities (which include accrued but unpaid fees and expenses). The Sponsor expects that the secondary market trading price of the Shares will fluctuate over time in response to the price of silver. In addition, the Sponsor expects that the trading price of the Shares will reflect the estimated accrued but unpaid expenses of the Trust.

Investors may obtain on a 24-hour basis silver pricing information based on the spot price for an ounce of silver from various financial information service providers. Current spot prices are also generally available with bid/ask spreads from silver bullion dealers. In addition, the Trust’s website (www.etfsecurities.com) will provide ongoing pricing information for silver spot prices and the Shares. Market prices for the Shares will be available from a variety of sources including brokerage firms, information websites and other information service providers. The NAV of the Trust will be published by the Sponsor on each day that the NYSE Arca is open for regular trading and will be posted on the Trust’s website.

The Trust has no fixed termination date.

THE SPONSOR

The Sponsor is a Delaware limited liability company and was formed on June 17, 2009. The Sponsor’s office is located at ETF Securities Representative Office, 2 London Wall Buildings, 6th Floor, London, EC2M 5UU, United Kingdom. Under the Delaware Limited Liability Company Act

and the governing documents of the Sponsor, the sole member of the Sponsor, ETF Securities Limited, is not responsible for the debts, obligations and liabilities of the Sponsor solely by reason of being the sole member of the Sponsor.

The Sponsor’s Role

The Sponsor will arrange for the creation of the Trust, the registration of the Shares for their public offering in the United States and the listing of the Shares on the NYSE Arca. The Sponsor has agreed to assume the following administrative and marketing expenses incurred by the Trust: the Trustee’s monthly fee and out-of-pocket expenses, the Custodian’s fee and the reimbursement of the Custodian’s expenses under the Custody Agreements, Exchange listing fees, SEC registration fees, printing and mailing costs, audit fees and up to $100,000 per annum in legal expenses. The Sponsor will also pay the costs of the Trust’s organization and the initial sale of the Shares, including the applicable SEC registration fees.

The Sponsor will not exercise day-to-day oversight over the Trustee or the Custodian. The Sponsor may remove the Trustee and appoint a successor Trustee (i) if the Trustee ceases to meet certain objective requirements (including the requirement that it have capital, surplus and undivided profits of at least $150 million), (ii) if, having received written notice of a material breach of its obligations under the Trust Agreement, the Trustee has not cured the breach within 30 days, or (iii) if the Trustee refuses to consent to the implementation of an amendment to the Trust’s initial Internal Control Over Financial Reporting. The Sponsor also has the right to replace the Trustee during the 90 days following any merger, consolidation or conversion in which the Trustee is not the surviving entity or, in its discretion, on the fifth anniversary of the creation of the Trust or on any subsequent third anniversary thereafter. The Sponsor also has the right to approve any new or additional custodian that the Trustee may wish to appoint.

The Sponsor or one of its affiliates or agents will (1) develop a marketing plan for the Trust on an ongoing basis, (2) prepare marketing materials regarding the Shares, including the content of the Trust’s website and (3) execute the marketing plan for the Trust.

THE TRUSTEE

The Bank of New York Mellon, a banking corporation organized under the laws of the State of New York with trust powers, will serve as the Trustee. BNYM has a trust office at 2 Hanson Place, Brooklyn, New York 11217. BNYM is subject to supervision by the New York State Banking Department and the Board of Governors of the Federal Reserve System. Information regarding creation and redemption Basket composition, NAV of the Trust, transaction fees and the names of the parties that have each executed an Authorized Participant Agreement may be obtained from BNYM. A copy of the Trust Agreement is available for inspection at BNYM’s trust office identified above. Under the Trust Agreement, the Trustee is required to maintain capital, surplus and undivided profits of $150 million.

The Trustee’s Role

The Trustee is generally responsible for the day-to-day administration of the Trust, including keeping the Trust’s operational records. The Trustee’s principal responsibilities include (1) transferring the Trust’s silver as needed to pay the Sponsor’s fee in silver (silver transfers are expected to occur approximately monthly in the ordinary course), (2) valuing the Trust’s silver and calculating the NAV of the Trust and the NAV per Share, (3) receiving and processing orders from Authorized Participants to create and redeem Baskets and coordinating the processing of such orders with the Custodian and DTC, (4) selling the Trust’s silver as needed to pay any extraordinary Trust expenses that are not assumed by the Sponsor, (5) when appropriate, making distributions of cash or other property to Shareholders, and (6) receiving and reviewing reports from or on the Custodian’s custody of and transactions in the Trust’s silver. The Trustee shall, with respect to directing the Custodian, act in accordance with the instructions of the Sponsor. If the Custodian resigns the Trustee shall appoint an additional or replacement Custodian selected by the Sponsor.

The ability of the Trustee and the Sponsor to monitor the performance of the Custodian may be limited because, under the Custody Agreements, the Trustee, the Sponsor and the Sponsor’s auditors and inspectors may, only up to twice a year, visit the premises of the Custodian for the purpose of examining the Trust’s silver and certain related records maintained by the Custodian. In addition, the Trustee has no right to visit the premises of any subcustodian for the purposes of examining the Trust’s silver or any records maintained by the subcustodian, and no subcustodian is obligated to cooperate in any review the Trustee may wish to conduct of the facilities, procedures, records or creditworthiness of such subcustodian.

The Trustee intends to regularly communicate with the Sponsor to monitor the overall performance of the Trust. The Trustee does not monitor the performance of the Custodian or any subcustodian other than to review the reports provided by the Custodian pursuant to the Custody Agreements. The Trustee, along with the Sponsor, will liaise with the Trust’s legal, accounting and other professional service providers as needed. The Trustee will assist and support the Sponsor with the preparation of all periodic reports required to be filed with the SEC on behalf of the Trust.

The Trustee’s monthly fees and out-of-pocket expenses will be paid by the Sponsor.

Affiliates of the Trustee may from time to time act as Authorized Participants or purchase or sell silver or Shares for their own account, as agent for their customers and for accounts over which they exercise investment discretion.

THE CUSTODIAN

HSBC Bank USA, National Association will serve as the Custodian of the Trust’s silver. HSBC is a national banking association organized under the laws of the United States of America. HSBC is subject to supervision by the Federal Reserve Bank of New York and the Federal Deposit Insurance Corporation. HSBC’s custodian office is located at 8 Canada Square, London, E14 5HQ, United Kingdom. In addition to supervision and examination by the US federal banking authorities, HSBC’s London custodian operations are subject to supervision by the FSA.

The Custodian’s Role

The Custodian is responsible for safekeeping for the Trust silver deposited with it by Authorized Participants in connection with the creation of Baskets. The Custodian is also responsible for selecting its direct subcustodians, if any. The Custodian facilitates the transfer of silver in and out of the Trust through the unallocated silver accounts it will maintain for each Authorized Participant and the unallocated and allocated silver accounts it will maintain for the Trust. The Custodian is responsible for allocating specific bars of silver bullion to the Trust’s allocated silver account. The Custodian will provide the Trustee with regular reports detailing the silver transfers in and out of the Trust’s unallocated and allocated silver accounts and identifying the silver bars held in the Trust’s allocated silver account.

The Custodian’s fees and expenses under the Custody Agreements will be paid by the Sponsor.

The Custodian and its affiliates may from time to time act as Authorized Participants or purchase or sell silver or Shares for their own account, as agent for their customers and for accounts over which they exercise investment discretion.

DESCRIPTION OF THE SHARES

General

The Trustee is authorized under the Trust Agreement to create and issue an unlimited number of Shares. The Trustee will create Shares only in Baskets (a Basket equals a block of 100,000 Shares) and only upon the order of an Authorized Participant. The Shares represent units of fractional undivided beneficial interest in and ownership of the Trust and have no par value. Any creation and issuance of Shares above the amount registered on the registration statement of which this prospectus is a part will require the registration of such additional Shares.

Description of Limited Rights

The Shares do not represent a traditional investment and you should not view them as similar to “shares” of a corporation operating a business enterprise with management and a board of directors. As a Shareholder, you will not have the statutory rights normally associated with the ownership of shares of a corporation, including, for example, the right to bring “oppression” or “derivative” actions. All Shares are of the same class with equal rights and privileges. Each Share is transferable, is fully paid and non-assessable and entitles the holder to vote on the limited matters upon which Shareholders may vote under the Trust Agreement. The Shares do not entitle their holders to any conversion or pre-emptive rights, or, except as provided below, any redemption rights or rights to distributions.

Distributions

If the Trust is terminated and liquidated, the Trustee will distribute to the Shareholders any amounts remaining after the satisfaction of all outstanding liabilities of the Trust and the establishment of such reserves for applicable taxes, other governmental charges and contingent or future liabilities as the Trustee shall determine. See “Description of the Trust Agreement—Termination of the Trust.” Shareholders of record on the record date fixed by the Trustee for a distribution will be entitled to receive their pro rata portion of any distribution.

Voting and Approvals

Under the Trust Agreement, Shareholders have no voting rights, except in limited circumstances. The Trustee may terminate the Trust upon the agreement of Shareholders owning at least 75% of the outstanding Shares. In addition, certain amendments to the Trust Agreement require advance notice to the Shareholders before the effectiveness of such amendments, but no Shareholder vote or approval is required for any amendment to the Trust Agreement.

Redemption of the Shares

The Shares may only be redeemed by or through an Authorized Participant and only in Baskets. See “Creation and Redemption of Shares” for details on the redemption of the Shares.

Book-Entry Form

Individual certificates will not be issued for the Shares. Instead, one or more global certificates will be deposited by the Trustee with DTC and registered in the name of Cede & Co., as nominee for DTC. The global certificates will evidence all of the Shares outstanding at any time. Under the Trust Agreement, Shareholders are limited to (1) participants in DTC such as banks, brokers, dealers and trust companies (DTC Participants), (2) those who maintain, either directly or indirectly, a custodial relationship with a DTC Participant (Indirect Participants), and (3) those banks, brokers, dealers, trust companies and others who hold interests in the Shares through DTC Participants or Indirect Participants. The Shares are only transferable through the book-entry system of DTC. Shareholders who are not DTC Participants may transfer their Shares through DTC by instructing the DTC Participant holding their Shares (or by instructing the Indirect Participant or other entity through which their Shares are held) to transfer the Shares. Transfers will be made in accordance with standard securities industry practice.

CUSTODY OF THE TRUST’S SILVER

Custody of the silver bullion deposited with and held by the Trust will be provided by the Custodian at its London, England vaults, by subcustodians selected by the Custodian and by others acting on behalf of the subcustodians. The Custodian is a market maker, clearer and approved weigher under the rules of the LBMA.

The Custodian, as instructed by the Trustee on behalf of the Trust, is authorized to accept, on behalf of the Trust, deposits of silver in unallocated form. Acting on standing instructions given by

the Trustee specified in the Custody Agreements, the Custodian will allocate silver deposited in unallocated form with the Trust by selecting bars of silver bullion for deposit to the Trust Allocated Account. All silver bullion allocated to the Trust must conform to the rules, regulations, practices and customs of the LBMA.

The process of withdrawing silver from the Trust for a redemption of a Basket will follow the same general procedure as for depositing silver with the Trust for a creation of a Basket, only in reverse. Each transfer of silver between the Trust Allocated Account and the Trust Unallocated Account connected with a creation or redemption of a Basket may result in a small amount of silver being held in the Trust Unallocated Account after the completion of the transfer. In making deposits and withdrawals between the Trust Allocated Account and the Trust Unallocated Account, the Custodian will use commercially reasonable efforts to minimize the amount of silver held in the Trust Unallocated Account as of the close of each business day. See “Creation and Redemption of Shares.”

DESCRIPTION OF THE CUSTODY AGREEMENTS

The Allocated Account Agreement among the Trustee, the Sponsor and the Custodian establishes the Trust Allocated Account. The Unallocated Account Agreement among the Trustee, the Sponsor and the Custodian establishes the Trust Unallocated Account. These agreements are sometimes referred to together as the “Custody Agreements” in this prospectus. The following is a description of the material terms of the Custody Agreements. As the Custody Agreements are similar in form, they are discussed together, with material distinctions between the agreements noted.

Reports

The Custodian will provide the Trustee with reports for each business day, no later than the following business day, identifying the movements of silver in and out of the Trust Allocated Account and the credits and debits of silver to the Trust Unallocated Account and containing sufficient information to identify each bar of silver held in the Trust Allocated Account. The Custodian will also provide the Trustee with monthly statements of account for the Trust Allocated Account and the Trust Unallocated Account as of the last business day of each month. Under the Custody Agreements, a “business day” means any day other than a day (1) when the NYSE Arca is closed for regular trading or (2), if the transaction requires the receipt or delivery, or the confirmation of receipt or delivery, of silver in the United Kingdom or in some other jurisdiction on a particular day, (A) when banks are authorized to close in the United Kingdom or in such other jurisdiction or when the London silver market is closed or (B) when banks in the United Kingdom or in such other jurisdiction are, or the London silver market is, not open for a full business day and the transaction requires the execution or completion of procedures which cannot be executed or completed by the close of the business day.

The Custodian’s records of all deposits to and withdrawals from, and all debits and credits to, the Trust Allocated Account and the Trust Unallocated Account which are to occur on a business day, and all end of business day account balances in the Trust Allocated Account and Trust Unallocated Account, are stated as of the close of the Custodian’s business (usually 4:00 PM London time) on such business day.

Subcustodians

Under the Allocated Account Agreement, the Custodian may select subcustodians to perform temporarily any of its duties, including holding silver for it. These subcustodians may in turn select other subcustodians to temporarily perform their duties, including holding silver for them, but the Custodian is not responsible for (and therefore has no liability in relation to) the selection of those other subcustodians. The Allocated Account Agreement requires the Custodian to use reasonable care in selecting any subcustodian and provides that, except for the Custodian’s obligation to use commercially reasonable efforts to obtain delivery of silver held by subcustodians when necessary,

the Custodian will not be liable for the acts or omissions, or for the solvency, of any subcustodian that it selects unless the selection of that subcustodian was made negligently or in bad faith. The subcustodians selected and used by the Custodian as of the date of this prospectus are: The Bank of Nova Scotia (ScotiaMocatta), Deutsche Bank AG, JPMorgan Chase Bank, N.A., UBS AG, Barclays Bank PLC, Johnson Matthey plc, Brink’s Global Services Inc. and Via Mat International. The Allocated Account Agreement provides that the Custodian will notify the Trustee if it selects any additional subcustodians or stops using any subcustodian it has previously selected.

Location and Segregation of Silver; Access

Silver held for the Trust Allocated Account by the Custodian will be held at the Custodian’s London vault. Silver temporarily held by the Custodian’s currently selected subcustodians and by subcustodians of subcustodians may be held in vaults located in England or in other locations.

The Custodian will segregate by identification in its books and records the Trust’s silver in the Trust Allocated Account from any other silver which it owns or holds for others and will require the subcustodians it selects to so segregate the Trust’s silver held by them. This requirement reflects the current custody practice in the London bullion market, and under the Allocated Account Agreement, the Custodian is deemed to have communicated such requirement by virtue of its participation in the London bullion market. The Custodian’s books and records are expected, as a matter of current London bullion market custody practice, to identify every bar of silver held in the Trust Allocated Account in its own vault by refiner, assay or fineness, serial number and gross and fine weight. Subcustodians selected by the Custodian are also expected, as a matter of current industry practice, to identify in their books and records each bar of silver held for the Custodian by serial number and such subcustodians may use other identifying information.

The Trustee and the Sponsor and their auditors may, during normal business hours, visit the Custodian’s premises up to twice a year and examine the Trust’s silver held there and the Custodian’s records concerning the Trust Allocated Account and the Trust Unallocated Account as they may be reasonably required to perform their respective duties to investors in the Shares. With respect to the Trust Unallocated Account, a second visit to the Custodian’s premises in any calendar year shall require the consent of the Custodian, which consent may not be withheld unreasonably.

Transfers into the Trust Unallocated Account

The Custodian will credit to the Trust Unallocated Account the amount of silver it receives from the Trust Allocated Account, an Authorized Participant Unallocated Account or from other third party unallocated accounts for credit to the Trust Unallocated Account. Unless otherwise agreed by the Custodian in writing, the only silver the Custodian will accept in physical form for credit to the Trust Unallocated Account is silver that the Trustee has transferred from the Trust Allocated Account, an Authorized Participant Unallocated Account or third party unallocated account.

Transfers from the Trust Unallocated Account

The Custodian will transfer silver from the Trust Unallocated Account only in accordance with the Trustee’s instructions to the Custodian. A transfer of silver from the Trust Unallocated Account may only be made (1) by transferring silver to an Authorized Participant Unallocated Account; (2) by transferring silver to the Trust Allocated Account; (3) by transferring silver to pay the Sponsor’s Fee; (4) by making silver available for collection at the Custodian’s vault premises or at such other location as the Custodian may direct, at the Trust’s expense and risk; or (5) by delivering the silver to such location as the Trustee directs, at the Trust’s expense and risk. Transfers made pursuant to clauses (4) and (5) will be made only on an exceptional basis, and are expected to include transfers in connection with a sale to pay extraordinary expenses of the Trust not paid by the Sponsor or with the liquidation of the Trust. Any silver made available in physical form will be in a form which complies with the rules, regulations, practices and customs of the LBMA, the Bank of England or any applicable regulatory body (Custody Rules) or in such other form as may be agreed between

the Trustee and the Custodian, and in all cases will comprise one or more whole silver bars selected by the Custodian.

The Custodian will use commercially reasonable efforts to transfer silver from the Trust Unallocated Account to the Trust Allocated Account by 2:00 PM London time on each business day. In doing so, 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.

Transfers into the Trust Allocated Account

The Custodian will receive transfers of silver into the Trust Allocated Account only at the Trustee’s instructions given pursuant to the Unallocated Account Agreement by debiting silver from the Trust Unallocated Account and crediting such silver to the Trust Allocated Account.

Transfers from the Trust Allocated Account

The Custodian will transfer silver from the Trust Allocated Account only in accordance with the Trustee’s instructions. Generally, the Custodian will transfer silver from the Trust Allocated Account only by debiting silver from the Trust Allocated Account and crediting the silver to the Trust Unallocated Account.

Right to Refuse Transfers or Amend Transfer Procedures

The Custodian may refuse to accept instructions to transfer silver to or from the Trust Unallocated Account and the Trust Allocated Account if in the Custodian’s opinion they are or may be contrary to the rules, regulations, practices and customs of the LBMA, or the Bank of England or contrary to any applicable law. The Custodian may amend the procedures for transferring silver to or from the Trust Unallocated Account or for the physical withdrawal of silver from the Trust Unallocated Account or the Trust Allocated Account or impose such additional procedures in relation to the transfer of silver to or from the Trust Unallocated Account as the Custodian may from time to time consider necessary due to a change in rules of the LBMA or on the Bank of England. The Custodian will notify the Trustee within a commercially reasonable time before the Custodian amends these procedures or imposes additional ones.

The Custodian receives no fee under the Unallocated Account Agreement.

Trust Unallocated Account Credit and Debit Balances

No interest will be paid by the Custodian on any credit balance to the Trust Unallocated Account. Unless otherwise agreed to by the Trustee and the Custodian, the Trustee may not maintain a negative balance in the Trust Unallocated Account.

Exclusion of Liability

The Custodian will use reasonable care in the performance of its duties under the Custody Agreements and will only be responsible for any loss or damage suffered by the Trust as a direct result of any negligence, fraud or willful default in the performance of its duties. The Custodian’s liability under the Allocated Account Agreement is further limited to the market value of the silver held in the Trust Allocated Account at the time such negligence, fraud or willful default is discovered by the Custodian, provided that the Custodian promptly notifies the Trustee of its discovery. The Custodian’s liability under the Unallocated Account Agreement is further limited to the amount of the silver credited to the Trust Unallocated Account at the time such negligence, fraud or willful default is discovered by the Custodian, provided that the Custodian promptly notifies the Trustee of its discovery.

Furthermore, the Custodian has no duty to make or take or to require any subcustodian selected by it to make or take any special arrangements or precautions beyond those required by the Custody Rules or as specifically set forth in the Custody Agreements.

Indemnity

The Trustee will, solely out of the Trust’s assets, indemnify the Custodian (on an after tax basis) on demand against all costs and expenses, damages, liabilities and losses which the Custodian may suffer or incur in connection with the Custody Agreements, except to the extent that such sums are due directly to the Custodian’s negligence, willful default or fraud.

Insurance

The Custodian will maintain such insurance for its business, including its bullion and custody business, as it deems appropriate in connection with its custodial and other obligations and will be responsible for all costs, fees and expenses arising from the insurance policy or policies attributable to its relationship with the Trust. Consistent with industry standards, the Custodian maintains a group insurance policy that covers all metals held in its vaults for the accounts of all its customers for a variety of events. The Trustee and the Sponsor may, subject to confidentiality restrictions, be provided with details of this insurance coverage from time to time upon reasonable prior notice.

Force Majeure

The Custodian will not be liable for any delay in performance or any non-performance of any of its obligations under the Custody Agreements by reason of any cause beyond its reasonable control, including acts of God, war or terrorism.

Termination

The Custody Agreements have an initial five year term and will automatically renew for successive five year terms unless otherwise terminated. The Trustee and the Custodian may each terminate any Custody Agreement for any reason or if the Custodian withdraws or proposes to withdraw from the business of offering bullion custody services, upon 90 business days’ prior notice. The Custody Agreements may also be terminated by the Custodian or the Trustee upon written notice effective immediately in the event that (1) the Custodian ceased to offer the services contemplated by the Custody Agreement to its clients or proposed to withdraw from the bullion business, (2) it becomes unlawful for either party or the Trustee to have entered into the agreement or to provide or receive the services thereunder, (3) either party determines in its sole view that the other party or the Trust is insolvent or faces impending insolvency, (4) the Trust is to be terminated or (5) if either of the Custody Agreements ceases to be in full force and effect. If either the Allocated Account Agreement or the Unallocated Account Agreement is terminated, the other agreement automatically terminates.

If redelivery arrangements acceptable to the Custodian for the silver held in the Trust Allocated Account are not made, the Custodian may continue to store the silver and continue to charge for its fees and expenses, and, after six months from the termination date, the Custodian may sell the silver and account to the Trustee for the proceeds. If arrangements acceptable to the Custodian for redelivery of the balance in the Trust Unallocated Account are not made, the Custodian may continue to charge for its fees and expenses payable under the Allocated Account Agreement, and, after six months from the termination date, the Custodian may close the Trust Unallocated Account and account to the Trustee for the proceeds.

Governing Law

The Custody Agreements are governed by English law. The Trustee and the Custodian both consent to the non-exclusive jurisdiction of the courts of the State of New York and the federal courts located in the borough of Manhattan in New York City.

CREATION AND REDEMPTION OF SHARES

The Trust will create and redeem Shares from time to time, but only in one or more Baskets (a Basket equals a block of 100,000 Shares). The creation and redemption of Baskets will only be made

in exchange for the delivery to the Trust or the distribution by the Trust of the amount of silver and any cash represented by the Baskets being created or redeemed, the amount of which will be based on the combined NAV of the number of Shares included in the Baskets being created or redeemed determined on the day the order to create or redeem Baskets is properly received.

Authorized Participants are the only persons that may place orders to create and redeem Baskets. Authorized Participants must be (1) registered broker-dealers or other securities market participants, such as banks and other financial institutions, which are not required to register as broker-dealers to engage in securities transactions, and (2) participants in DTC. To become an Authorized Participant, a person must enter into an Authorized Participant Agreement with the Sponsor and the Trustee. The Authorized Participant Agreement provides the procedures for the creation and redemption of Baskets and for the delivery of the silver and any cash required for such creations and redemptions. The Authorized Participant Agreement and the related procedures attached thereto may be amended by the Trustee and the Sponsor, without the consent of any Shareholder or Authorized Participant. Authorized Participants will pay a transaction fee of $500 to the Trustee for each order they place to create or redeem one or more Baskets. Authorized Participants who make deposits with the Trust in exchange for Baskets will receive no fees, commissions or other form of compensation or inducement of any kind from either the Sponsor or the Trust, and no such person has any obligation or responsibility to the Sponsor or the Trust to effect any sale or resale of Shares.

Authorized Participants are cautioned that some of their activities will result in their being deemed participants in a distribution in a manner which would render them statutory underwriters and subject them to the prospectus-delivery and liability provisions of the Securities Act, as described in “Plan of Distribution.”

Prior to initiating any creation or redemption order, an Authorized Participant must have entered into an agreement with the Custodian to establish an Authorized Participant Unallocated Account in London (Authorized Participant Unallocated Bullion Account Agreement). Authorized Participant Unallocated Accounts may only be used for transactions with the Trust. Silver held in Authorized Participant Unallocated Accounts is not segregated from the Custodian’s assets, as a consequence of which an Authorized Participant will have no proprietary interest in any specific bars of silver held by the Custodian. Credits to its Authorized Participant Unallocated Account are therefore at risk of the Custodian’s insolvency. No fees will be charged by the Custodian for the use of the Authorized Participant Unallocated Account as long as the Authorized Participant Unallocated Account is used solely for silver transfers to and from the Trust Unallocated Account and the Custodian (or one of its affiliates) receives compensation for maintaining the Trust Allocated Account. Authorized Participants should be aware that the Custodian’s liability threshold under the Authorized Participant Unallocated Bullion Account Agreement is gross negligence, not negligence, which is the Custodian’s liability threshold under the Trust’s Custody Agreements.

As the terms of the Authorized Participant Unallocated Bullion Account Agreement differ in certain respects from the terms of the Trust’s Unallocated Account Agreement, potential Authorized Participants should review the terms of the Authorized Participant Unallocated Bullion Account Agreement carefully. A copy of the Authorized Participant Unallocated Bullion Account Agreement may be obtained by potential Authorized Participants from the Custodian. A copy of the Authorized Participant Agreement may be obtained by potential Authorized Participants from the Trustee.

Certain Authorized Participants are expected to have the facility to participate directly in the silver bullion market and the silver futures market. In some cases, an Authorized Participant may from time to time acquire silver from or sell silver to its affiliated silver trading desk, which may profit in these instances. Each Authorized Participant will be registered as a broker-dealer under the Securities Exchange Act of 1934 (Exchange Act) and regulated by FINRA or will be exempt from being or otherwise will not be required to be so regulated or registered, and will be qualified to act as a broker or dealer in the states or other jurisdictions where the nature of its business so requires. Certain Authorized Participants will be regulated under federal and state banking laws and regulations. Each Authorized Participant will have its own set of rules and procedures, internal

controls and information barriers as it determines is appropriate in light of its own regulatory regime.

Authorized Participants may act for their own accounts or as agents for broker-dealers, custodians and other securities market participants that wish to create or redeem Baskets. An order for one or more Baskets may be placed by an Authorized Participant on behalf of multiple clients. As of the date of this prospectus, EWT, LLC, Goldman, Sachs & Co., Goldman Sachs Execution & Clearing, L.P., Merrill Lynch Professional Clearing Corp., and Newedge USA, LLC have each signed an Authorized Participant Agreement with the Trust and, upon the effectiveness of such agreement, may create and redeem Baskets as described above. Persons interested in purchasing Baskets should contact the Sponsor or the Trustee to obtain the contact information for the Authorized Participants. Shareholders who are not Authorized Participants will only be able to redeem their Shares through an Authorized Participant.

All silver will be delivered to the Trust and distributed by the Trust in unallocated form through credits and debits between Authorized Participant Unallocated Accounts and the Trust Unallocated Account. Silver transferred from an Authorized Participant Unallocated Account to the Trust in unallocated form will first be credited to the Trust Unallocated Account. Thereafter, the Custodian will allocate specific bars of silver representing the amount of silver credited to the Trust Unallocated Account (to the extent such amount is representable by whole silver bars) to the Trust Allocated Account. The movement of silver is reversed for the distribution of silver to an Authorized Participant in connection with the redemption of Baskets.

All silver bullion represented by a credit to any Authorized Participant Unallocated Account and to the Trust Unallocated Account and all silver bullion held in the Trust Allocated Account with the Custodian must be of at least a minimum fineness (or purity) of 999.0 parts per 1,000 (99.9%) and otherwise conform to the rules, regulations, practices and customs of the LBMA, including the specifications for a London Good Delivery Bar.

Under the Authorized Participant Agreement, the Sponsor has agreed to indemnify the Authorized Participants against certain liabilities, including liabilities under the Securities Act.

The following description of the procedures for the creation and redemption of Baskets is only a summary and an investor should refer to the relevant provisions of the Trust Agreement and the form of Authorized Participant Agreement for more detail, each of which is attached as an exhibit to the registration statement of which this prospectus is a part. See “Where You Can Find More Information” for information about where you can obtain the registration statement.

Creation Procedures

On any business day, an Authorized Participant may place an order with the Trustee to create one or more Baskets. Creation and redemption orders will be accepted on “business days” the NYSE Arca is open for regular trading. Settlements of such orders requiring receipt or delivery, or confirmation of receipt or delivery, of silver in the United Kingdom will occur on “business days” when (1) banks in the United Kingdom and (2) the London silver markets coordinated by the LBMA are regularly open for business in London. If such banks or the London silver markets are not open for regular business for a full day, such a day will only be a “business day” for settlement purposes if the settlement procedures can be completed by the end of such day. Settlement of orders requiring receipt or delivery, or confirmation of receipt or delivery, of Shares will occur, after confirmation of the applicable silver delivery, on “business days” the NYSE Arca is open for regular trading. Purchase orders must be placed no later than 3:59:59 p.m. on each business day the NYSE Arca is open for regular trading. The day on which the Trustee receives a valid purchase order is the purchase order date.

By placing a purchase order, an Authorized Participant agrees to deposit silver with the Trust, as described below. Prior to the delivery of Baskets for a purchase order, the Authorized Participant must also have wired to the Trustee the non-refundable transaction fee due for the purchase order.

Determination of required deposits

The amount of the required silver deposit is determined by dividing the number of ounces of silver held by the Trust by the number of Baskets outstanding, as adjusted for the amount of silver constituting estimated accrued but unpaid fees and expenses of the Trust.

Fractions of a fine ounce of silver smaller than 0.001 of a fine ounce which are included in the silver deposit amount are disregarded in the foregoing calculation. All questions as to the composition of a Creation Basket Deposit will be finally determined by the Trustee. The Trustee’s determination of the Creation Basket Deposit shall be final and binding on all persons interested in the Trust.

Delivery of required deposits

An Authorized Participant who places a purchase order is responsible for crediting its Authorized Participant Unallocated Account with the required silver deposit amount by the third business day in London following the purchase order date. Upon receipt of the silver deposit amount, the Custodian, after receiving appropriate instructions from the Authorized Participant and the Trustee, will transfer on the third business day following the purchase order date the silver deposit amount from the Authorized Participant Unallocated Account to the Trust Unallocated Account and the Trustee will direct DTC to credit the number of Baskets ordered to the Authorized Participant’s DTC account. The expense and risk of delivery, ownership and safekeeping of silver until such silver has been received by the Trust shall be borne solely by the Authorized Participant. The Trustee may accept delivery of silver by such other means as the Sponsor, from time to time, may determine to be acceptable for the Trust, provided that the same is disclosed in a prospectus relating to the Trust filed with the SEC pursuant to Rule 424 under the Securities Act. If silver is to be delivered other than as described above, the Sponsor is authorized to establish such procedures and to appoint such custodians and establish such custody accounts in addition to those described in this prospectus, as the Sponsor determines to be desirable.

Acting on standing instructions given by the Trustee, the Custodian will transfer the silver deposit amount from the Trust Unallocated Account to the Trust Allocated Account by transferring silver bars from its inventory to the Trust Allocated Account. The Custodian will use commercially reasonable efforts to complete the transfer of silver to the Trust Allocated Account prior to the time by which the Trustee is to credit the Basket to the Authorized Participant’s DTC account; if, however, such transfers have not been completed by such time, the number of Baskets ordered will be delivered against receipt of the silver deposit amount in the Trust Unallocated Account, and all Shareholders will be exposed to the risks of unallocated silver to the extent of that silver deposit amount until the Custodian completes the allocation process. See “Risk Factors—Silver held in the Trust’s unallocated silver account and any Authorized Participant’s unallocated silver account will not be segregated from the Custodian’s assets....”

Because silver is allocated only in multiples of whole bars, the amount of silver allocated from the Trust Unallocated Account to the Trust Allocated Account may be less than the total fine ounces of silver credited to the Trust Unallocated Account. Any balance will be held in the Trust Unallocated Account. The Custodian will use commercially reasonable efforts to minimize the amount of silver held in the Trust Unallocated Account; no more than 1100 ounces of silver (maximum weight to make one Good Delivery Bar) is expected to be held in the Trust Unallocated Account at the close of each business day.

Rejection of purchase orders

The Trustee may reject a purchase order or a Creation Basket Deposit if such order or Creation Basket Deposit if not presented in proper form as described in the Authorized Participant Agreement or if the fulfillment of the order, in the opinion of counsel, might be unlawful. None of the Trustee, the Sponsor or the Custodian will be liable for the rejection of any purchase order or Creation Basket Deposit.

Redemption Procedures

The procedures by which an Authorized Participant can redeem one or more Baskets will mirror the procedures for the creation of Baskets. On any business day, an Authorized Participant may place an order with the Trustee to redeem one or more Baskets. Redemption orders must be placed no later than 3:59:59 p.m. on each business day the NYSE Arca is open for regular trading. A redemption order so received is effective on the date it is received in satisfactory form by the Trustee. The redemption procedures allow Authorized Participants to redeem Baskets and do not entitle an individual Shareholder to redeem any Shares in an amount less than a Basket, or to redeem Baskets other than through an Authorized Participant.

By placing a redemption order, an Authorized Participant agrees to deliver the Baskets to be redeemed through DTC’s book-entry system to the Trust not later than the third business day following the effective date of the redemption order. Prior to the delivery of the redemption distribution for a redemption order, the Authorized Participant must also have wired to the Trustee the non-refundable transaction fee due for the redemption order.

Determination of redemption distribution

The redemption distribution from the Trust will consist of a credit to the redeeming Authorized Participant’s Authorized Participant Unallocated Account representing the amount of the silver held by the Trust evidenced by the Shares being redeemed. Fractions of a fine ounce of silver included in the redemption distribution smaller than 0.001 of a fine ounce are disregarded. Redemption distributions will be subject to the deduction of any applicable tax or other governmental charges which may be due.

Delivery of redemption distribution

The redemption distribution due from the Trust will be delivered to the Authorized Participant on the third business day following the redemption order date if, by 9:00 AM New York time on such third business day, the Trustee’s DTC account has been credited with the Baskets to be redeemed. If the Trustee’s DTC account has not been credited with all of the Baskets to be redeemed by such time, the redemption distribution will be delivered to the extent of whole Baskets received. Any remainder of the redemption distribution will be delivered on the next business day to the extent of remaining whole Baskets received if the Trustee receives the fee applicable to the extension of the redemption distribution date which the Trustee may, from time to time, determine and the remaining Baskets to be redeemed are credited to the Trustee’s DTC account by 9:00 AM New York time on such next business day. Any further outstanding amount of the redemption order shall be cancelled. The Trustee is also authorized to deliver the redemption distribution notwithstanding that the Baskets to be redeemed are not credited to the Trustee’s DTC account by 9:00 AM New York time on the third business day following the redemption order date if the Authorized Participant has collateralized its obligation to deliver the Baskets through DTC’s book entry system on such terms as the Sponsor and the Trustee may from time to time agree upon.

The Custodian will transfer the redemption silver amount from the Trust Allocated Account to the Trust Unallocated Account and, thereafter, to the redeeming Authorized Participant’s Authorized Participant Unallocated Account. The Authorized Participant and the Trust are each at risk in respect of silver credited to their respective unallocated accounts in the event of the Custodian’s insolvency. See “Risk Factors—Silver held in the Trust’s unallocated silver account and any Authorized Participant’s unallocated silver account will not be segregated from the Custodian’s assets....”

As with the allocation of silver to the Trust Allocated Account which occurs upon a purchase order, if in transferring silver from the Trust Allocated Account to the Trust Unallocated Account in connection with a redemption order there is an excess amount of silver transferred to the Trust Unallocated Account, the excess over the silver redemption amount will be held in the Trust Unallocated Account. The Custodian will use commercially reasonable efforts to minimize the amount of silver held in the Trust Unallocated Account; no more than 1100 ounces of silver

(maximum weight to make one Good Delivery Bar) is expected to be held in the Trust Unallocated Account at the close of each business day.

Suspension or rejection of redemption orders

The Trustee may, in its discretion, and will when directed by the Sponsor, suspend the right of redemption, or postpone the redemption settlement date, (1) for any period during which the NYSE Arca is closed other than customary weekend or holiday closings, or trading on the NYSE Arca is suspended or restricted or (2) for any period during which an emergency exists as a result of which delivery, disposal or evaluation of silver is not reasonably practicable. None of the Sponsor, the Trustee or the Custodian will be liable to any person or in any way for any loss or damages that may result from any such suspension or postponement.

The Trustee will reject a redemption order if the order is not in proper form as described in the Authorized Participant Agreement or if the fulfillment of the order, in the opinion of its counsel, might be unlawful.

Creation and Redemption Transaction Fee

To compensate the Trustee for services in processing the creation and redemption of Baskets, an Authorized Participant will be required to pay a transaction fee to the Trustee of $500 per order to create or redeem Baskets. An order may include multiple Baskets. The transaction fee may be reduced, increased or otherwise changed by the Trustee with the consent of the Sponsor. The Trustee shall notify DTC of any agreement to change the transaction fee and will not implement any increase in the fee for the redemption of Baskets until 30 days after the date of the notice.

Tax Responsibility

Authorized Participants are responsible for any transfer tax, sales or use tax, recording tax, value added tax or similar tax or governmental charge applicable to the creation or redemption of Baskets, regardless of whether or not such tax or charge is imposed directly on the Authorized Participant, and agree to indemnify the Sponsor, the Trustee and the Trust if they are required by law to pay any such tax, together with any applicable penalties, additions to tax or interest thereon.

DESCRIPTION OF THE TRUST AGREEMENT

The Trust operates under the terms of the Trust Agreement, dated as of July 20, 2009 between the Sponsor and the Trustee. A copy of the Trust Agreement is available for inspection at the Trustee’s office. The following is a description of the material terms of the Trust Agreement.

The Sponsor

This section summarizes some of the important provisions of the Trust Agreement which apply to the Sponsor. For a general description of the Sponsor’s role concerning the Trust, see “The Sponsor—The Sponsor’s Role.”

Liability of the Sponsor and indemnification

The Sponsor will not be liable to the Trustee or any Shareholder for any action taken or for refraining from taking any action in good faith, or for errors in judgment or for depreciation or loss incurred by reason of the sale of any silver or other assets of the Trust. However, the preceding liability exclusion will not protect the Sponsor against any liability resulting from its own gross negligence, willful misconduct or bad faith in the performance of its duties.

The Sponsor and its members, managers, directors, officers, employees, affiliates (as such term is defined under the Securities Act) and subsidiaries shall be indemnified from the Trust and held harmless against any loss, liability or expense incurred without (1) gross negligence, bad faith, willful misconduct or willful malfeasance on the part of such indemnified party arising out of or in

connection with the performance of its obligations under the Trust Agreement and under each other agreement entered into by the Sponsor in furtherance of the administration of the Trust (including, without limiting the scope of the foregoing, the Custody Agreements and any Authorized Participant Agreements) or any actions taken in accordance with the provisions of the Trust Agreement or (2) reckless disregard on the part of such indemnified party of its obligations and duties under the Trust Agreement. Such indemnity shall include payment from the Trust of the costs and expenses incurred by such indemnified party in defending itself against any claim or liability in its capacity as Sponsor. Any amounts payable to a indemnified party may be payable in advance or shall be secured by a lien on the Trust. The Sponsor may, in its discretion, undertake any action which it may deem necessary or desirable in respect of the Trust Agreement and the interests of the Shareholders and, in such event, the legal expenses and costs of any such actions shall be expenses and costs of the Trust and the Sponsor shall be entitled to be reimbursed therefor by the Trust.

The Sponsor may rely on all information provided by the Trustee for securities filings, including a free writing prospectus or marketing materials. If such information is incorrect or omits material information and is the foundation for a claim against the Sponsor, the Sponsor may be entitled to indemnification from the Trust.

Successor sponsors

If the Sponsor is adjudged bankrupt or insolvent, or a receiver of the Sponsor or of its property is appointed, or a trustee or liquidator or any public officer takes charge or control of the Sponsor or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then, in any such case, the Trustee may terminate and liquidate the Trust and distribute its remaining assets. The Trustee has no obligation to appoint a successor sponsor or to assume the duties of the Sponsor and will have no liability to any person because the Trust is terminated as described in the preceding sentence.

The Trustee

This section summarizes some of the important provisions of the Trust Agreement which apply to the Trustee. For a general description of the Trustee’s role concerning the Trust, see “The Trustee—The Trustee’s Role.”

Qualifications of the Trustee

The Trustee and any successor trustee must be (1) a bank, trust company, corporation or national banking association organized and doing business under the laws of the United States or any of its states, and authorized under such laws to exercise corporate trust powers, (2) a participant in DTC or such other securities depository as shall then be acting with respect to the Shares and (3), unless counsel to the Sponsor, the appointment of which is acceptable to the Trustee, determines that such requirement is not necessary for the exception under section 408(m)(3)(B) of the United States Internal Revenue Code of 1986, as amended (Code), to apply, a banking institution as defined in Code section 408(n). The Trustee and any successor trustee must have, at all times, an aggregate capital, surplus, and undivided profits of at least $150 million.

General duty of care of Trustee

The Trustee is a fiduciary under the Trust Agreement; provided, however, that the fiduciary duties and responsibilities and liabilities of the Trustee are limited by, and are only those specifically set forth in, the Trust Agreement. For limitations of the fiduciary duties of the Trustee, see the limitations on liability set forth in “The Trustee—Limitation on Trustee’s liability” and “The Trustee—Trustee’s liability for custodial services and agents.”

Limitation on Trustee’s liability

The Trustee will not be liable for the disposition of silver or moneys, or in respect of any evaluation which it makes under the Trust Agreement or otherwise, or for any action taken or omitted or for any loss or injury resulting from its actions or its performance or lack of performance of its duties under the Trust Agreement in the absence of gross negligence, willful misconduct or bad faith on its part. In no event will the Trustee be liable for acting in accordance with or conclusively relying upon any instruction, notice, demand, certificate or document (a) from the Sponsor or a Custodian or any entity acting on behalf of either which the Trustee believes is given as authorized by the Trust Agreement or a Custody Agreement, respectively; or (b) from or on behalf of any Authorized Participant which the Trustee believes is given pursuant to or is authorized by an Authorized Participant Agreement (provided that the Trustee has complied with the verification procedures specified in the Authorized Participant Agreement). In no event will the Trustee be liable for acting or omitting to act in reliance upon the advice of or information from legal counsel, accountants or any other person believed by it in good faith to be competent to give such advice or information. In addition, the Trustee will not be liable for any delay in performance or for the non-performance of any of its obligations under the Trust Agreement by reason of causes beyond its reasonable control, including acts of God, war or terrorism. The Trustee will not be liable for any indirect, consequential, punitive or special damages, regardless of the form of action and whether or not any such damages were foreseeable or contemplated, or for an amount in excess of the value of the Trust’s assets.

Trustee’s liability for custodial services and agents

The Trustee will not be answerable for the default of the Custodian or any other custodian of the Trust’s silver employed at the direction of the Sponsor or selected by the Trustee with reasonable care. The Trustee does not monitor the performance of the Custodian or any subcustodian other than to review the reports provided by the Custodian pursuant to the Custody Agreements. The Trustee may also employ custodians for Trust assets other than silver, agents, attorneys, accountants, auditors and other professionals and shall not be answerable for the default or misconduct of any of them if they were selected with reasonable care. The fees and expenses charged by custodians for the custody of silver and related services, agents, attorneys, accountants, auditors or other professionals, and expenses reimbursable to any custodian under a custody agreement authorized by the Trust Agreement, exclusive of fees for services to be performed by the Trustee, will be expenses of the Sponsor or the Trust. Fees paid for the custody of assets other than silver will be an expense of the Trustee.

Taxes

The Trustee will not be personally liable for any taxes or other governmental charges imposed upon the silver or its custody, moneys or other Trust assets, or on the income therefrom or the sale or proceeds of the sale thereof, or upon it as Trustee or upon or in respect of the Trust or the Shares which it may be required to pay under any present or future law of the United States of America or of any other taxing authority having jurisdiction in the premises. For all such taxes and charges and for any expenses, including counsel’s fees, which the Trustee may sustain or incur with respect to such taxes or charges, the Trustee will be reimbursed and indemnified out of the Trust’s assets and the payment of such amounts shall be secured by a lien on the Trust.

Indemnification of the Trustee

The Trustee, its directors, employees and agents shall be indemnified from the Trust and held harmless against any loss, liability or expense (including, but not limited to, the reasonable fees and expenses of counsel) arising out of or in connection with the performance of its obligations under the Trust Agreement and under each other agreement entered into by the Trustee in furtherance of the administration of the Trust (including, without limiting the scope of the foregoing, the Custody Agreements and any Authorized Participant Agreement) or by reason of the Trustee’s acceptance of the Trust incurred without (1) gross negligence, bad faith, willful misconduct or willful malfeasance

on the part of such indemnified party in connection with the performance of its obligations under the Trust Agreement or any actions taken in accordance with the provisions of the Trust Agreement or (2) reckless disregard on the part of such indemnified party of its obligations and duties under the Trust Agreement. Such indemnity shall include payment from the Trust of the costs and expenses incurred by such indemnified party in defending itself against any claim or liability in its capacity as Trustee. Any amounts payable to a indemnified party may be payable in advance or shall be secured by a lien on the Trust.

Indemnity for actions taken to protect the Trust

The Trustee is under no obligation to appear in, prosecute or defend any action that in its opinion may involve it in expense or liability, unless it is furnished with reasonable security and indemnity against the expense or liability. The Trustee’s costs resulting from the Trustee’s appearance in, prosecution of or defense of any such action are deductible from and will constitute a lien against the Trust’s assets. Subject to the preceding conditions, the Trustee shall, in its discretion, undertake such action as it may deem necessary to protect the Trust and the rights and interests of all Shareholders pursuant to the terms of the Trust Agreement.

Protection for amounts due to Trustee

If any fees or costs owed to the Trustee under the Trust Agreement are not paid when due by the Sponsor, the Trustee may sell or otherwise dispose of any Trust assets (including silver) and pay itself from the proceeds provided, however, that the Trustee may not charge to the Trust unpaid fees owed to the Trustee by the Sponsor in excess of the fees payable to the Sponsor by the Trust without regard to any waiver by the Sponsor of its fees. As security for all obligations owed to the Trustee under the Trust Agreement, the Sponsor, each Authorized Participant and each Shareholder grants the Trustee a continuing security interest in, and a lien on, the Trust’s assets and all Trust distributions.

Holding of Trust property other than silver

The Trustee will hold and record the ownership of the Trust’s assets in a manner so that it will be owned by the Trust and the Trustee as trustee thereof for the benefit of the Shareholders for the purposes of, and subject to and limited by the terms and conditions set forth in, the Trust Agreement. Other than issuance of the Shares, the Trust shall not issue or sell any certificates or other obligations or, except as provided in the Trust Agreement, otherwise incur, assume or guarantee any indebtedness for money borrowed.

All moneys held by the Trustee hereunder shall be held by it, without interest thereon or investment thereof, as a deposit for the account of the Trust. Such monies held hereunder shall be deemed segregated by maintaining such monies in an account or accounts for the exclusive benefit of the Trust. The Trustee may also employ custodians for Trust assets other than silver, agents, attorneys, accountants, auditors and other professionals and shall not be answerable for the default or misconduct of any such custodians, agents, attorneys, accountants, auditors and other professionals if such custodians, agents, attorneys, accountants, auditors or other professionals shall have been selected with reasonable care. Any Trust assets other than silver or cash will be held by the Trustee either directly or through the Federal Reserve/Treasury Book Entry System for United States and federal agency securities (Book Entry System), DTC, or through any other clearing agency or similar system (Clearing Agency), if available. The Trustee will have no responsibility or liability for the actions or omissions of the Book Entry System, DTC or any Clearing Agency. The Trustee shall not be liable for ascertaining or acting upon any calls, conversions, exchange offers, tenders, interest rate changes, or similar matters relating to securities held at DTC.

Resignation, discharge or removal of Trustee; successor trustees

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

The Sponsor may remove the Trustee in its discretion by written notice delivered to the Trustee at least 90 days prior to such date on the fifth anniversary of the date of the Trust Agreement or, thereafter, on the last day of any subsequent three-year period by written notice delivered to the Trustee at least 90 days prior to such date.

The Sponsor may also remove the Trustee at any time if the Trustee (1) ceases to be a Qualified Bank (as defined below), (2) is in material breach of its obligations under the Trust Agreement and fails to cure such breach within 30 days after receipt of written notice from the Sponsor or Shareholders acting on behalf of at least 25% of the outstanding Shares specifying such default and requiring the Trustee to cure such default, or (3) fails to consent to the implementation of an amendment to the Trust’s initial Internal Control Over Financial Reporting deemed necessary by the Sponsor and, after consultations with the Sponsor, the Sponsor and the Trustee fail to resolve their differences regarding such proposed amendment. Under such circumstances, the Sponsor, acting on behalf of the Shareholders, may remove the Trustee by written notice delivered to the Trustee and such removal shall take effect upon the appointment of a successor Trustee and its acceptance of such appointment.

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

The Sponsor may also remove the Trustee at any time if the Trustee merges into, consolidates with or is converted into another corporation or entity in a transaction in which the Trustee is not the surviving entity. The surviving entity from such a transaction shall be the successor of the Trustee without the execution or filing of any document or any further act; however, during the 90-day period following the effectiveness of such transaction, the Sponsor may, by written notice to the Trustee, remove the Trustee and designate a successor Trustee.

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

If the Trustee resigns and no successor trustee is appointed within 60 days after the date the Trustee issues its notice of resignation, the Trustee will terminate and liquidate the Trust and distribute its remaining assets.

The Custodian and Custody of the Trust’s Silver

This section summarizes some of the important provisions of the Trust Agreement which apply to the Custodian and the custody of the Trust’s silver. For a general description of the Custodian’s role, see “The Custodian—The Custodian’s Role.” For more information on the custody of the Trust’s silver, see “Custody of the Trust’s Silver” and “Description of the Custody Agreements.”

The Trustee, on behalf of the Trust, will enter into the Custody Agreements with the Custodian under which the Custodian will maintain the Trust Allocated Account and the Trust Unallocated Account.

If upon the resignation of any custodian there would be no custodian acting pursuant to the Custody Agreements, the Trustee shall, promptly after receiving notice of such resignation, appoint a substitute custodian or custodians selected by the Sponsor pursuant to custody agreements approved by the Sponsor (provided, however that the rights and duties of the Trustee under the Trust Agreement and Custody Agreements shall not be materially altered without its consent). When directed by the Sponsor or if the Trustee in its discretion determines that it is in the best interest of the Shareholders to do so and with the written approval of the Sponsor (which approval shall not be unreasonably withheld or delayed), the Trustee shall appoint a substitute or additional custodian or custodians, which shall thereafter be one of the Custodians under the Trust Agreement. After the entry into the Custody Agreements, the Trustee shall not enter into or amend any custody agreement with a custodian without the written approval of the Sponsor (which approval shall not be unreasonably withheld or delayed). When instructed by the Sponsor, the Trustee shall demand that a custodian of the Trust deliver such of the Trust’s silver held by it as is requested of it to any other custodian or such substitute or additional custodian or custodians directed by the Sponsor. Each such substitute or additional custodian shall forthwith upon its appointment, enter into a custody agreement in form and substance approved by the Sponsor.

The Sponsor will appoint accountants or other inspectors to monitor the accounts and operations of the Custodian and any successor custodian or additional custodian and for enforcing the obligations of each such custodian as is necessary to protect the Trust and the rights and interests of the Shareholders. The Trustee has no obligation to monitor the activities of any Custodian other than to receive and review such reports of the silver held for the Trust by such Custodian and of transactions in silver held for the account of the Trust made by such Custodian pursuant to the Custody Agreements. In the event that the Sponsor determines that the maintenance of silver with a particular custodian is not in the best interests of the Shareholders, the Sponsor will direct the Trustee to initiate action to remove the silver from the custody of such custodian or take such other action as the Trustee determines appropriate to safeguard the interests of the Shareholders. However, see “The Trustee—The Trustee’s Role” for a description of limitations on the ability of the Trustee to monitor the performance of the Custodian. The Trustee shall have no liability for any such action taken at the direction of the Sponsor or, in the absence of such direction, any action taken by it in good faith.

Appointment and removal of custodians

The Sponsor may direct the Trustee to employ one or more other custodians in addition to or in replacement of the Custodian, provided that the Sponsor may not direct the employment of a successor custodian or an additional custodian without the Trustee’s consent if the employment would have a material adverse effect on the Trustee’s ability to perform its duties. The Trustee may, with the prior approval of the Sponsor, also employ one or more successor or additional custodians selected by the Trustee for the safekeeping of silver and services in connection with the deposit and delivery of silver.

Valuation of Silver, Definition of Net Asset Value and Adjusted Net Asset Value

As of the London Fix on each day that the NYSE Arca is open for regular trading or, if there is no London Fix on such day or the London Fix has not been announced by 12:00 noon New York

time on such day, as of 4:00 p.m., New York time, on such day (Evaluation Time), the Trustee will evaluate the silver held by the Trust and determine both the ANAV and the NAV of the Trust.

At the Evaluation Time, the Trustee will value the Trust’s silver on the basis of that day’s London Fix or, if no London Fix is made on such day or has not been announced by the Evaluation Time, the next most recent London Fix determined prior to the Evaluation Time will be used, unless the Sponsor determines that such price is inappropriate as a basis for evaluation. In the event the Sponsor determine that the London Fix or last prior London Fix is not an appropriate basis for evaluation of the Trust’s silver, it shall identify an alternative basis for such evaluation to be employed by the Trustee. Neither the Trustee nor the Sponsor shall be liable to any person for the determination that the London Fix or such other publicly available price as the Sponsor may deem fairly represents the commercial value of the Trust’s silver is not appropriate as a basis for evaluation of the Trust’s silver or for any determination as to the alternative basis for such evaluation provided that such determination is made in good faith. See “Operation of the Silver Bullion Market–The London Bullion Market” for a description of the London Fix.

Once the value of the silver has been determined, the Trustee will subtract all estimated accrued but unpaid fees (other than the fees accruing for such day on which the valuation takes place computed by reference to the value of the Trust or its assets), expenses and other liabilities of the Trust from the total value of the silver and all other assets of the Trust (other than any amounts credited to the Trust’s reserve account, if established). The resulting figure is the ANAV of the Trust. The ANAV of the Trust is used to compute the Sponsor’s Fee.

All fees accruing for the day on which the valuation takes place computed by reference to the value of the Trust or its assets shall be calculated using the ANAV calculated for such day on which the valuation takes place. The Trustee shall subtract from the ANAV the amount of accrued fees so computed for such day and the resulting figure is the NAV of the Trust. The Trustee will also determine the NAV per Share by dividing the NAV of the Trust by the number of the Shares outstanding as of the close of trading on the NYSE Arca (which includes the net number of any Shares created or redeemed on such evaluation day).

The Trustee’s estimation of accrued but unpaid fees, expenses and liabilities will be conclusive upon all persons interested in the Trust and no revision or correction in any computation made under the Trust Agreement will be required by reason of any difference in amounts estimated from those actually paid.

The Sponsor and the Shareholders may rely on any evaluation furnished by the Trustee, and the Sponsor will have no responsibility for the evaluation’s accuracy. The determinations the Trustee makes will be made in good faith upon the basis of, and the Trustee will not be liable for any errors contained in, information reasonably available to it. The Trustee will not be liable to the Sponsor, DTC, the Shareholders or any other person for errors in judgment. However, the preceding liability exclusion will not protect the Trustee against any liability resulting from willful misfeasance, willful misconduct, bad faith or gross negligence in the performance of its duties or the reckless disregard of its obligations and duties.

Other Expenses

If at any time, other expenses are incurred outside the daily business of the Trust and the Sponsor’s Fee, the Trustee will at the discretion of the Sponsor or in its own discretion sell the Trust’s silver as necessary to pay such expenses. The Trust shall not bear any expenses incurred in connection with the issuance and distribution of the securities being registered. These expenses shall be paid by the Sponsor.

Sales of Silver

The Trustee will at the direction of the Sponsor or in its own discretion sell the Trust’s silver as necessary to pay the Trust’s expenses not otherwise assumed by the Sponsor. The Trustee will not sell silver to pay the Sponsor’s Fee. The Sponsor’s Fee will be paid through delivery of silver from the Trust Unallocated Account that had been de-allocated from the Trust Allocated Account for this

purpose. When selling silver to pay other expenses, the Trustee will endeavor to sell the smallest amounts of silver needed to pay expenses in order to minimize the Trust’s holdings of assets other than silver. Unless otherwise directed by the Sponsor, when selling silver the Trustee will endeavor to sell at the price established by the London Fix. The Trustee will place orders with dealers (which may include the Custodian) through which the Trustee expects to receive the most favorable price and execution of orders. The Custodian may be the purchaser of such silver only if the sale transaction is made at the next London Fix following the sale order. Neither the Trustee nor the Sponsor is liable for depreciation or loss incurred by reason of any sale. See “United States Federal Income Tax Consequences—Taxation of US Shareholders” for information on the tax treatment of silver sales.

The Trustee will also sell the Trust’s silver if the Sponsor notifies the Trustee that sale is required by applicable law or regulation or in connection with the termination and liquidation of the Trust. The Trustee will not be liable or responsible in any way for depreciation or loss incurred by reason of any sale of silver directed by the Sponsor.

Any property received by the Trust other than silver, cash or an amount receivable in cash (such as, for example, an insurance claim) will be promptly sold or otherwise disposed of by the Trustee at the direction of the Sponsor.

The Securities Depository; Book-Entry-Only System; Global Security

DTC will act as securities depository for the Shares. DTC is a limited-purpose trust company organized under the laws of the State of New York, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of section 17A of the Exchange Act. DTC was created to hold securities of DTC Participants and to facilitate the clearance and settlement of transactions in such securities among the DTC Participants through electronic book-entry changes. This eliminates the need for physical movement of securities certificates. DTC Participants include securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations, some of whom (and/or their representatives) own DTC. Access to the DTC system is also available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a DTC Participant, either directly or indirectly. DTC is expected to agree with and represent to the DTC Participants that it will administer its book-entry system in accordance with its rules and by-laws and the requirements of law.

Individual certificates will not be issued for the Shares. Instead, one or more global certificates will be signed by the Trustee and the Sponsor on behalf of the Trust, registered in the name of Cede & Co., as nominee for DTC, and deposited with the Trustee on behalf of DTC. The global certificates will evidence all of the Shares outstanding at any time. The representations, undertakings and agreements made on the part of the Trust in the global certificates are made and intended for the purpose of binding only the Trust and not the Trustee or the Sponsor individually.

Upon the settlement date of any creation, transfer or redemption of Shares, DTC will credit or debit, on its book-entry registration and transfer system, the amount of the Shares so created, transferred or redeemed to the accounts of the appropriate DTC Participants. The Trustee and the Authorized Participants will designate the accounts to be credited and charged in the case of creation or redemption of Shares.

Beneficial ownership of the Shares will be limited to DTC Participants, Indirect Participants and persons holding interests through DTC Participants and Indirect Participants. Owners of beneficial interests in the Shares will be shown on, and the transfer of ownership will be effected only through, records maintained by DTC (with respect to DTC Participants), the records of DTC Participants (with respect to Indirect Participants), and the records of Indirect Participants (with respect to Shareholders that are not DTC Participants or Indirect Participants). Shareholders are expected to receive from or through the DTC Participant maintaining the account through which the Shareholder has purchased their Shares a written confirmation relating to such purchase.

Shareholders that are not DTC Participants may transfer the Shares through DTC by instructing the DTC Participant or Indirect Participant through which the Shareholders hold their Shares to transfer the Shares. Shareholders that are DTC Participants may transfer the Shares by instructing DTC in accordance with the rules of DTC. Transfers will be made in accordance with standard securities industry practice.

DTC may decide to discontinue providing its service with respect to Baskets and/or the Shares by giving notice to the Trustee and the Sponsor. Under such circumstances, the Trustee and the Sponsor will either find a replacement for DTC to perform its functions at a comparable cost or, if a replacement is unavailable, terminate the Trust.

The rights of the Shareholders generally must be exercised by DTC Participants acting on their behalf in accordance with the rules and procedures of DTC. Because the Shares can only be held in book-entry form through DTC and DTC Participants, investors must rely on DTC, DTC Participants and any other financial intermediary through which they hold the Shares to receive the benefits and exercise the rights described in this section. Investors should consult with their broker or financial institution to find out about procedures and requirements for securities held in book-entry form through DTC.

Share Splits

If the Sponsor believes that the per Share price in the secondary market for Shares has fallen outside a desirable trading price range, the Sponsor may direct the Trustee to declare a split or reverse split in the number of Shares outstanding and to make a corresponding change in the number of Shares constituting a Basket.

Books and Records

The Trustee will keep proper books of record and account of the Trust at its office located in New York or such office as it may subsequently designate upon notice. These books and records are open to inspection by any person who establishes to the Trustee’s satisfaction that such person is a Shareholder upon reasonable advance notice at all reasonable times during the usual business hours of the Trustee.

The Trustee will keep a copy of the Trust Agreement on file in its office which will be available for inspection on reasonable advance notice at all reasonable times during its usual business hours by any Shareholder.

Statements, Filings and Reports

After the end of each fiscal year, the Sponsor will cause to be prepared an annual report for the Trust containing audited financial statements. The annual report will be in such form and contain such information as will be required by applicable laws, rules and regulations and may contain such additional information which the Sponsor determines shall be included. The annual report shall be filed with the SEC and the NYSE Arca and shall be distributed to such persons and in such manner, as shall be required by applicable laws, rules and regulations.

The Sponsor is responsible for the registration and qualification of the Shares under the federal securities laws and any other securities and blue sky laws of the US or any other jurisdiction as the Sponsor may select. The Sponsor will also prepare, or cause to be prepared, and file any periodic reports or updates required under the Exchange Act. The Trustee will assist and support the Sponsor in the preparation of such reports.

The accounts of the Trust will be audited, as required by law and as may be directed by the Sponsor, by independent registered public accountants designated from time to time by the Sponsor. The accountants report will be furnished by the Trustee to Shareholders upon request.

The Trustee will make such elections, file such tax returns, and prepare, disseminate and file such tax reports, as it is advised to by its counsel or accountants or as required from time to time by any applicable statute, rule or regulation.

The costs incurred in connection with such statements, filings and reports will be expenses of the Trust.

Fiscal Year

The fiscal year of the Trust will initially be the period ending December 31 of each year. The Sponsor may select an alternate fiscal year.

Termination of the Trust

The Trustee will set a date on which the Trust shall terminate and mail notice of the termination to the Shareholders at least 30 days prior to the date set for termination if any of the following occurs:

•

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

•

Shareholders acting in respect of at least 75% of the outstanding Shares notify the Trustee that they elect to terminate the Trust;

•

60 days have elapsed since the Trustee notified the Sponsor of the Trustee’s election to resign and a successor trustee has not been appointed and accepted its appointment;

•

the SEC determines that the Trust is an investment company under the Investment Company Act of 1940 and the Trustee has actual knowledge of such Commission determination;

•

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

•

the CFTC determines that the Trust is a commodity pool under the Commodity Exchange Act of 1936 and the Trustee has actual knowledge of that determination;

•

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

•

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

•

the Trustee elects to terminate the Trust after the Sponsor is deemed conclusively to have resigned effective immediately as a result of the Sponsor being adjudged bankrupt or insolvent, or a receiver of the Sponsor or of its property being appointed, or a trustee or liquidator or any public officer taking charge or control of the Sponsor or of its property or affairs for the purpose of rehabilitation, conservation or liquidation.

On and after the date of termination of the Trust, the Shareholders will, upon (i) surrender of Shares then held, (ii) payment of the fee of the Trustee for the surrender of Shares, and (iii) payment of any applicable taxes or other governmental charges, be entitled to delivery of the amount of Trust assets represented by those Shares. The Trustee shall not accept any deposits of silver after the date of termination. If any Shares remain outstanding after the date of termination, the Trustee thereafter shall discontinue the registration of transfers of Shares, shall not make any distributions to Shareholders, and shall not give any further notices or perform any further acts under the Trust Agreement, except that the Trustee will continue to collect distributions pertaining to Trust assets and hold the same uninvested and without liability for interest, pay the Trust’s expenses and sell silver as necessary to meet those expenses and will continue to deliver Trust assets, together with any distributions received with respect thereto and the net proceeds of the sale of any other property, in exchange for Shares surrendered to the Trustee (after deducting or upon payment of, in each case, the fee of the Trustee for the surrender of Shares, any expenses for the

account of the Shareholders in accordance with the terms and conditions of the Trust Agreement, and any applicable taxes or other governmental charges).

At any time after the expiration of 90 days following the date of termination of the Trust, the Trustee may sell the Trust assets then held under the Trust Agreement and may thereafter hold the net proceeds of any such sale, together with any other cash then held by the Trustee under the Trust Agreement, without liability for interest, for the pro rata benefit of the Shareholders that have not theretofore surrendered their Shares. After making such sale, the Trustee shall be discharged from all obligations under the Trust Agreement, except to account for such net proceeds and other cash (after deducting, in each case, any fees, expenses, taxes or other governmental charges payable by the Trust, the fee of the Trustee for the surrender of Shares and any expenses for the account of the Shareholders in accordance with the terms and conditions of the Trust Agreement, and any applicable taxes or other governmental charges). Upon the termination of the Trust, the Sponsor shall be discharged from all obligations under the Trust Agreement except for its certain obligations to the Trustee that survive termination of the Trust Agreement.

Amendments

The Trustee and the Sponsor may amend any provisions of the Trust Agreement without the consent of any Shareholder. Any amendment that imposes or increases any fees or charges (other than taxes and other governmental charges, registration fees or other such expenses), or that otherwise prejudices any substantial existing right of the Shareholders will not become effective as to outstanding Shares until 30 days after notice of such amendment is given to the Shareholders. Amendments to allow redemption for quantities of silver smaller or larger than a Basket or to allow for the sale of silver to pay cash proceeds upon redemption shall not require notice pursuant to the preceding sentence. Every Shareholder, at the time any amendment so becomes effective, shall be deemed, by continuing to hold any Shares or an interest therein, to consent and agree to such amendment and to be bound by the Trust Agreement as amended thereby. In no event shall any amendment impair the right of the Shareholder to surrender Baskets and receive therefor the amount of Trust assets represented thereby, except in order to comply with mandatory provisions of applicable law.

Governing Law; Consent to New York Jurisdiction

The Trust Agreement, and the rights of the Sponsor, the Trustee, DTC (as registered owner of the Trust’s global certificates for Shares) and the Shareholders under the Trust Agreement, are governed by the laws of the State of New York. The Sponsor, the Trustee and DTC and, by accepting Shares, each DTC Participant and each Shareholder, consents to the jurisdiction of the courts of the State of New York and any federal courts located in the borough of Manhattan in New York City. Such consent in not required for any person to assert a claim of New York jurisdiction over the Sponsor or the Trustee.

UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

The following discussion of the material US federal income tax consequences that generally will apply to the purchase, ownership and disposition of Shares by a US Shareholder (as defined below), and certain US federal income tax consequences that may apply to an investment in Shares by a Non- US Shareholder (as defined below), represents, insofar as it describes conclusions as to US federal income tax law and subject to the limitations and qualifications described therein, the opinion of Katten Muchin Rosenman LLP, counsel to the Sponsor. An opinion of counsel, however, is not binding on the Internal Revenue Service (IRS) or on the courts, and does not preclude the IRS from taking a contrary position. The discussion below is based on the Code, Treasury Regulations promulgated under the Code and judicial and administrative interpretations of the Code, all as in effect on the date of this prospectus and all of which are subject to change either prospectively or retroactively. The tax treatment of Shareholders may vary depending upon their own particular circumstances. Certain Shareholders (including broker-dealers, traders, banks and other financial institutions, insurance companies, real estate investment trusts, tax-exempt entities,

Shareholders whose functional currency is not the US dollar or other investors with special circumstances) may be subject to special rules not discussed below. In addition, the following discussion applies only to investors who will hold Shares as “capital assets” within the meaning of Code section 1221 and not as part of a straddle, hedging transaction or a conversion or constructive sale transaction. Moreover, the discussion below does not address the effect of any state, local or foreign tax law or any transfer tax on an owner of Shares. Purchasers of Shares are urged to consult their own tax advisors with respect to all federal, state, local and foreign tax law or any transfer tax considerations potentially applicable to their investment in Shares.

For purposes of this discussion, a “US Shareholder” is a Shareholder that is:

•

An individual who is treated as a citizen or resident of the United States for US federal income tax purposes;

•

A corporation (or other entity treated as a corporation for US federal tax purposes) created or organized in or under the laws of the United States or any political subdivision thereof;

•

An estate, the income of which is includible in gross income for US federal income tax purposes regardless of its source; or

•

A trust, if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more US persons have the authority to control all substantial decisions of the trust.

A Shareholder that is not a US Shareholder as defined above (other than a partnership, or an entity treated as a partnership for US federal tax purposes) is generally considered a “Non-US Shareholder” for purposes of this discussion. For US federal income tax purposes, the treatment of any beneficial owner of an interest in a partnership, including any entity treated as a partnership for US federal income tax purposes, will generally depend upon the status of the partner and upon the activities of the partnership. Partnerships and partners in partnerships should consult their tax advisors about the US federal income tax consequences of purchasing, owning and disposing of Shares.

Taxation of the Trust

The Trust will be classified as a “grantor trust” for US federal income tax purposes. As a result, the Trust itself will not be subject to US federal income tax. Instead, the Trust’s income and expenses will “flow through” to the Shareholders, and the Trustee will report the Trust’s income, gains, losses and deductions to the IRS on that basis.

Taxation of US Shareholders

Shareholders generally will be treated, for US federal income tax purposes, as if they directly owned a pro rata share of the underlying assets held in the Trust. Shareholders also will be treated as if they directly received their respective pro rata shares of the Trust’s income, if any, and as if they directly incurred their respective pro rata shares of the Trust’s expenses. In the case of a Shareholder that purchases Shares for cash, its initial tax basis in its pro rata share of the assets held in the Trust at the time it acquires its Shares will be equal to its cost of acquiring the Shares. In the case of a Shareholder that acquires its Shares as part of a creation, the delivery of silver to the Trust in exchange for the underlying silver represented by the Shares will not be a taxable event to the Shareholder, and the Shareholder’s tax basis and holding period for the Shareholder’s pro rata share of the silver held in the Trust will be the same as its tax basis and holding period for the silver delivered in exchange therefor (except to the extent of any cash contributed for such Shares). For purposes of this discussion, it is assumed that all of a Shareholder’s Shares are acquired on the same date and at the same price per Share. Shareholders that hold multiple lots of Shares, or that are contemplating acquiring multiple lots of Shares, should consult their tax advisors as to the determination of the tax basis and holding period for the underlying silver related to such Shares.

When the Trust sells silver, for example to pay expenses, a Shareholder generally will recognize gain or loss in an amount equal to the difference between (1) the Shareholder’s pro rata share of

the amount realized by the Trust upon the sale and (2) the Shareholder’s tax basis for its pro rata share of the silver that was sold, which gain or loss will generally be long-term or short-term capital gain or loss, depending upon whether the Shareholder has a holding period in its Shares of longer than one year. A Shareholder’s tax basis for its share of any silver sold by the Trust generally will be determined by multiplying the Shareholder’s total basis for its share of all of the silver held in the Trust immediately prior to the sale, by a fraction the numerator of which is the amount of silver sold, and the denominator of which is the total amount of the silver held in the Trust immediately prior to the sale. After any such sale, a Shareholder’s tax basis for its pro rata share of the silver remaining in the Trust will be equal to its tax basis for its share of the total amount of the silver held in the Trust immediately prior to the sale, less the portion of such basis allocable to its share of the silver that was sold.

Upon a Shareholder’s sale of some or all of its Shares, the Shareholder will be treated as having sold the portion of its pro rata share of the silver held in the Trust at the time of the sale that is attributable to the Shares sold. Accordingly, the Shareholder generally will recognize gain or loss on the sale in an amount equal to the difference between (1) the amount realized pursuant to the sale of the Shares, and (2) the Shareholder’s tax basis for the portion of its pro rata share of the silver held in the Trust at the time of sale that is attributable to the Shares sold, as determined in the manner described in the preceding paragraph.

A redemption of some or all of a Shareholder’s Shares in exchange for the underlying silver represented by the Shares redeemed generally will not be a taxable event to the Shareholder. The Shareholder’s tax basis for the silver received in the redemption generally will be the same as the Shareholder’s tax basis for the portion of its pro rata share of the silver held in the Trust immediately prior to the redemption that is attributable to the Shares redeemed. The Shareholder’s holding period with respect to the silver received should include the period during which the Shareholder held the Shares redeemed. A subsequent sale of the silver received by the Shareholder will be a taxable event.

After any sale or redemption of less than all of a Shareholder’s Shares, the Shareholder’s tax basis for its pro rata share of the silver held in the Trust immediately after such sale or redemption generally will be equal to its tax basis for its share of the total amount of the silver held in the Trust immediately prior to the sale or redemption, less the portion of such basis which is taken into account in determining the amount of gain or loss recognized by the Shareholder upon such sale or, in the case of a redemption, which is treated as the basis of the silver received by the Shareholder in the redemption.

An Authorized Participant and other investors may be able to re-invest, on a tax-deferred basis, in-kind redemption proceeds received from exchange-traded products that are substantially similar to the Trust in the Trust’s Shares. Authorized Participants and other investors should consult their tax advisors as to whether and under what circumstances the reinvestment in the Shares of proceeds from substantially similar exchange-traded products can be accomplished on a tax-deferred basis.

Maximum 28% Long-Term Capital Gains Tax Rate for US Shareholders who are Individuals

Under current law, gains recognized by individuals from the sale of “collectibles,” including silver bullion, held for more than one year are taxed at a maximum federal income tax rate of 28%, rather than the 15% rate applicable to most other long-term capital gains. For these purposes, gain recognized by an individual upon the sale of an interest in a trust that holds collectibles is treated as gain recognized on the sale of collectibles, to the extent that the gain is attributable to unrealized appreciation in value of the collectibles held by the trust. Therefore, any gain recognized by an individual US Shareholder attributable to a sale of Shares held for more than one year, or attributable to the Trust’s sale of any silver bullion which the Shareholder is treated (through its ownership of Shares) as having held for more than one year, generally will be taxed at a maximum rate of 28%. The tax rates for capital gains recognized upon the sale of assets held by an individual US Shareholder for one year or less or by a taxpayer other than an individual US taxpayer are generally the same as those at which ordinary income is taxed.

Brokerage Fees and Trust Expenses

Any brokerage or other transaction fee incurred by a Shareholder in purchasing Shares will be treated as part of the Shareholder’s tax basis in the underlying assets of the Trust. Similarly, any brokerage fee incurred by a Shareholder in selling Shares will reduce the amount realized by the Shareholder with respect to the sale.

Shareholders will be required to recognize gain or loss upon a sale of silver by the Trust (as discussed above), even though some or all of the proceeds of such sale are used by the Trustee to pay Trust expenses. Shareholders may deduct their respective pro rata shares of each expense incurred by the Trust to the same extent as if they directly incurred the expense. Shareholders who are individuals, estates or trusts, however, may be required to treat some or all of the expenses of the Trust, to the extent that such expenses may be deducted, as miscellaneous itemized deductions. Individuals may deduct certain miscellaneous itemized deductions only to the extent they exceed 2% of adjusted gross income. In addition, such deductions may be subject to further limitations under applicable provisions of the Code, and may not be deductible at all for alternative minimum tax purposes.

Investment by Regulated Investment Companies

Mutual funds and other investment vehicles which are “regulated investment companies” within the meaning of Code section 851 should consult with their tax advisors concerning (1) the likelihood that an investment in Shares, although they are a “security” within the meaning of the Investment Company Act of 1940, may be considered an investment in the underlying silver for purposes of Code section 851(b), and (2) the extent to which an investment in Shares might nevertheless be consistent with preservation of their qualification under Code section 851.

United States Information Reporting and Backup Withholding for US and Non-US Shareholders

The Trustee or the appropriate Broker will file certain information returns with the IRS, and provide certain tax-related information to Shareholders, in accordance with applicable Treasury Regulations. Each Shareholder will be provided with information regarding its allocable portion of the Trust’s annual income (if any) and expenses.

A US Shareholder may be subject to US backup withholding tax in certain circumstances unless it provides its taxpayer identification number and complies with certain certification procedures. Non-US Shareholders may have to comply with certification procedures to establish that they are not a US person in order to avoid the information reporting and backup withholding tax requirements.

The amount of any backup withholding will be allowed as a credit against a Shareholder’s US federal income tax liability and may entitle such a Shareholder to a refund, provided that the required information is furnished to the IRS.

Income Taxation of Non-US Shareholders

The Trust does not expect to generate taxable income except for gain (if any) upon the sale of silver. A Non-US Shareholder generally will not be subject to US federal income tax with respect to gain recognized upon the sale or other disposition of Shares, or upon the sale of silver by the Trust, unless (1) the Non-US Shareholder is an individual and is present in the United States for 183 days or more during the taxable year of the sale or other disposition, and the gain is treated as being from United States sources; or (2) the gain is effectively connected with the conduct by the Non-US Shareholder of a trade or business in the United States.

Taxation in Jurisdictions other than the United States

Prospective purchasers of Shares that are based in or acting out of a jurisdiction other than the United States are advised to consult their own tax advisers as to the tax consequences, under the laws of such jurisdiction (or any other jurisdiction not being the United States to which they are

subject), of their purchase, holding, sale and redemption of or any other dealing in Shares and, in particular, as to whether any value added tax, other consumption tax or transfer tax is payable in relation to such purchase, holding, sale, redemption or other dealing.

ERISA AND RELATED CONSIDERATIONS

The Employee Retirement Income Security Act of 1974, as amended (ERISA), and/or Code section 4975 impose certain requirements on employee benefit plans and certain other plans and arrangements, including individual retirement accounts and annuities, Keogh plans, and certain collective investment funds or insurance company general or separate accounts in which such plans or arrangements are invested, that are subject to ERISA and/or the Code (collectively, Plans), and on persons who are fiduciaries with respect to the investment of assets treated as “plan assets” of a Plan. Government plans and some church plans are not subject to the fiduciary responsibility provisions of ERISA or the provisions of section 4975 of the Code, but may be subject to substantially similar rules under state or other federal law.

In contemplating an investment of a portion of Plan assets in Shares, the Plan fiduciary responsible for making such investment should carefully consider, taking into account the facts and circumstances of the Plan, the “Risk Factors” discussed above and whether such investment is consistent with its fiduciary responsibilities, including, but not limited to (1) whether the fiduciary has the authority to make the investment under the appropriate governing plan instrument, (2) whether the investment would constitute a direct or indirect non-exempt prohibited transaction with a party in interest, (3) the Plan’s funding objectives, and (4) whether under the general fiduciary standards of investment prudence and diversification such investment is appropriate for the Plan, taking into account the overall investment policy of the Plan, the composition of the Plan’s investment portfolio and the Plan’s need for sufficient liquidity to pay benefits when due.

It is anticipated that the Shares will constitute “publicly-held offered securities” as defined in Department of Labor Regulations § 2510.3-101(b)(2). Accordingly, Shares purchased by a Plan, and not the Plan’s interest in the underlying silver bullion held in the Trust represented by the Shares, should be treated as assets of the Plan, for purposes of applying the “fiduciary responsibility” and “prohibited transaction” rules of ERISA and the Code.

Investment by Certain Retirement Plans

Code section 408(m) provides that the acquisition of a “collectible” by an individual retirement account (IRA) or a participant-directed account maintained under any plan that is tax-qualified under Code section 401(a) is treated as a taxable distribution from the account to the owner of the IRA, or to the participant for whom the plan account is maintained, of an amount equal to the cost to the account of acquiring the collectible. The IRS has issued private letter rulings to the effect that a purchase of shares in a trust holding precious metals by an IRA, or by a participant-directed account under a Code section 401(a) plan, will not be treated as resulting in a taxable distribution to the IRA owner or plan participant under Code section 408(m). However, if any of the Shares so purchased are distributed from the IRA or plan account to the IRA owner or plan participant, or if any silver received by such IRA or plan account upon the redemption of any of the Shares purchased by it, the Shares or silver so distributed will be subject to federal income tax in the year of distribution, to the extent provided under the applicable provisions of Code sections 408(d), 408(m) or 402.

PLAN OF DISTRIBUTION

In addition to, and independent of the initial purchases by the Initial Purchaser (described below), the Trust will issue Shares in Baskets to Authorized Participants in exchange for deposits of silver on a continuous basis. The Trust will not issue fractions of a Basket. Because new Shares can be created and issued on an ongoing basis, at any point during the life of the Trust, a “distribution,” as such term is used in the Securities Act, will be occurring. Broker-dealers and other persons are cautioned that some of their activities will result in their being deemed participants in a distribution

in a manner which would render them statutory underwriters and subject them to the prospectus-delivery and liability provisions of the Securities Act. For example, a broker-dealer firm or its client will be deemed a statutory underwriter if it purchases a Basket from the Trust, breaks the Basket down into the constituent Shares and sells the Shares directly to its customers; or if it chooses to couple the creation of a supply of new Shares with an active selling effort involving solicitation of secondary market demand for the Shares. A determination of whether a particular market participant is an underwriter must take into account all the facts and circumstances pertaining to the activities of the broker-dealer or its client in the particular case, and the examples mentioned above should not be considered a complete description of all the activities that could lead to designation as an underwriter.

Investors that purchase Shares through a commission/fee-based brokerage account may pay commissions/fees charged by the brokerage account. We recommend that investors review the terms of their brokerage accounts for details on applicable charges.

Dealers that are not “underwriters” but are participating in a distribution (as contrasted to ordinary secondary trading transactions), and thus dealing with Shares that are part of an “unsold allotment” within the meaning of Section 4(3)(C) of the Securities Act, would be unable to take advantage of the prospectus-delivery exemption provided by Section 4(3) of the Securities Act.

The Sponsor intends to qualify the Shares in states selected by the Sponsor and that sales be made through broker-dealers who are members of FINRA. Investors intending to create or redeem Baskets through Authorized Participants in transactions not involving a broker-dealer registered in such investor’s state of domicile or residence should consult their legal advisor regarding applicable broker-dealer or securities regulatory requirements under the state securities laws prior to such creation or redemption.

On July 20, 2009, the Initial Purchaser purchased 100,000 Shares which compose the initial Basket. The Initial Purchaser intends to make a public offering of the initial Basket at a per Share offering price that will vary, depending on, among other factors, the price of silver and the trading price of the Shares on the NYSE Arca at the time of offer. The Initial Purchaser will not receive from the Trust, the Sponsor, the Trustee or any of their affiliates a fee or other compensation in connection with the sale of the Shares. With respect to sale of the Shares comprising the initial Basket and in the event that the Initial Purchaser or any affiliate acts as Authorized Participant, it may receive commissions/fees from investors who purchase Shares.

The Trust will not bear any expenses in connection with the offering or sales of the initial Basket of Shares.

The offering of Baskets is being made in compliance with Conduct Rule 2810 of FINRA. Accordingly, the Initial Purchaser will not make any sales to any account over which it has discretionary authority without the prior written approval of a purchaser of Shares. Neither the Initial Purchaser nor the Authorized Participants receive from the Trust or the Sponsor any compensation in connection with an offering of the Shares. Accordingly, there is, and will be, no payment of underwriting compensation in connection with any such offering of Shares in excess of 10% of the gross proceeds of the offering.

Pursuant to a Marketing Agent Agreement (“Agent Agreement”) between ALPS Distributors, Inc. (“ADI”) and ETFS Marketing LLC, a Delaware limited liability company (“Marketing Agent”) that provides marketing services under contract to the Sponsor, ADI will be paid by the Marketing Agent approximately $20,000 per annum, plus any fees or disbursements incurred by ADI in connection with its assistance to the Marketing Agent in the marketing of the Trust and its Shares. The maximum compensation ADI may receive under this Agent Agreement, as a result of the Trust’s offering, is estimated to be $192,725, which includes $100,000 (fees) and $92,725 (expenses). The Trust is not responsible for the payment of any amounts to ADI or the Marketing Agent. The maximum compensation that will be paid for wholesaling salaries, as a result of this offering, is estimated to be $718,750. The Marketing Agent and its parent, C7 PLUS LLP, are solely responsible

for the payment of these salaries. Under the Agent Agreement, ADI will provide the following services to the Marketing Agent:

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Review marketing related legal documents and contracts;

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Consult with the Marketing Agent on the development of FINRA-compliant marketing campaigns;

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Consult with the Trust’s legal counsel on free-writing prospectus materials and disclosures in all marketing materials;

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Review and file with FINRA marketing materials that are not free-writing prospectus materials;

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Maintain books and records related to the ADI services provided.

LEGAL MATTERS

The validity of the Shares will be passed upon for the Sponsor by Katten Muchin Rosenman LLP, New York, New York, who, as special US tax counsel to the Trust, will also render an opinion regarding the material federal income tax consequences relating to the Shares.

EXPERTS

The financial statement included in this prospectus has been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report appearing herein, and is included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION

The Sponsor has filed on behalf of the Trust a registration statement on Form S-1 with the SEC under the Securities Act. This prospectus does not contain all of the information set forth in the registration statement (including the exhibits to the registration statement), parts of which have been omitted in accordance with the rules and regulations of the SEC. For further information about the Trust or the Shares, please refer to the registration statement, which you may inspect, without charge, at the public reference facilities of the SEC at the below address or online at www.sec.gov, or obtain at prescribed rates from the public reference facilities of the SEC at the below address. Information about the Trust and the Shares can also be obtained from the Trust’s website. The internet address of the Trust’s website will be www.etfsecurites.com. This internet address is only provided here as a convenience to you to allow you to access the Trust’s website, and the information contained on or connected to the Trust’s website is not part of this prospectus or the registration statement of which this prospectus is part.

The Trust is subject to the informational requirements of the Exchange Act and the Sponsor, on behalf of the Trust, will file quarterly and annual reports and other information with the SEC. The Sponsor will file an updated prospectus annually for the Trust pursuant to the Securities Act. The reports and other information can be inspected at the public reference facilities of the SEC located at 100 F Street, NE, Washington, DC 20548 and online at www.sec.gov. You may also obtain copies of such material from the public reference facilities of the SEC at 100 F Street, NE, Washington, DC 20548 , at prescribed rates. You may obtain more information concerning the operation of the public reference facilities of the SEC by calling the SEC at 1-800-SEC-0330 or visiting online at www.sec.gov.

Report of Independent Registered Public Accounting Firm

To the Sponsor, Trustee and the Unitholders of the ETFS Silver Trust

We have audited the accompanying Statement of Financial Condition of the ETFS Silver Trust (the “Trust”) as of July 20, 2009. This financial statement is the responsibility of the Trust’s management. Our responsibility is to express an opinion on this financial statement based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material misstatement. The Trust is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Trust’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statement, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, such financial statement presents fairly, in all material respects, the financial position of the Trust as of July 20, 2009 in conformity with accounting principles generally accepted in the United States of America.

DELOITTE & TOUCHE LLP

New York, New York
July 20, 2009

F-1

Statement of Financial Condition
ETFS Silver Trust
as of July 20, 2009


Assets
Silver bullion inventory (fair value $1,374,000)	$	1,374,000

Total Assets	$	1,374,000

Liabilities and Shareholders’ Equity
Liabilities:
Total Liabilities		—
Commitments and Contingent Liabilities		—
Redeemable Shares:
Redeemable capital shares, no par value, unlimited amount authorized, 100,000 outstanding (at redemption value)	$	1,374,000
Shareholders’ Equity:
Retained earnings		—

Total Liabilities and Shareholders’ Equity	$	1,374,000

The accompanying notes are an integral part of this financial statement.

F-2

NOTES TO THE FINANCIAL STATEMENT
as of July 20, 2009

1. Organization

ETFS Silver Trust (the “Trust”) is an investment trust formed on July 20, 2009, under New York law pursuant to a trust agreement. The Trust holds Silver and issues shares (“Shares”) (in minimum blocks of 100,000 Shares, also referred to as “Baskets”) in exchange for deposits of Silver and distributes Silver in connection with redemption of Baskets. The Trust’s sponsor is ETF Securities USA LLC (the “Sponsor”), a Delaware limited liability company whose sole member is ETF Securities Limited, a Jersey company. The Sponsor is responsible for, among other things, overseeing the performance of The Bank of New York Mellon (the “Trustee”) and the Trust’s principal service providers, including the preparation of financial statements. The Trustee is responsible for the day-to-day administration of the Trust.

The Kellogg Specialist Group LLC, also known as the Lead Market Maker, is the Initial Purchaser and contributed 100,000 ounces of silver in exchange for 100,000 shares on July 20, 2009. At contribution, the value of the silver deposited with the Trust was based on the price of an ounce of silver of $13.74. Kellogg owns 100% of the outstanding shares of the Trust. The Initial Purchaser is not affiliated with the Sponsor or the Trustee.

The investment objective of the Trust is for the Shares (the “Shares”) to reflect the performance of the price of silver bullion, less the Trust’s expenses and liabilities. The Trust is designed to provide a vehicle for investors to own interests in silver bullion.

The fiscal year end for the Trust is December 31.

2. Significant Accounting Policies

The following is a summary of significant accounting policies followed by the Trust.

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires those responsible for preparing financial statements to make estimates and assumptions that affect the reported amounts and disclosures. Actual results could differ from those estimates.

A. Valuation of Silver Bullion

Silver bullion is held by HSBC Bank USA, National Association, (the “Custodian”), on behalf of the Trust and is valued, for financial statement purposes, at the lower of cost or market. The cost of silver bullion is determined according to the average cost method and the market value is based on the London Fix used to determine the Net Asset Value of the Trust. Realized gains and losses on sales of silver bullion, or silver distributed for the redemption of shares, are calculated on a trade date basis using average cost.

B. Creations and Redemptions of Shares

The Trust expects to create and redeem Shares from time to time, but only in one or more Baskets (a Basket equals a block of 100,000 Shares). The Trust issues Shares in Baskets to certain authorized participants (“Authorized Participants”) on an ongoing basis. The creation and redemption of Baskets is only made in exchange for the delivery to the Trust or the distribution by the Trust of the amount of Silver and any cash represented by the Baskets being created or redeemed, the amount of which will be based on the combined net asset value of the number of Shares included in the Baskets being created or redeemed determined on the day the order to create or redeem Baskets is properly received.

Trust shares are issued and redeemed continuously in aggregations of 100,000 shares in exchange for silver bullion rather than cash. Individual investors cannot purchase or redeem shares in direct transactions with the Trust. The Trust only deals with registered broker-dealers eligible to settle securities transactions through the book-entry facilities of the Depository Trust Company and

F-3

which have entered into a contractual arrangement with the Trust and the Sponsor governing, among other matters, the creation and redemption processes (“Authorized Participants”). Holders of shares of the Trust may redeem their shares at any time acting through an Authorized Participant and in the prescribed aggregations of 100,000 shares; provided, that redemptions of shares may be suspended during any period while regular trading on the NYSE Arca is suspended or restricted, or in which an emergency exists as a result of which delivery, disposal or evaluation of silver is not reasonably practicable.

The shares of the Trust are classified as “Redeemable Capital Shares” for financial statement purposes, since they are subject to redemption at the option of Authorized Participants. Outstanding shares are reflected at redemption value, which represents the maximum obligation (based on net asset value per share), with the difference from historical cost recorded as an offsetting amount to Retained Earnings.

At July 20, 2009, there are no Shares whose redemption value exceeds their historical value.

At July 20, 2009, 100,000 Shares are outstanding.

The typical settlement period for Shares is three business days. In the event of a trade date at period end, where a settlement is pending, a respective account receivable and/or payable will be recorded.

The per-share amount of silver exchanged for a purchase or redemption is calculated daily by the Trustee, using the London PM Fix to calculate the silver amount in respect of any liabilities for which covering silver sales have not yet been made, and represents the per-share amount of silver held by the Trust, after giving effect to its liabilities, sales to cover expenses and liabilities and any losses that may have occurred.

When silver is exchanged in settlement of redemption, it is considered a sale of silver for financial statement purposes, with a gain or loss recognized currently.

Net asset value is computed by deducting all accrued fees, expenses and other liabilities of the Trust, including Sponsor’s fees, from the fair value of the silver bullion held by the Trust.

C. Investment in Silver

At July 20, 2009, the Trust owned 100,000 ounces of silver, with a carrying value (lower of cost or market basis) of $1,374,000.

D. Expenses

The Trust will pay to the Sponsor a fee that will accrue daily at an annualized rate equal to 0.45% of the adjusted daily net asset value of the Trust, paid monthly in arrears. Presently, the Sponsor intends to waive a portion of its fee and reduce the Sponsor’s Fee to 0.30% for the first year of the Trust’s operations beginning on the Trust’s inception date and ending on July 24, 2010.

E. Income Taxes

The Trust is classified as a “grantor trust” for US federal income tax purposes. As a result, the Trust itself will not be subject to US federal income tax. Instead, the Trust’s income and expenses will “flow through” to the Shareholders, and the Trustee will report the Trust’s proceeds, income, deductions, gains, and losses to the Internal Revenue Service on that basis.

3. Organizational Cost

Expenses incurred in organizing of the Trust and the initial offering of the Shares, including applicable SEC registration fees, are approximately $1,153,000, and will be borne directly by the Sponsor. The Trust will not be obligated to reimburse the Sponsor.

F-4

4. Related Parties—Sponsor, Trustee, Custodian and Marketing Agent Fees

Fees are paid to the Sponsor as compensation for services performed under the Trust Agreement and for services performed in connection with maintaining the Trust’s administrative and marketing expenses incurred by the Trust: the Trustee’s fee and out-of-pocket expenses, the custodian’s fee and reimbursement of the custodian expenses, NYSE Arca listing fees, SEC registration fees, printing and mailing costs, audit fees and expenses, and up to $100,000 per annum in legal fees and expenses. The Sponsor’s Fee will accrue daily at an annualized rate equal to 0.45% of the adjusted net asset value (“ANAV”) of the Trust and will be payable monthly in silver, in arrears. The Sponsor, from time to time, may temporarily waive all or a portion of the Sponsor’s Fee at its discretion for a stated period of time. Presently, the Sponsor intends to waive a portion of its fee and reduce the Sponsor’s Fee to 0.30% for the first year of the Trust’s operations beginning on the Trust’s inception date and ending on July 24, 2010. After July 24, 2010, the Sponsor may renew its fee waiver, waive a larger or smaller portion of its fee or not renew its fee waiver.

If the Sponsor does not continue its partial fee waiver after July 24, 2010, the full Sponsor’s Fee will accrue and be paid to the Sponsor for subsequent periods. The Sponsor is under no obligation to continue to waive of all or part of the Sponsor’s Fee after the fixed end date of its waiver.

5. Concentration of Risk

In accordance with Statement of Position No. 94-6, Disclosure of Certain Significant Risks and Uncertainties, the Trust’s sole business activity is the investment in silver bullion. Several factors could affect the price of silver: (i) global silver supply and demand, which is influenced by such factors as forward selling by silver producers, purchases made by silver producers to unwind silver hedge positions, central bank purchases and sales, and production and cost levels in major silver-producing countries; (ii) investors’ expectations with respect to the rate of inflation; (iii) currency exchange rates; (iv) interest rates; (v) investment and trading activities of hedge funds and commodity funds; and (vi) global or regional political, economic or financial events and situations. In addition, there is no assurance that silver will maintain its long-term value in terms of purchasing power in the future. In the event that the price of silver declines, the Sponsor expects the value of an investment in the Shares to decline proportionately. Each of these events could have a material affect on the Trust’s financial position and results of operations.

6. Indemnification

Under the Trust’s organizational documents, each of the Trustee (and its directors, employees and agents) and the Sponsor (and its members, managers, directors, officers, employees, affiliates) is indemnified against any liability, cost or expense it incurs without negligence, bad faith or willful misconduct on its part and without reckless disregard on its part of its obligations and duties under the Trust’s organizational documents. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred.

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ETFS Silver Trust

50,000,000 ETFS Physical Silver Shares

PROSPECTUS

July 20, 2009

Until August 14, 2009 (25 calendar days after the date of this prospectus), all dealers effecting transactions in the Shares, whether or not participating in this distribution, may be required to deliver a prospectus. This requirement is in addition to the obligations of dealers to deliver a prospectus when acting as underwriters and with respect to unsold allotments or subscriptions.

PART II—INFORMATION NOT REQUIRED IN PROSPECTUS

TABLE OF CONTENTS

Item 13. Other Expenses of Issuance and Distribution.

The Registrant (“Registrant” or “Trust”) shall not bear any expenses incurred in connection with the issuance and distribution of the securities being registered. These expenses shall be paid by ETF Securities USA LLC, the sponsor of the Registrant (“Sponsor”).

Item 14. Indemnification of Directors and Officers.

Section 5.6(a) of the Registrant’s Depositary Trust Agreement (“Trust Agreement”) between The Bank of New York Mellon, the Registrant’s Trustee (“Trustee”), and the Sponsor provides that the Trustee, its directors, employees and agents (the “Trustee Indemnified Persons”) shall be indemnified from the Trust and held harmless against any loss, liability or expense (including, but not limited to, the reasonable fees and expenses of counsel) arising out of or in connection with the performance of its obligations under the Trust Agreement and under each other agreement entered into by the Trustee, in furtherance of the administration of the Trust (including, without limiting the scope of the foregoing, the Trust’s custody agreements and authorized participant agreements to which the Trustee is a party) or by reason of the Trustee’s acceptance of the Trust incurred without (1) gross negligence, bad faith, willful misconduct or willful malfeasance on the part of such Trustee Indemnified Party in connection with the performance of its obligations under the Trust Agreement or any actions taken in accordance with the provisions of the Trust Agreement or (2) reckless disregard on the part of such Trustee Indemnified Party of its obligations and duties under the Trust Agreement. Such indemnity shall include payment from the Trust of the costs and expenses incurred by such Trustee Indemnified Party in defending itself against any claim or liability in its capacity as Trustee. Any amounts payable to a Trustee Indemnified Party under Section 5.6(a) of the Trust Agreement may be payable in advance or shall be secured by a lien on the Trust.

Section 5.6(b) of the Trust Agreement provides that the Sponsor and its members, managers, directors, officers, employees, affiliates (as such term is defined under the Securities Act of 1933, as amended (“Securities Act”)) and subsidiaries (each a “Sponsor Indemnified Party”) shall be indemnified from the Trust and held harmless against any loss, liability or expense incurred without (1) gross negligence, bad faith, willful misconduct or willful malfeasance on the part of such Sponsor Indemnified Party arising out of or in connection with the performance of its obligations under the Trust Agreement and under each other agreement entered into by the Sponsor in furtherance of the administration of the Trust (including, without limiting the scope of the foregoing, the Trust’s custody agreements and authorized participant agreements to which the Sponsor is a party) or any actions taken in accordance with the provisions of the Trust Agreement or (2) reckless disregard on the part of such Sponsor Indemnified Party of its obligations and duties under the Trust Agreement. Such indemnity shall include payment from the Trust of the costs and expenses incurred by such Sponsor Indemnified Party in defending itself against any claim or liability in its capacity as Sponsor. Any amounts payable to a Sponsor Indemnified Party under Section 5.6(b) of the Trust Agreement may be payable in advance or shall be secured by a lien on the Trust. The Sponsor may, in its discretion, undertake any action which it may deem necessary or desirable in respect of the Trust Agreement and the rights and duties of the parties hereto and the interests of the shareholders of the Trust and, in such event, the legal expenses and costs of any such actions shall be expenses and costs of the Trust and the Sponsor shall be entitled to be reimbursed therefor by the Trust.

The indemnities provided by Section 5.6 of the Trust Agreement shall survive notwithstanding any termination of the Trust Agreement and the Trust or the resignation or removal of the Trustee or the Sponsor, respectively.

Item 15. Recent Sales of Unregistered Securities.

Not applicable.

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Item 16. Exhibits and Financial Statement Schedules.

(a) Exhibits


Exhibit Number		Description
4.1		Depositary Trust Agreement (the “Trust Agreement”)
4.2		Form of Authorized Participant Agreement
4.3		Global Certificate
5.1		Opinion of Katten Muchin Rosenman LLP as to legality
8.1		Opinion of Katten Muchin Rosenman LLP as to tax matters
10.1		Allocated Account Agreement
10.2		Unallocated Account Agreement
10.3		Depository Agreement
10.4		Marketing Agent Agreement
23.1		Consent of Deloitte & Touche LLP
23.2		Consents of Katten Muchin Rosenman LLP are included in Exhibits 5.1 and 8.1
24.1		Powers of attorney are included on the signature page to the Trust’s registration statement filed with the Securities and Exchange Commission on July 21, 2009.
99.1		Opinion of Katten Muchin Rosenman Cornish LLP

(b) Financial Statement Schedules

Not applicable.

Item 17. Undertakings.

The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i) To include any prospectus required by section 10(a)(3) of the Securities Act;

(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Securities and Exchange Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

(2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(4) That, for the purpose of determining liability under the Securities Act to any purchaser:

(i) If the Registrant is relying on Rule 430B (§230.430B of this chapter):

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(A) Each prospectus filed by the Registrant pursuant to Rule 424(b)(3) (§230.424(b)(3) of this chapter) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

(B) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) (§230.424(b)(2), (b)(5), or (b)(7) of this chapter) as part of a registration statement in reliance or Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) (§230.415(a)(1)(i), (vii), or (x) of this chapter) for the purpose of providing the information required by section 10(a) of the Securities Act shall be deemed to be part of an included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability proposes of the issuer and any person that is at that date an underwriter such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchase with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date; or

(ii) If the Registrant is subject to Rule 430C (§230.430C of this chapter), each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A (§230.430A of this chapter), shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

(5) That, for the purpose of determining liability of the Registrant under the Securities Act to any purchaser in the initial distribution of the securities:

The undersigned Registrant undertakes that in a primary offering of securities of the undersigned Registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned Registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(i) Any preliminary prospectus or prospectus of the undersigned Registrant relating to the offering required to be filed pursuant to Rule 424 (§230.424 of this chapter);

(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned Registrant or used or referred to by the undersigned Registrant;

(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned Registrant or its securities provided by or on behalf of the undersigned Registrant; and

(iv) Any other communication that is an offer in the offering made by the undersigned Registrant to the purchaser.

(6) That insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the

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foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of St. Helier, Jersey, on July 20, 2009.

ETF SECURITIES USA LLC
Sponsor of the ETFS Silver Trust

By:

/ S / G RAHAM T UCKWELL

Graham Tuckwell
President and Chief Executive Officer

Each person whose signature appears below hereby constitutes Graham Tuckwell and Greg Burgess, and each of them singly, his true and lawful attorneys-in-fact with full power to sign on behalf of such person, in the capacities indicated below, any and all amendments to this registration statement and any subsequent related registration statement filed pursuant to Rule 462(b) under the Securities Act of 1933, and generally to do all such things in the name and on behalf of such person, in the capacities indicated below, to enable the Registrant to comply with the provisions of the Securities Act of 1933 and all requirements of the Securities and Exchange Commission thereunder, hereby ratifying and confirming the signature of such person as it may be signed by said attorneys-in-fact, or any of them, on any and all amendments to this registration statement or any such subsequent related registration statement.

Pursuant to the requirements of the Securities Act of 1933, this amendment to the registration statement has been signed by the following persons in the capacities* and on the dates indicated.

Signature	Capacity	Date

/ S / G RAHAM T UCKWELL Graham Tuckwell	President and Chief Executive Officer (principal executive officer)	July 20, 2009
/ S / G REG B URGESS Greg Burgess	Chief Financial Officer and Treasurer (principal financial officer and principal accounting officer)	July 20, 2009

The Registrant will be a trust and the persons are signing in their capacities as officers of ETF Securities USA LLC, the Sponsor of the Registrant.

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Exhibit 4.1

EXECUTION COPY

DEPOSITARY TRUST AGREEMENT

ETF SECURITIES USA LLC
as Sponsor

and

THE BANK OF NEW YORK MELLON,

as Trustee

__________________________________________

Depositary Trust Agreement

ETFS Silver Trust

__________________________________________

Dated as of July 20, 2009


TABLE OF CONTENTS
		Page
Article I. DEFINITIONS AND RULES OF CONSTRUCTION		1

Section 1.1	Definitions	1

Section 1.2	Rules of Construction	5

Article II. CREATION AND DECLARATION OF TRUSTS; FORM OF
CERTIFICATES; DEPOSIT OF SILVER; DELIVERY, REGISTRATION OF
TRANSFER AND SURRENDER OF SHARES		6

Section 2.1	Creation and Declaration of Trust; Business of the Trust	6

Section 2.2	Form of Certificates; Book-Entry System; Transferability of
	Shares	6

Section 2.3	Deposit of Silver	8

Section 2.4	Delivery of Shares	8

Section 2.5	Registration and Registration of Transfer of Shares; Combination
	and Split-up of Certificates	9

Section 2.6	Surrender of Shares and Withdrawal of Trust Property	9

Section 2.7	Limitations on Delivery, Registration of Transfer and Surrender
	of Shares	11

Section 2.8	Lost Certificates, Etc	11

Section 2.9	Cancellation and Destruction of Surrendered Certificates	11

Section 2.10	Splits and Reverse Splits of Shares	11

Article III. CERTAIN OBLIGATIONS OF REGISTERED OWNERS OF SHARES		12

Section 3.1	Liability of Registered Owner for Taxes and Other Governmental
	Charges	12

Section 3.2	Warranties on Deposit of Silver	12

Article IV. ADMINISTRATION OF THE TRUST		12

Section 4.1	Evaluation of Silver	12

Section 4.2	Responsibility of the Trustee for Evaluations	13


Section 4.3	Trust Evaluation	13

Section 4.4	Cash Distributions	14

Section 4.5	Other Distributions	14

Section 4.6	Fixing of Record Date	14

Section 4.7	Payment of Expenses; Silver Sales	15

Section 4.8	Statements and Reports	16

Section 4.9	Further Provisions for Silver Sales	16

Section 4.10	Counsel	16

Section 4.11	Grantor Trust	16

Article V. THE TRUSTEE AND THE SPONSOR		17

Section 5.1	Maintenance of Office and Transfer Books by the Trustee	17

Section 5.2	Prevention or Delay in Performance by the Sponsor or the Trustee	17

Section 5.3	Obligations of the Sponsor and the Trustee	18

Section 5.4	Resignation or Removal of the Trustee; Appointment of Successor
	Trustee	22

Section 5.5	The Custodian	23

Section 5.6	Indemnification	24

Section 5.7	Charges of Trustee	25

Section 5.8	Charges of Sponsor	26

Section 5.9	Retention of Trust Documents	26

Section 5.10	Federal Securities Law Filings	26

Section 5.11	Prospectus Delivery	27

Section 5.12	Discretionary Actions by Trustee; Consultation	27

Section 5.13	Dissolution of the Sponsor Not to Terminate Trust	28

Article VI. AMENDMENT AND TERMINATION		28

Section 6.1	Amendment	28
ii


Section 6.2	Termination	28

Article VII. MISCELLANEOUS		30

Section 7.1	Counterparts	30

Section 7.2	Third-Party Beneficiaries	30

Section 7.3	Severability	30

Section 7.4	Certain Matters Relating to Beneficial Owners	30

Section 7.5	Notices	31

Section 7.6	Agent for Service; Submission to Jurisdiction	32

Section 7.7	Governing Law	33

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DEPOSITARY TRUST AGREEMENT

THIS DEPOSITARY TRUST AGREEMENT dated as of July 20, 2009, between ETF SECURITIES USA LLC, a Delaware limited liability company, as sponsor, and THE BANK OF NEW YORK MELLON, a New York banking corporation, as trustee.

W I T N E S S E T H :

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

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

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

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

ARTICLE I.
DEFINITIONS AND RULES OF CONSTRUCTION

Section 1.1 Definitions .

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

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

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

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

“Basket” means 100,000 Shares, except that the Trustee, in consultation with the Sponsor, may from time to time increase or decrease the number of Shares comprising a Basket.

“Basket Silver Amount” is the amount of Silver that must be deposited for issuance of one Basket or that is deliverable upon Surrender of one Basket. The Basket Silver Amount will be determined as provided in Section 2.3(b) .

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

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

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

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

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

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

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

“Custodian” means the Initial Custodian and any substitute or additional Custodian appointed by the Trustee at the direction of or as approved by the Sponsor as provided in Section 5.5 and any subcustodian employed by the Initial Custodian or any such substitute or additional Custodian.

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

“Delivery” means (a) when used with respect to Silver, obtaining an acknowledgement from the Custodian of a credit of Silver on an Unallocated Basis to the account of the Person entitled to that delivery and (b) when used with respect to Shares, one or more book-entry transfers of those Shares to an account or accounts at the Depository designated by the Person entitled to such delivery for further credit as specified by that Person

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

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

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

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

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

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

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

“Initial Custodian” means HSBC Bank USA National Association, London Branch, as Custodian under the Custody Agreements,

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

“LBMA” means the London Bullion Market Association.

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

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

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

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

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

“Ounce” means a troy ounce, equal to 1.0971428 ounces avoirdupois, with a minimum fineness of 999.0 parts per thousand silver.

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

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

“Purchase Order” is defined in Section 2.3.

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

“Redemption Order” is defined in Section 2.6.

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

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

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

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

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

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

“Trust” means the ETFS Silver Trust, the trust entity created by this Agreement.

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

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

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

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

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

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

“Unallocated Basis” means that the Person in whose name Silver is so held is entitled to receive delivery of Silver standing to the credit of that Person’s account, but that Person has no ownership interest in any particular Silver that the custodian maintaining that account owns or holds.

Section 1.2 Rules of Construction .

Unless the context otherwise requires:

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

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

(iii) “or” is not exclusive;

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

(v) “including” means including without limitation;

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

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

ARTICLE II.

CREATION AND DECLARATION OF TRUSTS;
FORM OF CERTIFICATES; DEPOSIT OF SILVER;
DELIVERY, REGISTRATION OF TRANSFER AND SURRENDER OF SHARES

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

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

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

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

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

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

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

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

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

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

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

of determining the person entitled to any distribution or to any notice provided for in this Agreement and for all other purposes.

Section 2.3 Deposit of Silver .

(a) After the initial deposit of Silver in the Trust, the issuance and Delivery of Shares will take place only in integral numbers of Baskets and in compliance with the provisions of this Agreement, as supplemented by the Procedures, to the extent those Procedures are consistent with this Agreement. Authorized Participants wishing to acquire from the Trustee one or more Baskets must place an order with the Trustee (a “Purchase Order”) no later than 3:59:59 p.m. (New York time) on any Business Day. Purchase Orders received by the Trustee prior to the Order Cutoff Time on a Business Day on which the Benchmark Price is announced will have that Business Day as the Order Date. Purchase Orders received by the Trustee on or after the Order Cutoff Time on a Business Day, or on a Business Day on which the Benchmark Price is not announced, will have as their Order Date the next Business Day on which the Benchmark Price is announced. As consideration for each Basket acquired, Authorized Participants must deposit with the Custodian, from an account of the Authorized Participant maintained by the Custodian, or, if otherwise expressly permitted by the Procedures, other LBMA-member custodian identified by the Authorized Participant to the Custodian and the Trustee, the Basket Silver Amount determined by the Trustee on the Order Date of the corresponding Purchase Order. Silver must be Delivered to the Custodian by credit to the Trust Unallocated Account only.

(b) The Trustee shall determine the Basket Silver Amount for each Business Day. The initial “Basket Silver Amount” is 100,000 Ounces. After the initial deposit, the “Basket Silver Amount” for each Business Day shall be an amount of Silver equal to the result obtained by subtracting the number of Ounces of Silver constituting the unpaid expense accrual from the total Ounces of Silver in the Trust and then dividing by the number of Baskets outstanding. Fractions of an Ounce of Silver included in the Basket Silver Amount smaller than 0.001 Ounce shall be disregarded. The Sponsor intends to publish, or may designate other persons to publish, for each Business Day, the Basket Silver Amount.

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

(d) All deposited Silver shall be owned by the Trust and held for the Trust by the Custodian. Pursuant to the Unallocated Account Agreement, Custodian agrees to use reasonable efforts to minimize the amount of Silver held for the Trust on an Unallocated Basis at all times and the Custodian must allocate ownership of silver bars to the Trust such that no more than 1100 Ounces of Silver are held on an Unallocated Basis for the Trust at the end of each business day of the Custodian. Cash and any other assets of the Trust shall be held by the Trustee at such place and in such manner as the Trustee shall determine.

Section 2.4 Delivery of Shares .

Upon receipt by the Trustee of a Purchase Order and the other documents required as above specified, if any, and a confirmation from the Custodian that the Basket Silver Amount

has been Delivered to the Custodian for each Basket of Shares requested in such Purchase Order and the Custodian is holding that Silver for the account of the Trust, the Trustee, subject to the terms and conditions of this Agreement and the Procedures, shall Deliver to the Depositor the number of Baskets of Shares issuable in respect of such deposit as requested in the corresponding Purchase Order, but only upon payment to the Trustee of the fees and expenses of the Trustee as provided in Section 5.7 and of all taxes and governmental charges and fees payable in connection with such deposit, the transfer of the Silver and the issuance and Delivery of the Shares.

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

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

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

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

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

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

Section 2.6 Surrender of Shares and Withdrawal of Trust Property .

(a) Upon Surrender of any integral number of Baskets for the purpose of withdrawal of the amount of Trust Property represented thereby, and upon payment of the fee of the Trustee in connection with the Surrender of Shares as provided in Section 5.7 and payment of all taxes and charges payable in connection with such Surrender and withdrawal of Trust

Property, and subject to the terms and conditions of this Agreement, the Procedures and the practices of the Depository, an Authorized Participant acting on authority of the Registered Owner of those Shares will be entitled to Delivery, in accordance with the provisions of this Agreement, as supplemented by any procedures attached to an applicable Authorized Participant Agreement, to the extent those procedures are consistent with this Agreement, of the amount of Trust Property at the time represented by such Baskets, including the Basket Silver Amounts corresponding to such Baskets on the applicable Order Date (determined as provided below). Authorized Participants wishing to redeem one or more Baskets must place an order with the Trustee (a “Redemption Order”) no later than 3:59:59 p.m. (New York time) on any Business Day. Redemption Orders received by the Trustee prior to the Order Cutoff Time on a Business Day on which the Benchmark Price is announced will have that Business Day as the Order Date. Redemption Orders received by the Trustee on or after the Order Cutoff Time on any Business Day, or on a Business Day on which the Benchmark Price is not announced, will have as their Order Date the next Business Day on which the Benchmark Price is announced. Silver will be Delivered by the Custodian only by credit to an account of the Authorized Participant maintained by the Custodian or, if otherwise expressly permitted by the Procedures, other LBMA-member custodian identified by the Authorized Participant to the Custodian and the Trustee on an Unallocated Basis. The Authorized Participant shall bear all risk of any loss from the time the Silver is paid from the Trust Unallocated Account to the Authorized Participant and neither the Trustee nor the Trust shall have any liability for any such loss.

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

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

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

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

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

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

Section 2.8 Lost Certificates, Etc .

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

Section 2.9 Cancellation and Destruction of Surrendered Certificates .

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

Section 2.10 Splits and Reverse Splits of Shares .

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

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

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

ARTICLE III.
CERTAIN OBLIGATIONS OF REGISTERED OWNERS OF SHARES

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

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

Section 3.2 Warranties on Deposit of Silver .

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

ARTICLE IV.
ADMINISTRATION OF THE TRUST

Section 4.1 Evaluation of Silver .

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

Person for the determination that the most recently announced Benchmark Price is not appropriate as a basis for evaluation of the Silver held or receivable by the Trust or for any determination as to the alternative basis for evaluation, provided that such determination is made in good faith.

If the Sponsor determines that Benchmark Price will have the meaning set forth in part (ii) of the definition of that term, the Trustee shall give notice to the Registered Owners, and the Trustee shall not apply the new definition of Benchmark Price until 60 days after the date of that notice.

Section 4.2 Responsibility of the Trustee for Evaluations .

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

Section 4.3 Trust Evaluation .

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

Adjusted Net Asset Value, Net Asset Value and Net Asset Value per Share shall be computed in accordance with generally accepted accounting principles in the United States. Any estimate of the expenses and liabilities of the Trust for purposes of the computations required by this Section made by the Trustee in good faith shall be conclusive upon all Persons.

Section 4.4 Cash Distributions .

Whenever the Trustee distributes any cash, the Trustee shall distribute the amount available for the distribution to the Registered Owners entitled thereto, in proportion to the number of Shares held by them respectively; provided, however, that in the event that the Trustee shall be required to withhold and does withhold from such cash an amount on account of taxes, the amount distributed to the Registered Owners shall be reduced accordingly. The Trustee shall distribute only such amount, however, as can be distributed without attributing to any Registered Owner a fraction of one cent. Any such fractional amounts shall be rounded to the nearest whole cent and so distributed to Registered Owners entitled thereto.

Section 4.5 Other Distributions .

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

Section 4.6 Fixing of Record Date .

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

Section 4.7 Payment of Expenses; Silver Sales .

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

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

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

(iii) taxes and other governmental charges;

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

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

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

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

The Trustee shall, when directed by the Sponsor, and, in the absence of such direction, may, in its discretion, sell Silver in such quantity and at such times, as may be necessary to permit payment of expenses under this Agreement. The Trustee is authorized to sell Silver at such times and in the smallest amounts required to permit payment of expenses as they come due, it being the intention to avoid or minimize the Trust’s holdings of assets other than Silver. Neither the Trustee nor the Sponsor shall have any liability for loss or depreciation resulting from sales of Silver so made. The Trustee shall not be liable or responsible in any way for depreciation or loss incurred by reason of any sale made pursuant to the Sponsor’s direction or otherwise in accordance with this Section.

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

(d) Payment of the fees of the Sponsor provided in Section 5.8(a) hereof shall be made by delivery to an account maintained by the Custodian for the Sponsor on an Unallocated Basis, monthly on the first Business Day of the month in respect of fees payable in respect of the prior month, of that number of Ounces of Silver which shall equal the daily accrual of the Sponsor’s fee for such prior month calculated at the Benchmark Price for the day of accrual.

Section 4.8 Statements and Reports .

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

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

Section 4.9 Further Provisions for Silver Sales .

In addition to selling Silver in accordance with Section 4.7, the Trustee shall sell Silver whenever any one or more of the following conditions exists:

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

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

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

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

Section 4.10 Counsel .

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

Section 4.11 Grantor Trust .

Nothing in this Agreement, any agreement with a Custodian, or otherwise, shall be construed to give the Trustee the power to vary the investment of the Beneficial Registered

Owners within the meaning of Section 301.7701-4(c) under the Internal Revenue Code of 1986, as amended (the “Code”) or any similar or successor provision of the regulations under the Code, nor shall the Sponsor give the Trustee any direction that would vary the investment of the Beneficial Owners. However, the Trustee shall not be liable to any Person for any failure of the Trust to qualify as a grantor trust under the Code or any comparable provision of the laws of any State or other jurisdiction where that treatment is sought, except that this sentence shall not limit the Trustee’s responsibility for the administration of the Trust in accordance with this Agreement.

ARTICLE V.
THE TRUSTEE AND THE SPONSOR

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

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

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

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

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

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

Neither the Sponsor nor the Trustee nor any of their respective directors, employees, agents or affiliates shall incur any liability to any Registered Owner, Beneficial Owner or Depositor if, by reason of any provision of any present or future law or regulation of the United States or any other country, or of any governmental or regulatory authority or stock exchange, or by reason of any act of God or war or terrorism or other circumstances beyond its control, the Sponsor or the Trustee is prevented or forbidden from, or would be subject to any civil or criminal penalty on account of, or is delayed in, doing or performing any act or thing which by the terms of this Agreement it is provided shall be done or performed and accordingly the Sponsor or the Trustee does not do that thing or does that thing at a later time than would otherwise be required. The Sponsor and the Trustee will not incur any liability to any Registered Owner or Beneficial Owner or Depositor by reason of any non-performance or delay in the performance of any act or thing which by the terms of this Agreement it is provided may be done or performed, or by reason of any exercise of, or failure to exercise, any discretion provided for in this Agreement.

Section 5.3 Obligations of the Sponsor and the Trustee .

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

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

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

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

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

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

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

(i) The Trustee shall not be under any obligation to appear in, prosecute or defend any action that in its opinion may involve it in expense or liability, unless it shall be furnished with reasonable security and indemnity against such expense or liability. Subject to the foregoing, the Trustee shall, in its discretion, undertake such action as it may deem

necessary at any and all times to protect the Trust and the rights and interest of all Beneficial Owners pursuant to the terms of this Agreement.

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

(iii) If at any time the Trustee is served with any judicial or administrative order, judgment, decree, writ or other form of judicial or administrative process that in any way affects the Trust or its property (including but not limited to orders of attachment or garnishment or other forms of levies or injunctions or stays relating to the transfer of any assets of the Trust), the Trustee is authorized to comply therewith in any manner that it or legal counsel of its own choosing deems appropriate; however, the Trustee to the extent practicable will inform the Sponsor of such order, judgment, decree, writ or other form of judicial or administrative process that in any way affects the Trust and consult in good faith with the Sponsor as to the course of action by the Trustee. If the Trustee complies with any such judicial or administrative order, judgment, decree, writ or other form of judicial or administrative process, the Trustee shall not be liable to any of the parties hereto or to any other person or entity even though such order, judgment, decree, writ or process may be subsequently modified or vacated or otherwise determined to have been without legal force or effect.

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

faith in accordance with any advice from such counsel. The expense of such counsel shall be paid as provided in Section 5.7(b) and (c), as applicable.

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

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

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

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

(ix) When the Trustee acts on any information, instructions, communications (including communications with respect to the delivery of securities or the wire transfer of funds) sent by telex, facsimile, email or other form of electronic or data transmission,

the Trustee, absent gross negligence, shall not be responsible or liable in the event such communication is not an authorized or authentic communication of the party sending it or is not in the form the party sent or intended to send (whether due to fraud, distortion or otherwise), provided that this paragraph shall not limit the Trustee's obligation to obtain such confirmations as may be specified in this Agreement or any Authorized Participant Agreement. The Trustee shall be indemnified as provided in Section 5.6 hereof against any loss, liability, claim or expense (including legal fees and expenses) it may incur in acting in accordance with any such communication.

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

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

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

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

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

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

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

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

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

(i) ceases to be a Qualified Bank,

(ii) is in material breach of its obligations under this Agreement and fails to cure such breach within 30 days after receipt of written notice from the Sponsor or Registered Owners acting on behalf of at least 25% of the outstanding Shares specifying such default and requiring the Trustee to cure such default, or

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

(d) If the Trustee acting hereunder resigns or is removed, the Sponsor, acting on behalf of the Registered Owners, shall use its reasonable efforts to appoint a successor Trustee, which shall be a Qualified Bank. Every successor Trustee shall execute and deliver to its predecessor and to the Sponsor, acting on behalf of the Registered Owners, an instrument in

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

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

Section 5.5 The Custodian .

(a) The Trustee is hereby directed to enter into the Trust Allocated Account Agreement and the Trust Unallocated Account Agreement with the Initial Custodian. The Initial Custodian will be subject to the directions of the Trustee as provided in such Custody Agreements, and will be responsible solely to it and to Beneficial Owners to the extent UK law requires. If upon the resignation of any Custodian there would be no Custodian acting hereunder, the Trustee shall, promptly after receiving such notice of such resignation, appoint a substitute custodian or custodians selected by the Sponsor pursuant to custody agreements approved by the Sponsor (provided, however that the rights and duties of the Trustee hereunder shall not be materially altered without its consent), each of which shall thereafter be a Custodian hereunder. When directed by the Sponsor or if the Trustee in its discretion determines that it is in the best interest of the Registered Owners to do so and with the written approval of the Sponsor (which approval shall not be unreasonably withheld or delayed), the Trustee shall appoint a substitute or additional custodian or custodians, which shall thereafter be one of the Custodians hereunder. After the date of this Agreement, the Trustee shall not enter into or amend any Custody Agreement with a Custodian without the written approval of the Sponsor (which approval shall not be unreasonably withheld or delayed). When instructed by the Sponsor, the Trustee shall demand that a Custodian deliver such of the Silver held by it as is requested of it to any other Custodian or such substitute or additional custodian or custodians directed by the Sponsor. In connection with such delivery the Trustee will, solely if and in the manner directed by the Sponsor, cause the Silver to weighed or assayed and any such weighing and assay shall be an expense of the Trust pursuant to Section 4.7(a)(ii) hereof. The Trustee shall have no liability for any delivery of Silver or weighing or assaying of delivered Silver directed by the Sponsor pursuant to the preceding provisions of this paragraph and in the absence of such direction shall have no obligation to effect such a delivery or to cause the delivered Silver to be weighed, assayed or otherwise validated. Each such substitute or additional custodian shall forthwith upon its appointment, enter into a Custody Agreement in form and substance satisfactory to the Sponsor and the Trustee.

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

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

Section 5.6 Indemnification .

(a) The Trustee, its directors, employees and agents (the “Trustee Indemnified Persons”) shall be indemnified from the Trust and held harmless against any loss, liability or expense (including, but not limited to, the reasonable fees and expenses of counsel) arising out of or in connection with the performance of its obligations under this Agreement and under each other agreement entered into by the Trustee in furtherance of the administration of the Trust (including, without limiting the scope of the foregoing, the Custody Agreements and any Authorized Participant Agreement, including the Trustee’s indemnification obligations thereunder) or by reason of the Trustee’s acceptance of the Trust incurred without (1) gross negligence, bad faith, willful misconduct or willful malfeasance on the part of such Trustee Indemnified Party in connection with the performance of its obligations under this Agreement or any such other agreement or any actions taken in accordance with the provisions of this Agreement or any such other agreement or (2) reckless disregard on the part of such Trustee Indemnified Party of its obligations and duties under this Agreement or any such other agreement. Such indemnity shall include payment from the Trust of the costs and expenses incurred by such Trustee Indemnified Party in defending itself against any claim or liability in its capacity as Trustee. Any amounts payable to a Trustee Indemnified Party under this Section 5.6(a) may be payable in advance or shall be secured by a lien on the Trust.

(b) The Sponsor and its members, managers, directors, officers, employees, affiliates (as such term is defined under the Securities Act of 1933, as amended) and subsidiaries (each a “Sponsor Indemnified Party”) shall be indemnified from the Trust and held harmless against any loss, liability or expense incurred without (1) gross negligence, bad faith, willful misconduct or willful malfeasance on the part of such Sponsor Indemnified Party arising out of or in connection with the performance of its obligations under this Agreement and under each

other agreement entered into by the Sponsor in furtherance of the administration of the Trust (including, without limiting the scope of the foregoing, the Custody Agreements and any Authorized Participant Agreement) or any actions taken in accordance with the provisions of this Agreement or (2) reckless disregard on the part of such Sponsor Indemnified Party of its obligations and duties under this Agreement. Such indemnity shall include payment from the Trust of the costs and expenses incurred by such Sponsor Indemnified Party in defending itself against any claim or liability in its capacity as Sponsor. Any amounts payable to a Sponsor Indemnified Party under this Section 5.6(b) may be payable in advance or shall be secured by a lien on the Trust. The Sponsor may, in its discretion, undertake any action which it may deem necessary or desirable in respect of this Agreement and the rights and duties of the parties hereto and the interests of the Registered Owners and, in such event, the legal expenses and costs of any such actions shall be expenses and costs of the Trust and the Sponsor shall be entitled to be reimbursed therefor by the Trust.

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

Section 5.7 Charges of Trustee .

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

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

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

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

Section 5.8 Charges of Sponsor .

(a) The Sponsor is entitled to receive from the Trust, chargeable as an expense of the Trust, a fee for services that will accrue daily and be paid monthly in arrears in the manner provided in Section 4.7(d) at an annualized rate of 0.45 % of Adjusted Net Asset Value. The Sponsor may, at its sole discretion and from time to time, waive all or a portion of its fee payable under this Section 5.8(a) for such periods of time as shall be specified in the Sponsor’s written notice of such fee waiver to the Trustee. The Sponsor is under no obligation to waiver its fees hereunder, and any such waiver shall create no obligation to waive fees during any period not covered by the applicable waiver. Any fee waiver by the Sponsor shall not operate to reduce Sponsor’s obligations hereunder, including, but not limited to, the Sponsor’s obligations under Section 5.3(g) .

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

Section 5.9 Retention of Trust Documents .

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

Section 5.10 Federal Securities Law Filings .

(a) The Sponsor shall (i) prepare and file a registration statement with the Commission and take such action as is necessary from time to time to qualify the Shares for offering and sale under the federal securities laws of the United States, including the preparation and filing of amendments and supplements to such registration statement, (ii) promptly notify the Trustee of any amendment or supplement to the registration statement or prospectus, of any order preventing or suspending the use of any prospectus, of any request for the amending or supplementing of the registration statement or prospectus or if any event or circumstance occurs which is known to the Sponsor as a result of which the registration statement or prospectus, as then amended or supplemented, would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, (iii) provide the Trustee from time to time with copies, including copies in electronic form, of the prospectus, as amended and supplemented, in

such quantities as the Trustee may reasonably request and (iv) prepare and file any periodic reports or updates that may be required under the Securities Exchange Act of 1934, as amended. The Trustee shall furnish to the Sponsor any information from the records of the Trust that the Sponsor reasonably requests in writing that is needed to prepare any filing or submission that the Sponsor or the Trust is required to make under the federal securities laws of the United States, and the Sponsor is entitled to rely on such information so furnished by the Trustee.

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

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

Section 5.11 Prospectus Delivery .

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

Section 5.12 Discretionary Actions by Trustee; Consultation .

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

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

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

Section 5.13 Dissolution of the Sponsor Not to Terminate Trust .

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

ARTICLE VI.
AMENDMENT AND TERMINATION

Section 6.1 Amendment .

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

Section 6.2 Termination .

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

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

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

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

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

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

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

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

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

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

(b) On and after the date of termination of this Agreement, the Registered Owner of Shares will, upon (i) Surrender of those Shares, (ii) payment of the fee of the Trustee for the Surrender of Shares provided in Section 5.7, and (iii) payment of any applicable taxes or other governmental charges, be entitled to Delivery, to him or upon his order, of the amount of Trust Property represented by those Shares. The Trustee shall not accept any deposits of Silver after the date of termination of this Agreement. If any Shares remain outstanding after the date of termination of this Agreement, the Trustee thereafter shall discontinue the registration of transfers of Shares, shall not make any distributions to Registered Owners, and shall not give any further notices or perform any further acts under this Agreement, except that the Trustee shall continue to collect distributions pertaining to Trust Property and hold the same uninvested and without liability for interest, pay the Trust’s expenses and sell Silver as necessary to meet those expenses and shall continue to deliver Trust Property, together with any distributions received with respect thereto and the net proceeds of the sale of any other property, in exchange for Shares Surrendered to the Trustee (after deducting or upon payment of, in each case, the fee of the Trustee set forth in 5.7 for the Surrender of Shares, any expenses for the account of the Registered Owner of such Shares in accordance with the terms and conditions of this Agreement, and any applicable taxes or other governmental charges). At any time after the expiration of 90 days following the date of termination of this Agreement, the Trustee may sell the Trust Property then held under this Agreement and may thereafter hold the net proceeds of any such sale, together with any other cash then held by it under this Agreement, without liability for interest, for the pro rata benefit of the Registered Owners of Shares that have not theretofore been Surrendered. After making such sale, the Trustee shall be discharged from all obligations under this Agreement, except to account for such net proceeds and other cash (after deducting, in each case, any fees, expenses, taxes or other governmental charges payable by the Trust, the fee of the Trustee for the Surrender of Shares and any expenses for the account of the Registered Owner of such Shares in accordance with the terms and conditions of this Agreement, and any applicable

taxes or other governmental charges). Upon the termination of this Agreement, the Sponsor shall be discharged from all obligations under this Agreement except for its obligations to the Trustee under Sections 5.6, 5.7 and 5.8 shall survive termination of this Agreement.

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

ARTICLE VII.
MISCELLANEOUS

Section 7.1 Counterparts .

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

Section 7.2 Third-Party Beneficiaries .

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

Section 7.3 Severability .

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

Section 7.4 Certain Matters Relating to Beneficial Owners .

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

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

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

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

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

Section 7.5 Notices .

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

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

To the Trustee:

THE BANK OF NEW YORK MELLON
2 Hanson Place
Brooklyn, New York 11217
Attention: Donald Guire
Telephone: 718-315-4927
Facsimile: 718-315-4850

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

To the Sponsor:

ETF SECURITIES USA LLC
c/o ETF Securities Representative Office
6 ^th Floor
2 London Wall Buildings
London, EC2M 5UU
UK
Telephone: 011 44 207 448 4330
Attention: President

with a copy to:

Katten Muchin Rosenman LLP
575 Madison Avenue
New York, New York 10022
Attention: Peter J. Shea, Esq.

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

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

Section 7.6 Agent for Service; Submission to Jurisdiction .

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

it and consents that any such service of process may be made by certified or registered mail, return receipt requested, directed to the Sponsor at its address last specified for notices hereunder, and service so made shall be deemed completed five (5) days after the same shall have been so mailed.

Each party hereto, each Authorized Participant by its delivery of an Authorized Participant Agreement and each Beneficial Owner by the acceptance of a Share, irrevocably consents to the jurisdiction of the courts of the State of New York and of any Federal Court located in the Borough of Manhattan in such State in connection with any action, suit or other proceeding arising out of or relating to this Agreement or any action taken or omitted hereunder, and waives any claim of forum non conveniens and any objections as to laying of venue. Each party further waives personal service of any summons, complaint or other process and agrees that service thereof may be made by certified or registered mail directed to such person at such person's address for purposes of notices hereunder.

Section 7.7 Governing Law .

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

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


	ETF SECURITIES USA LLC


	By:	/s/ Graham Tuckwell
	Name: Graham Tuckwell
	Title: President and Chief Executive Officer

Witnessed:	Witnessed:

/s/ Julie Renouf	/s/ Greg Burgess
Name: Julie Renouf	Name:	Greg Burgess
	Title:	Vice President, Treasurer and
	Chief Financial Officer



	THE BANK OF NEW YORK MELLON,
	as Trustee


	By:	/s/ Andrew Pfeifer
	Name:	Andrew Pfeifer
	Title:	Vice President

[Depositary Trust Agreement acknowledgment, Trustee]


STATE OF NEW YORK	)
	) ss.:
COUNTY OF NEW YORK	)

On the 20th day of July in the year 2009 before me, the undersigned, personally appeared Andrew Pfeiffer, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual, or the person upon behalf of which the individual acted, executed the instrument.

	/s/ Sylvia Cohen
	Notary Public

(Notarial Seal)

EXHIBIT A

[Form of Certificate]

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

A-1

ETFS PHYSICAL SILVER SHARES
ISSUED BY
ETFS SILVER TRUST
REPRESENTING
FRACTIONAL UNDIVIDED INTERESTS IN DEPOSITED SILVER AND ANY OTHER
TRUST PROPERTY

THE BANK OF NEW YORK MELLON, as Trustee

No.

* Shares

CUSIP:

THE BANK OF NEW YORK MELLON, as Trustee (hereinafter called the Trustee), hereby certifies that CEDE & CO., as nominee of the Depository Trust Company, or registered assigns, is the owner of * Shares issued by ETFS Silver Trust, each representing a fractional undivided interest in the net assets of the Trust, as provided in the Agreement referred to below. At the time of delivery of the Agreement, each 100,000 Shares represented an interest in 100,000 Ounces of Silver that are deposited under the Agreement and held by the Custodian referred to in the Agreement. The amount of Silver in which each 100,000 Shares represents an interest will decline over time as provided in the Agreement. The Trustee’s Corporate Trust Office is located at a different address than its principal executive office. Its Corporate Trust Office is located at 2 Hanson Place, Brooklyn, New York 11217, and its principal executive office is located at One Wall Street, New York, New York 10286.

This Certificate is issued upon the terms and conditions set forth in the Depositary Trust Agreement dated as of July 20, 2009 (“Agreement”) between ETF Securities USA LLC (herein called the Sponsor) and the Trustee. By becoming a Registered Owner or Beneficial Owner, or by depositing Silver, a Person is bound by all the terms and conditions of the Agreement. The Agreement sets forth the rights of Depositors and Registered Owners and the rights and duties of the Trustee and the Sponsor. Copies of the Agreement are on file at the Trustee’s Corporate Trust Office in New York City.

______________________________________

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

A-2

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

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


Dated:			THE BANK OF NEW YORK MELLON,
			as Trustee

			By:

THE TRUSTEE’S CORPORATE TRUST OFFICE ADDRESS IS
2 HANSON PLACE, BROOKLYN, NEW YORK 11217

A-3

Exhibit 4.2

AUTHORIZED PARTICIPANT AGREEMENT

AUTHORIZED PARTICIPANT AGREEMENT (this “Agreement”) dated as of [DATE] among (i) [AUTHORIZED PARTICIPANT], a [company] organized under the laws of [JURISDICTION OF AP] (the “ Authorized Participant ”), (ii) The Bank of New York Mellon, a New York Banking corporation acting in its capacity as trustee (in such capacity, the “ Trustee ”) of the Trust(s) listed on the attached Schedule A, which is a part of this Agreement (each a “ Trust ” and collectively, the “ Trusts ”), each Trust created under New York law pursuant to its respective Depositary Trust Agreement identified on the attached Schedule A (each a “ Trust Agreement ” and collectively, the “ Trust Agreements ”), and (iii) ETF Securities USA LLC, in its capacity as sponsor of each Trust (in such capacity, the “ Sponsor ”).

R E C I T A L S

A. Pursuant to the provisions of the applicable Trust Agreements, each Trust may from time to time issue or redeem equity securities representing an interest in the assets of such Trust (“ Shares ”), in each case only in aggregate amounts as set out in Schedule A (such aggregate amount, a “ Basket ”), and integral multiples thereof, and only in transactions with a party who, at the time of the transaction, shall have signed and in effect an Authorized Participant Agreement with such Trust.

B. [AUTHORIZED PARTICIPANT] has requested to become an “Authorized Participant” with respect to each Trust (as such term is defined in the applicable Trust Agreement), and the Sponsor and the Trustee have agreed to such request.

NOW, THEREFORE, in consideration of the foregoing premises, and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties, hereto, intending to be legally bound, agree as follows:

Section 1. Procedures . The Authorized Participant will purchase or redeem Baskets of Shares of the relevant Trust in compliance with the relevant Trust Agreement as supplemented by the Creation and Redemption Procedures attached to this Agreement as Schedule 1 (such procedures, as the same may be amended or modified from time to time in compliance with the provisions hereof and thereof, the “ Procedures ”), using either (i) the form attached thereto as Annex I (a “ Purchase Order ”, in the case of an order to purchase one or more Baskets of Shares issued by a specified Trust and a “ Redemption Order ”, in case of an order to redeem one or more Baskets of Shares issued by a specified Trust) or (ii) through the Trustee’s electronic order entry system, as such may be made available and constituted from time to time, the use of which shall be subject to the terms and conditions attached thereto as Annex II. All Purchase Orders and Redemption Orders (collectively, “ Orders ”) shall be placed and executed in accordance with the relevant Trust Agreement as supplemented by the Procedures. Capitalized terms used in this Agreement and not otherwise defined herein have the meaning ascribed to them in the Procedures.

Section 2. Incorporation of Standard Terms . The Standard Terms attached hereto as Schedule 2 are hereby incorporated by reference into, and made a part of, this Agreement.

Section 3. Conflicts Rules . In case of any inconsistency between the provisions of this Agreement and an applicable Trust Agreement, the provisions of such Trust Agreement shall control. In case of inconsistency between the provisions incorporated by reference into this Agreement pursuant to Section 2 above and any other provision of this Agreement, the latter will control.

Section 4. Authorized Representatives . Pursuant to Section 2.01 of the Standard Terms, attached hereto as Schedule 3-A is a certificate listing the Authorized Representatives of the Authorized Participant.

Section 5. Additional Covenants . The Authorized Participant covenants and agrees:

(a) To use its best efforts to ensure that any Delivery of applicable Bullion to the Custodian, or any withdrawal of applicable Bullion from the appropriate Trust, in connection with a Purchase Order or Redemption Order placed by the Authorized Participant will take place only through one or more members of the London Bullion Market Association and/or the London Platinum and Palladium Market as appropriate under the terms of the applicable Trust Agreement.

(b) Promptly upon written demand therefore (accompanied by such reasonable evidence as the Authorized Participant may request), to reimburse the relevant Trust or the Custodian the amount of any taxes (including value added taxes) that may be imposed on the relevant Trust or the Custodian in connection with any Delivery of Bullion by or on behalf of the Authorized Participant to the Custodian (in the case of a Purchase Order placed by the Authorized Participant), or any Delivery of Bullion to or for the account of the Authorized Participant (in the case of a Redemption Order placed by the Authorized Participant).

Section 6. Notices . Except as otherwise specifically provided in the Procedures, all notices required or permitted to be given pursuant hereto shall be given in writing and delivered by personal delivery or by postage prepaid registered or certified United States first class mail, return receipt requested, or by telex or facsimile (with a confirming copy by mail) addressed as follows:

(i) If to the Trustee:

The Bank of New York Mellon
2 Hanson Place — Floor 9th
Brooklyn, NY 11217
Attn: Jarvis Joseph
Telephone: (718) 315-7500
Facsimile: (732) 667-9478
E-Mail: jarvis.joseph@bnymellon.com

(ii) If to the Sponsor:

ETF Securities USA LLC
c/o Representative’s Office
6 ^th Floor
2 London Wall Buildings
London
EC2M 5UU

United Kingdom
Attn: Legal and Compliance
Telephone: +44 20 7448 4330
Facsimile: +44 20 74484366
E-Mail: legal.compliance@etfsecurities.com

(iii) If to the Authorized Participant:

[AUTHORIZED PARTICIPANT]
Attn:
[AP’S ADDRESS]
Telephone:
Facsimile:
Telex:

or such other address as any of the parties hereto shall have communicated in writing to the remaining parties in compliance with the provisions hereof.

Section 7. Effectiveness, Termination and Amendment . This Agreement shall become effective upon execution and delivery by each of the parties hereto. This Agreement may be terminated at any time by any party upon sixty days prior written notice to the other parties and may be terminated earlier by the Trustee or the Sponsor at any time on the event of a breach by the Authorized Participant of any provision of this Agreement (including the Standard Terms incorporated by Section 2 hereof) or the Procedures. This Agreement, along with any other agreement or instrument delivered pursuant to this Agreement, supersedes any prior agreement between or among the parties concerning the matters governed hereby. This Agreement may be amended by the Trustee and the Sponsor from time to time without the consent of the Authorized Participant or any Beneficial Owner by the following procedure: the Trustee or the Sponsor will mail a copy of the amendment to the Authorized Participant in compliance with the notice provisions of this Agreement; if the Authorized Participant does not object in writing to the amendment within fifteen (15) Business Days after receipt of the proposed amendment, the amendment will become part of this Agreement in accordance with its terms. Titles and section headings in this Agreement (and in the Standard Terms incorporated by Section 2 hereof and the Procedures) are included solely for convenient reference and are not a part of this Agreement.

Section 8. Governing Law . This Agreement and all the transactions hereunder shall be governed by and interpreted in accordance with the laws of the State of New York (regardless of the laws that might otherwise govern under applicable New York conflict law principles) as to all matters including matters of validity, construction, effect, performance and remedies. The parties irrevocably submit to the non-exclusive jurisdiction of any New York State or United States Federal court sitting in New York City over any suit, action or proceeding arising out of, or relating to, this Agreement.

Section 9. Assignment . No party to this Agreement shall assign any rights, or delegate the performance of any obligations, arising hereunder without the prior written consent of the other parties hereto, which shall not be unreasonably withheld; provided, that any entity into which a party hereto may be merged or converted, or with which it may be consolidated, or any entity resulting from any merger, consolidation or conversion to which a party hereunder shall be a party, shall be the successor

of such party hereto. The party resulting from any such merger, conversion, consolidation or succession shall promptly notify the other parties hereto of the change. Any purported assignment or delegation in violation of these provisions shall be null and void. Notwithstanding the foregoing, any successor Trustee appointed in compliance with the applicable Trust Agreement shall automatically become a party hereto and shall assume all the obligations, and be entitled to all the rights and remedies of the Trustee hereunder with respect to the applicable Trust.

Section 10. No Strict Construction . The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against any party.

Section 11. Counterparts . This Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.

[ Signatures Follow on Next Page ]

IN WITNESS WHEREOF , the parties hereto have executed this Authorized Participant Agreement as of the date set forth above.

THE BANK OF NEW YORK MELLON , in its capacity as
Trustee of the Trusts listed on Schedule A hereto


By:
Name:
Title:
Date:

ETF SECURITIES USA LLC , in its capacity as
Sponsor of the Trusts listed on Schedule A hereto


By:
Name:
Title:
Date:

[AUTHORIZED PARTICIPANT]


By:
Name:
Title:
Date:

SCHEDULE A – APPLICABLE TRUSTS

•	ETFS Silver Trust, a trust created under New York law pursuant to that certain Depositary Trust Agreement between the Trustee and the Sponsor, as may be amended from time to time.

•	ETFS Gold Trust, a trust created under New York law pursuant to that certain Depositary Trust Agreement between the Trustee and the Sponsor, as may be amended from time to time.

•	ETFS Platinum Trust, a trust created under New York law pursuant to that certain Depositary Trust Agreement between the Trustee and the Sponsor, as may be amended from time to time.

•	ETFS Palladium Trust, a trust created under New York law pursuant to that certain Depositary Trust Agreement between the Trustee and the Sponsor, as may be amended from time to time.

DELIVERY LOCATIONS, BASKET SIZES
AND BULLION OUNCES PER SHARE

Description of Delivery and Basket Sizes:

	Delivery of Bullion	Shares Per Basket	Oz. per Share at Inception
ETFS Physical Silver Shares	Loco-London	100,000	1.0
ETFS Physical Swiss Gold Shares	Loco-Zurich/London	50,000	0.1
ETFS Physical Platinum Shares	Loco-Zurich/London	50,000	0.1
ETFS Physical Palladium Shares	Loco-Zurich/London	50,000	0.1

SCHEDULE 1- CREATION AND REDEMPTION PROCEDURES


TABLE OF CONTENTS - SCHEDULE 1

		Page

ARTICLE I DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.01	Definitions	2
Section 1.02	Interpretation	6

ARTICLE II CREATION PROCEDURES
Section 2.01	Initial Creation of Shares	6
Section 2.02	Subsequent Creation of Shares	6

ARTICLE III REDEMPTION PROCEDURES
Section 3.01	Redemption of Shares	9

ANNEX I TO CREATION AND REDEMPTION PROCEDURES
Creation/Redemption Order Form		13

ANNEX II TO CREATION AND REDEMPTION PROCEDURES
Order Entry System Terms and Conditions		15

S1-1

CREATION AND REDEMPTION PROCEDURES

Adopted by the Sponsor and Trustee (each as defined below) as of July 20, 2009

ARTICLE I

DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

Section 1.01. Definitions . For purposes of these Procedures, and the Standard Terms incorporated by reference into the Authorized Participant Agreement to which these Procedures are attached, unless the context otherwise requires, the following terms will have the following meanings:

“ 1933 Act ” means the U.S. Securities Act of 1933, as amended.

“ Affiliate ” shall have the meaning given to it by Rule 501(b) under the 1933 Act.

“ AP Indemnified Party ” shall have the meaning ascribed to such term in Section 6.01. a of the Standard Terms.

“ Authorized Participant ” shall have the meaning ascribed to the term in the introductory paragraph of the Authorized Participant Agreement.

“ Authorized Participant Agreement ” shall mean each Authorized Participant Agreement among the Authorized Participant, the Trustee and the Sponsor into which these Creation and Redemption Procedures are attached as Schedule 1 and the Standard Terms and Conditions attached as Schedule 2 shall have been incorporated by reference.

“ Authorized Participant Client ” means any party on whose behalf the Authorized Participant acts in connection with an Order (whether a customer or otherwise).

“ Authorized Representative ” shall mean, with respect to an Authorized Participant, each individual who, pursuant to the provisions of the Authorized Participant Agreement between such Authorized Participant, the Sponsor, and the Trustee, has the power and authority to act on behalf of the Authorized Participant in connection with the placement of Purchase Orders or Redemption Orders and is in possession of the personal identification number (PIN) assigned by the Trustee for use in any communications regarding Purchase or Redemption Orders on behalf of such Authorized Participant.

“ Basket ” shall have the meaning ascribed to the term in Section 1.1 of the relevant Trust Agreement.

“ Basket Amount ” shall mean the specific basket amount term defined in Section 1.1 of the relevant Trust Agreement (e.g., the “Basket Silver Amount” in the case of the ETFS Silver Trust).

S1-2

“ Benchmark Price ” shall have the meaning ascribed to the term in Section 1.1 of the relevant Trust Agreement.

“ Beneficial Owner ” shall have the meaning given to it by Rule 16a-1(a)(2) of the Securities Exchange Act of 1934.

“ Bullion ” shall mean Silver, Gold, Platinum and/or Palladium as appropriate.

“ Business Day ” shall mean each day the exchange on which the relevant Shares trade is open for regular trading.

“ Creation ” means the process that begins when an Authorized Participant first indicates to the Trustee its intention to purchase one or more Baskets of a specified Trust pursuant to these Procedures and concludes with the issuance by the Trustee and Delivery to such Authorized Participant of the corresponding number of that Trust’s Shares.

“ Creation and Redemption Line ” shall mean a telephone number designated as such by the Trustee and specified in Annex I of the Procedures or otherwise communicated to each Authorized Participant in compliance with the notice provisions of the respective Authorized Participant Agreement.

“ Custodial Unallocated Account ” shall mean the unallocated bullion account established by the Trustee with the Custodian pursuant to the relevant Custodian Agreement.

“ Custodial Allocated Account ” shall mean the allocated bullion account established by the Trustee with the Custodian pursuant to the relevant Custodian Agreement.

“ Custodian ” shall mean HSBC Bank USA National Association, London Branch, in its capacity as custodian under the Custodian Agreements and any successor thereto or additional or other custodian appointed in compliance with the provisions of the relevant Trust Agreements and relevant Custodian Agreement(s).

“ Custodian Day ” shall mean a day on which the facilities at which a Delivery of Bullion is to take place to or by the Custodian on behalf of the Trust(s) are open for business.

“ Custodian Agreement ” or “ Custodian Agreements ” shall mean the applicable Custodian Agreement by and between the Trustee and the Custodian with respect to the applicable Trust.

“ Delivery ” shall mean a delivery of Bullion or Shares, as applicable, in each case effected according to the definition of “Deliver” in Section 1.1 of the relevant Trust Agreement.

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

S1-3

“ Deposit Property ” means property which, in compliance with the provisions of the relevant Trust Agreement, must be transferred by the Authorized Participant to the relevant Trust in exchange for that Trust’s Shares.

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

“ FINRA ” means the Financial Industry Regulatory Authority.

“ Gold ” shall have the meaning ascribed to the term in Section 1.1 of the Trust Agreement of the ETFS Gold Trust relating to gold.

“ Initial Creation ” shall mean the initial creation of Shares pursuant to the provisions of Section 2.01 hereof.

“ LBMA ” shall mean the London Bullion Market Association.

“ LPPM ” shall mean the London Platinum and Palladium Market.

“ London Business Day ” shall mean a day (other than a Saturday, Sunday or a public holiday in England) on which commercial banks generally and the over-the-counter markets in silver, with respect to ETFS Silver Trust and the ETFS PM Basket Trust and gold, with respect to the ETFS Gold Trust and the ETFS PM Basket Trust, each as coordinated by the LBMA, and in platinum, with respect to the ETFS Platinum Trust and the ETFS PM Basket Trust, and palladium, with respect to the ETFS Palladium Trust and the ETFS PM Basket Trust, coordinated by the LPPM are open for the transaction of business in London.

“ Order ” shall have the meaning ascribed to it in Section 1 of the Authorized Participant Agreement.

“ Order Cutoff Time ” shall have the meaning ascribed to the term in Section 1.1 of the relevant Trust Agreement.

“ Order Date ” shall have, (i) with respect to a Purchase Order, the meaning ascribed to the term in Section 2.3(a) of the relevant Trust Agreement; and (ii) with respect to a Redemption Order, the meaning ascribed to the term in Section 2.6(a) of the relevant Trust Agreement.

“ Ounce ” shall have the meaning ascribed to the term in Section 1.1 of the relevant Trust Agreement.

“ Palladium ” shall have the meaning ascribed to the term in Section 1.1 of the Trust Agreement of the ETFS Palladium Trust relating to palladium.

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

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“ Platinum ” shall have the meaning ascribed to the term in Section 1.1 of the Trust Agreement of the ETFS Platinum Trust relating to platinum.

“ PM Basket ” shall mean precious metal Shares with a pro-rata share of Gold, Silver, Platinum and Palladium as set out in Schedule A of the Authorized Participant Agreement.

“ Procedures ” shall have the meaning ascribed to it in Section 1 of the Authorized Participant Agreement.

“ Prospectus ” or “ Prospectuses ” means the current prospectus of the relevant Trust included in its effective registration statement, as supplemented or amended from time to time.

“ Purchase Order ” shall have the meaning ascribed to it in Section 1 of the Authorized Participant Agreement.

“ Redemption Order ” shall have the meaning ascribed to it in Section 1 of the Authorized Participant Agreement.

“ Shares ” means Shares issued by the relevant Trust pursuant to the provisions of the relevant Trust Agreement.

“ Silver ” shall have the meaning ascribed to the term in Section 1.1 of the Trust Agreement of the ETFS Silver Trust relating to silver.

“ Sponsor ” shall mean ETF Securities USA LLC, a Delaware limited liability company.

“ Sponsor Indemnified Party ” shall have the meaning ascribed to such term in Section 6.01. b of the Standard Terms.

“ Trustee ” shall mean The Bank of New York Mellon, a New York banking corporation, in its capacity as Trustee under each Trust Agreement, and any successor thereto in compliance with the provisions thereof.

“ Trust ” or “ Trusts ” shall have the meanings ascribed to them in the introductory paragraph of the Authorized Participant Agreement.

“ Trust Agreement ” or “ Trust Agreements ” shall have the meanings ascribed to them in the introductory paragraph of the Authorized Participant Agreement.

“ Unallocated Basis ” shall have the meaning ascribed to the term in Section 1.1 of the relevant Trust Agreement.

“ VAT ” shall mean (a) any tax imposed pursuant to or in compliance with the Sixth Directive of the Council of the European Economic Communities (77/388/EEC) including, in relation to the United Kingdom, value added tax imposed by the Value Added Tax Act 1994 and legislation and regulations supplemental thereto; and (b) any other tax of a similar nature, whether imposed in a

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member state of the European Union or elsewhere, in substitution for, or levied in addition to, such tax referred to in “(a)”.

Section 1.02. Interpretation . In these Procedures:

Unless otherwise indicated, all references to Sections, clauses, paragraphs, schedules or exhibits, are to Sections, clauses, paragraphs, schedules or exhibits in or to these Procedures.

To the extent that term(s) defined in Section 1.01 apply to a Trust that has not commenced operations as of any relevant date and such Trust is listed or to be listed on Schedule A of the Authorized Participant Agreement, such term(s) shall not be operative and any provisions relating to such a Trust and its Shares contained in the Authorized Participant Agreement shall have no effect until such Trust commences operations and its Trust Agreement and applicable Custodian Agreement have been executed and delivered whereupon such terms and provisions shall become automatically operative and effective without any further action by the parties to the Authorized Participant Agreement.

The words “hereof”, “herein”, “hereunder” and words of similar import shall refer to these Procedures as a whole, and not to any individual provision in which such words may appear.

A reference to any statute, law, decree, rule, regulation or other applicable norm shall be construed as a reference to such statute, law, decree, rule, regulation or other applicable norm as re-enacted, re-designated or amended from time to time.

A reference to any agreement, instrument or document shall be construed as a reference to such agreement, instrument or document as the same may have been amended from time to time in compliance with the provisions thereof.

ARTICLE II

CREATION PROCEDURES

Section 2.01. Initial Creation of Shares . The initial creation of Shares of a Trust will take place in compliance with such procedures as the Trustee, the Sponsor and the initial Depositor may agree.

Section 2.02. Subsequent Creation of Shares . After the Initial Creation, the issuance and Delivery of Shares of a specified Trust shall take place only in integral numbers of Baskets in compliance with the following rules:

a. Authorized Participants wishing to acquire from the Trustee one or more Baskets shall place a Purchase Order with the Trustee no later than 3:59:59 p.m. (New York time) on any Business Day. Purchase Orders received by the Trustee on or after the Order Cutoff Time on a Business Day shall be considered received at the opening of business on the next Business Day and shall have as their Order Date such next Business Day.

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b. For purposes of Section 2.02a. above, a Purchase Order shall be deemed “received” by the Trustee only when either of the following has occurred no later than 3:59:59 p.m. (New York time):

(i) Telephone/fax Order – An Authorized Representative shall have placed a telephone call to the Trustee’s Creation and Redemption Line and has received an Order Number from the Trustee for insertion in the Purchase Order, or

(ii) Web-based Order – An Authorized Representative shall have accessed the Trustee’s online services (www.etfservices.bankofny.com)

in either case informing the Trustee that the Authorized Participant wishes to place a Purchase Order for a specified number of Baskets and, in the case of a telephone order, within 15 minutes following such telephone call the Trustee shall have received a properly completed, irrevocable Purchase Order in the form set out in Annex I to these Procedures executed by an Authorized Representative of such Authorized Participant, via facsimile at the number specified in such Annex I.

c. The Trustee shall provide a written summary to the Sponsor and the Custodian of all accepted Purchase Orders for such Order Date no later than 5:30 p.m. (New York time).

d. As soon as reasonably practicable following receipt of a properly completed Purchase Order but not later than 5:30 p.m. (New York time) on the Order Date for such Purchase Order, the Trustee shall send to the Authorized Participant (with copy to the Custodian), via facsimile or electronic mail message, a copy of the corresponding Purchase Order endorsed “Accepted” by the Trustee and indicating the Basket Amount that the Authorized Participant shall Deliver to the Custodian in respect of each Basket. Prior to the transmission of the Trustee’s acceptance as specified above, a Purchase Order will only represent the Authorized Participant’s unilateral offer to deposit Bullion in exchange for Baskets of Shares and will have no binding effect upon the Trust or any other party. Following the transmission of the Trustee’s acceptance as specified above, a Purchase Order will be a binding agreement among the Trust and the Authorized Participant for the creation and purchase of Baskets of Shares and the deposit of Bullion pursuant to the terms of the Purchase Order and these Procedures. If a Purchase Order is rejected, the Trustee shall send to the Authorized Participant (with copy to the Custodian), via facsimile or electronic mail message, as soon as reasonably practicable, but not later than 5:30 p.m. (New York time) on the Order Date for such Purchase Order, a copy of the corresponding Purchase Order endorsed “Declined” by the Trustee and indicating the reason. The preceding sentence notwithstanding, Purchase Orders not accepted by 5:30 p.m. (New York time) on the Order Date shall be deemed cancelled. A Purchase Order which is not properly completed will be deemed invalid and rejected by the Trustee; the Authorized Participant may submit a corrected Purchase Order within the time period specified in Section 1.09 of the Standard Terms.

e. Each Purchase Order shall settle on the third Business Day following the Order Date. The Basket Amount corresponding to each Basket must be deposited in the Custodial Unallocated Account in unallocated Bullion loco London with respect to Silver and loco Zurich

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or loco London with respect to Gold, Platinum and Palladium no later than 11:00 a.m. (London time) on the third Business Day following the Order Date. With respect to Gold and where the Authorized Participant elects loco London, the Authorized Participant must first agree to the cost of the loco swap with the Custodian and reimburse the Custodian for any amount owed under such swap.

f. The Custodian shall advise the Trustee in writing of the deposits made to the Custodial Allocated Account in connection with each Purchase Order. Upon receipt of such advice, the Trustee shall determine whether a deposit of Bullion required to be made pursuant to Section 2.02e. has not been noted as deposited in the Trustee’s Custodial Unallocated Account. In such event, the Trustee shall, by the Trustee’s close of business on the second Business Day following the Order Date, (i) send to the Custodian, via electronic mail message, a request that the Custodian confirm that the Custodian did not receive the anticipated deposit of Bullion, and (ii) send to the Authorized Participant whose deposit was not received, via facsimile at the facsimile number specified by the Authorized Participant in the Purchase Order, a concurrent copy of such request.

g. On the third Business Day following the Order Date corresponding to a Purchase Order, or on such earlier date and time as the Trustee in its absolute discretion may agree with the Authorized Participant, the Trustee shall issue the aggregate number of Shares corresponding to the Baskets ordered by the Authorized Participant and Deliver them, by credit to the account at DTC which the Authorized Participant shall have identified for such purpose in its Purchase Order, provided that, by 9:00 a.m. (New York time) on the date such issuance and Delivery is to take place:

(i) the Custodian shall have reported in writing to the Trustee that the corresponding required amount of Bullion has been deposited in the Trustee’s Custodial Unallocated Account in compliance with the provisions of Section 2.02e. above and

(ii) the Authorized Participant shall have paid or agreed to pay the Trustee a per order transaction fee in the amount of US$500, if applicable.

h. In all other cases, the Trustee shall issue the aggregate number of Shares corresponding to the Baskets ordered by the Authorized Participant and Deliver them by credit to the account at DTC which the Authorized Participant shall have identified for such purpose in its Purchase Order on the Business Day following the date on which all of the conditions set forth in clauses (i) and (ii) of Section 2.02g. above shall have been met. In the event that, by 11:00 a.m. (New York time) on the third Business Day following the Order Date of a Purchase Order, the Trustee’s Custodial Unallocated Account shall not have been credited with the required amount of Bullion in compliance with the provisions of section 2.02e. above, the Trustee shall send to the Authorized Participant and the Custodian via fax or electronic mail message notice of such fact and the Authorized Participant shall have two (2) Business Days following receipt of such notice to correct such failure. If such failure is not cured within such two (2) Business Day period, the Trustee shall, unless the Sponsor shall otherwise direct, cancel such Purchase Order and will send via fax or electronic mail message notice of such cancellation to the Authorized

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Participant and the Custodian, and the Authorized Participant will be solely responsible for all costs incurred by the Trust, the Trustee or the Custodian related to the cancelled Order.

i. The foregoing provisions notwithstanding, neither the Trustee nor the Custodian shall be liable for any failure or delay in making Delivery of Shares in respect of a Purchase Order arising from nuclear fission or fusion, radioactivity, war, terrorist event, invasion, insurrection, civil commotion, riot, strike, act of government, public authority, public service or utility problems, power outages resulting in telephone, telecopy and computer failures, act of God such as fires, floods, extreme weather conditions, market conditions or activities causing trading halts, systems failures involving computer or other information systems affecting a Trust, the Trustee, the Custodian or sub-custodian and similar extraordinary events beyond the Trustee’s control. In the event of any such delay, the time to complete Delivery in respect of a Purchase Order will be extended for a period equal to that during which the inability to perform continues.

j. Except as provided in Sections 2.02d. , 2.02f. and 2.02h. , none of the Trustee, the Sponsor, the Custodian, nor any sub-custodian are under any duty, to give notification of any defects or irregularities in any Purchase Order or the delivery of the Basket Amount, and shall not incur any liability for the failure to give any such notification.

ARTICLE III

REDEMPTION PROCEDURES

Section 3.01. Redemption of Shares . Redemption of Shares of a specified Trust shall take place only in integral numbers of Baskets in compliance with the following rules:

a. Authorized Participants wishing to redeem one or more Baskets shall place a Redemption Order with the Trustee no later than 3:59:59 p.m. (New York time) on any Business Day. Redemption Orders received by the Trustee on or after the Order Cutoff Time on any Business Day shall be considered received at the opening of business on the next Business Day and shall have as their Order Date such next Business Day.

b. For purposes of Section 3.01a. above, a Redemption Order shall be deemed “received” by the Trustee only when either of the following has occurred no later than 3:59:59 p.m. (New York time):

(ii) Web-based Order – An Authorized Representative shall have accessed the Trustee’s online services (www.etfservices.bankofny.com)

in either case informing the Trustee that the Authorized Participant wishes to place a Redemption Order for a specified number of Baskets and, in the case of a telephone order, within 15 minutes

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following such telephone call the Trustee shall have received a duly completed, irrevocable Redemption Order in the form set out in Annex I to these Procedures executed by an Authorized Representative of such Authorized Participant, via facsimile at the number specified in such Annex I.

c. Upon receipt of a properly completed Redemption Order, the Trustee shall send to the Authorized Participant (with copy to the Custodian), via facsimile or electronic mail message, as soon as reasonably practicable, but not later than 5:30 p.m. (New York time) on the Order Date for such Redemption Order a copy of the corresponding Redemption Order endorsed “Accepted” by the Trustee and indicating the Basket Amount that the Custodian shall Deliver to the Authorized Participant in respect of each Basket being redeemed.

d. The Trustee shall, by the Trustee’s close of business on the second Business Day following the Order Date of a Redemption Order, confirm in writing to the Custodian whether each of the following has occurred:

(i) the Authorized Participant has Delivered to the Trustee’s account at DTC the total number of Shares to be redeemed by such Authorized Participant pursuant to such Redemption Order; and

(ii) the Authorized Participant has paid or agreed to pay the Trustee a per order transaction fee of US$500, if applicable.

Provided that the Custodian has received written confirmation from the Trustee that the conditions set forth in clauses (i) and (ii) of Section 3.01d. above have been satisfied, the Custodian shall, on the next following London Business Day, Deliver, as applicable to the specific Redemption Order, unallocated Silver loco London or unallocated Gold, Platinum or Palladium loco Zurich or loco London in the amounts specified in the communication sent in compliance with Section 3.01c. above, to the account indicated by the redeeming Authorized Participant in its Redemption Order (which shall be an appropriate bullion account with an LBMA member or LPPM member, as applicable for the type of Bullion involved). With respect to Gold and where the Authorized Participant elects loco London, the Authorized Participant must first agree to the cost of the loco swap with the Custodian and reimburse the Custodian for any amount owed under such swap. Having made such Delivery, the Custodian shall send written confirmation thereof to the Trustee who shall then cancel the Shares so redeemed.

e. In all other cases, Delivery must be completed by the Custodian as soon as, in the reasonable judgment of the Custodian, it is practicable following receipt of written confirmation from the Trustee that the conditions set forth in clauses (i) and (ii) of Section 3.01d. above have been satisfied.

f. The foregoing provisions notwithstanding, neither the Trustee nor the Custodian shall be liable for any failure or delay in making Delivery of Bullion in respect of a Redemption Order arising from nuclear fission or fusion, radioactivity, war, terrorist event, invasion, insurrection, civil commotion, riot, strike, act of government, public authority, public service or utility problems, power outages resulting in telephone, telecopy and computer failures, act of

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God such as fires, floods, extreme weather conditions, market conditions or activities causing trading halts, systems failures involving computer or other information systems affecting a Trust, the Trustee, the Custodian or sub-custodian and similar extraordinary events beyond the Trustee’s control. In the event of any such delay, the time to complete Delivery in respect of a Redemption Order will be extended for a period equal to that during which the inability to perform continues.

g. In the event that, by 4:00 p.m. (New York time) on the second Business Day following the Order Date of a Redemption Order, Trustee’s account at DTC shall not have been credited with the total number of Shares corresponding to the total number of Baskets to be redeemed pursuant to such Redemption Order, the Trustee shall send to the Authorized Participant and the Custodian via fax or electronic mail message notice of such fact and the Authorized Participant shall have two (2) Business Days following receipt of such notice to correct such failure. If such failure is not cured within such two (2) Business Day period, the Trustee (in consultation with the Sponsor) will cancel such Redemption Order and will send via fax or electronic mail message notice of such cancellation to the Authorized Participant and the Custodian, and the Authorized Participant will be solely responsible for all costs incurred by the Trust, the Trustee or the Custodian related to the cancelled Order.

h. The Custodian is not a clearing bank for platinum and palladium and will be reliant on its clearing agent in Zurich to credit its own account at that bank in order to effect creations and redemptions of Shares involving Platinum or Palladium. In the case of redemptions, it may take longer than three business days for Platinum or Palladium to be credited to such account and if so the settlement will be delayed.

i. The redemption of Shares may be suspended under the circumstances specified in the applicable Prospectus.

[ Signatures Follow on Next Page ]

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IN WITNESS WHEREOF , the Sponsor and the Trustee have executed these Creation and Redemption Procedures as of the date set forth above.

THE BANK OF NEW YORK MELLON , in its capacity as

Trustee


By:	/s/ Andrew Pfeifer
Name:	Andrew Pfeifer
Title:	Vice President
Date:	July 20, 2009

ETF SECURITIES USA LLC , in its capacity as Sponsor


By:	/s/ Graham Tuckwell
Name:	Graham Tuckwell
Title:	President and Chief Executive Officer
Date:	July 20, 2009

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ANNEX I TO CREATION AND REDEMPTION PROCEDURES

THE BANK OF NEW YORK MELLON, TRUSTEE
CREATION/REDEMPTION ORDER FORM
UNALLOCATED ORDERS ONLY


CONTACT INFORMATION FOR ORDER EXECUTION:
Telephone order number:	(718) 315-7500
Fax order number:	(732) 667-9478

Participant must complete all items in Part 1. The Trustee in its discretion may reject any order not submitted in proper form.

I. TO BE COMPLETED BY PARTICIPANT:

Name of Trust:

Date:

Time:

Broker Name:

Authorized Participant Firm Name:

DTC Participant Number:

Fax Number:

Telephone Number:

Symbol:

Type of order (Check Creation or Redemption please)


Creation:			Redemption:

# of Baskets:

Number of Baskets written out:

Order #

Please indicate Bullion clearing agent:

For Silver only	For Gold, Palladium and Platinum
HSBC o	JP Morgan o	Other (please specify clearing agent):


Account number for Bullion delivery:

(With respect to Gold, Platinum and Palladium only):

loco London o

loco Zurich o

This Purchase or Redemption Order is subject to the terms and conditions of the Trust Agreement of the Shares of the Trust as currently in effect and the Authorized Participant Agreement between the Authorized Participant, the Trustee and the Sponsor named therein. All representations and warranties of the Authorized Participant set forth in such Trust Agreement (including, if this is a Purchase Order, the representations in Section 3.2 of the Trust Agreement) and in the Authorized Participant Agreement are incorporated herein by reference and are true and accurate as of the date hereof.

The undersigned does hereby certify as of the date set forth below that he/she is an Authorized Representative under the Authorized Participant Agreement and that he/she is authorized to deliver this Purchase or Redemption Order to the Trustee on behalf of the Authorized Participant. The Authorized Participant acknowledges and agrees that (1) once accepted by the Trustee, this Purchase or Redemption Order will become a legally binding contract for the delivery of the Basket Amount per Basket, or the number of Baskets, indicated above, and that the final Basket Amount will be announced at the conclusion of the trading day and, (2) any taxes (including Value Added Taxes) incurred in connection with this transaction will be the responsibility of, and will be reimbursed upon demand from the Custodian or the Trust by, the Authorized Participant if required pursuant to the Authorized Participant Agreement.



		Authorized Representative’s Signature		Date

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II. TO BE COMPLETED BY TRUSTEE:

This certifies that the above order has been:

Accepted by the Trustee

Declined-Reason:

Final # of Ounces:

Final # of Shares:

Final Cash Due to BNYM


Date		Time		Authorized Signature of Trustee

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ANNEX II TO CREATION AND REDEMPTION PROCEDURES

ORDER ENTRY SYSTEM TERMS AND CONDITIONS

This Annex II shall govern use by Authorized Participant of the electronic order entry system for placing Purchase Orders and Redemption Orders for Shares (the “ System ”). Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in Schedule A of the Authorized Participant Agreement. In the event of any conflict between the terms of this Annex II and the main body of the Authorized Participant Agreement with respect to the placing of Purchase Orders and Redemption Orders, the terms of this Annex II shall control.

1. (a) Authorized Participant shall provide to The Bank of New York Mellon a duly executed authorization letter, in a form satisfactory to The Bank of New York Mellon, identifying those authorized persons who will access the System (the “ Authorized Persons ”). Authorized Participant shall notify The Bank of New York Mellon in writing in the event that any person’s status as an Authorized Person is revoked or terminated as soon as possible, in order to give The Bank of New York Mellon a reasonable opportunity to terminate such Authorized Person’s access to the System.

(b) It is understood and agreed that each Authorized Person shall be designated as an authorized user of Authorized Participant for the purpose of the Authorized Participant Agreement. Upon termination of the Authorized Participant Agreement, the Authorized Participant’s and each Authorized Person’s access rights with respect to System shall be immediately revoked.

2. The Bank of New York Mellon grants to Authorized Participant a personal, nontransferable and nonexclusive license to use the System solely for the purpose of transmitting Purchase Orders and Redemption Orders and otherwise communicating with The Bank of New York Mellon in connection with the same. Authorized Participant shall use the System solely for its own internal and proper business purposes. Except as set forth herein, no license or right of any kind is granted to Authorized Participant with respect to the System. Authorized Participant acknowledges that The Bank of New York Mellon and its suppliers retain and have title and exclusive proprietary rights to the System. Authorized Participant further acknowledges that all or a part of the System may be copyrighted or trademarked (or a registration or claim made therefor) by The Bank of New York Mellon or its suppliers. Authorized Participant shall not take any action with respect to the System inconsistent with the foregoing acknowledgments. Authorized Participant may not copy, distribute, sell, lease or provide, directly or indirectly, the System or any portion thereof to any other person or entity without The Bank of New York Mellon’s prior written consent. Authorized Participant may not remove any statutory copyright notice or other notice included in the System. Authorized Participant shall reproduce any such notice on any reproduction of any portion of the System and shall add any statutory copyright notice or other notice upon The Bank of New York Mellon’s request.

2. (a) Authorized Participant acknowledges that any user manuals or other documentation (whether in hard copy or electronic form) (collectively, the “ Material ”), which is delivered or made available to Authorized Participant regarding the System is the exclusive and confidential property of The Bank of New York Mellon. Authorized Participant shall keep the Material confidential by using the same care and discretion that Authorized Participant uses with respect to its own confidential property and trade secrets, but in no event less than reasonable care. Authorized Participant may make such copies of the Material as is reasonably necessary for Authorized Participant to use the System and shall reproduce The Bank of New York Mellon’s proprietary markings on any such copy. The foregoing shall not in any way be deemed to affect the copyright status of any of the Material which may be copyrighted and shall apply to all Material whether or not copyrighted. THE BANK OF NEW YORK MELLON AND ITS SUPPLIERS MAKE NO WARRANTIES, EXPRESS OR IMPLIED, CONCERNING THE MATERIAL OR ANY PRODUCT OR SERVICE, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

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(b) Upon termination of the Authorized Participant Agreement for any reason, Authorized Participant shall return to The Bank of New York Mellon all copies of the Material which is in Authorized Participant’s possession or under its control.

3. Authorized Participant agrees that it shall have sole responsibility for maintaining adequate security and control of the user IDs, passwords and codes for access to the System, which shall not be disclosed to any third party without the prior written consent of The Bank of New York Mellon. The Bank of New York Mellon shall be entitled to rely on the information received by it from the Authorized Participant and The Bank of New York Mellon may assume that all such information was transmitted by or on behalf of an Authorized Person regardless of by whom it was actually transmitted.

4. The Bank of New York Mellon shall have no liability in connection with the use of the System, the access granted to the Authorized Participant and its Authorized Persons hereunder, or any transaction effected or attempted to be effected by the Authorized Participant hereunder, except for damages incurred by the Authorized Participant as a direct result of The Bank of New York Mellon’s gross negligence or willful misconduct. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, IT IS HEREBY AGREED THAT IN NO EVENT SHALL THE BANK OF NEW YORK MELLON OR ANY MANUFACTURER OR SUPPLIER OF EQUIPMENT, SOFTWARE OR SERVICES BE RESPONSIBLE OR LIABLE FOR ANY SPECIAL, INDIRECT, OR CONSEQUENTIAL DAMAGES WHICH THE AUTHORIZED PARTICIPANT MAY INCUR OR EXPERIENCE BY REASON OF ITS HAVING ENTERED INTO OR RELIED ON THIS AGREEMENT, OR IN CONNECTION WITH THE ACCESS GRANTED TO AUTHORIZED PARTICIPANT HEREUNDER, OR ANY TRANSACTION EFFECTED OR ATTEMPTED TO BE EFFECTED BY AUTHORIZED PARTICIPANT HEREUNDER, EVEN IF THE BANK OF NEW YORK MELLON OR SUCH MANUFACTURER OR SUPPLIER HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, NOR SHALL THE BANK OF NEW YORK MELLON OR ANY SUCH MANUFACTURER OR SUPPLIER BE LIABLE FOR ACTS OF GOD, MACHINE OR COMPUTER BREAKDOWN OR MALFUNCTION, INTERRUPTION OR MALFUNCTION OF COMMUNICATION FACILITIES, LABOR DIFFICULTIES OR ANY OTHER SIMILAR OR DISSIMILAR CAUSE BEYOND SUCH PERSON'S REASONABLE CONTROL.

5. The Bank of New York Mellon reserves the right to revoke Authorized Participant’s access to the System immediately and without notice upon any breach by the Authorized Participant of the terms and conditions of this Annex II.

6. The Bank of New York Mellon shall acknowledge through the System its receipt of each Purchase Order or Redemption Order communicated through the System, and in the absence of such acknowledgment The Bank of New York Mellon shall not be liable for any failure to act in accordance with such orders and Authorized Participant may not claim that such Purchase Order or Redemption Order was received by The Bank of New York Mellon. The Bank of New York Mellon may in its discretion decline to act upon any instructions or communications that are insufficient or incomplete or are not received by The Bank of New York Mellon in sufficient time for The Bank of New York Mellon to act upon, or in accordance with such instructions or communications.

7. Authorized Participant agrees to use reasonable efforts to prevent the transmission through the System of any software or file which contains any viruses, worms, harmful component or corrupted data and agrees not to use any device, software, or routine to interfere or attempt to interfere with the proper working of the Systems.

8. Authorized Participant acknowledges and agrees that encryption may not be available for every communication through the System, or for all data. Authorized Participant agrees that The Bank of New York Mellon may deactivate any encryption features at any time, without notice or liability to Authorized Participant, for the purpose of maintaining, repairing or troubleshooting its systems.

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SCHEDULE 2- STANDARD TERMS


TABLE OF CONTENTS - SCHEDULE 2
		Page

ARTICLE I ORDERS FOR PURCHASE AND REDEMPTION
Section 1.01.	Authorization to Purchase and Redeem Baskets	1
Section 1.02.	Procedures for Orders	1
Section 1.03.	Consent to Recording	1
Section 1.04.	Irrevocability	1
Section 1.05.	Costs and Expenses	1
Section 1.06.	Delivery of Property to the Trust	2
Section 1.07.	Title to Deposit Property and Shares Surrendered for Redemption	2
Section 1.08.	Certain Payments or Distributions	3
Section 1.09.	Ambiguous Instructions	3

ARTICLE II AUTHORIZED REPRESENTATIVES
Section 2.01.	Certification	4
Section 2.02.	PIN Numbers	4
Section 2.03.	Termination of Authority	5
Section 2.04.	Verification	5

ARTICLE III STATUS OF THE AUTHORIZED PARTICIPANT
Section 3.01.	Clearing Status	5
Section 3.02.	Broker-Dealer Status	5
Section 3.03.	Foreign Status	6
Section 3.04.	Compliance with Certain Laws	6
Section 3.05.	Authorized Participant Status	6

ARTICLE IV ROLE OF AUTHORIZED PARTICIPANT
Section 4.01.	No Agency	6
Section 4.02.	Rights and Obligations of DTC Participant	6
Section 4.03.	Beneficial Owner Communications	6
Section 4.04.	Authorized Participant Customer Information	7

ARTICLE V MARKETING MATERIALS AND REPRESENTATIONS AND WARRANTIES
Section 5.01.	Authorized Participant’s Representation	7
Section 5.02.	Prospectus	8

ARTICLE VI INDEMNIFICATION; LIMITATION OF LIABILITY
Section 6.01.	Indemnification	8

ARTICLE VII MISCELLANEOUS
Section 7.01.	Commencement of Trading	10

STANDARD TERMS FOR AUTHORIZED PARTICIPANT AGREEMENTS (the “ Standard Terms ”) agreed to as of July 20, 2009 by and between The Bank of New York Mellon, a New York banking corporation (the “ Trustee ”), and ETF Securities USA LLC, a Delaware limited liability company (the “ Sponsor ”).

ARTICLE I

ORDERS FOR PURCHASE AND REDEMPTION

Section 1.01. Authorization to Purchase and Redeem Baskets . Subject to the provisions of the Authorized Participant Agreement, during the term of the Authorized Participant Agreement the Authorized Participant will be authorized to purchase and redeem Baskets of Shares in compliance with the provisions of the relevant Prospectus.

Section 1.02. Procedures for Orders . Each party hereto agrees to comply with the provisions of the relevant Prospectus and the Procedures to the extent applicable to it.

Section 1.03. Consent to Recording . The phone lines used by the Trustee, the Custodian, the Sponsor and/or their affiliated persons may be recorded, and the Authorized Participant hereby consents to the recording of all calls with any of those parties. In the event that the Trustee, the Custodian, the Sponsor or any of their affiliated persons becomes legally compelled to disclose to any third party any recording involving communications with the Authorized Participant, the Sponsor agrees to provide the Authorized Participant with reasonable advance written notice identifying the recordings to be so disclosed unless prohibited by applicable rule, law or order, together with copies of such recordings, so that the Authorized Participant may seek a protective order or other appropriate remedy with respect to the recordings or waive its right to do so. In the event that such protective order or other remedy is not obtained or the Authorized Participant waives its right to seek such protective order or remedy, the Sponsor will use commercially reasonable efforts to obtain reliable assurance that confidential treatment will be accorded the recorded conversation. The Trustee, the Sponsor or any of their affiliated persons shall not otherwise disclose to any third party any recording involving communications with the Authorized Participant without the Authorized Participant’s express written consent, except the Trustee and the Sponsor may disclose to any regulatory or self-regulatory organization, to the extent required by applicable rule or law, any recording involving communications with the Authorized Participant.

Section 1.04. Irrevocability . The Authorized Participant agrees that delivery to the Trustee of an Order shall be irrevocable; provided that the Trust will reject any Order that is not properly completed. In the event that the purchase or redemption of Baskets is suspended by the Trustee or the Sponsor and such suspension affects any Order submitted by the Authorized Participant, the Trustee or Sponsor, as applicable, will promptly notify the Authorized Participant of such suspension. In such case, the Sponsor agrees to undertake commercially reasonable efforts to accommodate any request by the Authorized Participant to cancel a previously placed Order.

Section 1.05. Costs and Expenses . The Authorized Participant shall be responsible for the expenses and costs incurred by the Trust that can be directly attributable to Orders submitted by the Authorized Participant other than ordinary course expenses and costs which are reimbursed through payment of the fee contemplated in Section 2.02(g) of the Procedures. The Trustee or

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the Sponsor shall provide the Authorized Participant with reasonably detailed information relating to such expenses and costs upon request by the Authorized Participant.

Section 1.06. Delivery of Property to the Trust and Shares Surrendered for Redemption . The Authorized Participant understands and agrees that in the event Deposit Property is not transferred to the Trust by the time specified for the Purchase Order, or Shares are not delivered to the Trustee by the time specified for the Redemption Order and, in each such case, in compliance with the Procedures and the relevant Prospectus, the Purchase Order or Redemption Order may be cancelled by the Trustee and the Authorized Participant will be solely responsible for all costs incurred by the Trust, the Trustee or the Custodian related to the cancelled Order. The Authorized Participant will not, however, be responsible for costs incurred by the Trust, the Trustee, or the Custodian related to cancelled Orders where the failure to transfer Deposit Property to the Trust is due to the gross negligence, bad faith, or reckless or willful misconduct of the Trustee, the Sponsor, or the Custodian. The foregoing provisions notwithstanding, the Authorized Participant shall not be liable for any failure or delay in making Delivery of Bullion in respect of a Purchase Order or for any failure or delay in surrendering Shares for redemption arising from nuclear fission or fusion, radioactivity, war, terrorist event, invasion, insurrection, civil commotion, riot, strike, act of government, public authority, public service or utility problems, power outages resulting in telephone, telecopy and computer failures, acts of God, such as fires, floods, extreme weather conditions, market conditions or activities causing trading halts, systems failures involving computer or other information systems affecting the Authorized Participant, or similar extraordinary events beyond the Authorized Participant’s control. In the event of any such delay, the time to complete Delivery in respect of a Purchase Order or Redemption Order will be extended for a period equal to that during which the inability to perform continues. Upon the deposit of any Bullion, the Authorized Participant as Depositor represents and warrants that (i) the Bullion meets the relevant requirements to be such Bullion and contains the required number of Ounces, (ii) the Authorized Participant is duly authorized to make such deposit of Bullion and (iii) at the time of delivery, the Bullion is free and clear of any lien, pledge, encumbrance, right, charge or claim.

Section 1.07. Title to Deposit Property and Shares Surrendered for Redemption . The Authorized Participant represents and warrants to the Trustee and the Sponsor that

a. in connection with each Purchase Order, the Authorized Participant will have the right and authority to transfer to the Trust the corresponding Deposit Property, and that upon delivery of such Deposit Property to the Custodian and/or the relevant sub-custodian in accordance with the Procedures, the Trust will acquire good and unencumbered title to such property, free and clear of all liens, charges, duties imposed on the transfer of assets and encumbrances and not subject to any adverse claims or transferability restrictions, whether arising by operation of law or otherwise; and

b. in connection with a Redemption Order, the Authorized Participant will have the right and authority to surrender to the Trustee for redemption the corresponding Shares, and upon such surrender the Trust will acquire good and unencumbered title to such Shares, free and clear of all liens, charges, duties imposed on the transfer of assets and encumbrances and not subject to any adverse claims, transferability restrictions (whether arising by operation of law or otherwise), loan, pledge, repurchase or securities lending agreements or other arrangements which, under such circumstances, would

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preclude the delivery of such Shares to the Trustee on the third Business Day following the date of the Redemption Order.

Section 1.08. Certain Payments or Distributions .

a. With respect to any Purchase Order, the Trustee acknowledges and agrees to return to the Authorized Participant or any Authorized Participant Client for which it is acting any payment, distribution or other amount paid to the Trust in respect of any Deposit Property transferred to the Trust that, based on the valuation of such Deposit Property at the time of transfer, should have been paid to the Authorized Participant or any Authorized Participant Client. Likewise, the Authorized Participant acknowledges and agrees to return to the Trust any payment, distribution or other amount paid to the Authorized Participant or any Authorized Participant Client in respect of any Deposit Property transferred to the Trust that, based on the valuation of such Deposit Property at the time of transfer, should have been paid to the Trust.

b. With respect to any Redemption Order, the Authorized Participant on behalf of itself and any Authorized Participant Client acknowledges and agrees to return to the Trust any payment, distribution or other amount paid to it or an Authorized Participant Client in respect of any property transferred to the Authorized Participant or any Authorized Participant Client that, based on the valuation of such property at the time of transfer, should have been paid to the Trust. The Trustee is entitled to reduce the amount of any property due to the Authorized Participant or any Authorized Participant Client by an amount equal to any payment, distribution or other sum to be paid to the Authorized Participant or to the Authorized Participant Client in respect of any property transferred to the Authorized Participant or any Authorized Participant Client that, based on the valuation of such property at the time of transfer, should be paid to the Trust. If, however, the Trustee so reduces an amount of any property appropriately due to the Authorized Participant, the Authorized Participant shall not be required to return to the Trust payments, distributions or other amounts equal to such reduction that has been paid to the Authorized Participant or the Authorized Participant Client as is contemplated in the first sentence of this Section 1.08(b) . Likewise, the Trust acknowledges and agrees to return to the Authorized Participant or any Authorized Participant Client any payment, distribution or other amount paid to it in respect of any Shares transferred to the Trust that, based on the valuation of such Shares at the time of transfer, should have been paid to the Authorized Participant or such Authorized Participant Client.

Section 1.09. Ambiguous Instructions . In the event that a Purchase Order or Redemption Order contains terms that differ from the information provided in the related telephone call or email transmission, the Trustee will attempt to contact the Authorized Participant to request confirmation of the terms of the order at the telephone number indicated in the Purchase Order or Redemption Order. If an Authorized Person confirms the terms as they appear in the Purchase Order or Redemption Order, then the order will be accepted and processed. If an Authorized Person contradicts the terms of the Purchase Order or Redemption Order, the order will be deemed invalid, and a corrected Purchase Order or Redemption Order must be received by the Trustee not later than the earlier of (i) within fifteen (15) minutes of such contact with the Authorized Person or (ii) thirty (30) minutes after the Order Cutoff Time. For the avoidance of doubt, notwithstanding the invalidation of the initial Purchase Order or Redemption Order pursuant to this paragraph, a Purchase Order or Redemption Order that is otherwise in proper

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form shall be deemed submitted at the time of its initial submission for purposes of determining when orders are deemed “received.” If the Trustee is not able to contact an Authorized Person, then the Purchase Order or Redemption Order shall be accepted and processed in accordance with its terms notwithstanding any inconsistency from the terms of the telephone information. In the event that a Purchase Order or Redemption Order contains terms that are illegible, the submission will be deemed invalid and the Trustee will attempt to contact the Authorized Participant to request retransmission. A corrected Purchase Order or Redemption Order must be received by the Trustee, as applicable, not later than the earlier of (i) within fifteen (15) minutes of such contact with the Authorized Participant or (ii) thirty (30) minutes after the Order Cutoff Time.

ARTICLE II

AUTHORIZED REPRESENTATIVES

Section 2.01. Certification . Concurrently with the execution of the Authorized Participant Agreement, the Authorized Participant shall deliver to the Trustee a certificate in a form as attached at Schedule 3-A to the Authorized Participant Agreement (an “ Authorized Representative Certificate ”) signed by the Authorized Participant’s Secretary or other duly authorized person setting forth the names, signatures, e-mail addresses and telephone and facsimile numbers of all persons authorized to give instructions relating to any activity contemplated hereby or any other notice, request or instruction on behalf of the Authorized Participant (each an “ Authorized Representative ”). Such certificate may be accepted and relied upon by the Trustee as conclusive evidence of the facts set forth therein and shall be considered to be in full force and effect until (i) receipt by the Trustee of a superseding Authorized Representative Certificate, or (ii) termination of the Authorized Participant Agreement. After such Authorized Representative Certificate is accepted by the Trustee, the Authorized Participant may authorize additional Authorized Representatives to give instructions relating to any activity contemplated hereby or any other notice, request or instruction on behalf of the Authorized Participant by delivering to the Trustee an addendum to the certificate described above in a form as attached at Schedule 3-B to the Authorized Participant Agreement.

Section 2.02. PIN Numbers . The Trustee shall issue to each Authorized Participant a unique personal identification number (“ PIN Number ”) by which such Authorized Participant shall be identified and instructions issued by the Authorized Participant shall be authenticated. The PIN Number shall be kept confidential and only provided to Authorized Representatives. The Authorized Participant may revoke the PIN Number at any time upon written notice to the Trustee, and the Authorized Participant shall be responsible for doing so in the event that it becomes aware that an unauthorized person has received access to its PIN Number or has or intends to use the PIN Number in an unauthorized manner. Upon receipt of such written request, the Trustee shall, as promptly as practicable, de-activate the PIN Number. If an Authorized Participant’s PIN Number is changed, the new PIN Number will become effective on a date mutually agreed upon by the Authorized Participant and the Trustee. Except as otherwise provided in these Standard Terms, the Authorized Participant agrees that, absent the Trustee’s fraud, gross negligence, bad faith or reckless or willful misconduct in failing to cancel the PIN Number promptly following a written request to do so from the Authorized Participant or the termination of the Authorized Participant Agreement, none of the Trust or the Trustee shall be liable for losses incurred by the Authorized Participant as a result of unauthorized use of the Authorized Participant’s PIN Number prior to the time when the Authorized Participant provides

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notice to the Trustee of the termination or revocation of authority pursuant to Section 2.03 and the Trustee has de-activated the PIN Number as provided for in this paragraph.

Section 2.03. Termination of Authority . Upon the termination or revocation of authority of an Authorized Representative by the Authorized Participant, the Authorized Participant shall (i) give, as promptly as practicable under the circumstances, written notice of such fact to the Trustee and such notice shall be effective upon receipt by the Trustee; and (ii) request a new PIN Number. The Trustee shall, as promptly as practicable, de-activate the PIN Number upon receipt of such written notice.

Section 2.04. Verification . The Trustee may assume that all instructions issued to it using the Authorized Participant’s PIN Number have been properly placed by Authorized Representatives, unless the Trustee has actual knowledge to the contrary or the Authorized Participant has revoked its PIN Number. The Trustee shall have no duty to verify that an Order is being placed by an Authorized Representative that uses a valid PIN Number. The Authorized Participant agrees that the Trustee shall not be responsible, absent the Trustee’s fraud, gross negligence, bad faith or reckless or willful misconduct, for any losses incurred by the Authorized Participant as a result of an Authorized Representative identifying himself or herself as a different Authorized Representative or an unauthorized person identifying himself or herself as an Authorized Representative, unless the Trustee previously received from the Authorized Participant written notice to revoke its PIN Number.

ARTICLE III

STATUS OF THE AUTHORIZED PARTICIPANT

Section 3.01. Clearing Status . The Authorized Participant represents, covenants and warrants that, as of the date of execution of the Authorized Participant Agreement, and at all times during the term of the Authorized Participant Agreement, the Authorized Participant is and will be entitled to use the clearing and settlement services of each of the national or international clearing and settlement organizations through which, in compliance with the Procedures, the transactions contemplated hereby will clear and settle. Any change in the foregoing status of the Authorized Participant shall terminate the Authorized Participant Agreement and the Authorized Participant shall give prompt written notice thereof to the Trustee.

Section 3.02. Broker-Dealer Status . The Authorized Participant represents and warrants that, if required under U.S. law, it is (i) registered as a broker-dealer under the Securities Exchange Act of 1934, as amended, (ii) qualified to act as a broker or dealer in the states or other jurisdictions where it transacts business to the extent so required by applicable law, and (iii) a member in good standing with FINRA. The Authorized Participant agrees that it will maintain such registrations, qualifications, and membership in good standing and in full force and effect throughout the term of the Authorized Participant Agreement. The Authorized Participant further agrees to comply with all applicable U.S. federal laws, the laws of the states or other jurisdictions concerned, and the rules and regulations promulgated thereunder, to the extent such laws and regulations are applicable to the Authorized Participant’s transactions in Shares, and with the FINRA By-Laws and Conduct Rules of the NASD (or with comparable FINRA Conduct Rules, if such NASD Conduct Rules are subsequently repealed, rescinded, or are otherwise replaced by FINRA Conduct Rules) to the extent the foregoing relates to the

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Authorized Participant’s activities with respect to, Shares, and that it will not offer or sell Shares in any state or jurisdiction where they may not lawfully be offered and/or sold.

Section 3.03. Foreign Status . If the Authorized Participant is offering and selling Shares in jurisdictions outside the several states, territories and possessions of the United States and is not otherwise required to be registered, qualified, or a member of FINRA as set forth in the preceding paragraph, the Authorized Participant nevertheless agrees to observe the applicable laws of the jurisdiction in which such offer and/or sale is made and to conduct its business in accordance with the FINRA Conduct Rules, to the extent the foregoing relates to the Authorized Participant’s transactions in, and activities with respect to, Shares.

Section 3.04. Compliance with Certain Laws . If the Authorized Participant is subject to the requirements of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (the “ U.S.A. PATRIOT Act ”), the Authorized Participant has policies and procedures reasonably designed to comply with the anti-money laundering and related provisions of the U.S.A. PATRIOT Act.

Section 3.05. Authorized Participant Status . The Authorized Participant understands and acknowledges that the method by which Baskets of Shares will be created and traded may raise certain issues under applicable securities laws. For example, because new Baskets of Shares may be issued and sold by the Trust on an ongoing basis, at any point a “distribution”, as such term is used in the 1933 Act, may occur.

ARTICLE IV

ROLE OF AUTHORIZED PARTICIPANT

Section 4.01. No Agency . The Authorized Participant acknowledges and agrees that for all purposes of the Authorized Participant Agreement, the Authorized Participant will have no authority to act as agent for the Trust or the Trustee in any matter or in any respect. The Authorized Participant agrees to make itself and its employees available, upon reasonable request, during normal business hours to consult with the Trustee, the Sponsor or their designees concerning the performance of the Authorized Participant’s responsibilities under the Authorized Participant Agreement; provided, however , that the Authorized Participant shall be under no obligation to divulge or otherwise disclose any information that the Authorized Participant reasonably believes (i) the disclosure of which to third parties is in violation of any applicable law or regulation or is otherwise prohibited, or (ii) is confidential or proprietary in nature.

Section 4.02. Rights and Obligations of DTC Participant . The Authorized Participant, as a DTC Participant, agrees that it shall be bound by all of the obligations of a DTC Participant in addition to any obligations that it undertakes hereunder or in accordance with the Procedures.

Section 4.03. Beneficial Owner Communications . The Authorized Participant agrees (i) subject to any limitations arising under federal or state securities laws relating to privacy, its internal privacy policies, or other obligations it may have to its customers, to assist the Trustee or the Sponsor in determining certain information regarding sales of Shares made by or through the Authorized Participant (including, without limitation, the ownership level of each beneficial owner relating to positions in Shares that the Authorized Participant may hold as record holder) upon the request of the Trustee or the Sponsor that is necessary for the Trustee or Sponsor to

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comply with their obligations to distribute information to beneficial owners of Shares under applicable state or federal securities laws or (ii) in lieu thereof, and at the option of the Authorized Participant, to forward to such beneficial owners written materials and communications received from the Sponsor or the Trustee in sufficient quantities to allow mailing thereof to such beneficial owners, including notices, annual reports, disclosure or other informational materials and any amendments or supplements thereto that may be required to be sent by the Sponsor or the Trustee to such beneficial owners pursuant applicable law or regulation or otherwise, or that the Sponsor or the Trustee reasonably wishes to distribute to such beneficial owners, in each case at the expense of the Sponsor and/or the Trust.

Section 4.04. Authorized Participant Customer Information . The Sponsor and the Trustee agree that the names and addresses and other information concerning the Authorized Participant’s customers are and shall remain the sole property of the Authorized Participant, and none of the Sponsor, the Trust, or the Trustee, or any of their respective affiliates shall use such names, addresses or other information for any purpose except in connection with the performance of their duties and responsibilities under the Authorized Participant Agreement, the Procedures, the Standard Terms and the applicable Prospectus and except for servicing and informational mailings related to the Trust(s) referred to in Section 4.03 above.

ARTICLE V

MARKETING MATERIALS AND REPRESENTATIONS AND WARRANTIES

Section 5.01. Authorized Participant’s Representation . The Authorized Participant represents, warrants and agrees that, in connection with any sale or solicitation of a sale of Shares, it will not make, or permit any of its representatives to make on its behalf, any representations concerning Shares other than those not inconsistent with the Trust’s then current Prospectus or any promotional materials or sales literature furnished to the Authorized Participant by the Sponsor. The Authorized Participant agrees not to furnish or cause to be furnished to any person or display or publish any information or materials relating to Shares (excluding, without limitation, promotional materials and sales literature, advertisements, press releases, announcements, statements, posters, signs or other similar materials not inconsistent with the Trust’s then current Prospectus and in accordance with applicable laws and regulations, and any materials prepared and used for the Authorized Participant’s internal use only or brokerage communications prepared by the Authorized Participant in the normal course of its business), except such information and materials as may be furnished to the Authorized Participant by the Sponsor and such other information and materials as may be approved in writing by the Sponsor. The Authorized Participant understands that the Trust will not be advertised as offering redeemable securities, and that any advertising materials will prominently disclose that the Shares are not redeemable units of beneficial interest in the Trust. Notwithstanding the foregoing, the Authorized Participant and its Affiliates and representatives may, without the approval of the Sponsor, prepare and circulate in the regular course of their respective businesses, research, reports, marketing materials, sales literature or similar materials that include information, opinions or recommendations relating to Shares (i) for public dissemination, provided that such reports, research, marketing materials, sales literature or other similar materials comply with applicable FINRA rules and (ii) for internal use by the Authorized Participant and its Affiliates and representatives.

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Section 5.02. Prospectus . The Sponsor will provide, or cause to be provided, to the Authorized Participant copies of the then current Prospectus and any printed supplemental information in reasonable quantities upon request. The Sponsor will, as promptly as practicable under the circumstances, notify the Authorized Participant when a revised, supplemented or amended Prospectus for the Shares is available, and deliver or otherwise make available to the Authorized Participant copies of such revised, supplemented or amended Prospectus at such time and in such quantities as may be reasonable to permit the Authorized Participant to comply with any obligation the Authorized Participant may have to deliver such Prospectus to its customers. The Sponsor will make such revised, supplemented or amended Prospectus available to the Authorized Participant no later than its effective date. The Sponsor shall be deemed to have complied with this Section 5.02 when the Authorized Participant has received such revised, supplemented or amended Prospectus by e-mail, in printable form, with such number of hard copies as may be agreed from time to time by the parties promptly thereafter

ARTICLE VI

INDEMNIFICATION; LIMITATION OF LIABILITY

Section 6.01. Indemnification . The provisions of this Section 6.01 shall survive termination of the Agreement.

a. The Authorized Participant shall indemnify and hold harmless the Sponsor, in its capacity as sponsor of the applicable Trust, the Trustee, the Trust and their respective Affiliates, subsidiaries, directors, officers, employees and agents, and each person, if any, who controls such persons within the meaning of Section 15 of the 1933 Act (each an “ AP Indemnified Party ”) from and against any loss, liability, cost and expense (including reasonable attorneys’ fees) incurred by such AP Indemnified Party as a result of (i) any breach by the Authorized Participant of any provision of the Authorized Participant Agreement that relates to the Authorized Participant; (ii) any failure on the part of the Authorized Participant to perform any of its obligations set forth in the Authorized Participant Agreement applicable to it; (iii) any failure by the Authorized Participant to comply in all material respects with applicable laws, including rules and regulations of self-regulatory organizations to the extent such laws, rules and regulations are applicable to the transactions being undertaken pursuant to the Authorized Participant Agreement; or (iv) actions of such AP Indemnified Party pursuant to any instructions issued in accordance with the relevant Prospectus, Authorized Participant Agreement, the Procedures, or the Standard Terms reasonably believed by the AP Indemnified Party to be genuine and to have been given by the Authorized Participant except to the extent that the Authorized Participant had previously revoked a PIN Number used in giving such instructions or representations (where applicable) and such revocation was given by the Authorized Participant and received by the Trustee in accordance with the terms of Section 2.03 hereto. The Authorized Participant shall not be liable under its indemnity agreement contained in this paragraph with respect to any claim made against any AP Indemnified Party unless the AP Indemnified Party shall have notified the Authorized Participant in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim was served upon the AP Indemnified Party (or after the AP Indemnified Party shall have received notice of service on any designated agent). However, failure to notify the Authorized Participant of any claim shall not relieve the Authorized Participant from any liability which it may

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have to any AP Indemnified Party against whom such action is brought otherwise than on account of its indemnity agreement contained in this paragraph and shall only release it from such liability under this paragraph to the extent it has been materially prejudiced by such failure to give notice. The Authorized Participant shall be entitled to participate at its own expense in the defense, or, if it so elects, to assume the defense of any suit brought to enforce any claims, but if the Authorized Participant elects to assume the defense, the defense shall be conducted by counsel chosen by it and satisfactory to the AP Indemnified Parties in the suit and who shall not, except with consent of the AP Indemnified Parties, be counsel to the Authorized Participant. If the Authorized Participant does not elect to assume the defense of any suit, it will reimburse the AP Indemnified Parties in the suit for the reasonable fees and expenses of any counsel retained by them.

b. The Sponsor hereby agrees to indemnify and hold harmless the Authorized Participant, its Affiliates, subsidiaries, directors, officers, employees and agents, and each person, if any, who controls such persons within the meaning of Section 15 of the 1933 Act (each a “ Sponsor Indemnified Party ”) from and against any loss, liability, cost and expense (including reasonable attorneys' fees) incurred by such Sponsor Indemnified Party as a result of (i) any breach by the Sponsor of any provision of the Authorized Participant Agreement that relates to the Sponsor; (ii) any failure on the part of the Sponsor to perform any of its obligations set forth in the Authorized Participant Agreement applicable to it; (iii) any failure on the part of the Sponsor to comply in all material respects with applicable laws, including rules and regulations of self-regulatory organizations to the extent such laws, rules and regulations are applicable to the transactions being undertaken pursuant to the Authorized Participant Agreement; (iv) actions of such Sponsor Indemnified Party pursuant to any instructions issued or representations made in accordance with the relevant Prospectus, Authorized Participant Agreement, the Procedures, or the Standard Terms reasonably believed by the Sponsor Indemnified Party to be genuine and to have been given by the Sponsor; or (v) any untrue statements or omissions made in any promotional material or sales literature furnished to the Authorized Participant by the Sponsor or otherwise approved in writing by the Sponsor. The Sponsor shall not be liable under its indemnity agreement contained in this paragraph with respect to any claim made against any Sponsor Indemnified Party unless the Sponsor Indemnified Party shall have notified the Sponsor in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon the Sponsor Indemnified Party (or after the Sponsor Indemnified Party shall have received notice of service on any designated agent). However, failure to notify the Sponsor of any claim shall not relieve the Sponsor from any liability which it may have to any Sponsor Indemnified Party against whom such action is brought otherwise than on account of its indemnity agreement contained in this paragraph and shall only release it from such liability under this paragraph to the extent it has been materially prejudiced by such failure to give notice. The Sponsor shall be entitled to participate at its own expense in the defense, or, if it so elects, to assume the defense of any suit brought to enforce any claims, but if the Sponsor elects to assume the defense, the defense shall be conducted by counsel chosen by it and satisfactory to the Sponsor Indemnified Parties in the suit and who shall not, except with the consent of the Sponsor Indemnified Parties, be counsel to the Sponsor. If the Sponsor does not elect to assume the defense of any suit, it will

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reimburse the Sponsor Indemnified Parties in the suit for the reasonable fees and expenses of any counsel retained by them.

d. No indemnifying party, as described in paragraphs (a) and (b) above, shall, without the written consent of the AP Indemnified Party or the Sponsor Indemnified Party, as the case may be, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification may be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (i) includes an unconditional release of the AP Indemnified Party or Sponsor Indemnified Party, as the case may be, from all liability arising out of such action or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any AP Indemnified Party or Sponsor Indemnified Party, as the case may be.

e. The Authorized Participant shall not be liable to any AP Indemnified Party for any damages arising out of (i) mistakes or errors in data provided in connection with purchase or redemption transactions except for data provided by the Authorized Participant, or (ii) mistakes or errors by, or arising out of interruptions or delays of communications with, the Trustee or any AP Indemnified Party.

f. The indemnification provided for in Section 6.01(a) shall not apply to the extent any such losses, liabilities, damages, costs and expenses are incurred as a result of any fraud, gross negligence, bad faith or reckless or willful misconduct on the part of an AP Indemnified Party. The indemnification provided for in Section 6.01(b) shall not apply to the extent any such losses, liabilities, damages, costs and expenses are incurred as a result of any fraud, gross negligence, bad faith or reckless or willful misconduct on the part of a Sponsor Indemnified Party.

f. The indemnity agreements contained in this Section 6.01 shall remain in full force and effect and shall survive any termination of this Agreement. The Sponsor and the Authorized Participant agree promptly to notify each other of the commencement of any Proceeding against it and against any of their officers or directors in connection with the issuance and sale of the Shares or in connection with the registration statement or the relevant Prospectus.

ARTICLE VII

MISCELLANEOUS

Section 7.01. Commencement of Trading . The Authorized Participant may not submit an Order prior to the effectiveness of the registration statement, or amendment to the registration statement, filed with the Securities and Exchange Commission and pursuant to which the Authorized Participant is identified as such in the relevant Prospectus.

[ Signatures Follow on Next Page ]

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IN WITNESS WHEREOF , the Sponsor and the Trustee have executed these Standard Terms as of the date set forth above.

THE BANK OF NEW YORK MELLON , in its capacity as Trustee


By:	/s/ Andrew Pfeifer
Name:	Andrew Pfeifer
Title:	Vice President
Date:	July 20, 2009

ETF SECURITIES USA LLC , in its capacity as Sponsor


By:	/s/ Graham Tuckwell
Name:	Graham Tuckwell
Title:	President and Chief Executive Officer
Date:	July 20, 2009

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SCHEDULE 3-A : AUTHORIZED REPRESENTATIVES OF THE AUTHORIZED
PARTICIPANT

Certificate of Authorized Representatives of the Authorized Participant

The following are the names, titles, signatures, phone numbers, and email addresses of all persons (each, an “Authorized Representative”) authorized to give instructions relating to any activity contemplated by the Authorized Participant Agreement between [AUTHORIZED PARTICIPANT], The Bank of New York Mellon and ETF Securities USA LLC dated [DATE] (the “Agreement”) or any other notice, request or instruction on behalf of the Authorized Participant pursuant to the Agreement.


Name:			Name:
Title:			Title:
Signature:			Signature:
Phone:			Phone:
Email:			Email:


Name:			Name:
Title:			Title:
Signature:			Signature:
Phone:			Phone:
Email:			Email:


Name:			Name:
Title:			Title:
Signature:			Signature:
Phone:			Phone:
Email:			Email:

The undersigned, [AP’S AUTHORIZED SIGNATORY], does hereby certify that the persons listed above have been duly authorized to act as Authorized Representatives pursuant to the Authorized Participant Agreement.


By:
Name:
Title:
Date:

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SCHEDULE 3-B : ADDENDUM TO CERTIFICATE OF AUTHORIZED
REPRESENTATIVES OF THE ETFS SILVER TRUST

[On AP’s Firm Letterhead]

[DATE]

Attn: Jarvis Joseph
The Bank of New York Mellon
2 Hanson Place — Floor 9th
Brooklyn, NY 11217
New York

Re:	Addendum to the Certificate of Authorized Representatives for [AUTHORIZED PARTICIPANT] under the Authorized Participant Agreement for the relevant Trusts sponsored by ETF Securities USA LLC dated [DATE] (the “Agreement”)

Ladies and Gentlemen:

Pursuant to the Agreement, the following are the names, titles, signatures, phone numbers, and email addresses of additional Authorized Representatives of [AUTHORIZED PARTICIPANT] (the “AP”) authorized to give instructions relating to any activity contemplated by the Agreement or any other notice, request or instruction on behalf of the AP pursuant to the Agreement. This list of Authorized Representatives is an addendum and adds further Authorized Representatives to the AP’s most recently executed certificate (entitled “Certificate of Authorized Representatives of the Authorized Participant”).


Name:			Name:
Title:			Title:
Signature:			Signature:
Phone:			Phone:
Email:			Email:


Name:			Name:
Title:			Title:
Signature:			Signature:
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Email:			Email:

Please provide PIN numbers for those listed above.

The undersigned, [AP’S AUHTORIZED SIGNATORY], does hereby certify that the persons listed above have been duly authorized to act as Authorized Representatives pursuant to the Authorized Participant Agreement.


By:
Name:
Title:
Date:

S3-2

CERTIFICATE OF BENEFICIAL INTEREST

Evidencing

FRACTIONAL UNDIVIDED INTERESTS

ETFS SILVER TRUST

ETFS PHYSICAL SILVER SHARES
ISSUED BY
ETFS SILVER TRUST
REPRESENTING
FRACTIONAL UNDIVIDED INTERESTS IN DEPOSITED SILVER AND ANY OTHER
TRUST PROPERTY

THE BANK OF NEW YORK MELLON, as Trustee

No. 1

* Shares

CUSIP: 26922X107

THE BANK OF NEW YORK MELLON, as Trustee (hereinafter called the Trustee), hereby certifies that CEDE & CO., as nominee of the Depository Trust Company, or registered assigns, is the owner of * Shares issued by ETFS Silver Trust, each representing a fractional undivided interest in the net assets of the Trust, as provided in the Agreement referred to below. At the time of delivery of the Agreement, each 100,000 Shares represented an interest in 100,000 Ounces of Silver that are deposited under the Agreement and held by the Custodian referred to in the Agreement. The amount of Silver in which each 100,000 Shares represents an interest will decline over time as provided in the Agreement. The Trustee’s Corporate Trust Office is located at a different address than its principal executive office. Its Corporate Trust Office is located at 2 Hanson Place, Brooklyn, New York, 11217, and its principal executive office is located at One Wall Street, New York, New York 10286.

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


Dated: 7/20/09	THE BANK OF NEW YORK MELLON,
	as Trustee


	By:	/s/ Andrew Pfeifer
		Andrew Pfeifer
		Vice President

THE TRUSTEE’S CORPORATE TRUST OFFICE ADDRESS IS
2 HANSON PLACE, BROOKLYN, NEW YORK 11217

July 20, 2009

ETF Securities USA LLC
as Sponsor to ETFS Silver Trust
c/o ETF Securities Representative Officer
2 London Wall Buildings, 6 ^th Floor
London, EC2M 5UU, United Kingdom
Attention: Graham Tuckwell

ETFS Silver Trust (Registration No. 333-156307)

Ladies and Gentlemen:

We have acted as counsel for ETF Securities USA LLC, a Delaware limited liability company (the “ Sponsor ”), the sponsor of ETFS Silver Trust, a grantor trust formed under the laws of the State of New York (the “ Trust ”), in connection with the Trust’s filing on December 19, 2008 with the Securities and Exchange Commission (the “ Commission ”) of its Registration Statement on Form S-1, including the prospectus included Part I of the Registration Statement (the “ Prospectus ”), under the Securities Act of 1933 (the “ 1933 Act ”) (No. 333-156307) and the Trust’s filing on March 23, 2009 with the Commission of its Pre-Effective Amendment No. 1 to the Registration Statement, Amendment No. 2 thereto filed with the SEC on April 27, 2009 and Amendment No. 3 thereto filed with the SEC on July 21, 2009 (as amended, the “ Registration Statement ”) relating to the issuance and sale by the Trust of 50,000,000 ETFS Physical Silver Shares (the “Shares” ).

In connection with this opinion, we have examined originals or copies, certified or otherwise identified to our satisfaction, of such instruments, documents and records as we have deemed relevant and necessary to examine for the purpose of this opinion, including (a) the Registration Statement, (b) the Trust's Depository Trust Agreement, (c) the pertinent provisions of the constitution and laws of the State of New York; and (d) such other instruments, documents, statements and records of the Trust and others and other such statutes as we have deemed relevant and necessary to examine and rely upon for the purpose of this opinion.

In connection with this opinion, we have assumed the legal capacity of all natural persons, the accuracy and completeness of all documents and records that we have reviewed, the

July 20, 2009
Page 2

genuineness of all signatures, the authenticity of the documents submitted to us as originals and the conformity to authentic original documents of all documents submitted to us as certified, conformed or reproduced copies.

Based upon the foregoing, we are of the opinion that the Shares proposed to be offered and sold pursuant to the Registration Statement, when it is made effective by the Commission or otherwise pursuant to the rules and regulations of the Commission, will have been validly authorized and, when sold in accordance with the terms of the Registration Statement and the requirements of applicable federal and state law and delivered by the Trust against receipt of the net asset value of the Shares, as described in the Registration Statement, will have been legally and validly issued and will be fully paid and non-assessable by the Trust.

This opinion is given as of the date hereof and we assume no obligation to advise you of changes that may hereafter be brought to our attention. This opinion is limited to the laws of the State of New York governing grantor trusts and matters such as the authorization and issuance of the Shares, the applicable provisions of the New York constitution and the reported judicial decisions interpreting such laws, and we do not express any opinion concerning any other laws.

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement, to be filed with the Commission, and to the use of our name in the Prospectus under the caption “Legal Matters” and in any revised or amended versions thereof. In giving such consent, however, we do not admit that we are within the category of persons whose consent is required by Section 7 of the 1933 Act, as amended, and the rules and regulations thereunder.

Respectfully submitted,

/s/ Katten Muchin Rosenman LLP

KATTEN MUCHIN ROSENMAN LLP

PJS/mb

LOGO

July 20, 2009

ETF Securities USA LLC
as Sponsor to ETFS Silver Trust
c/o ETF Securities Representative Officer
2 London Wall Buildings, 6 ^th Floor
London, EC2M 5UU, United Kingdom
Attention: Graham Tuckwell

The Bank of New York Mellon
as Trustee to ETFS Silver Trust
2 Hanson Place
Brooklyn, NY 11217
Attention: Donald Guire

Messrs. Tuckwell and Guire:

We are acting as special United States tax counsel to the ETFS Silver Trust (the “Trust”) in connection with the preparation of a registration statement on Form S-1 dated December 19, 2008, and Amendment No. 1 thereto filed with the Securities and Exchange Commission (the “SEC”) on March 23, 2009, Amendment No. 2 thereto filed with the SEC on April 27, 2009 and Amendment No. 3 thereto filed with the SEC on July 21, 2009 (the registration statement, together with each amendment thereto, the “Registration Statement”). The Registration Statement relates to the proposed issuance by the Trust, an investment trust formed on July 20, 2009 under New York law pursuant to a Depository Trust Agreement between ETF Securities USA LLC, as Sponsor, and The Bank of New York Mellon, as Trustee, of 50,000,000 shares, representing units of fractional undivided beneficial interest in and ownership of the Trust (the “Shares”).

In rendering this opinion, we have examined the Registration Statement and such other documents and materials as we have deemed necessary or appropriate to review for purposes of our opinion, and have made such investigations of law as we have deemed appropriate as a basis for the opinion expressed below. In addition, in rendering this opinion, we have relied upon and have assumed, with your permission, the accuracy of the statements contained in the Registration

ETF Securities USA LLC
The Bank of New York Mellon
July 20, 2009

Statement, and that the Trust will operate in the manner discussed in its organizational documents and the prospectus included in the Registration Statement (the “Prospectus”).

Our opinion is based on the Internal Revenue Code of 1986, as amended (the “Code”), Treasury Regulations promulgated thereunder, and administrative and judicial interpretations thereof, all as of the date hereof and all of which are subject to change, possibly on a retroactive basis. In rendering this opinion, we are expressing our views only as to United States federal income tax law.

Based on and subject to the foregoing, it is our opinion that the discussion relating to tax matters under the heading “United States Federal Income Tax Consequences” in the Prospectus correctly describes (subject to the qualifications contained therein) the material aspects of the United States federal income tax treatment to a Shareholder, as of the date hereof, of an acquisition of a Share pursuant to the Prospectus.

Our opinion relies on, and is subject to, the facts, representations and assumptions set forth or referenced herein. Any inaccuracy or subsequent change in such facts, representations or assumptions could adversely affect our opinion.

We hereby consent to the filing with the SEC of this letter as an exhibit to the Registration Statement and the reference to this letter and to us under the heading “United States Federal Income Tax Consequences” in the Prospectus. In giving such consent, we do not thereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act of 1933.

Very truly yours,

/s/ Katten Muchin Rosenman LLP

KATTEN MUCHIN ROSENMAN LLP

Exhibit 10.1

EXECUTION COPY

HSBC BANK USA, NATIONAL ASSOCIATION, LONDON BRANCH

and

THE BANK OF NEW YORK MELLON
solely in its capacity as trustee of the ETFS Silver Trust
and not individually

and

ETF SECURITIES USA LLC

______________________________________________

ALLOCATED ACCOUNT AGREEMENT
______________________________________________

THIS AGREEMENT is made with effect on and from 20 July 2009

BETWEEN

(1)	HSBC BANK USA, NATIONAL ASSOCIATION, LONDON BRANCH, a National Association incorporated in the State of Delaware, United States of America, whose principal place of business in England is at 8 Canada Square, London E14 5HQ (the “ Custodian ”);

(2)	THE BANK OF NEW YORK MELLON, a New York banking corporation, solely in its capacity as trustee of the ETFS Silver 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 in the Trust Agreement); and

(3)	ETF SECURITIES USA LLC , a limited liability corporation formed in Delaware, whose principal place of business is at ETF Securities Representative Office, 2 London Wall Buildings, 6 ^th Floor, London EC2M 5UU (the “ Sponsor ”).

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 allocated Bullion account number 19340 established in the name of the Trustee with the Custodian pursuant to this Agreement;

“ 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 silver 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 Allocated Account as the context requires;

“ 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 Bullion markets are open for the transaction of business in London;

“ 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;

“ HSBC net ” means the HSBC Group’s electronic system known as HSBC net which the Custodian authorises its customers to use from time to time pursuant to the terms of a separate agreement entered into between the Custodian and the customer;

“ 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 333-156307 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 July 21, 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 Shareholder in accordance with the Conditions;

“ Relevant Association ” means the London Bullion 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;

“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 Silver Shares” created pursuant to and constituted by 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 Silver Trust formed pursuant to the Trust Agreement

“ Trust Agreement ” means the Depositary Trust Agreement of the ETFS Silver Trust dated on or about July 20, 2009, as amended from time to time, between the ETF Securities USA LLC, as Sponsor, and Bank of New York Mellon, the Trustee;

“ Unallocated Account ” means the unallocated Bullion account number 19340 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 on or about July 20, 2009 among the Trustee, the Sponsor 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;

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 troy ounces to three decimal places.

2.4	*Reports:* Account reports will be provided to the Trustee by the Custodian by fax or by e-mail (at the option of the Trustee) by the close of each Business Day should there be any credits or debits to the Allocated Account that same day.

2.5	*Reversal of Entries:* The Custodian at all times reserves the right to reverse any provisional or erroneous entries to the Allocated Account 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 if 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) only such 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 or the Sponsor’s expense and shall be limited to no more than twice a calendar year.

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	*Standing Instructions; Notice Requirements:* Deposits of Bullion into the Allocated Account shall be pursuant to the standing instructions of the Trustee. In the absence of such standing instructions or for deposits of Bullion other than pursuant to such standing instructions, a notice relating to a deposit of Bullion into the Allocated Account must be in writing by the Trustee and received by the Custodian no later than 3:00 p.m., London Time, on the day which is one London Business Day prior to the date of deposit.

3.3	*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 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.

3.4	*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 through HSBC net (or such other authenticated method as may be agreed by the parties) or 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 subject to the conditions of the preceding clause 3.3 and will be promptly notified to the Trust 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.

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:* 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:* It is hereby agreed that only the Trustee shall have the right to give instructions to the Custodian for withdrawal of Bullion from the Allocated Account. All 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 it is hereby agreed that 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.	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.

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 silver 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:* Bullion must be held by the Custodian at its London vault 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.

7.5	*Allocated Account Reports:* For each Business Day, by no later than the following Business Day, we will transmit to you by HSBC net , SWIFT, email or facsimile, information showing the movement of Bullion into and out of your Allocated Account, and 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.

8.	SUB-CUSTODIANS

8.1	*Sub-Custodians:* The Custodian may appoint 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: The Bank of Nova Scotia (ScotiaMocatta), Deutsche Bank AG, JPMorganChase Bank, N.A., UBS AG, Barclays Bank PLC, Johnson Matthey plc, Brink’s Global Services Inc. and ViaMat International. The Custodian will notify each of the Trustee if it selects any additional Sub-Custodian, or stops using any Sub- Custodian for such purpose. The receipt of notice by the Trustee 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 any further delegate of such Sub-Custodian unless the appointment of that Sub-Custodian was made by the Custodian negligently or in bad faith.

9.	REPRESENTATIONS

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

	(1)	it is duly constituted and validly existing under the laws of its jurisdiction of constitution;

	(2)	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;

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

	(4)	this Agreement and the obligations created under it are binding upon and enforceable against the Trustee, as Trustee, 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; and

	(5)	the Trustee has received an indemnification from the Trust in the Trust Agreement in respect of any loss, liability or expense arising out of or in connection with the performance of its obligations under this Agreement incurred without (a) gross negligence, bad faith, wilful misconduct or wilful malfeasance on the part of the Trustee in connection with the performance of or (b reckless disregard on the part of the Trustee of its obligations and duties under this Agreement.

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

	(1)	it is duly constituted and validly existing under the laws of its jurisdiction of constitution;

	(2)	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;

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

	(4)	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.

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

	(1)	it is duly constituted and validly existing under the laws of its jurisdiction of constitution;

	(2)	the Sponsor 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;

	(3)	the persons entering into this Agreement on behalf of the Sponsor have been duly authorised to do so;

	(4)	this Agreement and the obligations created under it are binding upon the Sponsor and enforceable against the Sponsor 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 Sponsor is bound; and

	(5)	the Sponsor has received an indemnification from the Trust in the Trust Agreement in respect of any loss, liability or expense arising out of or in connection with the performance of its obligations under this Agreement incurred without (a) gross negligence, bad faith, wilful misconduct or wilful malfeasance on the part of the Sponsor in connection with the performance of or (b) reckless disregard on the part of the Sponsor of its obligations and duties under this Agreement.

10.	FEES AND EXPENSES

10.1	Fees: The Custodian shall charge for the services provided by it under this Agreement 10bps per annum and the Sponsor shall procure payment to the Custodian of such amount.

	The Fee will be calculated daily by applying the above fee rate divided by 365 (366 in a leap year), to the Custodian’s end of Business Day balance in the Allocated Account. Such fee shall be paid monthly in arrears as determined by the Custodian in Bullion relating to the same kind of Bullion and having the same denomination as that (or one of those) to which the Allocated Account relates.

10.2	*Expenses:* The Sponsor shall procure the payment to the Custodian on demand of all costs, charges and legal fees and expenses (excluding any relevant taxes and VAT, duties, other governmental charges, fees for storage and insurance of the Bullion, any fees and expenses of Sub-Custodians, and indemnification obligations of the Trustee under clause 12.5) 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 in 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) incurred by the Custodian in connection with the performance of its duties and obligations under this Agreement or otherwise in connection with the Bullion.

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

10.4	Default Interest: If the Trustee or the Sponsor 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.

10.5	*Recovery from Trust:* Amounts payable pursuant to this clause 10 shall not be debited from the Allocated Account, but shall be payable by the Sponsor 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 Company 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 performance of its duties (including as set out in clause 8.2), 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 (calculating the value using the next available prices for Bullion of the same type and amount on the relevant London Bullion market following the occurrence of 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. The Custodian shall not in any event be liable for any consequential loss, or loss of profit or goodwill, whether or not resulting from any negligence, fraud or wilful default on its part.

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 will maintain such insurance for its business, including its bullion and custody business, as it deems appropriate in connection with its

	custodial and other obligations and will be responsible for all costs, fees and expenses arising from the insurance policy or policies attributable to its relationship with the Trust. Consistent with industry standards, the Custodian maintains a group insurance policy that covers all metals held in its vaults for the accounts of all its customers for a variety of events. The Trustee and the Sponsor may, subject to confidentiality restrictions, be provided with details of this insurance coverage from time to time upon reasonable prior notice.

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, 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 the expenses assumed by the Sponsor 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.

	The Sponsor 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) which the Custodian may suffer or incur, directly or indirectly in connection with any breach of the Sponsor’s obligation under 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 2.7 and 12.3, the Custodian does not owe any duty or obligation or have any liability towards any person who is not a party to this Agreement. 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. 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 clauses 13.2 and 13.3 below, either the Trustee or the Custodian may terminate this Agreement for any reason or if the 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 (the “ Termination Date ”);

	(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 the fifth anniversary from the date of this Agreement and shall automatically renew for a further five years thereafter unless terminated by the Parties in accordance with this clause 13, provided that during such periods either the Trustee or the Custodian may terminate the agreement immediately upon written notice if:-

	(1)	the Custodian ceases to offer the services contemplated by this Agreement to its clients or proposes to withdraw from the Bullion business;

	(2)	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, Sponsor or the Trust to receive such services or for the Trustee or Sponsor to be a party to this Agreement;

	(3)	there is any event which, in the Custodian’s sole view, indicates the Trust’s insolvency or impending insolvency;

	(4)	there is any event which, in the Trustee’s sole view, indicates the Custodian’s insolvency or impending insolvency;

	(5)	in the event of the presentation of a winding up order, bankruptcy or analogous event in relation to either the Trustee or the Sponsor and no such replacement Trustee or Sponsor is identified within 90 days of such event;

	(6)	the Trust is to be terminated;

	(7)	the Trust Agreement is amended to remove the indemnification provisions described in 9.1(5) and 9.3(5) of this Agreement; or

	(8)	if the Unallocated Account Agreement ceases to be in full force and effect at any time, the Custodian shall have the right, by service of written notice on the Trustee, to terminate this Agreement immediately.

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 01. 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 Termination Date, 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:* Any Transfer Notice shall be in writing in English and shall be marked “Urgent – This Requires Immediate Attention” and signed (unless sent by HSBC net ) by or on behalf of the party giving it (or its duly authorised representative). Any Transfer Notice shall be sent either by facsimile or via HSBCn et 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;

	The Custodian:	HSBC Bank USA, National Association, London Branch
		8 Canada Square
		London
		E14 5HQ
		Attention: Tony J Dean
		Facsimile No. +44 (0)20 7992 4489


	The Trustee:
		The Bank of New York Mellon
		2 Hanson Place
		Brooklyn, New York 11217
		Attention: Donald Guire
		Facsimile: 718-315-4927

	The Sponsor:

		ETF Securities USA LLC
		c/o ETF Securities Representative Office
		6 ^th Floor
		2 London Wall Buildings
		London EC2M 5UU
		Telephone: +442074404330
		Attention: US Fund Services


	or such other address or facsimile number as shall have been notified (in accordance with this clause) to the other party hereto.

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 parties hereto with investment advice. In asking the Custodian to open and maintain the Allocated Account, the Trustee acknowledges that it is acting in reliance on its own judgment 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.

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 parties otherwise agree 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, and excludes any prior agreements or representations save for any made with fraudulent intent.

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.

15.10	Prior Agreements: The Custodian, or any member of the HSBC group of companies (the “ HSBC 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 HSBC 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 relating to the same subject matter.

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.

6.4	*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.

16.5	*Service of Process* : Process by which any proceedings are begun may be served on it 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:*

	HSBC Bank USA, National Association, London Branch
	8 Canada Square
	London, E14 5HQ
	Attention: Precious Metals Department

	*Trustee’s Address for service of process:*

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

Sponsor’s Address for Service of Process:
ETF Securities USA LLC
c/o ETF Securities Representative Office
6 ^th Floor
2 London Wall Buildings
London EC2M 5UU

EXECUTED by the Parties:

Signed on behalf of and for HSBC BANK USA, NATIONAL ASSOCIATION, LONDON BRANCH by


Signature	/s/ Dem Rousos
Name	Dem Rousos
Title	Authorized Signatory.

Signed on behalf of and for

THE BANK OF NEW YORK MELLON, solely in its capacity as trustee of the ETFS Silver Trust and not individually by


Signature	/s/ Andrew T. Pfeifer
Name	Andrew T. Pfeifer
Title	Vice President

Signed on behalf of and for ETF SECURITIES USA LLC by


Signature	/s/ Graham Tuckwell
Name	Graham Tuckwell
Title	President and Chief Executive Officer

Exhibit 10.2

EXECUTION COPY

HSBC BANK USA, NATIONAL ASSOCIATION, LONDON BRANCH

and

THE BANK OF NEW YORK MELLON
solely in its capacity as trustee of the ETFS Silver Trust
and not individually

and

ETF SECURITIES USA LLC

_______________________________________________

UNALLOCATED ACCOUNT AGREEMENT

_______________________________________________

THIS AGREEMENT is made with effect on and from July 20, 2009.

BETWEEN

(1)	HSBC BANK USA, NATIONAL ASSOCIATION, LONDON BRANCH, a National Association incorporated in the State of Delaware, United States of America, whose principal place of business is at 8 Canada Square, London E14 5HQ (the “ Custodian ”);

(2)	THE BANK OF NEW YORK MELLON , a New York banking corporation, solely in its capacity as trustee of the ETFS Silver 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 in the Trust Agreement); and

(3)	ETF SECURITIES USA LLC , a limited liability corporation formed in Delaware, whose principal place of business is at c/o ETF Securities Representative Office, 2 London Wall Buildings, 6 ^th Floor, London EC2M 5UU (the “ Sponsor ”).

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

“ Allocated Account ” means the allocated Bullion account number 19340 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 on or about July 20, 2009 between the Trustee, the Sponsor and the Custodian pursuant to which the Allocated Account is established and operated;

“ AP Account ” means a loco London account maintained on an unallocated basis by the Custodian 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 Business Day on which the 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 Fix but is subject to change by the Sponsor in accordance with the Trust Agreement.

“ 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;

“HSBC net ” means the HSBC Group’s electronic system known as HSBC net which the Custodian authorises its customers to use from time to time pursuant to the terms of a separate agreement entered into between the Custodian and the customer;

“ 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 Bullion market are open for the transaction of business in London;

“ 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 Trust in accordance with the terms of the Prospectus;

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

“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;

“Prospectus ” means the prospectus constituting a part of the registration statement filed on Form S-1, Registration Number 333-158221 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 July 21, 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 Shareholder in accordance with the Conditions;

“ Relevant Association” means the London Bullion 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;

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

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

“Sponsor Account” means a loco London 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 Silver Trust formed pursuant to the Trust Agreement;

“Trust Agreement” means the Depositary Trust Agreement of the ETFS Silver Trust dated on or about July 20, 2009, as amended from time to time, between the ETFS Securities USA LLC, as Sponsor, and the Trustee;

“ Unallocated Account ” means the unallocated Bullion account, number 19340 established in the name of the Trustee, with the Custodian pursuant to

	this Agreement on an Unallocated Basis;

	“Unallocated Basis” means, with respect to a Metal Account maintained with us, 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 Business Day on which the Trustee wishes a withdrawal of Bullion from the Unallocated Account to take place.

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 troy ounces to three decimal places.

2.3	*Reports:* Account reports will be provided to the Trustee by the Custodian by fax or by email (at the option of the Trustee) by the close of each London Business Day should there be any credits or debits to the Unallocated Account that same day.

2.4	*Reversal of Entries:* The Custodian at all times reserves the right to reverse any provisional or erroneous entries to the Unallocated Account 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 if 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) only such 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 or Sponsor’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 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 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	*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 Business Day prior to the Availability Date and specify the weight (in troy ounces of silver) 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 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.

3.3	*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 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 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

	(e)	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 Business Day prior to the Availability Date, at the Trust’s expense and risk; or

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

	and no other methods of withdrawal are permitted, save that the Trustee agrees to exercise its rights under clauses 4.1(e) and (f) on an exceptional basis only. Any Bullion made available to the relevant person (as instructed by the Trustee) pursuant to clause 4.1(e) and (f) 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 at the Benchmark Price.

4.2	*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), 4.1(b) or 4.1(d), to be in the form 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 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 instructions for the purposes of this Agreement) and be received by the Custodian no later than 3:00 p.m. (London time) on the day which is one London Business Day prior to the Withdrawal Date.

	(c)	if it relates to a withdrawal pursuant to clause 4.1(e) or (f), be received by the Custodian no later than 11:30 a.m. (London time) not less than two London 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 troy ounces of silver) of the Bullion to be debited to 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.

4.3	*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 3.3 and will be promptly notified to the Trust and the Trustee, such notice to be given in advance of implementation whenever practicable.

4.4	*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. All insurance and transportation costs shall be for the account of the Trust.

4.5	Risk: 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.

4.6	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) the London Business Day after receipt of notice given in the form prescribed in clause 4.2(b). Following the Custodian’s 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:* It is hereby agreed that 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 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 1100 fine ounces at the close of each London Business Day.

5.3	*Account not to be Overdrawn:* The Unallocated Account may not at any time have a debit balance thereon, and it is hereby agreed that 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 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.

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).

7.4	*Unallocated Account Reports:* For each London Business Day, by no later than the following London Business Day, the Custodian will transmit to the Trustee by HSBC net , SWIFT, email or facsimile information showing the increases and decreases to the Bullion standing to the Trustee’s credit in the Unallocated Account, and identifying separately each transaction and the New York business Day or London Business Day on which it occurred. On each London Business Day on which Bullion is deposited or that is a Withdrawal Date, the Custodian will send the Trustee a notification as of 9:00 a.m. (New York time) of (i) each separate transaction transferring Bullion to the Unallocated Account, including the amount of Bullion transferred to the Unallocated Account and the name on the account held with the Custodian from which such Bullion was transferred, (ii) the amount of Bullion transferred from the Unallocated Account to the Allocated 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.

8.	REPRESENTATIONS

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

	(1)	it is duly constituted and validly existing under the laws of its jurisdiction of constitution;

	(2)	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;

	(3)	the persons entering into this Agreement on the Trustee’s behalf have been duly Authorized to do so;

	(4)	this Agreement and the obligations created under it are binding upon and enforceable against the Trustee, as Trustee, 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; and

	(5)	the Trustee has received an indemnification from the Trust in the Trust Agreement in respect of any loss, liability or expense arising out of or in connection with the performance of its obligations under this Agreement incurred without (a) gross negligence, bad faith, willful misconduct or willful malfeasance on the part of the Trustee in connection with the performance of or (b) reckless disregard on the part of the Trustee of its obligations and duties under this Agreement.

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)	it is duly constituted and validly existing under the laws of its jurisdiction of constitution;

	(2)	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;

	(3)	the persons entering into this Agreement on behalf of the Custodian have been duly authorized to do so; and

	(4)	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.

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

	(1)	it is duly constituted and validly existing under the laws of its jurisdiction of constitution;

	(2)	the Sponsor 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;

	(3)	the persons entering into this Agreement on behalf of the Sponsor have been duly authorised to do so;

	(4)	this Agreement and the obligations created under it are binding upon the Sponsor and enforceable against the Sponsor 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 Sponsor is bound; and

	(5)	the Sponsor has received an indemnification from the Trust in the Trust Agreement in respect of any loss, liability or expense arising out of or in connection with the performance of its obligations under this Agreement incurred without (a) gross negligence, bad faith, willful misconduct or willful malfeasance on the part of the Sponsor in connection with the performance of or (b) reckless disregard on the part of the Sponsor of its obligations and duties under this Agreement.

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.

9.2	*Expenses:* The Sponsor shall procure the payment to the Custodian on demand of all costs, charges and legal fees and expenses (excluding relevant taxes and VAT, duties, other governmental charges, fees for storage and insurance of the Bullion and indemnification obligations of the Trustee under clause 11.5) 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 in 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 for storage and insurance of the Bullion) incurred by the Custodian in connection with the performance of its duties and obligations under this Agreement or otherwise in connection with the Bullion.

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

9.4	Default Interest: If the Trustee or the Sponsor 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.

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 (calculating the value using the

	next available prices for Bullion of the same type and amount on the relevant London Bullion market following the occurrence of 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 to the Allocated Account or to any other account held with the Custodian 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, provided, however, that if the Custodian delivers from the Unallocated Account to any location other than an account held with the Custodian or with any other clearing member of the London Bullion Market Association pursuant to clauses 4.1(e) or (f) 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, provided that any such claim is brought within ten London Business Days. The Custodian shall not in any event be liable for any consequential loss, or loss of profit or goodwill, whether or not resulting from any negligence, fraud or wilful default on its part.

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.

11.3	*Insurance:* The Custodian will maintain such insurance for its business, including its bullion and custody business, as it deems appropriate in connection with its custodial and other obligations and will be responsible for all costs, fees and expenses arising from the insurance policy or policies attributable to its relationship with the Trust. Consistent with industry standards, the Custodian maintains a group insurance policy that covers all metals held in its vaults for the accounts of all its customers for a variety of events. The Trustee and the Sponsor may, subject to confidentiality restrictions, be provided with details of this insurance coverage from time to time upon reasonable prior notice.

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, 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 the expenses assumed by the Sponsor 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.

	The Sponsor 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) which the Custodian may suffer or incur, directly or indirectly in connection with any breach of the Sponsor’s obligation under 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. 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. 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 clauses 12.2 and 12.3 below, either the Trustee or the Custodian may terminate this Agreement for any reason including if the 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 (the “ Termination Date ”);

	(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 either the Trustee or the Custodian may terminate the

	agreement immediately upon written notice if:

	(1)	the Custodian ceases to offer the services contemplated by this Agreement to its clients or proposes to withdraw from the Bullion business;

	(2)	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 it becomes unlawful for the Trustee, Sponsor or the Trust to receive such services or for the Trustee or Sponsor to be a party to this Agreement;

	(3)	there is any event which, in the Custodian’s sole view, indicates the Trust’s insolvency or impending insolvency;

	(4)	there is any event which, in the Trustee’s sole view, indicates the Custodian’s insolvency or impending insolvency;

	(5)	in the event of the presentation of a winding up order, bankruptcy or analogous event in relation to either the Trustee or the Sponsor and no such replacement Trustee or Sponsor is identified within 90 days of such event.

	(6)	the Trust is to be terminated;

	(7)	the Trust Agreement is amended to remove the indemnification provisions described in 8.1(5) and 8.3(5) of this Agreement; or

	(8)	the Allocated Account Agreement ceases to be in full force and effect at any time, the Custodian shall have the right, by service of written notice on the Trustee to terminate this Agreement immediately.

12.3	Change in Trustee: If there is any change in the identity of the Trustee in accordance with the Trust Agreement or of the Sponsor, then the Custodian, the Trustee, the Sponsor and the Trust shall execute such documents and shall take such actions as the new Trustee and the outgoing Trustee or the new Sponsor and the outgoing Sponsor may reasonably require for the purpose of vesting in the new Trustee or the new Sponsor (as the case may be) the rights and obligations of the outgoing Trustee, and releasing the outgoing Trustee or the outgoing Sponsor 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 in the Unallocated Account within six months of the date specified in the termination notice as the Termination Date, 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:* Any Transfer Notice shall be in writing in English and shall be marked “Urgent – This Requires Immediate Attention” and signed (unless sent via HSBC net ) by or on behalf of the party giving it (or its duly Authorized representative). Any Transfer Notice shall be sent either by facsimile or via HSBC net 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 Business Days in the case of inland post or seven London 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.

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


	The Custodian:	HSBC Bank USA, National Association, London Branch
		8 Canada Square
		London E14 5HQ

		Attention: Tony J Dean
		Facsimile No. +44 (0) 20 7992 4489

	The Trustee:	The Bank of New York Mellon
		2 Hanson Place
		Brooklyn, New York 11217

		Attention: Donald Guire
		Facsimile: 718-315-4927

	The Sponsor:	ETF Securities USA LLC
		c/o ETF Securities Representative Office
		6 ^th Floor
		2 London Wall Buildings
		London EC2M 5UU
		Telephone: +442074404330

Attention: US Fund Services

	or such other address or facsimile number as shall have been notified (in accordance with this clause) to the other party hereto.

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 parties hereto with investment advice. In asking the Custodian to open and maintain the Unallocated Account, the Trustee acknowledges that it is acting in reliance on its own judgment 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 from, the Unallocated Account.

14.2	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.

14.2	*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 parties otherwise agree 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, and excludes any prior agreements or representations the save for any made with fraudulent intent.

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 London Business Day, as the case may be, then the relevant obligations shall be performed on the next succeeding New York Business Day or London Business Day.

14.10	*Prior Agreements:* The Custodian, or any member of the HSBC group of companies (the “ HSBC 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 HSBC 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.

15.3	*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 it 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:*

	HSBC Bank USA, National Association, London Branch 8 Canada Square London, E14 5HQ Attention: Precious Metals Department

	*Trustee’s Address for Service of Process:*

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

	*Sponsor’s Address for Service of Process:* ETF Securities USA LLC c/o ETF Securities Representative Office 6 ^th Floor 2 London Wall Building London EC2M 5UU

EXECUTED by the parties:

Signed on behalf of and for
HSBC BANK USA, NATIONAL ASSOCIATION, LONDON BRANCH by


Signature		/s/ Dem Rousos
Name		Dem Rousos
Title		Authorized Signatory

Signed on behalf of and for
THE BANK OF NEW YORK MELLON solely in its capacity as trustee of the ETFS Silver Trust and not individually by


Signature		/s/ Andrew T. Pfeifer
Name		Andrew T. Pfeifer
Title		Vice President

Signed on behalf of and for ETF SECURITIES USA LLC by


Signature		/s/ Graham Tuckwell
Name		Graham Tuckwell
Title		President and Chief Executive Officer

The Depository Trust Company
A subsidiary of the Depository Trust & Clearing Corporation

BLANKET ISSUER LETTER OF REPRESENTATIONS

ETFS SILVER TRUST

June 25, 2009
(Date)

Attention: Underwriting Department
The Depository Trust Company
55 Water Street, 1SL
New York, NY 10041-0099

Ladies and Gentlemen:

This letter sets forth our understanding with respect to all issues (the “Securities”) that Issuer shall request to be made eligible for deposit by the Depository Trust Company (“DTC”).

Issuer is formed under the laws of the State of New York.

To induce DTC to accept the Securities as eligible for deposit at DTC, and to act in accordance with DTC’s Rules with respect to the Securities, Issuer represents to DTC that issuer will comply with the requirements stated in DTC’s Operational Arrangements, as they may be amended from time to time.

Note :		Very truly yours,
Schedule A contains statements that DTC believes
accurate describe DTC, the method of effecting		ETFS SILVER TRUST,
book-entry transfers of securities distributed
through DTC, and certain related matters.		by ETF Securities USA LLC, as sponsor

Received and Accepted		By:	/s/ Greg Burgess
THE DEPOSITORY TRUST COMPANY			(Authorized Officer’s Signature”)

By:	/s/ The Depository Trust Company		Greg Burgess
			(Print Name)

			Ordnance House, 31 Pier Road, St. Helier JE48 PW
			(Street Address)

			Jersey, Channel Islands
			(City, State, Country, Zip)

			011-44-77-997-8005
			(Phone Number)

			Greg.Burgess@etfsecurities.com
			(Email Address)

Exhibit 10.4

ETFS SILVER TRUST
MARKETING AGENT AGREEMENT

MARKETING AGENT AGREEMENT (the “Agreement”) made as of July 16 2009, on behalf of ETFS Silver Trust, a New York trust (the “Fund” or the “Trust”), by and among ETFS Marketing, LLC, a Delaware limited liability company, as agent of the Fund (“ETFS Marketing”) and ALPS Distributors, Inc., a Colorado corporation (the “Marketing Agent”). Capitalized terms used but not defined in this Agreement shall have the meaning ascribed thereto in the Trust’s Prospectus included its Registration Statement on Form S-1 (Registration No. 333-156307), as it may be amended from time-to-time.

W I T N E S S E T H:

WHEREAS, ETF Securities USA LLC, as sponsor of the Trust (the “Sponsor”), on behalf of the Fund, has filed with the Securities and Exchange Commission (the “Commission” or “SEC”) a registration statement on Form S-1 (Registration No. 333-156307) and amendments thereto, including as part thereof a prospectus (the “Prospectus”), under the Securities Act of 1933, as amended (the “1933 Act”), the forms of which have heretofore been delivered to the Marketing Agent; and

WHEREAS, ETFS Marketing has been engaged to provide marketing services in the United States; and

WHEREAS, the Trust and ETFS Marketing wish to employ the Marketing Agent in connection with the performance of the services listed in Schedule A and additional services as may be agreed from time-to-time;

NOW, THEREFORE, in consideration of the mutual promises and undertakings herein contained, the parties agree as follows:

1. Registration — ETFS Marketing has furnished or will furnish, upon request, the Marketing Agent with copies of the Trust’s trust agreement, custodian agreements, transfer agency agreement, current prospectus, and all forms relating to any plan, program or service offered by the Trust. ETFS Marketing shall furnish, within a reasonable time period, to the Marketing Agent a copy of any amendment or supplement to any of the above-mentioned documents. Upon request, ETFS Marketing shall furnish promptly to the Marketing Agent any additional documents necessary or advisable to perform its functions hereunder. As used in this Agreement the terms “registration statement,” “prospectus” shall mean any registration statement and prospectus filed by the Trust with the SEC and any amendments and supplements thereto that are filed with the SEC.

2. Representations and Warranties of ETFS Marketing – ETFS Marketing represents and warrants and covenants the following:

(a) ETFS Marketing has been duly organized and is validly existing as a limited liability company in good standing under the laws of the State of Delaware, with full power and authority to conduct its business as described in the Registration Statement and the Prospectus, and has all requisite power and authority to execute and deliver this Agreement;

(b) the Fund and ETFS Marketing are duly qualified and are in good standing in each jurisdiction where the conduct of its business requires such qualification; and

(d) this Agreement has been duly authorized, executed and delivered by ETFS Marketing and constitutes the valid and binding obligations of ETFS Marketing, enforceable against ETFS Marketing in accordance with its terms.

3. Representations and Warranties of the Marketing Agent - The Marketing Agent represents and warrants and covenants the following:

(a) The Marketing Agent is registered as a broker-dealer under the Exchange Act, and is a member in good standing of the Financial Industry Regulatory Authority (“FINRA”) and is qualified to act as a broker or dealer in the states or other jurisdictions where the nature of its business so requires; and has all other necessary licenses, authorizations, consents and approvals and has made all necessary filings required under any federal, state, local or foreign law, regulation or rule, and has obtained all necessary authorizations, consents and approvals from other Persons, in order to conduct its activities as contemplated by this Agreement. The Marketing Agent will maintain any such registrations, qualifications and membership in good standing and in full force and effect throughout the term of this Agreement. The Marketing Agent will comply with all applicable federal laws, including but not limited to, federal securities and commodities laws, the laws of the states or other jurisdictions concerned, and the rules and regulations promulgated thereunder, and with the Constitution, By-Laws and Conduct Rules of FINRA;

(b) The Marketing Agent (i) has been duly organized and is validly existing as a corporation in good standing under the laws of the State of Colorado, with full power and authority to conduct its business and has all requisite power and authority to execute and deliver this Agreement and (ii) is duly qualified and is in good standing in each jurisdiction where the conduct of its business requires such qualification; and

(c) This Agreement has been duly authorized, executed and delivered by the Marketing Agent and constitutes the valid and binding obligations of the Marketing Agent, enforceable against the Marketing Agent in accordance with its terms.

4. Fees and Trust Expenses — (a) In consideration of the services to be performed by the Marketing Agent hereunder as set forth on Schedule A attached hereto and as it may be amended from time-to-time, ETFS Marketing will pay the Marketing Agent an annual fee in the amount of $20,000 per annum to be paid in 1/12 equal monthly installments commencing on launch date of the Trust, subject to any limitation imposed by any law, rule or regulation applicable to any of the parties hereto. The fee shall not exceed $100,000 for the five-year period beginning from the date of this agreement.

(b) ETFS Marketing shall reimburse the Marketing Agent for any reasonable fees or disbursements incurred by the Marketing Agent in connection with the performance by the Marketing Agent of its duties under and pursuant to this Agreement including, but not limited to, the items identified as Out of Pocket Expenses in Schedule B of this agreement. These fees shall not exceed $92,725 for the five-year period beginning from the date of this agreement. Further, unless otherwise agreed to by the parties hereto in writing, the Marketing Agent shall not be responsible for fees and expenses in connection with (a) filing of any registration statement, printing and the distribution of any prospectus under the 1933 Act and amendments prepared for use in connection with the offering of shares for sale to the public, preparing, setting in type, printing and mailing the prospectus, and any supplements thereto sent to shareholders of the Trust, (b) preparing, setting in type, printing and mailing any report (including annual and semi-annual reports) or other communication to shareholders of the Trust, and (c) the Blue Sky registration and qualification of shares of the Trust for sale in the various states in which the officers of the Trust shall determine it advisable to qualify such shares of the Trust for sale (including registering the Trust as a broker or dealer or any officer of the Trust or any Trust as agent or salesman in any state).

5. Use of the Marketing Agent’s Name — Neither the Trust nor ETFS Marketing, or any of their affiliates, shall use the name of the Marketing Agent, or any of its affiliates, in any prospectus, sales literature, and other material relating to the Trust in any manner without the prior written consent of the Marketing Agent (which shall not be unreasonably withheld); provided , however , that the Marketing Agent hereby approves all lawful uses of the names of the Marketing Agent and its affiliates in the prospectus of the Trust and in all other materials which merely refer to accurate terms to their appointment hereunder or which are required by the SEC, FINRA, OCC or any state securities authority.

6. Use of the Trust’s Name — Neither the Marketing Agent nor any of its affiliates shall use the name of the Trust in any publicly disseminated materials, including sales literature in any manner without the prior consent of ETFS Marketing (which shall not be unreasonably withheld); provided , however , that ETFS Marketing hereby approves all lawful uses of its or the Trust’s names in any required regulatory filings of the Marketing Agent which merely refer in accurate terms to the appointment of the Marketing Agent hereunder, or which are required by the SEC, FINRA, or any state securities authority.

7. Indemnification of Marketing Agent - ETFS Marketing agrees to indemnify, defend and hold harmless the Marketing Agent, its partners, stockholders, members, directors, officers and employees of the foregoing, and the successors and assigns of all of the foregoing, from and against any loss, damage, expense, liability or claim (including the reasonable cost of investigation) which the Marketing Agent or any such person may incur under the 1933 Act, the Securities Exchange Act of 1934 (the “Exchange Act”), the common law or otherwise, insofar as such loss, damage, expense, liability or claim arises out of or is based upon:

(a)		any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or in the Registration Statement as amended or supplemented) or in a Prospectus (the term Prospectus being deemed to include the Prospectus and the Prospectus as amended or supplemented), or arises out of or is based upon any omission or alleged omission to state a material fact required to be stated in either such Registration Statement or such Prospectus or necessary to make the statements made therein not misleading, except for any statements provided in writing, directly or indirectly through ETFS Marketing, by the Marketing Agent to the Sponsor for inclusion in such Registration Statement or such prospectus or any material omissions therefrom;

(b)		any untrue statement or alleged untrue statement of a material fact or breach by ETFS Marketing of any representation or warranty contained in this Agreement;

(c)		the failure by ETFS Marketing to perform when and as required any agreement or covenant contained herein;

(d)		any untrue statement of any material fact contained in any audio or visual materials provided by ETFS Marketing or based upon written information furnished by or on behalf of ETFS Marketing including, without limitation, slides, videos, films or tape recordings used in connection with the marketing of the Trust;

(e)		the Marketing Agent’s performance of its duties under this Agreement except in the case of this clause (e), for any loss, damage, expense, liability or claim resulting from the gross negligence or willful misconduct of the Marketing Agent. In no case is the indemnity of ETFS Marketing in favor of the Marketing Agent deemed to protect the Marketing Agent against any liability to ETFS Marketing to which the Marketing Agent would otherwise be subject by reason of willful misfeasance, bad faith or gross negligence in the performance of

its duties or by reason of its reckless disregard of its obligations and duties under this Agreement.

If any action, suit or proceeding (each, a “Proceeding”) is brought against the Marketing Agent in respect of which indemnity may be sought against ETFS Marketing pursuant to the foregoing paragraph, the Marketing Agent shall promptly notify ETFS Marketing in writing of the institution of such Proceeding and ETFS Marketing shall assume the defense of such Proceeding, including the employment of counsel reasonably satisfactory to such indemnified party and payment of all fees and expenses; provided, however, that the omission to so notify ETFS Marketing shall not relieve ETFS Marketing from any liability which it may have to the Marketing Agent hereunder except to the extent that it has been materially prejudiced by such failure. The Marketing Agent shall have the right to employ its or their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of the Marketing Agent unless the employment of such counsel shall have been authorized in writing by ETFS Marketing in connection with the defense of such Proceeding or ETFS Marketing shall not have, within a reasonable period of time in light of the circumstances, employed counsel to have charge of the defense of such Proceeding or such indemnified party or parties shall have reasonably concluded that there may be defenses available to it or them which are different from, additional to or in conflict with those available to ETFS Marketing (in which case ETFS Marketing shall not have the right to direct the defense of such Proceeding on behalf of the indemnified party or parties), in any of which events such fees and expenses shall be borne by ETFS Marketing and paid as incurred (it being understood, however, that ETFS Marketing shall not be liable for the expenses of more than one separate counsel (in addition to any local counsel) in any one Proceeding or series of related Proceedings in the same jurisdiction representing the indemnified parties who are parties to such Proceeding).

ETFS Marketing shall not be liable for any settlement of any Proceeding effected without ETFS Marketing’s written consent, but if settled with ETFS Marketing’s written consent, ETFS Marketing agrees to indemnify and hold harmless the Marketing Agent from and against any loss or liability by reason of such settlement. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second sentence of the foregoing paragraph, then the indemnifying party agrees that it shall be liable for any settlement of any Proceeding effected without its written consent if (i) such settlement is entered into more than 60 Business Days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall not have fully reimbursed the indemnified party in accordance with such request prior to the date of such settlement and (iii) such indemnified party shall have given the indemnifying party at least 30 Business Days’ prior notice of its intention to settle. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened Proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such Proceeding and does not include an admission of fault, culpability or a failure to act, by or on behalf of such indemnified party.

8. Indemnification of ETFS Marketing and the Trust - The Marketing Agent agrees to indemnify, defend and hold harmless ETFS Marketing and the Trust, their partners, shareholders, members, directors, officers and employees of the foregoing, and the controlling persons of all of the foregoing, within the meaning of Section 15 of the 1933 Act or Section 20 of the Exchange Act, and the successors and assigns of all of the foregoing, from and against any loss, damage, expense, liability or claim (including the

reasonable cost of investigation) which ETFS Marketing may incur under the 1933 Act, the Exchange Act, the common law or otherwise, insofar as such loss, damage, expense, liability or claim arises out of or is based upon any untrue statement or alleged untrue statement of a material fact contained in and in conformity with information furnished in writing, directly or indirectly through ETFS Marketing, by or on behalf of the Marketing Agent to the Sponsor expressly for use in the Registration Statement (or in the Registration Statement as amended or supplemented by any post-effective amendment thereof) or in a Prospectus, or arises out of or is based upon any omission or alleged omission to state a material fact in connection with such information required to be stated in such Registration Statement or such Prospectus or necessary to make such information not misleading.

The Marketing Agent will also indemnify ETFS Marketing and the Trust as stated above insofar as such loss, damage, expense, liability or claim arises out of or is based upon the Marketing Agent’s performance of its duties under this Agreement, except in the case of any loss, damage, expense, liability or claim resulting from the gross negligence or willful misconduct of ETFS Marketing or the Trust. In no case is the indemnity of the Marketing Agent in favor of ETFS Marketing and the Trust to be deemed to protect ETFS Marketing and the Trust against any liability to the Marketing Agent to which ETFS Marketing or the Trust would otherwise be subject by reason of willful misfeasance, bad faith or gross negligence in the performance of its duties or by reason of its reckless disregard of ETFS Marketing’s obligations and duties under this Agreement.

If any Proceeding is brought against ETFS Marketing or the Trust in respect of which indemnity may be sought against the Marketing Agent pursuant to the first paragraph of this Section 8, ETFS Marketing shall promptly notify the Marketing Agent in writing of the institution of such Proceeding and the Marketing Agent shall assume the defense of such Proceeding, including the employment of counsel reasonably satisfactory to such indemnified party and payment of all fees and expenses; provided, however, that the omission to so notify the Marketing Agent shall not relieve the Marketing Agent from any liability hereunder which it may have to ETFS Marketing except to the extent that it has been materially prejudiced by such failure. ETFS Marketing and the Trust shall have the right to employ their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of ETFS Marketing unless the employment of such counsel shall have been authorized in writing by the Marketing Agent in connection with the defense of such Proceeding or the Marketing Agent shall not have, within a reasonable period of time in light of the circumstances, employed counsel to defend such Proceeding or such indemnified party or parties shall have reasonably concluded that there may be defenses available to it or them which are different from or additional to or in conflict with those available to the Marketing Agent (in which case the Marketing Agent shall not have the right to direct the defense of such Proceeding on behalf of the indemnified party or parties, but the Marketing Agent may employ counsel and participate in the defense thereof but the fees and expenses of such counsel shall be at the expense of the Marketing Agent), in any of which events such fees and expenses shall be borne by the Marketing Agent and paid as incurred (it being understood, however, that the Marketing Agent shall not be liable for the expenses of more than one separate counsel (in addition to any local counsel) in any one Proceeding or series of related Proceedings in the same jurisdiction representing the indemnified parties who are parties to such Proceeding).

The Marketing Agent shall not be liable for any settlement of any such Proceeding effected without the written consent of the Marketing Agent but if settled with the written consent of the Marketing Agent, the Marketing Agent agrees to indemnify and hold harmless ETFS Marketing and the Trust from and against any loss or liability by reason of such settlement. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by the second sentence of the foregoing paragraph, then the indemnifying party agrees that it shall be liable for any settlement of any Proceeding effected without its written consent if (i) such settlement is entered into more than 60 Business Days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall not have reimbursed the

indemnified party in accordance with such request prior to the date of such settlement and (iii) such indemnified party shall have given the indemnifying party at least 30 Business Days’ prior notice of its intention to settle. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened Proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such Proceeding.

9. Term — This Agreement shall become effective as of July 20, 2009, and shall continue until two years from such date and thereafter shall continue automatically for successive annual periods, provided that such continuance is specifically approved at least annually by ETFS Marketing. This Agreement is terminable without penalty on sixty (60) days’ written notice by ETFS Marketing or by the Marketing Agent. This Agreement shall automatically terminate in the event of its assignment.

Upon the termination of this Agreement, the Marketing Agent, at ETFS Marketing’s expense and direction, shall transfer to such successor, as ETFS Marketing shall specify, all relevant books, records and other data established or maintained by the Marketing Agent under this Agreement.

10. Notice — Any notice required or permitted to be given by any party to the other shall be deemed sufficient if sent by (i) telecopier (fax) or (ii) registered or certified mail, postage prepaid, addressed by the party giving notice to the other party at the last address furnished by the other party to the party giving notice:

if to the Trust or ETFS Marketing, at:

ETFS Marketing LLC
555 California Street, Suite 2900
San Francisco, CA 94104
Attn: Fred Jheon

with a copy to

ETFS Silver Trust
c/o ETF Securities Representative Office
6th Floor
2 London Wall Buildings
London, EC2M 5UU
Telephone: 011 44 207 448-4330
Attention: President

if to the Marketing Agent at:

ALPS Distributors, Inc.
1290 Broadway, Suite 1100
Denver, Colorado, 80203
Attn: General Counsel

or such other telecopier (fax) number or address as may be furnished by one party to the other.

11. Confidential Information — The Marketing Agent, its officers, directors, employees and agents will treat confidentially and as proprietary information of the Trust, all records and other information relative to the Trust. If the Marketing Agent is requested or required by, but not limited to, depositions,

interrogatories, requests for information or documents, subpoena, civil investigation, demand or other action, proceeding or process or as otherwise required by law, statute, regulation, writ, decree or the like to disclose such information, the Marketing Agent will provide ETFS Marketing with prompt written notice of any such request or requirement so that ETFS Marketing may seek an appropriate protective order or other appropriate remedy and/or waive compliance with this provision. If such order or other remedy is not sought, or obtained, or waiver not received within a reasonable period following such notice, then the Marketing Agent may without liability hereunder, disclose to the person, entity or agency requesting or requiring the information, that portion of the information that is legally required in the reasonable opinion of the Marketing Agent’s counsel.

12. Miscellaneous — Each party agrees to perform such further acts and execute such further documents as are necessary to effectuate the purposes hereof. The Agreement shall be construed, interpreted, and enforced in accordance with and governed by the laws of the State of Colorado. The captions in this Agreement are included for convenience of reference only and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. This Agreement may not be changed, waived, discharged or amended except by written instrument that shall make specific reference to this Agreement and which shall be signed by the party against which enforcement of such change, waiver, discharge or amendment is sought. This Agreement may be executed simultaneously in two or more counterparts, each of which taken together shall constitute one and the same instrument.

ETFS Marketing shall provide all information to the Marketing Agent necessary for the Marketing Agent to perform its obligations under applicable securities laws and regulations as they relate to the transactions contemplated in this agreement; and agrees that its employees registered with and supervised by the Marketing Agent will comply with the Written Supervisory Procedures of the Marketing Agent, which may be amended from time to time.

IN WITNESS WHEREOF , each of the undersigned has executed this instrument in its name and behalf as of the date and year first above written.

ETFS MARKETING, LLC

By: /s/ Fred Jheon
Name: Fred Jheon
Title: President & Chief Executive Officer

ALPS DISTRIBUTORS, INC.

By: /s/ Thomas A. Carter
Name: Thomas A. Carter
Title: President

Schedule A

Marketing Agent Services

Review marketing related legal documents and contracts.
Consult with ETFS Marketing’s marketing staff and on development of FINRA compliant marketing campaigns.
Consult with Trust’s legal counsel on marketing materials that are deemed to qualify as a free-writing prospectus materials and appropriate disclosure associated with all marketing materials.
Review and file applicable marketing materials with FINRA that don’t otherwise qualify as free-writing prospectus materials.
Register and oversee supervisory activities of unlimited number of FINRA licensed registered representatives.
Maintain, reproduction and storage of applicable books and records related to the services provided under this Agreement.

Schedule B
Out-of-pocket expense


Description	Amount	Frequency
Licensing and Registration Fees
Individual State Registration Fees ¹	$3398.00	Annual/Registered
		Representative
FINRA Annual Processing Fee	$30.00	Annual/Registered
		Representative
FBI Fingerprint Fee	$17.00	Initial/Registered Representative
FINRA Fingerprint Fee	$13.00	Initial/Registered Representative
FINRA Individual Registration Fee	$85.00	Initial/Registered Representative
Examination Fees (if applicable – vary by exam type)	$75.00-	Initial/Registered Representative
	$250.00
FINRA Disclosure Processing Fee (if applicable)	$95.00	Initial/Registered Representative
Firm Registration and Membership Fees	$675.00	Estimated Annual Fee/Client
FINRA Advertising Submittal Fees
Normal ADI Review, FINRA Filing not Required	$0.00	N/A
Normal ADI Review, FINRA Filing Required	$100.00	Per Filing up to 10 pages
		($10/page thereafter)
Expedited ADI Review, FINRA Filing not Required ²	$250.00	Per Piece (no minimum pages)
Expedited ADI Review, FINRA Pre-Filing Required	$500.00	Per Filing up to 10 pages
		($25/page thereafter)
COBRA 2810 Filing Fees
COBRA 2810 Filing Fee	.01% of	Per COBRA Filing
	proposed
	maximum
	offering
	amount +
	$500.00, not
	to exceed
	$75,500.00
	per offering
Other Ongoing Out of Pocket Expenses
Annual Onsite Branch Office Travel Expenses	$1150.00	Estimated Associated Annual
		Travel Costs/Designated Branch
		Office Location
RegED Registered Representative Portal, Continuing	$110.00	Estimated Annual/Registered
Education and Annual Compliance Meeting Costs		Representative

Because a legal distributor is not required for the ETFS Silver Trust, ALPS will instead be acting in a role of Marketing Agent for the Trust. In addition to the services described above, this role will include helping facilitate the authorized participant process by assisting the Trustee to coordinate the AP agreements.

¹ This fee is inclusive of all state fee registrations. Underlying individual state fees vary by state.
² Fee is associated with additional service extension of Expedited Review Agreement whereby ALPS shall provide optional 24 hour turnaround on requested advertising materials.

ALPS will coordinate with ETFS Marketing and the Trust’s legal counsel on marketing materials to ensure compliance with applicable FINRA and SEC rules, and submit the required marketing materials to FINRA for review.

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the use in this Amendment No. 3 to Registration Statement No. 333-156307 of ETFS Silver Trust on Form S-1 of our report dated July 20, 2009, appearing in the Prospectus, which is part of this Registration Statement, and to the reference to us under the heading "Experts" in such Prospectus.

DELOITTE & TOUCHE LLP

New York, New York
July 20, 2009

Exhibit 99.1

ETF Securities USA LLC
as sponsor to ETFS Silver Trust
ETF Securities Representative Office
2 London Wall Buildings
6th Floor
London, EC2M 5UU
United Kingdom

20 July 2009

Dear Sirs

ETFS SILVER TRUST – Form S-1 Registration Statement under the Securities Act of 1933

1	We act as English legal advisers to ETF Securities USA LLC, a Delaware limited liability company acting as sponsor to ETFS Silver Trust ( the Trust ), in connection with the preparation and filing of a Registration Statement on Form S-1 (Registration No. 333-156307), as amended ( the Registration Statement ), including the prospectus included in Part 1 of the Registration Statement under the Securities Act of 1933, as amended ( the 1933 Act ), originally filed on December 19, 2008 and as amended by Amendment No. 1 filed on March 23, 2009 and Amendment No. 2 filed on April 27, 2009. The Registration Statement related to the proposed registration under the 1933 Act of 50,000,000 shares of fractional undivided beneficial interest in and ownership of the Trust.

2	Unless otherwise defined herein, the words and expressions used in this letter shall have the same meaning as those words and expressions defined in the Registration Statement.

3	We are solicitors qualified in England and express no opinion as to any law other than English law at the date hereof. This opinion is governed by and construed in accordance with English law.

4	For the purpose of the opinion contained in this letter, we have examined the following only:

4.1	the form of ETFS Silver Trust Allocated Account Agreement made between HSBC Bank USA, National Association, London Branch as custodian (1) and The Bank of New York Mellon, as trustee (2), as filed as an exhibit to the Registration Statement; and

4.2	the form of ETFS Silver Trust Unallocated Account Agreement and made between HSBC Bank USA, National Association, London Branch as custodian (1) and The Bank of New York Mellon, as trustee (2), as filed as an exhibit to the Registration Statement; (together with the ETFS Silver Trust Allocated Bullion Account Agreement, the Custody Agreements ).

5	The opinion set out in this letter is based upon the following assumptions:

5.1	that the Custody Agreements which we have examined and on which we have based the opinion set out in this letter are in the form in which they will be executed and delivered;

5.2	that all signatures, stamps or seals, if any, on all documents supplied to us as originals or as copied of originals are genuine;

5.3	that all documents submitted to us are authentic and complete;

5.4	that the parties to the Custody Agreements have the legal right and full power and authority to enter into and perform the Custody Agreements and any other documents to be executed by them pursuant to or in connection with the Custody Agreements and that the Custody Agreements will when executed constitute valid and binding obligations on the parties in accordance with their terms;

5.5	that all corporate or constitutional action required by the parties to the Custody Agreements validly and duly authorise the execution and delivery of, and to exercise their rights and perform their obligations under, the Custody Agreements has been duly taken;

5.6	that all documents submitted to us as copied conform to the original documents and such originals are authentic and complete;

5.7	that the Custody Agreements and the arrangements to which they give rise are not illegal, non-binding or unenforceable under or by virtue of any applicable laws outside England (as to which we express no opinion);

5.8	that to the extent that any obligation under the Custody Agreements, is to be performed in any jurisdiction other than English, its performance will not be illegal, non-binding or unenforceable under the laws of such jurisdiction (as to which we express no opinion); and

5.9	that the Custodian, the Trustee and any other person referred to in the Custody Agreements have been duly incorporated and are validly existing and will have due power and authority (at the relevant time) to enter into and be bound by the arrangements contemplated by the Custody Agreements.

6	On the basis of the foregoing and in reliance thereon and subject to the qualifications set out below and to matters not disclosed to us, we are of the opinion, as of the date hereof that when duly executed and delivered, the Custody Agreements will constitute legally binding obligations of the parties thereto and would be enforceable if brought before a court in England and Wales.

7	The opinion set out in paragraph 6 above ( the Opinion ) is subject to the following qualifications:

7.1	we do not express any opinion in relation to the compliance of the Registration Statement or the offering of Shares thereunder with the laws, rules, requirements, customs or practices of the Securities and Exchange Commission or any other regulatory authority;

7.2	we do not give any opinion that any clause in the Custody Agreements, would be upheld in any English court if found to be contrary to the privacy and human rights legislation prevailing under English law;

7.3	if proceedings relating to the Custody Agreements are brought before an English court, permission will have to be sought to serve process against any party who is resident outside England and Wales and who has not otherwise provided an address for service of proceedings in England and Wales;

7.4	in the event that the Trustee resigns or is removed as trustee of the Trust in circumstances whereby no successor is immediately appointed, an English court could construe the Custody Agreements as invalid by virtue of having only one party;

7.5	we have reviewed the Custody Agreements in isolation from the rules, regulations, practices and customs of the London Bullion Market Association and/or the Bank of England as well as from the rules, regulations, practices, customs and laws of any other applicable government, regulatory body or government authority applicable to silver or banking or custody arrangements and as to which we consequently express no opinion;

7.6	we do not give any opinion as regards the likely outcome of the bringing of proceedings in relation to the Custody Agreements in New York or any other jurisdiction in outside England and Wales;

7.7	we give no opinion as to the likelihood or otherwise of the English courts agreeing to enforce a judgment of the New York courts or a judgment of the courts of any other jurisdiction in relation to the Custody Agreements;

7.8	the Opinion is subject to all limitations arising from bankruptcy, insolvency, liquidation, administrative procedures, moratoria, voluntary arrangements, re- organisations, fraudulent transfers or similar laws, rules and regulations affecting the rights of creditors generally and affecting the enforcement of rights generally;

7.9	as used in this opinion, the word “enforceable” means that the Custody Agreements are of a type and form enforceable by the English courts; it is not, however, certain that each or any obligation within the Custody Agreements will necessarily be enforced in all circumstances in accordance with its terms since such enforcement is subject to principles of law, equity, courts discretion, issued of public policy and procedure of general application; the term does not address the extend to which a judgment obtained in a court outside England will be enforceable in England;

7.10	we give no opinion that the choice of English law as the governing law of the Custody Agreements and/or the agreement that the Custody Agreements will be construed in accordance with English law will be held to be valid and enforceable by the courts of the State of New York and/or the United States federal court in the Borough of Manhattan and/or any other court of competent jurisdiction (outside England and Wales) who may be called upon to settle any dispute or claim which may arise out of or in connection with the Custody Agreements;

7.11	the power of the English court to grant equitable remedies, such as specific performance and injunctions, is discretionary and, accordingly where an equitable

	remedy is sought an English court might, instead, make an award of damages if it considered this an adequate remedy;

7.12	claims may become time-barred under the Limitation Act 1980 or become subject to defences of set-off or counterclaim and failure or delay by any party in exercising any right may constitute a waiver of that right in spite of provisions to the contrary in the Custody Agreements;

7.13	the English courts will not normally give full effect to the provisions requiring an indemnity for the costs of litigation or enforcement, even to the successful litigant;

7.14	the effectiveness and enforceability of the terms exculpating a party from a liability or duty are limited by law;

7.15	the questions of whether or not any provisions which may be illegal, invalid or unenforceable may be severed from other provisions would be determined by an English court, as its total discretion;

7.16	any discretion to be exercised under the Custody Agreements may be required by English law to be exercised reasonably and any determination may be required by English law to be based on reasonable grounds, in order to be enforceable;

7.17	any obligation to pay additional amounts in circumstances of breach of default might be held to be unenforceable under English law on the ground that it is a penalty;

7.18	provisions in the Custody Agreements may be amended by oral agreement between the parties or by a course of conduct of the parties, notwithstanding any provision in the Custody Agreements to the contrary;

7.19	provisions considered by the English courts to lack certainty may not be enforceable;

7.20	an English court may choose not to enforce a contract to the extent that performance or observance thereof would be manifestly incompatible with English public policy, or is contrary to any applicable mandatory rules or would be unlawful in the place where it is to be performed;

7.21	in the event of any proceeding being brought or any judgment being enforced in an English court in respect of a monetary obligation expressed in a currency other than pounds sterling, such court would have power to give judgement expressed as an order to pay in such currency but could decline to do so, at its discretion; and

7.22	in so far as the Opinion may express or be deemed to express any opinion as to future events or matters, the Opinion is based solely upon existing law in force as at today’s date and upon existing documents of which we have knowledge.

8	This opinion is furnished by Katten Muchin Rosenman Cornish LLP solely for the benefit of ETF Securities USA LLC for use in connection with the Registration Statement. It may not be distributed, circulated, quoted, referred to, relied upon by or otherwise disseminated to any other entity or person and may not be used by ETF Securities USA LLC other than in connection with the Registration Statement, in each case without our prior written consent.

Yours faithfully
/s/ Katten Muchin Rosenman Cornish LLP
Katten Muchin Rosenman Cornish LLP


	which equals the NAV of the Trust, divided by the number of outstanding Shares
Trust expenses	The Trust’s only ordinary recurring charge is expected to be the remuneration due to the Sponsor (Sponsor’s Fee). In exchange for the Sponsor’s Fee, the Sponsor has agreed to assume the ordinary administrative and marketing expenses that the Trust is expected to incur. The Sponsor will also pay the costs of the Trust’s organization and the initial sale of the Shares, including the applicable SEC registration fees.
Sponsor’s fee	The Sponsor’s Fee will be accrued daily and will be payable in-kind in silver monthly in arrears. The Sponsor, from time to time, may waive all or a portion of the Sponsor’s Fee at its discretion for stated periods of time. The Sponsor is under no obligation to continue a waiver after the end of such stated period, and, if such waiver is not continued, the Sponsor’s Fee will thereafter be paid in full. The Trustee will from time to time deliver silver in such quantity as may be necessary to permit payment of the Sponsor’s Fee and sell silver in such quantity as may be necessary to permit payment in cash of Trust expenses not assumed by the Sponsor. The Trustee is authorized to sell silver at such times and in the smallest amounts required to permit such cash payments as they become due, it being the intention to avoid or minimize the Trust’s holdings of assets other than silver. Accordingly, the amount of silver to be sold will vary from time to time depending on the level of the Trust’s expenses and the market price of silver. See “Business of the Trust—Trust Expenses.”
	Each delivery or sale of silver by the Trust to pay the Sponsor’s Fee or other expenses will be a taxable event to Shareholders. See “United States Federal Tax Consequences—Taxation of US Shareholders.”
Termination events	The Trustee will terminate and liquidate the Trust if one of the following events occurs:
	Ø	the Shares are delisted from the NYSE Arca and are not approved for listing on another national securities exchange within five business days of their delisting;
	Ø	Shareholders acting in respect of at least 75% of the outstanding Shares notify the Trustee that they elect to terminate the Trust;
	Ø	60 days have elapsed since the Trustee notified the Sponsor of the Trustee’s election to resign and a successor trustee has not been appointed and accepted its appointment;
	Ø	the SEC determines that the Trust is an investment company under the Investment Company Act of 1940 and the Trustee has actual knowledge of that determination;
	Ø	the aggregate market capitalization of the Trust, based on the closing price for the Shares, was less than $350 million (as adjusted for inflation by reference to the US Consumer Price Index) at any time after the first anniversary after the Trust’s formation and the Trustee receives, within six months after the last trading date on which the aggregate market capitalization of the Trust was less than $350 million, notice from the Sponsor of its decision to terminate the Trust;


	1998		1999		2000		2001		2002		2003		2004		2005		2006		2007
Supply
Mine production		542.2		556.9		591.0		606.2		593.6		600.6		621.1		643.8		647.4		670.6
Net Government Sales		33.5		97.2		60.3		62.6		60.3		88.4		60.2		67.5		78.2		42.3
Old silver scrap		193.9		181.6		180.7		182.7		187.5		184.0		183.7		186.0		188.0		181.6
Net producer hedging		6.5		0.0		0.0		18.9		0.0		0.0		9.6		27.6		0.0		0.0
Implied Net Disinvestment		48.2		44.8		87.2		0.0		10.8		0.0		0.0		0.0		0.0		0.0

Total Supply		824.3		880.4		919.1		870.4		852.2		872.9		874.6		925.0		913.7		894.5

Demand
Fabrication
Industrial Application		316.3		339.0		374.3		335.2		339.2		349.8		367.3		405.3		424.8		455.3
Photography		225.4		227.9		218.3		213.1		204.3		192.9		178.8		160.3		144.0		128.3
Jewelry & Silverware		254.8		268.4		267.0		280.4		252.4		263.1		242.2		241.6		227.5		222.2
Coins & Medals		27.8		29.1		32.1		30.5		31.6		35.7		42.4		40.0		39.8		37.8

Total Fabrication		824.3		864.4		891.7		859.2		827.4		841.5		830.7		847.4		836.0		843.7
Net Government Purchases		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Producer De-hedging		0.0		16.0		27.4		0.0		24.8		20.9		0.0		0.0		6.8		25.0
Implied Net Investment		0.0		0.0		0.0		11.2		0.0		10.5		44.0		77.6		70.8		25.8

Total Demand		824.3		880.4		919.1		870.4		852.2		872.9		874.6		925.0		913.7		894.5