Tradable Products Specifications and Settlement Procedures

General Definitions

  1. “Custodial Participant” means a customer of one or more of the Depositories that has one or more Accounts established with a Depository for the trading of precious metals and other Tradable Products and is also a user of the TWM DL. The Custodial Participant may use the TWM DL to make transfers of records of title to Tradable Products between its Account and the TWM DL Account. A Custodial Participant may also be a Trading Participant.
  2. “Depository” means a vault providing secure storage of precious metals listed below as Tradable Products or other facility for the storage of Tradable Products.
  3. A “Permitted Transfer” means a transfer of records of title to Tradable Products on the TWM DL made, other than in connection with settling a transaction executed on the TWM ECN, as part of (i) a lending transaction in which the borrower provides consideration to the lender; (ii) the correction of operational errors, provided that the original trade documentation confirms the error; (iii) a transfer from one account to another where no change in ownership is involved; (iv) a transfer through the operation of law from death or bankruptcy; (v) a transfer as a result of a merger, asset purchase, consolidation or similar non-recurring transaction where the parties thereto are organizations; or (vi) a purchase and sale of records of title to Tradable Products not executed on the TWM ECN, which the Custodial Participant certifies to be a bona fide transaction.
  4. “Tradable Products” mean the products for which TWM has set forth product specifications below and title to which is recorded on the TWM DL.
  5. “Tradewind” and “TWM” refer to Tradewind Markets Inc., a Delaware corporation with offices at 42 Greene Street, Floor 2, New York, NY10013.
  6. “Trading Participant” means a market participant which has subscribed to have direct connectivity to the TWM ECN.
  7. The “TWM DL” means a distributed ledger technology platform provided by TWM or one of its affiliates for the recording of legal title to Tradable Products.
  8. The “TWM ECN” means an electronic trading technology platform through which Trading Participants connected to it may place bids and offers to buy and sell Tradable Products in exchange for one or more currencies recognized as legal tender in one or more jurisdictions.

1. Royal Canadian Mint Pool Fine Gold Credits (“RCM Gold Credits”)

1.1. RCM Gold Credits Specific Definitions

1.1.1. “RCM Gold Credit” or “RCM Gold Credits” means, or mean, entries made on the TWM DL and account records maintained by RCM and account statements RCM issues to a customer with a Pool Account with RCM which indicate and represent the pro rata ownership interest of, and title to, a specific quantity of Unallocated Fine Gold measured in Ounces (or fractions thereof) held by RCM as bailee on behalf of customers with Pool Accounts as bailors where each Credit represents the ownership of, and title to, one Ounce of Fine Gold.

1.1.2. “Fine Gold” means 9,999 or more parts of gold per 10,000 parts.

1.1.3. “LBMA” means the London Bullion Market Association with headquarters in the United Kingdom at 1-2 Royal Exchange Buildings, Royal Exchange, London EC3V 3LF.

1.1.4. “Ounce” means troy ounce.

1.1.5. “Pool Accounts” mean the accounts recording the respective amounts, in Ounces, of RCM Gold Credits, calculated to three decimal places, held by RCM on behalf of a customer on an Unallocated basis.

1.1.6. “RCM” means the Royal Canadian Mint, a Royal Crown corporation, with its principal vaulting facility located at 320 Sussex Drive, Ottawa, Ontario K1A 0G8, Canada. RCM is the Depository for the secure storage of the Fine Gold underlying the RCM Gold Credits, as further detailed in subsection 1.1.9 below.

1.1.7. “Transfer of Credits” means a transfer of RCM Gold Credits from a Custodial Participant’s RCM Pool Account to the TWM Pool Account or vice versa pursuant to RCM’s procedures as defined in the Pool Trading Account Agreement or elsewhere, or the transfer of RCM Gold Credits on the TWM DL.

1.1.8. The “TWM Pool Account” is the Pool Account held by RCM nominally in the name of TWM in which the RCM Gold Credits are held for the benefit of Custodial Participants and their customers.

1.1.9. “Unallocated” means Fine Gold that is part of a fungible bulk of gold contained in the form of bullion bars, ingots, wafers, coins or work-in-progress held by RCM, RCM’s third-party service providers (where RCM guarantees that it is at all times fully responsible for such Fine Gold as bailee), or RCM’s sub-custodians located in London, England or other locations around the world.

1.2. Contract Specifications

Each contract is for the spot sale of one RCM Gold Credit.

1.3. Trading Specifications

1.3.1. Trading Symbol – RCM Gold Credits are represented on the TWM ECN and TWM DL by the symbol “AUR”.

1.3.2. Trading Hours – The hours of trading for RCM Gold Credits will be determined by TWM and posted on TWM’s website.

1.3.3. Trading Unit – The unit of trading is one RCM Gold Credit.

1.3.4. Price Increments – The minimum price fluctuation on the TWM ECN for RCM Gold Credits is ten United States cents (US $0.10) per Ounce.

1.4. Settlement Procedures

On the second business day following a purchase and sale transaction executed on the TWM ECN or through a Permitted Transfer (or at such other time the buyer’s and seller’s Custodial Participants mutually agree), the buyer’s Custodial Participant will pay the seller’s Custodial Participant the currency amount equal to the execution price times the number of RCM Gold Credits traded and the seller’s Custodial Participant will deliver through the TWM DL to the buyer’s Custodial Participant the number of Credits purchased.

1.5. RCM Disclosures and Limitations of Liability

1.5.1. Warehouse Liens

The terms of the Pool Account agreement between TWM and RCM (for purposes of this Section 1.5 and each of its subsections, the “Agreement”), as is customary, provide RCM the right to set-off any fees, costs, expenses and interests payable to RCM under the Agreement (which include, but are not limited to, the expenses incurred by RCM in collecting the fees and expenses payable to RCM under the Agreement, including, but not limited to, reasonable legal fees), against the equivalent amount of the Fine Gold in TWM’s Pool Account, determined using the p.m. price of gold expressed in the U.S. dollars, as published by the LBMA (or, should the LBMA cease to publish gold prices, any other gold spot rate selected by RCM acting reasonably), on the day of issuance of said written notice.

1.5.2. Limitations of Liability in Force Majeure and Other Extreme Scenarios

Although RCM bears the risk of loss or destruction of the Fine Gold held in the TWM Pool Account held with RCM, the Agreement provides that, among other limitations of liability, ​RCM is not liable for any damages, losses, costs and/or expenses and/or for non-performance and/or delays of service caused by or resulting from any of the following, whether suffered directly or indirectly by RCM:

  1. either:

    (1) war, hostile or warlike action in time of peace or war, including action in hindering, combating or defending against an actual, impending or expected attack (i) by any government or sovereign power (de jure or de facto); or (ii) by any authority maintaining or using military, naval or air forces; or (iii) by an agent of any such government, power, authority or forces;

    or

    (2) insurrection, rebellion, revolution, civil war, usurped power or action taken by governmental authority in hindering, combating or defending against such an occurrence or confiscation by order of any government or public authority.

  2. (i) ionising radiations from or contamination by radioactivity from any nuclear fuel or from any nuclear waste or from the combustion of nuclear fuel; (ii) the radioactive, toxic, explosive or other hazardous or contaminating properties of any nuclear installation, reactor or other nuclear assembly or nuclear component thereof; (iii) any weapon or device employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter; (iv) the radioactive, toxic, explosive or other hazardous or contaminating properties of any radioactive matter, with the exception of radioactive isotopes when such isotopes are being prepared, carried, stored, or used for commercial, agricultural, medical, scientific or other similar peaceful purposes other than for nuclear fuel; or (v) any chemical, biological, or electromagnetic weapon;
  3. any act of terrorism or any action taken in controlling, preventing, suppressing or in any way relating to any act of terrorism. An act of terrorism means an act, including but not limited to the use of force or violence and/or the threat thereof, of any person or group(s) of persons, whether acting alone or on behalf of or in connection with any organization(s) or government(s), committed for political, religious, ideological or similar purposes including the intention to influence any government and/or to put the public, or any section of the public, in fear;
  4. the use or operation, as a means for inflicting harm, of any computer, computer system, computer software, computer software programme, malicious code, computer virus or process or any other electronic system;
  5. a case of Force Majeure.

1.5.3. Force Majeure

For purposes of these RCM Disclosures and Limitations of Liability, “force majeure” means circumstances or causes beyond RCM’s reasonable control, including, without limitation, acts or omissions or the failure to cooperate of a customer of RCM (including TWM) and/or of third parties (including, without limitation, entities and/or individuals under their respective control, and/or their respective officers, directors, employees and/or other personnel and agents), fire or other casualty, act of God, war, strike, lockout or labor disturbance, riot or other violence, or any law, order or requirement of any governmental agency or authority.

1.5.4. Right to Compensate for Lost Gold in Cash in Certain Situations

The Agreement provides that in the event of loss and/or destruction of Fine Gold where RCM bears the risks of loss or destruction in accordance with the Agreement, RCM shall, at its discretion, either:

(i) replace the quantity of lost and/or destroyed Fine Gold regarding which TWM is the duly authorized agent of the owner or owners, namely the Custodial Participants;

(ii) compensate TWM (for the benefit of the relevant Custodial Participants) for the monetary value of the lost and/or destroyed Fine Gold regarding which TWM is the duly authorized agent of the owner or owners (namely the Custodial Participants), using the p.m. price of gold expressed in U.S. dollars, as published by the LBMA (or, should the LBMA cease to publish gold prices, any other gold spot rate selected by RCM acting reasonably), on the first (1 st ) trading day following the discovery of said loss and/or destruction by RCM if first discovered by RCM, or, if first discovered by TWM, on the first (1 st ) trading day following the date the relevant Notice of Loss was given to RCM;

or

(iii) replace a portion of the lost and/or destroyed Fine Gold for which TWM is the duly authorized agent of the owner or owners (namely the Custodial Participants) and compensate TWM (for the benefit of the relevant Custodial Participants) for the monetary value of the remaining portion of lost or destroyed Fine Gold for which the TWM is the duly authorized agent of the owner or owners (namely the Custodial Participants) using the p.m. price of gold expressed in U.S. dollars, as published by the LBMA (or, should the LBMA cease to publish gold prices, any other gold spot rate selected by RCM acting reasonably), on the first (1 st ) trading day following the discovery by RCM of said loss and/or destruction if first discovered by RCM, or, if first discovered by TWM, on the first (1 st ) trading day following the date the relevant Notice of Loss was given to RCM.

2. Royal Canadian Mint Pool Fine Silver Credits (“RCM Silver Credits”)

2.1. RCM Silver Credits Specific Definitions

2.1.1. “RCM Silver Credit” or “RCM Silver Credits” means, or mean, entries made on the TWM DL and account records maintained by RCM and account statements RCM issues to a customer with a Pool Account with RCM which indicate and represent the pro rata ownership interest of, and title to, a specific quantity of Unallocated Fine Silver measured in Ounces (or fractions thereof) held by RCM as bailee on behalf of customers with Pool Accounts as bailors where each RCM Silver Credit represents the ownership of, and title to, one Ounce of Fine Silver.

2.1.2. “Fine Silver” means 999 or more parts of silver per 1,000 parts.

2.1.3. “LBMA” means the London Bullion Market Association with headquarters in the United Kingdom at 1-2 Royal Exchange Buildings, Royal Exchange, London EC3V 3LF.

2.1.4. “Ounce” means troy ounce.

2.1.5. “Pool Accounts” mean the accounts recording the respective amounts, in Ounces, of RCM Silver Credits, calculated to three decimal places, held by RCM on behalf of a customer on an Unallocated basis.

2.1.6. “RCM” means the Royal Canadian Mint, a Royal Crown corporation, with its principal vaulting facility located at 320 Sussex Drive, Ottawa, Ontario K1A 0G8, Canada. RCM is the Depository for the secure storage of the Fine Silver underlying the RCM Silver Credits, as further detailed in subsection 2.1.9 below.

2.1.7. “Transfer of Credits” means a transfer of RCM Silver Credits from a Custodial Participant’s RCM Pool Account to the TWM Pool Account or vice versa pursuant to RCM’s procedures as defined in the Pool Trading Account Agreement or elsewhere, or the transfer of RCM Silver Credits on the TWM DL.

2.1.8. The “TWM Pool Account” is the Pool Account held by RCM nominally in the name of TWM in which the RCM Silver Credits are held for the benefit of Custodial Participants and their customers.

2.1.9. “Unallocated” means Fine Silver that is part of a fungible bulk of silver contained in the form of bullion bars, ingots, wafers, coins or work-in-progress held by RCM, RCM’s third-party service providers (where RCM guarantees that it is at all times fully responsible for such Fine Silver as bailee), or RCM’s sub-custodians located in London, England or other locations around the world.

2.2. Contract Specifications

Each contract is for the spot sale of one RCM Silver Credit.

2.3. Trading Specifications

2.3.1. Trading Symbol ​– ​RCM Silver Credits are represented on the TWM ECN and TWM DL by the symbol “AGR”.

2.3.2. Trading Hours – The hours of trading for RCM Silver Credits will be determined by TWM and posted on TWM’s website.

2.3.3. Trading Unit – The unit of trading is one RCM Silver Credit.

2.3.4. Price Increments – The minimum price fluctuation for RCM Silver Credits on the TWM ECN is one United States cents (US $0.01) per Ounce.

2.4. Settlement Procedures

On the second business day following a purchase and sale transaction executed on the TWM ECN or through a Permitted Transfer (or at such other time the buyer’s and seller’s Custodial Participants mutually agree), the buyer’s Custodial Participant will pay the seller’s Custodial Participant the currency amount equal to the execution price times the number of contracts traded and the seller’s Custodial Participant will deliver through the TWM DL to the buyer’s Custodial Participant the number of Credits purchased.

2.5. RCM Disclosures and Limitations of Liability

2.5.1. Warehouse Liens

The terms of the Pool Account agreement between TWM and RCM (for purposes of this Section 2.5 and each of its subsections, the “Agreement”), as is customary, provide RCM the right “to set-off any fees, costs, expenses and interests payable to RCM under the Agreement (which include, but are not limited to, the expenses incurred by RCM in collecting the fees and expenses payable to RCM under the Agreement, including, but not limited to, reasonable legal fees), against the equivalent amount of the Fine Silver in TWM’s Pool Account, determined using the p.m. price of silver expressed in the U.S. dollars, as published by the LBMA (or, should the LBMA cease to publish 10 silver prices, any other silver spot rate selected by RCM acting reasonably), on the day of issuance of said written notice.”

2.5.2. Limitations of Liability in Force Majeure and Other Extreme Scenarios

Although RCM bears the risk of loss or destruction of the Fine Silver held in the TWM Pool Account held with RCM, the Agreement provides that, among other limitations of liability, ​RCM is not liable for any damages, losses, costs and/or expenses and/or for non-performance and/or delays of service caused by or resulting from any of the following, whether suffered directly or indirectly by RCM:

  1. either:

    (1) war, hostile or warlike action in time of peace or war, including action in hindering, combating or defending against an actual, impending or expected attack (i) by any government or sovereign power (de jure or de facto); or (ii) by any authority maintaining or using military, naval or air forces; or (iii) by an agent of any such government, power, authority or forces;

    or

    (2) insurrection, rebellion, revolution, civil war, usurped power or action taken by governmental authority in hindering, combating or defending against such an occurrence or confiscation by order of any government or public authority.

  2. (i) ionising radiations from or contamination by radioactivity from any nuclear fuel or from any nuclear waste or from the combustion of nuclear fuel; (ii) the radioactive, toxic, explosive or other hazardous or contaminating properties of any nuclear installation, reactor or other nuclear assembly or nuclear component thereof; (iii) any weapon or device employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter; (iv) the radioactive, toxic, explosive or other hazardous or contaminating properties of any radioactive matter, with the exception of radioactive isotopes when such isotopes are being prepared, carried, stored, or used for commercial, agricultural, medical, scientific or other similar peaceful purposes other than for nuclear fuel; or (v) any chemical, biological, or electromagnetic weapon;
  3. any act of terrorism or any action taken in controlling, preventing, suppressing or in any way relating to any act of terrorism. An act of terrorism means an act, including but not limited to the use of force or violence and/or the threat thereof, of any person or group(s) of persons, whether acting alone or on behalf of or in connection with any organization(s) or government(s), committed for political, religious, ideological or similar purposes including the intention to influence any government and/or to put the public, or any section of the public, in fear;
  4. the use or operation, as a means for inflicting harm, of any computer, computer system, computer software, computer software programme, malicious code, computer virus or process or any other electronic system;
  5. a case of Force Majeure.

2.5.3. Force Majeure

For purposes of these RCM Disclosures and Limitations of Liability, “force majeure” means circumstances or causes beyond RCM’s reasonable control, including, without limitation, acts or omissions or the failure to cooperate of an RCM customer (including TWM) and/or of third parties (including, without limitation, entities and/or individuals under their respective control, and/or their respective officers, directors, employees and/or other personnel and agents), fire or other casualty, act of God, war, strike, lockout or labor disturbance, riot or other violence, or any law, order or requirement of any governmental agency or authority.

2.5.4. Right to Compensate for Lost Silver in Cash in Certain Situations

The Agreement provides that in the event of loss and/or destruction of Fine Silver where RCM bears the risks of loss or destruction in accordance with the Agreement, RCM shall, at its discretion, either:

(i) replace the quantity of lost and/or destroyed Fine Silver regarding which TWM is the duly authorized agent of the owner or owners, namely the Custodial Participants;

(ii) compensate TWM (for the benefit of the relevant Custodial Participants) for the monetary value of the lost and/or destroyed Fine Silver regarding which TWM is the duly authorized agent of the owner or owners (namely the Custodial Participants), using the p.m. price of silver expressed in U.S. dollars, as published by the LBMA (or, should the LBMA cease to publish silver prices, any other silver spot rate selected by RCM acting reasonably), on the first (1 st ) trading day following the discovery of said loss and/or destruction by RCM if first discovered by RCM, or, if first discovered by TWM, on the first (1 st ) trading day following the date the relevant Notice of Loss was given to RCM;

or

(iii) replace a portion of the lost and/or destroyed Fine Silver for which TWM is the duly authorized agent of the owner or owners (namely the Custodial Participants) and compensate TWM (for the benefit of the relevant Custodial Participants) for the monetary value of the remaining portion of lost or destroyed Fine Silver for which TWM is the duly authorized agent of the owner or owners (namely the Custodial Participants) using the p.m. price of silver expressed in U.S. dollars, as published by the LBMA (or, should the LBMA cease to publish silver prices, any other silver spot rate selected by RCM acting reasonably), on the first (1 st ) trading day following the discovery by RCM of said loss and/or destruction if first discovered by RCM, or, if first discovered by TWM, on the first (1 st ) trading day following the date the relevant Notice of Loss was given to RCM.