Invesco Galaxy Solana ETF S-1/A, filed Nov 28, 2025
Invesco Galaxy Solana ETF (QSOL)
S-1/A
2025-11-28
View Original
Added on
October 22, 2026
As filed with the Securities and Exchange Commission on November 28, 2025
Registration No. 333-288318
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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PRE-EFFECTIVE AMENDMENT NO. 3
TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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Invesco Galaxy Solana ETF
(Exact name of registrant as specified in its charter)
(Exact name of registrant as specified in its charter)
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Delaware
(State or other jurisdiction of incorporation or organization) |
6221
(Primary Standard Industrial Classification Code Number)
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39-7104353
(I.R.S. Employer Identification No.) |
c/o Adam Henkel, Esq.
Invesco Capital Management LLC
3500 Lacey Road, Suite 700
Downers Grove, IL 60515
800-983-0903
(Address, including zip code, and telephone number,
including area code, of registrant’s principal executive offices)
(Address, including zip code, and telephone number,
including area code, of registrant’s principal executive offices)
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Copy to:
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J. Stephen Feinour, Jr., Esq.
Stradley Ronon Stevens & Young, LLP
2600 One Commerce Square
Philadelphia, PA 19103-7098
(215) 564-8521
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Miranda Sturgis, Esq.
Stradley Ronon Stevens & Young, LLP
2600 One Commerce Square
Philadelphia, PA 19103-7098
(215) 564-8131
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Mark R. Greer, Esq.
Stradley Ronon Stevens & Young, LLP
191 North Wacker Drive, Suite 1601
Chicago, IL 60606
(312) 964-3505
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Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of
this Registration Statement.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the
following box: ☒
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities
Act registration statement number of the earlier effective registration statement for the same offering: ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration 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, smaller reporting company, or an emerging growth
company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Securities Exchange Act of 1934.
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Large accelerated filer ☐
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Accelerated filer ☐
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Non-accelerated filer ☒
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Smaller reporting company ☒
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Emerging growth company ☒
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☒
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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.
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The information in this Preliminary Prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed
with the Securities and Exchange Commission is effective. This Preliminary Prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
Subject to Completion
Preliminary Prospectus dated November 28, 2025
Preliminary Prospectus dated November 28, 2025
PRELIMINARY PROSPECTUS
INVESCO GALAXY SOLANA ETF
COMMON SHARES
Invesco Galaxy Solana ETF (the “Trust”) is an exchange-traded fund that issues common shares of beneficial interest (the “Shares”) that trade on Cboe BZX (“Cboe” or the “Exchange”) under the ticker
symbol “QSOL”. The Trust’s investment objective is to reflect the performance of the spot price of Solana (“SOL”) as measured using Lukka Prime Solana Reference Rate (the “Benchmark”), as adjusted to reflect the SOL staking rewards earned by the
Trust and the Trust’s expenses and other liabilities. The Trust expects to outperform the Benchmark before taking its expenses and liabilities into account due to its plans to receive SOL staking rewards.
In seeking to achieve its investment objective, the Trust will hold SOL and will seek to stake substantially all of its SOL to earn staking rewards to the extent the Trust, in the Sponsor’s sole
discretion, can engage in staking without undue legal or regulatory risk, including jeopardizing its status as a grantor trust for U.S. federal income tax purposes (the “Staking Condition”). The Sponsor has determined that the Staking Condition has
been satisfied. As of the date of this Prospectus, the Sponsor intends to engage in staking on behalf of the Trust of substantially all of the Trust's SOL, subject to an amount that it determines to maintain as unstaked SOL to manage liquidity
(“Liquidity Sleeve”). The Trust will value its Shares each day when the Exchange is open for regular trading (a “Business Day”) as of 4:00 p.m. ET. The value of SOL held by the Trust is determined based on the fair market value (“FMV”) price for
SOL, reflecting the execution price of SOL on its principal market as determined each day by Lukka Inc., an independent third-party digital asset data company (the “Benchmark Provider”). The Benchmark is designed to provide an estimated fair market
value price for SOL, based on the execution price of SOL on its principal market. In this regard, the Benchmark Provider seeks to identify a “principal market” for SOL each day by evaluating eligible SOL trading platforms across a variety of
different criteria, including the trading platforms’ oversight and governance frameworks, microstructure efficiency, trading volume, data transparency and data integrity. Invesco Capital Management LLC (the “Sponsor” or “Invesco”) is the sponsor of
the Trust, CSC Delaware Trust Company (the “Trustee”) is the trustee of the Trust, The Bank of New York Mellon is the Trust’s transfer agent (“Transfer Agent”) and will hold all of the Trust’s cash on the Trust’s behalf as cash custodian (“Cash
Custodian”), and Coinbase Custody Trust Company, LLC (the “Solana Custodian”) will hold all of the Trust’s SOL on the Trust’s behalf as custodian.
The Trust intends to issue Shares on a continuous basis and is registering an indeterminate number of Shares with the SEC in accordance with Rule 456(d) and 457(u) under the Securities Act of 1933,
as amended (the “Securities Act”). The Trust will process all creations and redemptions of Shares in transactions with financial firms that are authorized to do so (known as “Authorized Participants”). When the Trust creates or redeems its Shares,
it will do so in cash or in-kind. When the Trust issues or redeems its Shares, it does so only in blocks of 5,000 Shares (a “Creation Basket”) based on the quantity of SOL attributable to each Share of the Trust (net of accrued but unpaid Sponsor
fees and any accrued but unpaid expenses or liabilities).
Creations and redemption transactions will be conducted in exchange for SOL in-kind or cash.
When purchasing Creation Baskets in-kind with SOL, Authorized Participants and/or their designees will deliver SOL to the Solana Custodian. After confirming receipt of the SOL by the Solana
Custodian, the Transfer Agent is authorized by the Sponsor to issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of the creation order.
When purchasing Creation Baskets for cash, Authorized Participants will deliver cash to the Cash Custodian. Galaxy Digital Funds LLC (the “Execution Agent”) will be responsible for acquiring the
requisite amount of SOL on behalf of the Trust on an agency basis. Once the Execution Agent selects a counterparty or digital asset trading platform (“Solana Counterparty”), the Cash Custodian will transfer cash to the Solana Counterparty in payment
for the requisite amount of SOL on behalf of the Trust on an agency basis on the value date of the order. The SOL acquired from the Solana Counterparty will be transferred to the Solana Custodian. After receipt of the SOL by the Solana Custodian, the
Transfer Agent will issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of the creation order.
When redeeming Creation Baskets in-kind for SOL, the Transfer Agent will redeem the Shares and the Solana Custodian will distribute the resulting SOL to the redeeming Authorized Participant
and/or its designee in satisfaction of the redemption order.
When redeeming Creation Baskets for cash, the Execution Agent will be responsible for selling the requisite amount of SOL on behalf of the Trust on an agency basis. Once the Execution Agent selects
a Solana Counterparty, the Solana Custodian will transfer SOL to the Solana Counterparty in return for the requisite cash payment. The cash received from the Solana Counterparty will be delivered to the Cash Custodian. After receipt of the cash
payment, the Transfer Agent will redeem the Shares and the Cash Custodian will distribute the resulting cash to the redeeming Authorized Participant in satisfaction of the redemption order.
In connection with both cash creation and cash redemption transactions, the Execution Agent, pursuant to the oversight of the Sponsor, will decide how and with which Solana Counterparty to
transact on the Trust’s behalf.
The Trust expects to purchase or sell SOL in connection with cash creation and redemption transactions, and to sell SOL to pay certain expenses, including the Sponsor Fee and to liquidate
staking rewards for cash to pay quarterly distributions to Shareholders. Each creating or redeeming Authorized Participant will be charged (i) a transaction fee and (ii) transfer, processing and other transaction costs charged by the Solana
Custodian (the “Custody Transaction Fee”) in connection with each creation or redemption transaction. Authorized Participants are expected to sell Shares to the public at prices that reflect, among other factors, the value of the Trust’s assets,
supply and demand for the Shares and market conditions at the time of a transaction.
The Sponsor seeks to stake substantially all of the Trust’s assets through one or more trusted staking providers (“Staking Provider”), except as necessary to (i) pay the Sponsor Fee or other
Trust expenses, (ii) satisfy existing and reasonably foreseen potential redemption requests, (iii) address regulatory or tax concerns raised by staking activities or (iv) to maintain unstaked SOL in the Liquidity Sleeve. Galaxy Blockchain
Infrastructure LLC, an affiliate of the Execution Agent, is expected to serve as a Staking Provider with respect to the Trust’s SOL, though the Sponsor may choose to engage additional staking providers in its sole discretion. In consideration for
any staking activity in which the Trust may engage, the Trust would receive certain staking rewards of SOL tokens, which may be treated as income for U.S. federal income tax purposes. The Trust will not acquire and will disclaim any Incidental
Right (as defined below) or Incidental Right asset received, for example as a result of forks or airdrops, and such assets will not be taken into account for purposes of determining the net asset value per share (“NAV”). Holders of the Shares
(“Shareholders”) who decide to buy or sell Shares of the Trust will place their trade orders through their brokers and may incur customary brokerage commissions and charges. Such trades may occur at a premium or discount relative to the NAV of the
Shares of the Trust. The treatment of staking in a grantor trust for U.S. federal income tax purposes is still developing. As a grantor trust, the Trust can undertake only certain types of activities. Please see “Taxation of the Trust” below for
more details.
The Trust was seeded with $100,000 on October 16, 2025, through the sale of 4,000 Shares at a per-Share price of $25.00 (the “Initial Seed Shares”) by the Trust to Invesco Ltd. Invesco Ltd. is
expected to purchase five initial seed creation baskets, equal to 25,000 shares, before the Trust is listed on the Exchange at a price per Share based on the Benchmark price as of 4:00 p.m. Eastern Time on the date of the transaction (the “Seed
Creation Baskets”). The Initial Seed Shares will be redeemed for cash prior to the purchase of the Seed Creation Baskets.
Invesco Ltd. (“Invesco” and, in such role, the “Seed Capital Investor”) has acted as a statutory underwriter in connection with its purchase of the applicable shares. Invesco may sell some or
all of the shares underlying its purchases pursuant to the registration statement for the Trust (Invesco Ltd., in such role, the “Selling Shareholder”), which shares have been registered to permit the resale from time to time after purchase. The
Selling Shareholder may make a public offering of the Shares held by it at a price per Share that will depend, among other factors, on the net asset value per Share and the trading price of Shares on the Exchange at the time of the offer. The price
of Shares offered by the Selling Shareholder was acquired by the Selling Shareholder as described in the registration statement, and could be sold at different times and at different offering prices. The Trust will not receive any of the proceeds
from the resale by the Selling Shareholder of these shares. The Selling Shareholder will not receive any fee or other compensation from the Sponsor in connection with the sale of the Shares. Prior to this offering, pursuant to this Prospectus,
there has been no public market for the Shares. The Shares are expected to be listed for trading, subject to notice of issuance, on the Exchange under the ticker symbol QSOL. Investing in the Trust involves risks similar to those involved with an
investment directly in SOL, as well as other significant risks. See “Risk Factors” beginning on page 18.
The offering of the Trust’s Shares is registered with the Securities and Exchange Commission (the “SEC”) in accordance with the Securities Act. The offering is intended to be a continuous offering
and is not expected to terminate until either all of the registered Shares have been sold or three years from the date of the original offering, whichever is earlier, unless extended as permitted by applicable rules under the Securities Act. The
Trust is not a mutual fund, is not registered under the Investment Company Act of 1940, as amended (the “1940 Act”) and is not subject to regulation under the 1940 Act. The Trust is not a commodity pool for purposes of the Commodity Exchange Act of
1936, as amended (the “CEA”), and the Sponsor is not subject to regulation by the Commodity Futures Trading Commission (the “CFTC”) as a commodity pool operator or a commodity trading advisor. The Trust’s Shares are neither interests in, nor
obligations of, the Sponsor or the Trustee.
AN INVESTMENT IN THE TRUST INVOLVES SIGNIFICANT RISKS AND MAY NOT BE SUITABLE FOR SHAREHOLDERS THAT ARE NOT IN A POSITION TO ACCEPT RISKS RELATED TO SOLANA. THE SHARES ARE
SPECULATIVE SECURITIES. THEIR PURCHASE INVOLVES A HIGH DEGREE OF RISK, AND YOU COULD LOSE YOUR ENTIRE INVESTMENT. YOU SHOULD CONSIDER ALL RISK FACTORS BEFORE INVESTING IN THE TRUST. PLEASE REFER TO “RISK FACTORS” BEGINNING ON PAGE 18.
THE SHARES OF THE TRUST ARE NEITHER INTERESTS IN NOR OBLIGATIONS OF THE SPONSOR, THE TRUSTEE, THE BENCHMARK PROVIDER, THE ADMINISTRATOR, THE TRANSFER AGENT, THE EXECUTION AGENT,
THE CASH CUSTODIAN, THE SOLANA CUSTODIAN, THE MARKETING AGENT OR ANY OF THEIR RESPECTIVE AFFILIATES. THE SHARES ARE NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THE SECURITIES OFFERED IN THIS PROSPECTUS, OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR
COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE TRUST IS AN “EMERGING GROWTH COMPANY” AS THAT TERM IS USED IN THE JUMPSTART OUR BUSINESS STARTUPS ACT AND, AS SUCH, MAY ELECT TO COMPLY WITH CERTAIN REDUCED REPORTING
REQUIREMENTS.
The date of this Prospectus is December [__], 2025
TABLE OF CONTENTS
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STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
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iii
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EMERGING GROWTH COMPANY STATUS
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iii
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PROSPECTUS SUMMARY
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1
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RISK FACTORS
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18
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SOLANA AND THE SOLANA MARKET
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67
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CALCULATION OF NAV
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87
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ADDITIONAL INFORMATION ABOUT THE TRUST
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91
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THE TRUST’S SERVICE PROVIDERS
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93
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CUSTODY OF THE TRUST’S ASSETS
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98
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THE PRIME BROKER
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102
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FORM OF SHARES
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105
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TRANSFER OF SHARES
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105
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PLAN OF DISTRIBUTION
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106
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CREATION AND REDEMPTION OF SHARES
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108
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USE OF PROCEEDS
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117
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OWNERSHIP OR BENEFICIAL INTEREST IN THE TRUST
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118
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CONFLICTS OF INTEREST
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118
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DUTIES OF THE SPONSOR
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120
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LIABILITY AND INDEMNIFICATION
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121
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VOTING BY SHAREHOLDERS; MANAGEMENT
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124
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BOOKS AND RECORDS
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127
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STATEMENTS, FILINGS, AND REPORTS TO SHAREHOLDERS
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127
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FISCAL YEAR
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127
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GOVERNING LAW; CONSENT TO DELAWARE JURISDICTION
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127
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LEGAL MATTERS
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128
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EXPERTS
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128
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MATERIAL CONTRACTS
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128
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U.S. FEDERAL INCOME TAX CONSEQUENCES
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135
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PURCHASES BY EMPLOYEE BENEFIT PLANS
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141
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INFORMATION YOU SHOULD KNOW
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142
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WHERE YOU CAN FIND MORE INFORMATION
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143
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INVESCO CAPITAL MANAGEMENT LLC PRIVACY NOTICE
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144
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
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146
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APPENDIX A GLOSSARY OF DEFINED TERMS
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A-1
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PART II INFORMATION NOT REQUIRED IN PROSPECTUS
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II-1
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This Prospectus contains information you should consider when making an investment decision about the Shares of the Trust. 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 of the Trust are not registered for public sale in any jurisdiction other than the United States (the “U.S.”).
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STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This Prospectus includes “forward-looking statements” that generally relate to future events or future performance. In some cases, you can identify forward-looking statements by terminology such as
“may,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or the negative of these terms or other comparable terminology. All statements (other than statements of historical fact) included in this
Prospectus that address activities, events or developments that will or may occur in the future, including such matters as movements in the digital asset markets, 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 has made based on
its perception of historical trends, technology developments regarding the use of SOL and other digital assets, including the systems used by the Sponsor and the Trust’s Solana Custodian in their provision of services to the Trust, 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 economic and political developments. Consequently, all the forward-looking statements made in this Prospectus are qualified by these cautionary statements, and there can be no assurance that 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 its Shares. None of the Trust, the Sponsor, or the
Trustee or their respective affiliates is under a duty to update any of the forward-looking statements to conform such statements to actual results or to a change in the Sponsor’s expectations or predictions, other than as required by applicable
laws.
EMERGING GROWTH COMPANY STATUS
The Trust is an “emerging growth company” as that term is used in the Jumpstart Our Business Startups Act (the “JOBS Act”) and, as such, may elect to comply with certain reduced reporting
requirements. For as long as the Trust is an emerging growth company, unlike other public companies, it will not be required to:
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provide an auditor’s attestation report on management’s assessment of the effectiveness of its system of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002;
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comply with any new requirements adopted by the Public Company Accounting Oversight Board (“PCAOB”) requiring mandatory auditor rotation or a supplement to the auditor’s report in which the auditor would be required to provide additional
information about the audit and the financial statements of the issuer;
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comply with any new audit rules adopted by the PCAOB after April 5, 2012, unless the Securities and Exchange Commission determines otherwise;
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provide certain disclosure regarding executive compensation required of larger public companies; or
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obtain shareholder approval of any golden parachute payments not previously approved.
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The Trust will cease to be an “emerging growth company” upon the earliest of (i) when it has $1.235 billion or more in annual revenues; (ii) when it is deemed to be a large accelerated filer under
Rule 12b-2 promulgated pursuant to the Securities Exchange Act of 1934; (iii) when it issues more than $1.0 billion of
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non-convertible debt over a three-year period; or (iv) the last day of the fiscal year following the fifth anniversary of its initial public offering. In addition, Section 107 of the JOBS Act also
provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can
delay the adoption of certain accounting standards until those standards would otherwise apply to private companies however, the Trust is choosing to “opt out” of such extended transition period, and as a result, the Trust will comply with new or
revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that the Trust’s decision to opt out of the extended transition period for
complying with new or revised accounting standards is irrevocable.
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INVESCO GALAXY SOLANA ETF
TICKER: QSOL
CUSIP: 67122G106
TICKER: QSOL
CUSIP: 67122G106
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 the Prospectus that is material and/or that may be important to you. You should read this entire Prospectus before making an investment decision about the Shares. For a glossary of defined terms, see Appendix A.
As used below, “Solana” is used to describe the system as a whole that is involved in maintaining the ledger of Solana ownership and facilitating the transfer of SOL among parties. “SOL” is used to
refer to the digital asset within the Solana network.
Overview of the Trust
Invesco Galaxy Solana ETF (the “Trust”) is an exchange-traded fund that issues common shares of beneficial interest (the “Shares”) that trade on Cboe BZX (“Cboe” or the “Exchange”) under the ticker
symbol QSOL.
Invesco Capital Management LLC (the “Sponsor”) is the sponsor of the Trust.
The Trust’s investment objective is to reflect the performance of the spot price of SOL as measured using the Lukka Prime Solana Reference Rate (the “Benchmark”), as adjusted to reflect the SOL
staking rewards earned by the Trust and the Trust’s expenses and other liabilities. The Trust expects to outperform the Benchmark before taking its expenses and liabilities into account due to its plans to receive SOL staking rewards. The Trust is
passively-managed and the Sponsor does not actively manage the SOL held by the Trust. This means that the Sponsor does not sell SOL at times when its price is high or acquire SOL at low prices in the expectation of future price increases. It also
means that the Sponsor does not make use of any of the hedging techniques available to professional SOL investors to attempt to reduce the risks of losses resulting from price changes. The Trust will not utilize leverage, derivatives or any similar
arrangements in seeking to meet its investment objective; however, the Trust may utilize a short term credit facility or an alternative liquidity arrangement for the purposes of obtaining funds necessary to meet requested redemptions from the Trust
as further described herein. The Trust is not a registered investment company under the Investment Company Act of 1940 (the “1940 Act”) and is not required to register under the 1940 Act. The Sponsor is not registered with the SEC as an investment
adviser and is not subject to regulation by the SEC as such in connection with its activities with respect to the Trust. The Trust is not a commodity pool for purposes of the Commodity Exchange Act (the “CEA”), and the Sponsor is not subject to
regulation by the CFTC as a commodity pool operator or a commodity trading advisor in connection with its activities with respect to the Trust.
The Trust intends to continuously offer Shares but may suspend the issuance of Shares at any time.
In seeking to achieve its investment objective, the Trust will hold SOL and will seek to stake substantially all of its SOL to earn staking rewards to the extent the Trust, in the Sponsor’s sole
discretion, can engage in staking without undue legal or regulatory risk, including jeopardizing its status as a grantor trust for U.S. federal income tax purposes (the “Staking Condition”). The Sponsor has determined that the Staking Condition has
been satisfied. As of the date of this Prospectus, the Sponsor intends to engage in staking on behalf of the Trust of substantially all of the Trust's SOL, subject to an amount that it determines to invest in the Liquidity Sleeve. The Trust will
value its Shares each day when the Exchange is open for regular trading (a “Business Day”) as of 4:00 p.m. ET. The value of SOL held by the Trust is determined based on the
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estimated fair market value (“FMV”) price for SOL, reflecting the execution price of SOL on its principal market as determined each day by Lukka Inc., an independent third-party digital asset
data company (the “Benchmark Provider”). In this regard, the Benchmark Provider seeks to identify a “principal market” for SOL each day, by evaluating eligible SOL trading platforms across a variety of different criteria, including the trading
platforms’ oversight and governance frameworks, microstructure efficiency, trading volume, data transparency and data integrity. CSC Delaware Trust Company (the “Trustee”) is the trustee of the Trust, The Bank of New York Mellon is the Trust’s
transfer agent (“Transfer Agent”) and will hold all of the Trust’s cash on the Trust’s behalf as cash custodian (“Cash Custodian”), and Coinbase Custody Trust Company, LLC (the “Solana Custodian”) will hold all of the Trust’s SOL on the Trust’s
behalf as custodian.
The Trust will process all creations and redemptions of Shares in transactions with financial firms that are authorized to do so (known as “Authorized Participants”). When the Trust creates or
redeems its Shares, it will do so in cash or in-kind. When the Trust issues or redeems its Shares, it will do so only in blocks of 5,000 Shares (a “Creation Basket”) based on the quantity of SOL attributable to each Share of the Trust (net of
accrued but unpaid Sponsor fees and any accrued but unpaid expenses or liabilities). Creation and redemption transactions will be conducted in exchange for SOL in-kind or cash. See “Creation and Redemption of Shares.”
The Trust expects to purchase and sell SOL in connection with cash creation or redemption transactions, and will sell SOL to pay certain expenses, including the Sponsor Fee and to liquidate
staking rewards for cash to pay quarterly distributions to Shareholders. In this capacity, the Sponsor has entered into an agreement with Execution Agent to facilitate the purchase or sale of SOL by the Trust.
The quantity of SOL required to create each Creation Basket (“Creation Basket Deposit”) changes from day to day. On each day that the Exchange is open for regular trading, the Sponsor will publish
the Creation Basket after market close, which is composed of an amount of SOL or an amount of cash and/or SOL required to purchase a Creation Basket the following day. After the Trust’s NAV is struck on a Business Day, The Bank of New York Mellon
(the “Administrator”) adjusts the quantity of SOL constituting the Creation Basket Deposit for the next Business Day as appropriate to reflect accrued expenses. The computation is made by the Administrator as promptly as practicable after 4:00 p.m.
ET. The Administrator calculates the Creation Basket Deposit for a given day by multiplying the NAV by the number of Shares in a Creation Basket (5,000) divided by the price of SOL at 4:00 p.m. ET as determined consistent with the Benchmark to
determine the cash amount required for a Creation Basket. Fractions of a SOL smaller than 0.00000001 are disregarded for purposes of the computation of the Creation Basket Deposit. Although the Administrator applies the SOL price to the calculation
of the Creation Basket value, the Administrator plays no role in the determination of the SOL price used by the Trust; rather the SOL price used in calculating the cash value of a Creation Basket is identical to the SOL price used in determining the
Trust’s NAV.
For cash creation transactions, to the extent there is a difference between the price actually paid by the Trust to acquire a Creation Basket worth of SOL in the cash creation process compared to
the cash value of the Creation Basket (i.e., if there is a difference between the amount paid by the Execution Agent on behalf of the Trust to purchase the requisite amount of SOL and the valuation of SOL as part of the Trust’s NAV calculation), that
difference will also be charged to the creating Authorized Participant in the form of a variable fee.
To support the ability of Authorized Participants to provide liquidity at prices that reflect the value of the Trust’s assets and to facilitate orderly transactions in the Shares, the Trust will
ordinarily process redemptions of Creation Baskets within two business days following receipt of a redemption request by an Authorized Participant.
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Creation Baskets are expected to be created when there is sufficient demand for Shares, including when the market price per Share is at a premium to the net asset value per Share (“NAV”).
Authorized Participants are expected to sell such Shares to the public at prices that reflect, among other factors, the value of the Trust’s assets, supply of and demand for Shares and market conditions at the time of a transaction. Similarly,
Creation Baskets are expected to be redeemed when the market price per Share is at a discount to the NAV. Investors (other than Authorized Participants) seeking to purchase or sell Shares on any day are expected to transact in the secondary market,
on the Exchange or other national securities exchanges, at the market price per Share, rather than through the creation or redemption of Creation Baskets. Shares initially comprising the same Creation Basket but offered by the Authorized Participants
to the public at different times may have different offering prices, which depend on various factors, including the supply and demand for Shares, the value of the Trust’s assets, and market conditions at the time of a transaction.
The Sponsor believes that the design of the Trust will enable investors to effectively and efficiently implement strategic and tactical asset allocation strategies that use SOL by investing in the
Shares rather than directly in SOL.
The Trust’s Expenses
The Trust will pay the Sponsor a unified fee of 0.25% per annum (the “Sponsor Fee”) as compensation for services performed under the Trust Agreement (as defined herein). The Trust’s only ordinary
recurring expense is the Sponsor Fee.
The Sponsor Fee will be accrued daily and paid monthly in arrears in U.S. dollars, and will be calculated by the Administrator. The Sponsor may, at its sole discretion and from time to time,
waive all or a portion of the Sponsor’s Fee for stated periods of time. The Sponsor is under no obligation to waive any portion of its fees and any such waiver shall create no obligation to waive any such fees during any period not covered by the
waiver. The Administrator will calculate the Sponsor Fee on a daily basis by applying the 0.25% annualized rate to the Trust’s total net assets. To cover the Sponsor Fee, and extraordinary expenses not assumed by the Sponsor, the Sponsor or its
delegate will cause the Trust (or its delegate) to instruct the Execution Agent to convert SOL held by the Trust into U.S. dollars. At the direction of the Trust, the Execution Agent will seek to sell SOL at approximately the price at which it is
valued by the Trust and in the smallest amounts required to permit such payments as they become due, with the intention of minimizing the Trust’s holdings of assets other than SOL. Accordingly, the amount of
SOL to be sold may vary from time to time depending on the level of the Trust’s expenses and liabilities and the market price of SOL. The NAV of the Trust and the number of SOL represented by a Share will decline each time the Trust accrues the
Sponsor Fee or any Trust expenses not assumed by the Sponsor. The Trust is not responsible for paying any costs associated with the transfer of SOL to or from the Trust in connection with paying the Sponsor Fee or in connection with creation and
redemption transactions, except for potential borrowing costs under a short-term credit facility or alternative liquidity arrangement.
Except as noted below, the Sponsor has agreed to pay all of the Trust’s ordinary expenses out of the Sponsor’s unified fee, including, but not limited to, the Trustee’s fees, the fees of The Bank
of New York Mellon (for its services as the “Administrator,” “Transfer Agent,” and “Cash Custodian”), the fees of the Solana Custodian, the fees of the Execution Agent, Exchange listing fees, Securities and Exchange Commission (“SEC”) registration
fees, printing and mailing costs, legal costs and audit fees. The Sponsor’s payment of such Trust expenses is not subject to a cap. The Sponsor also paid the costs of the Trust’s organization.
The Trust will receive a portion of the staking rewards earned through its staking program in the form of SOL. The Staking Provider and Sponsor are entitled to receive a fee for their respective
roles in facilitating the Trust's staking program (collectively, "Staking Expenses"). The Trust will pay the Staking Expenses at a rate of 3% of the gross staking rewards received by the Trust. The staking rewards earned by the Trust
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will accrue to the Trust’s account with the Solana Custodian and will generally be staked in the same way as the Trust’s already staked SOL. The expenses of staking the Trust’s SOL will be paid
from the proceeds of the Trust's staking program and the Trust will retain the remaining amount of the staking rewards. The Sponsor, on behalf of the Trust, intends to liquidate staking rewards for cash to be distributed to Shareholders quarterly.
The Trust may incur certain extraordinary expenses that are not assumed by the Sponsor. These include, but are not limited to, taxes and governmental charges, any applicable brokerage
commissions, financing fees, borrowing costs under a short term credit facility or alternative liquidity arrangement, Solana network fees and similar transaction fees, expenses and costs of any extraordinary services performed by the Sponsor (or
any other service provider) on behalf of the Trust to protect the Trust or the interests of Shareholders (including, for example, in connection with any fork of the Solana blockchain), any indemnification of the Sponsor, Cash Custodian, Solana
Custodian, Staking Provider, Administrator or other agents, service providers or counterparties of the Trust and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory
enforcement or investigation matters.
The Trust’s Legal Structure
The Trust is a Delaware statutory trust, formed on June 12, 2025, pursuant to the Delaware Statutory Trust Act (“DSTA”). The Trust continuously issues common shares representing fractional
undivided beneficial interest in and ownership of the Trust that may be purchased and sold on the Exchange. The Trust operates pursuant to its Amended and Restated Declaration of Trust and Trust Agreement, dated as of November 28, 2025 (the “Trust
Agreement”). CSC Delaware Trust Company, a Delaware trust company, is the Delaware trustee of the Trust (the “Trustee”). Shareholders will have very limited voting rights, which will limit their ability to influence matters such as amendment of the
Trust Agreement, change in the Trust’s basic investment policy, dissolution of the Trust, or the sale or distribution of the Trust’s assets.
The Lukka Prime Solana Reference Rate
The Benchmark is designed to provide an estimated fair market value (“FMV”) for SOL, in a manner that aligns with accounting principles generally accepted in the United States (“U.S. GAAP”) and
International Financial Reporting Standards Foundation (“IFRS”) accounting guidelines regarding fair market value measurements. In this regard, the Benchmark Provider seeks to identify a “principal market” for SOL each day, by evaluating eligible SOL
trading platforms across a variety of different criteria, including the trading platforms’ oversight and governance frameworks, microstructure efficiency, trading volume, data transparency and data integrity. As of September 30, 2025, the following
trading platforms are considered to be eligible trading platforms by the Benchmark Provider: Binance, Bitfinex, Bitflyer, Bitstamp, Bullish, Coinbase, Crypto.com, Gate.io, Gemini, HitBTC, Huobi, itBit, Kraken, KuCoin, LMAX, MEXC Global, OKX and
Poloniex (collectively, “Benchmark Pricing Sources”). The Benchmark Provider reviews trading platforms eligible for inclusion in the Benchmark quarterly. In determining which trading platforms to include as Benchmark Pricing Sources, the Benchmark
Provider evaluates each trading platform using proprietary ratings criteria. The Benchmark Provider periodically reassesses the trading platforms eligible to be considered Benchmark Pricing Sources, and makes adjustments as needed.
For purposes of financial reporting, the Trust will determine the principal market for SOL in accordance with ASC Topic 820-10, and such determination is considered from the Trust’s perspective.
Procedures will be implemented to review and confirm the prices utilized to value SOL reflect fair value in accordance with Accounting Standards Codification Topic 820, “Fair Value Measurements and Disclosures” (“ASC Topic 820”) and will be reviewed
by the Sponsor’s Valuation Committee on a periodic basis.
With respect to the Trust’s Authorized Participants, the Trust has no authority over which trading platforms the Authorized Participants or their affiliates might transact on, although the Trust
expects that most
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Authorized Participants or their affiliates may transact on several of the trading platforms used by the Benchmark Provider. The Trust notes that for transactions in which it is selling SOL, it may
do so in principal-to-principal transactions, although the Trust is eligible to execute trades on all of the trading platforms used by the Benchmark Provider. While the principal to principal market is the market in which the Execution Agent, on the
Trust’s behalf, would normally transact for sales of SOL, in considering all information reasonably available in accordance with the guidance in ASC 820-10-35-5A, the Trust notes that the identification of a principal market is completed by the
Benchmark Provider based on a variety of different criteria including but not limited to trading platforms’ oversight and governance frameworks, microstructure efficiency, trading volume, data transparency and data integrity. The Trust views this
evidence to the contrary as an appropriate basis to determine a primary market that is not the principal-to-principal market, in accordance with the guidance in ASC 820-10-35-5A.
The Trust’s Staking Program
In seeking to achieve its investment objective, the Trust will hold SOL and will seek to stake substantially all of its SOL to earn staking rewards, except as necessary to (i) pay the Sponsor
Fee or other Trust expenses, (ii) satisfy existing and reasonably foreseen potential redemption requests, (iii) address regulatory or tax concerns raised by staking activities or (iv) to maintain unstaked SOL in the Liquidity Sleeve. The Trust will
only engage in staking to the extent the Trust, in the Sponsor’s sole discretion, can engage in staking without undue legal or regulatory risk, including without jeopardizing its status as a grantor trust for U.S. federal income tax purposes (the
“Staking Condition”). The Sponsor has determined that the Staking Condition has been satisfied. As of the date of this Prospectus, the Sponsor intends to engage in staking on behalf of the Trust of
substantially all of the Trust's SOL, subject to an amount that it determines to invest in the Liquidity Sleeve. Galaxy Blockchain Infrastructure LLC, an affiliate of the Execution Agent, is expected to serve as a Staking Provider with respect to
the Trust’s SOL.
If the Trust engaging in staking activities raised concerns about the safety or liquidity of the Trust's SOL, the Trust may cease some or all of its staking activities. Staking on the Solana network involves
delegating of SOL to validators and carries risks discussed further below. Staked SOL may be subject to community-determined penalties for validator misbehavior, or slashing. If the Staking Provider causes the Trust’s staked SOL to be subject to
such slashing losses, the Trust could suffer losses of the staked SOL. Additionally, the staking process includes protocol-defined warm-up, activation and withdrawal periods, during which staked SOL is temporarily locked and inaccessible. These
phases affect when SOL begins earning rewards, participates in consensus and becomes available for transfer or redelegation.
The Staking Provider will stake the Trust’s SOL as the node operator and will operate a validator to stake the Trust’s SOL. The Staking Provider will perform its staking services in collaboration with the Solana
Custodian, as the SOL will be staked directly from the Trust’s SOL account with the Solana Custodian. The Trust will maintain control of the SOL while it is staked because it will remain in the Trust’s account with the Solana Custodian (i.e., it will be kept in a separate account for which the Trust is the beneficial and record owner and will not be commingled other parties' accounts with the Solana Custodian). The Trust will maintain the power
to unstake its SOL. The Staking Provider will not have this capability. Staking will be a passive activity for the Trust, as it will not operate its staking program. The Trust’s role will be limited to evaluating and contracting with one or more
Staking Providers and instructing the Staking Provider on when to stake and/or unstake the Trust’s SOL.
The Trust will receive a portion of the staking rewards earned through its staking program in the form of SOL. The Staking Provider and Sponsor are entitled to receive a fee for their respective roles in
facilitating the Trust's staking program (collectively, "Staking Expenses"). The Trust will pay Staking Expenses at a rate of 3% of the gross staking rewards received by the Trust. The expenses of staking the Trust’s SOL will be paid from the
proceeds of the Trust's staking program and the Trust will retain the remaining amount of the staking rewards. The staking rewards earned by the Trust will accrue to the Trust’s account with the Solana Custodian and will generally be staked in the
same way as
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the Trust’s already staked SOL. The Sponsor, on behalf of the Trust, intends to liquidate staking rewards for cash to be distributed to Shareholders quarterly.
Liquidity Risk Management
The Trust’s staking program involves the temporary loss of the ability to transfer or otherwise dispose of the Trust’s SOL. The Sponsor has adopted a liquidity risk management policy (the “Policy”) related to the
management of the Trust’s staking-related liquidity risks. The Policy is intended to comply with, and is in line with, the listing rules of the Exchange. Below is a summary of certain aspects of the Policy, which is available at the Trust’s
website. The Sponsor expects that under normal conditions, the Trust will generally regain complete control over the Trust’s SOL in up to three days of instructing the Solana Custodian to unstake or "exit" the Trust’s staked SOL positions. However,
there can be no guarantee that such process will result in the Trust regaining complete control of its SOL in time to satisfy its current obligations. Accordingly, the Sponsor may consider a number of options to manage the liquidity of the Trust’s
assets in times of stress, including a temporary extension of the settlement timeline for redemption orders or a temporary suspension of redemption orders. The Sponsor may also rely on other means of managing liquidity such as the use of a credit
facility or an alternative liquidity arrangement (including a credit facility with the Sponsor or its affiliates acting as lender) in its sole discretion. The costs of such a borrowing arrangement would be borne by the Trust.
The Trust may reduce the amount of its SOL that is staked as part of managing its liquidity, extend the settlement time for redemptions of Creation Baskets, or seek alternative sources of liquidity, such as a credit
facility. As of the date of this Prospectus, the Sponsor intends to engage in staking on behalf of the Trust of substantially all of the Trust's SOL, subject to an amount that it determines to maintain as unstaked SOL to manage liquidity. As of
the date of the Prospectus, the Trust has not entered into a credit facility or an alternative liquidity arrangement. If the Trust enters into a credit facility or an alternative liquidity arrangement, the
Trust will notify shareholders through the filing of a Form 8-K and a supplement to this Prospectus describing the material terms of any such arrangement. Key staking metrics related to the amount of SOL that is staked and staking rewards received
by the Trust will be published and updated on the Trust’s website.
The Trust will not utilize leverage, derivatives or similar instruments or transactions in seeking to meet its investment objective; however, the Trust may utilize a short term credit facility or an alternative
liquidity arrangement for the purposes of obtaining funds necessary to meet redemptions from the Trust. The Policy is designed to manage staking-related liquidity risks, but these risks cannot be fully eliminated, especially in extreme or stressed
market conditions or in the event that the Trust or its service providers experience operational disruptions. Accordingly, investors could still experience delays or limitations on redemptions if the Trust is unable to unstake the necessary amount
of SOL in time to satisfy its current obligations.
The Trust’s Service Providers
The Sponsor
Invesco Capital Management LLC is the Sponsor of the Trust. The Sponsor arranged for the creation of the Trust and is responsible for the ongoing registration of the Shares for their public
offering, the listing of Shares on the Exchange and valuing the SOL held by the Trust. The Sponsor is a limited liability company formed in the State of Delaware on February 7, 2003, and is a wholly-owned subsidiary of Invesco Ltd. Invesco Ltd. and
its subsidiaries, including the Sponsor, are an independent global investment management group. The Sponsor’s principal address is 3500 Lacey Road, Suite 700, Downers Grove, IL 60515.
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The Trustee
CSC Delaware Trust Company, a Delaware trust company, acts as the Trustee of the Trust as required to create a Delaware statutory trust in accordance with the Trust Agreement and the DSTA. The
Trustee’s principal address is 251 Little Falls Drive, Wilmington, DE 19808 Attention: Invesco Galaxy Solana ETF.
The Administrator
The Bank of New York Mellon (“BNYM”) serves as the Trust’s Administrator. Under the trust administration and accounting agreement, the Administrator provides necessary administrative, tax and
accounting services and financial reporting for the maintenance and operations of the Trust, including calculating the NAV of the Trust, determining the net assets of the Trust, and calculating the size of the Creation Baskets. The Administrator’s
principal address is 240 Greenwich Street, New York, New York 10286.
The Transfer Agent
BNYM also serves as the Transfer Agent for the Trust. The Transfer Agent is responsible for (1) issuing and redeeming Shares in connection with creation and redemption transactions, (2) responding
to correspondence by Shareholders and others relating to its duties, (3) maintaining Shareholder accounts and (4) making periodic reports to the Trust. The Transfer Agent’s principal address is 240 Greenwich Street, New York, New York 10286.
The Solana Custodian
Coinbase Custody Trust Company, LLC serves as the Trust’s Solana Custodian. The Trust has entered into a prime brokerage and custody agreement with the Solana Custodian (the “Solana Custody
Agreement”), pursuant to which the Solana Custodian will hold in custody all of the Trust’s SOL, other than that which may be maintained in a trading account with Coinbase, Inc. from time to time. See “Prospectus Summary—Custody of the Trust’s
Assets,” below. The Solana Custodian is chartered as a limited purpose trust company by the New York State Department of Financial Services (“NYSDFS”) and is authorized by the NYSDFS to provide digital asset custody services. The Solana Custodian is
a wholly-owned subsidiary of Coinbase Global, Inc.
The Solana Custodian is a third-party limited purpose trust company that was chartered in 2018 upon receiving a trust charter from the NYSDFS. The Solana Custodian is subject to regulation by the
NYSDFS and has a long track record of providing custodial services for digital asset private keys. The Sponsor believes that the Solana Custodian’s policies, procedures, and controls for safekeeping, exclusively possessing, and controlling the
Trust’s SOL holdings are consistent with industry best practices to protect against theft, loss, and unauthorized and accidental use of the private keys. Each Trust Solana account at the Solana Custodian and the Sponsor’s Solana account, if any, at
the Solana Custodian are segregated accounts and are therefore not commingled with the Solana Custodian’s corporate or other customer assets.
Although the Solana Custodian carries insurance for the benefit of its account holders, the Solana Custodian’s insurance does not cover any loss in value to SOL and only covers losses caused by
certain events such as fraud or theft and, in such covered events, it is unlikely the insurance would cover the full amount of any losses incurred by the Trust.
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The Cash Custodian
BNYM also serves as the cash custodian for the Trust (the “Cash Custodian”) pursuant to a custody agreement (the “Cash Custody Agreement”). The Cash Custodian is responsible for holding the Trust’s
cash, including in connection with creation and redemption transactions effected in cash. The Cash Custodian is a New York state-chartered bank and a member of the Federal Reserve System. The Cash Custodian’s principal address is 240 Greenwich
Street, New York, New York 10286.
The Staking Provider
Galaxy Blockchain Infrastructure LLC, an affiliate of the Execution Agent is expected to serve as a Staking Provider with respect to the Trust’s SOL. The Staking Provider will stake the Trust’s
SOL as the node operator and will operate a validator by which the Trust’s SOL is staked. The Staking Provider will perform its staking services in collaboration with the Solana Custodian, as the SOL will be staked directly from the Trust’s account
with the Solana Custodian.
The Execution Agent
The Sponsor has entered into an agreement with Galaxy Digital Funds LLC, a subsidiary of Galaxy Digital LP (“Galaxy” or the “Execution Agent”) to serve as Execution Agent. At the direction of
the Sponsor, the Execution Agent is responsible for selling SOL on behalf of the Trust to the extent necessary to permit the payment of the Trust’s expenses and to liquidate staking rewards for cash to pay quarterly distributions to Shareholders.
The Trust also will utilize the services of the Execution Agent to purchase or sell SOL in connection with cash creations and redemptions. When acquiring or disposing of SOL on behalf of the Trust in connection with a creation or redemption
transaction, the Sponsor will provide instructions to the Execution Agent, who will identify a Solana Counterparty. The Solana Counterparty will not have a pre-existing material relationship with the Trust, except that in some cases the Solana
Counterparty may be an affiliate of a service provider to the Trust. In connection with both cash creation and cash redemption transactions, the Execution Agent, pursuant to the oversight of the Sponsor, will decide how and with which Solana
Counterparty to transact on the Trust’s behalf. In addition, as part of this agreement, the Execution Agent has agreed to co-brand and co-market the Trust and the Sponsor has licensed the use of certain Execution Agent trademarks, service marks and
trade names in connection with the Trust. The Execution Agent’s principal address is 300 Vesey Street, New York City, New York 10282.
Galaxy is a subsidiary of Galaxy Digital Holdings LP (“Galaxy Holdings”). Galaxy Digital Holdings Ltd., which holds a limited partner interest in Galaxy Holdings, is listed on the Toronto Stock
Exchange under the symbol “GLXY.”
Authorized Participants
The Trust will process all creations and redemptions of Shares in transactions with Authorized Participants. Creation and redemption transactions will be conducted in exchange for SOL in-kind or
cash.
When purchasing Creation Baskets in-kind with SOL, Authorized Participants and/or their designees will deliver SOL to the Solana Custodian. After confirming receipt of the SOL by the Solana
Custodian, the Transfer Agent is authorized by the Sponsor to issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of the creation order.
When purchasing Creation Baskets for cash, Authorized Participants will deliver cash to the Cash Custodian. The Execution Agent will be responsible for acquiring the requisite amount of SOL on
behalf of the Trust on an agency basis on the value date of the order. Once the Execution Agent selects a Solana
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Counterparty, the Cash Custodian will transfer cash to the Solana Counterparty in payment for the requisite amount of SOL. The SOL acquired from the Solana Counterparty will be transferred to the
Solana Custodian. After receipt of the SOL by the Solana Custodian, the Transfer Agent will issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of the creation order.
When redeeming Creation Baskets in-kind for SOL, the Transfer Agent will redeem the Shares and the Solana Custodian will distribute the resulting SOL to the redeeming Authorized Participant
and/or its designee in satisfaction of the redemption order.
When redeeming Creation Baskets for cash, the Execution Agent will be responsible for selling the requisite amount of SOL on behalf of the Trust on an agency basis. Once the Execution Agent selects
a Solana Counterparty, the Solana Custodian will transfer SOL to the Solana Counterparty in return for the requisite cash payment. The cash received from the Solana Counterparty will be delivered to the Cash Custodian. After receipt of the cash
payment, the Transfer Agent will redeem the Shares and the Cash Custodian will distribute the resulting cash to the redeeming Authorized Participant in satisfaction of the redemption order.
In connection with both cash creation and cash redemption transactions, the Execution Agent, pursuant to the oversight of the Sponsor, will decide how and with which Solana Counterparty to
transact on the Trust’s behalf.
Authorized Participants are expected to sell Shares to the public at prices that reflect, among other factors, the value of the Trust’s assets, supply of and demand for Shares and market conditions
at the time of a transaction.
As of the date of the Prospectus, the Trust has entered into Authorized Participant Agreements with Jane Street Capital, LLC and Virtu Americas LLC.
The Marketing Agent
Invesco Distributors, Inc. (the “Marketing Agent”) is responsible for: (1) working with the Transfer Agent to review and approve, or reject, purchase and redemption orders of Shares placed by
Authorized Participants with the Transfer Agent; and (2) reviewing and approving the marketing materials prepared by the Trust for compliance with applicable SEC and Financial Industry Regulatory Authority (“FINRA”) advertising laws, rules, and
regulations. The Marketing Agent’s principal address is 11 Greenway Plaza, Suite 1000, Houston, TX 77046.
Custody of the Trust’s Assets
The Solana Custodian will keep the private keys associated with the Trust’s SOL in a “cold storage” environment where the private keys are generated and secured (the “Prime Custody Vault”). The
Trust intends to conduct its regular SOL transactions, including in connection with creation and redemption
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transactions and selling SOL to pay the Trust’s expenses, directly from the Trust’s Prime Custody Vault in over-the-counter transactions directly with counterparties selected by the Execution
Agent. While the Trust does not expect to utilize the services of the Coinbase, Inc. (“Coinbase” or the “Prime Broker”), in connection with transactions where the Trust’s SOL is being processed in connection with certain creation or redemption
transactions or it is being sold to pay Trust expenses, the Execution Agent may elect to transact through the Prime Broker. In such circumstances, the Trust’s SOL may be maintained in a trading account (the “Trading Balance”) with the Prime Broker,
an affiliate of the Solana Custodian. The Trust’s SOL will be maintained by the Solana Custodian and Coinbase in accounts that are required to be segregated from the assets held by the Solana Custodian or Coinbase as principal and, when held in the
Prime Custody Vault, the assets of their other customers. “Cold storage” refers to a safeguarding method by which the private keys corresponding to the Trust’s SOL are generated and stored in an offline manner using computers or devices that are
not directly connected to the internet, which is intended to make them more resistant to hacking, or similarly secure technology. All of the Trust’s SOL will be held in the Prime Custody Vault, except that it may be maintained in the Trading
Balance in connection with certain creation or redemption transactions or when it is being sold to pay the Sponsor Fee or Trust expenses not assumed by the Sponsor. The Sponsor seeks to stake substantially all of the Trust’s assets through one or
more trusted Staking Providers, except as necessary to (i) pay the Sponsor Fee or other Trust expenses, (ii) satisfy existing and reasonably foreseen potential redemption requests, (iii) address regulatory or tax concerns raised by staking
activities or (iv) to maintain unstaked SOL in the Liquidity Sleeve. In consideration for any staking activity in which the Trust may engage, the Trust would receive certain staking rewards of SOL tokens, which may be treated as income for U.S.
federal income tax purposes. The Sponsor, on behalf of the Trust, intends to liquidate certain staking rewards for cash to be distributed to Shareholders quarterly. The treatment of staking in a grantor trust for U.S. federal income tax purposes is
still developing. As a grantor trust, the Trust can undertake only certain types of activities. Please see "Taxation of the Trust" below for more details. The Trust will not acquire and will disclaim any Incidental Right or Incidental Right
asset received, for example as a result of “forks” or “airdrops,” and such assets will not be taken into account for purposes of determining NAV.
The SOL in the Trust’s account at the Solana Custodian may be held across multiple wallets, any of which will feature the following safety and security measures to be implemented by the Solana
Custodian:
Cold Storage: Cold storage in the context of SOL means keeping the reserve of SOL offline, which is a widely-used security precaution, especially when
dealing with a large amount of SOL. SOL held under custodianship with the Solana Custodian will be kept in high-security, offline, multi-layer cold storage vaults. This means that the private key materials, the cryptographic components that allow a
user to access SOL, are stored offline on hardware that has never been directly connected to the internet. Storing private key materials offline minimizes the risk of the SOL being stolen. The Sponsor expects that all of the Trust’s SOL will be held
in cold storage of the Solana Custodian in the Prime Custody Vault on an ongoing basis, except as noted above. In connection with certain creations or redemptions, the Trust may process creations and redemptions by selling SOL from its Prime Custody
Vault balance.
Private Keys: All private keys are securely protected using multiple layers of high-quality encryption and in Solana Custodian-owned offline hardware in
physically secure environments. No customers or third parties are given access to the Solana Custodian’s private keys.
Whitelisting: Transactions are only sent to vetted, known addresses. The Solana Custodian’s platform supports pre-approval and test transactions. The Solana
Custodian requires authentication when adding or removing addresses for whitelisting. All instructions to initiate a whitelist addition or removal must be submitted via the Solana Custodian’s platform. When a whitelist addition or removal request is
initiated, the initiating user will be prompted to authenticate their request using a two-factor authentication key. A consensus mechanism on the Solana Custodian’s platform dictates how many approvals are required in order for the consensus to be
achieved to add or remove a whitelisted address. Only when the consensus is
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met is the underlying transaction considered officially approved. An account’s roster and user roles are maintained by the Solana Custodian in a separate log, an Authorized User List (“AUL”). Any
changes to the account’s roster must be reflected on an updated AUL first and executed by an authorized signatory.
Audit Trails: Audit trails exist for all movement of SOL within Solana Custodian-controlled SOL wallets and are audited annually for accuracy and
completeness by an independent external audit firm.
In addition to the above measures, in accordance with the Solana Custody Agreement, SOL held in custody with the Solana Custodian will be segregated from both the proprietary property of the Solana
Custodian and the assets of any other customer in accounts that clearly identify the Trust as the owner of the accounts.
The Solana Custodian has insurance coverage as a subsidiary under its parent company, Coinbase Global, Inc., which procures fidelity (e.g., crime) insurance to protect the organization from risks
such as theft of funds. Specifically, the fidelity program provides coverage for the theft of funds held in hot or cold storage. The insurance program is provided by a syndicate of industry-leading insurers. The insurance program does not cover,
insure or guarantee the performance of the Trust. The Solana Custodian is not insured by the Federal Deposit Insurance Corporation (“FDIC”).
The Trust relies on the Cash Custodian to hold or transfer any cash related to the purchase or sale of SOL in connection with cash creation and redemption transactions, or held for payment of
expenses not assumed by the Sponsor, such as the Sponsor Fee. In its role, the Cash Custodian helps facilitate the creations and redemptions of Shares done in exchange for cash.
Net Asset Value
NAV means the value of the total assets of the Trust including, but not limited to, all SOL and cash (if any) less the total liabilities of the Trust (including accrued but unpaid expenses),
divided by the number of outstanding Shares.
The Administrator determines the NAV of the Trust on each day that the Exchange is open for regular trading. In determining the Trust’s NAV, the Administrator values the SOL held by the Trust based
on the price established by the Benchmark Provider as of 4:00 p.m. ET each Business Day.
The amount of SOL represented by the Shares will be reduced during the life of the Trust each time the Trust accrues the Sponsor Fee or pays for any extraordinary expenses. This dynamic will occur
irrespective of whether the value of the Trust’s assets, or the trading price of the Shares, rises or falls. See “Risk Factors—Risks Related to the Trust and the Shares—The amount of SOL represented by the Shares will decline over time” and
“Calculation of NAV.”
Plan of Distribution
Most investors buy and sell Shares of the Trust in secondary market transactions through brokers. Shares trade on the Exchange under the ticker symbol “QSOL.” Shares are bought and sold throughout
the trading day like other publicly traded securities. When buying or selling Shares through a broker, most investors incur customary brokerage commissions and charges, as well as any bid-ask spread. Shareholders are encouraged to review the terms of
their brokerage account for details on applicable charges.
Authorized Participants are expected to sell such Shares to the public at prices that reflect, among other factors, the value of the Trust’s assets, supply of and demand for Shares and market
conditions at the time of a transaction. The Trust will continuously offer Creation Baskets consisting of 5,000 Shares to Authorized Participants. Authorized Participants may pay (i) a transaction fee and (ii) transfer, processing
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and other transaction costs charged by the Solana Custodian (the “Custody Transaction Fee”) for each order they place to create or redeem Creation Baskets.
Prior to this offering, there has been no public market for the Shares. The Shares are expected to be listed for trading, subject to notice of issuance, on the Exchange under the ticker symbol
QSOL.
Federal Income Tax Considerations
It is expected that owners of Shares will be treated, for U.S. federal income tax purposes, as if they own a proportionate share of the assets of the Trust, as if they directly receive a
proportionate share of any income of the Trust, and as if they incur a proportionate share of the expenses of the Trust. Consequently, each sale of SOL by the Trust (which includes, under current Internal Revenue Service guidance, using SOL to pay
expenses of the Trust, including the Sponsor Fee) would give rise to taxable gain or loss to Shareholders. See “U.S. Federal Income Tax Consequences—Taxation of U.S. Shareholders.”
Use of Proceeds
Proceeds received by the Trust from the issuance of Creation Baskets consist of in-kind SOL and cash deposits. SOL deposits are held by the Solana Custodian on behalf of the Trust until (i)
delivered to Authorized Participants or their designated agent or client in connection with an in-kind redemption or sold in connection with a cash redemption or (ii) sold to pay the Sponsor’s Fee and Trust expenses of liabilities not assumed by
the Sponsor. Cash deposits are held by the Cash Custodian on behalf of the Trust until (i) transferred in connection with the purchase of SOL, (ii) delivered to Authorized Participants in connection with a redemption of Creation Baskets; or (iii)
transferred to pay the Sponsor Fee or for extraordinary expenses and liabilities not assumed by the Sponsor. Proceeds may also be used in staking activities.
SOL and the Solana Network
SOL is a digital asset, also referred to as a digital currency or cryptocurrency, that is created and transmitted through the operations of the peer-to-peer Solana network (“Solana” or “Solana
network”), which is a network of computers, known as nodes, that operates as cryptographic computer-code based logic, call a protocol. No single entity owns or operates the Solana network, the infrastructure of which is collectively maintained by a
distributed user base, a phenomenon known as decentralization. The Solana network allows people to exchange tokens of value, called SOL, which are recorded on a public transaction ledger known as the Solana blockchain. SOL may be used to pay for
goods and services, including computational power on the Solana network, stored for future use, or converted to a fiat currency, such as the U.S. dollar, at rates determined on digital asset trading platforms, or in individual end-user-to-end-user
transactions under a barter system.
Furthermore, the Solana network also allows users to write and implement smart contracts—that is, general-purpose code that executes on every computer in the network and can instruct the
transmission of information and value based on a sophisticated set of logical conditions. Using smart contracts, users can create markets, store registries of debts or promises, represent the ownership of property, move funds in accordance with
conditional instructions and create digital assets other than SOL on the Solana network. Smart contract operations are executed on the Solana Blockchain in exchange for payment of SOL. The Solana network is one of a number of projects intended to
expand blockchain use beyond just a peer-to-peer money system. The value of SOL is not backed by any government, corporation, or other identified body.
The Solana protocol introduced the Proof-of-History ("PoH") timestamping mechanism. PoH automatically orders on-chain transactions by creating a historical record that proves an event has occurred at a specific
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moment in time. PoH is intended to provide a transaction processing speed and capacity advantage over other blockchain networks like Bitcoin and Ethereum, which rely on sequential production of blocks and can lead to
delays caused by validator confirmations. PoH is a new blockchain technology that is not widely used. PoH may not function as intended. For example, it may require more specialized equipment to participate in the network and fail to attract a
significant number of users, or may be subject to outages or fail to function as intended. In addition, there may be flaws in the cryptography underlying PoH, including flaws that affect functionality of the Solana network or make the network
vulnerable to attack.
In addition to the PoH mechanism described above, the Solana network uses a proof-of-stake consensus mechanism to incentivize SOL holders to validate transactions. Unlike proof-of-work, in which miners expend
computational resources to compete to validate transactions and are rewarded coins in proportion to the amount of computational resources expended, in proof-of-stake, validators risk or “stake” coins to compete to be randomly selected to validate
transactions and are rewarded coins in proportion to the amount of coins staked. Any malicious activity, such as disagreeing with the eventual consensus or otherwise violating protocol rules, results in the forfeiture or “slashing” of a portion of
the staked coins. Proof-of-stake is viewed as more energy efficient and scalable than proof-of-work and is sometimes referred to as “virtual mining.”
The Solana protocol was first conceived by Anatoly Yakovenko in a 2017 whitepaper. Development of the Solana network is overseen by the Solana Foundation, a Swiss non-profit organization, and Solana Labs, Inc. (“Solana
Labs”), a Delaware corporation, which administered the original network launch and token distribution. Although Solana Labs and the Solana Foundation continue to exert significant influence over the direction of the development of Solana, the Solana
network, like the Ethereum network, is understood to be decentralized and does not require governmental authorities or financial institution intermediaries to create, transmit or determine the value of Solana.
In order to own, transfer or use SOL directly on the Solana network (as opposed to through an intermediary, such as a custodian), a person generally must have internet access to connect to the Solana network. SOL
transactions may be made directly between end-users without the need for a third-party intermediary. To prevent the possibility of double-spending SOL, a user must notify the Solana network of the transaction by broadcasting the transaction data to
its network peers. The Solana network provides confirmation against double-spending by memorializing every transaction in the Solana blockchain, which is publicly accessible and transparent. This memorialization and verification against
double-spending is accomplished through the Solana network validation process, which adds “blocks” of data, including recent transaction information, to the Solana blockchain. Unlike other blockchains that rely solely on sequential production of
blocks through proof-of-work or proof-of-stake mechanisms, however, the Solana network introduces PoH, which creates a historical record that proves an event has occurred at a specific moment in time.
The Solana software source code allows for the creation of decentralized applications (“DApps”) that are supported by a transaction protocol referred to as “smart contracts,” which includes the
cryptographic operations that verify and secure SOL transactions. A smart contract operates by a predefined set of rules (i.e., “if/then statements”) that allows it to automatically execute code the same way on any Solana node on the network. Such
actions taken by the predefined set of rules are not necessarily contractual in nature but are intended to eliminate the arbitration of a third party for carrying out code execution on behalf of users, making the system decentralized, while
empowering developers to create a wide range of applications layering together different smart contracts. Smart contracts can be utilized across several different applications ranging from art to finance. One of the most popular applications is the
use of smart contracts for underpinning the operability of decentralized financial services (“DeFi”), which consist of numerous highly interoperable protocols and applications. DeFi is believed by some to offer many opportunities for innovation and
to have the potential to create an open, transparent, and immutable financial infrastructure, with democratized access.
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The Solana network operates using open-source protocols, meaning that any user can become a node by downloading a software application that implements Solana network specification and communications with the Solana
network (“Solana Client”), and participating in the Solana network, and no permission of a central authority or body is needed to do so. In addition, anyone can propose a modification to the Solana network’s source code and then propose that the
Solana network community support the modification. These proposed modifications to the Solana network’s source code, if adopted, can lead to forks (referred to as “planned forks” because they take place through a formal process).
A modification of the Solana network’s source code is only effective with respect to the SOL nodes that download it and modify their Solana Clients accordingly, and in practice such decisions are heavily influenced by
the preferences of validators and users. Typically, after a modification introduced and if a sufficiently broad critical mass of users and validators support the modification and nodes download the modification into their individual Solana Clients,
the change is implemented and the Solana network continues to operate uninterrupted, assuming there are no software issues (e.g., bugs, outages, etc.). However, if less than a sufficiently broad critical mass (in practice, amounting to a substantial
majority) of users and validators support the proposed modification and nodes refuse to download the modification to their Solana Clients, and the modification is not backwards compatible with the Solana blockchain or network or the Solana Clients of
nodes prior to their modification, the consequence would be what is known as a “hard fork” of the Solana network, with one group of nodes running the pre-modified software, with users and validators continuing to use the pre-modified software, while
the other group would adopt and run the modified software.
In the event of a hard fork of the Solana network, the Sponsor will instruct the Trust to immediately and irrevocably disclaim all rights to the SOL, cash or other assets or rights received as a
result of a hard fork or airdrop in respect of SOL (“IR Assets”) so created. As a result, shareholders will not receive the benefits of any hard fork or airdrop. SOL is the only digital asset that will be held by the Trust. In the event the Trust
seeks to change its treatment of Incidental Rights or IR Assets, an application would need to be filed with the SEC by the Exchange seeking approval to amend its listing rules.
Assets in the Solana network are held in accounts. Each account, or “wallet,” is made up of at least two components: a public address and a private key. A SOL private key controls the transfer or
“spending” of SOL from its associated public SOL address. A SOL “wallet” is a collection of public Solana addresses and their associated private key(s). This design allows only the owner of SOL to send SOL, the intended recipient of SOL to unlock it,
and the validation of the transaction and ownership to be verified by any third party anywhere in the world.
SOL may be regarded as a currency or digital commodity depending on its specific use in particular transactions. SOL may be used as a medium of exchange or unit of account. Similarly, SOL may be
used as a store of value (i.e., an asset that maintains its value rather than depreciating), although it has experienced significant periods of price volatility.
There can be no assurance as to the future performance of SOL; the past performance and volatility of SOL should not be taken as an indication of future performance or volatility.
The Solana Market
SOL spot trading occurs on venues in the U.S. that are licensed to conduct that business by the NYSDFS, other venues in the U.S. and non-U.S. venues. In addition, SOL futures trading occurs on
trading platforms in the U.S. regulated by the CFTC. The market for NYSDFS-licensed and CFTC-regulated trading of SOL and SOL futures has developed substantially. SOL market conditions in the three months ending on September 30, 2025, are briefly
summarized as follows:
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Solana: There are over 20 NYSDFS-licensed entities operating trading platforms with order books for spot trading of SOL. Among the top NYSDFS-licensed trading platforms, year-to-date as-of September
30, 2025, the average daily trading volume is approximately $293 million. Across these venues, the average daily deviation of prices was less than 0.08%. The largest NYSDFS-licensed trading platform by volume had an average bid-ask spread
during the period of less than 0.05%.
|
| • |
Futures: There are currently over 10 CFTC-regulated trading platforms, 2 of which are open and facilitate trading of SOL futures, with a total average daily trading volume of approximately $650
million.
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Principal Investment Risks of an Investment in the Trust
An investment in the Trust involves risks. You should consider carefully the risks summarized below, which are described in more detail under “Risk Factors.”
Shareholders may choose to use the Trust as means of investing indirectly in SOL. Shareholders considering a purchase of Shares of the Trust should carefully consider how much of their total assets
should be exposed to the SOL market, and should fully understand, be willing to assume, and have the financial resources necessary to withstand, the risks involved in the Trust’s investment strategy, and be in a position to bear the potential loss of
their entire investment in the Trust.
There is no assurance as to whether the Trust will be profitable or meet its expenses and liabilities. Any investment made in the Trust may result in a total loss of the investment.
Risks Related to Solana
Market and Volatility Risk. The trading prices of many digital assets, including SOL, have exhibited high price
volatility relative to more traditional asset classes, which may be due to speculation regarding potential future appreciation in value. The value of the Trust’s investments in SOL could decline rapidly, including to zero.
Some market observers have asserted that the digital asset market, including SOL, periodically experiences pricing “bubbles” and have predicted that, in time, the value of SOL will fall to a
fraction of its current value, or even to zero. SOL has not been in existence long enough for market participants to assess these predictions with any precision, but if these observers are even partially correct, an investment in the Shares may turn
out to be substantially worthless.
Adoption Risk. The further development and acceptance of the Solana network, which is part of a new and rapidly changing industry, is subject to a variety of
factors that are difficult to evaluate. The slowing, stopping or reversing of the development or acceptance of the Solana network may adversely affect the price of SOL and therefore an investment in the Shares.
Currently, there is relatively limited use of SOL in the retail and commercial marketplace in comparison to relatively extensive use as a store of value. Tax treatment of the use of SOL as a medium
of exchange and other factors could hinder expansion of SOL into retail and commercial markets. A lack of expansion by SOL into retail and commercial markets, or a contraction of such use, may result in damage to the public perception of SOL and the
utility of SOL as a payment system, increased volatility or a reduction in the value of SOL, all of which could adversely impact an investment in the Shares. Furthermore, many other digital assets besides SOL have been created. To the extent market
participants come to prefer these other digital assets, the value of SOL, and therefore an investment in the Shares, may be adversely affected.
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Regulatory Risk. Regulatory changes or actions may alter the nature of an investment in SOL or restrict the use of SOL or the operations of the Solana
network or venues on which SOL trades in a manner that adversely affects the price of SOL and an investment in the Shares. For example, it may become difficult or illegal to acquire, hold, sell or use SOL in one or more countries, which could
adversely impact the price of SOL.
Cybersecurity Risk. In the past, flaws in the source code for digital asset networks and related protocols have been
discovered, including those that resulted in the theft of users’ digital assets. Several errors and defects have been publicly found and corrected, including those that disabled some functionality for users and exposed users’ personal information.
Discovery of flaws in or exploitations of the source code that allow malicious actors to take or create money in contravention of known network rules has occurred.
Additionally, if a malicious actor or botnet (i.e., a volunteer or hacked collection of computers controlled by networked software coordinating the actions of the computers) obtains control of more
than 50% of the validating power of the Solana network, such actor or botnet could alter the digital transaction ledger, or “blockchain,” that records transactions in and ownership of SOL and adversely affect the value of SOL.
By using computers that appear to be participating in the Solana network, but that are not in fact connected to the network (so-called “cancer nodes”), a malicious actor can disconnect the target
user from the SOL economy entirely by refusing to relay any blocks or transactions.
Separate from the cybersecurity risks of the Solana protocol, entities that custody or facilitate the transfers or trading of SOL have been frequent and successful targets of cybersecurity attacks,
leading to significant theft of SOL. If any of these exploitations or attacks occur, it could result in a loss of public confidence in SOL, a decline in the value of SOL and, as a result, adversely impact an investment in the Shares.
Risks Related to the Trust and the Shares
Expense Risk. The Trust’s returns will not match the performance of SOL because the Trust incurs the Sponsor Fee and may incur other expenses.
Risk That Market Price of Shares May Reflect a Discount or Premium to NAV. The NAV of the Trust may not always correspond to the market price of its Shares
for a number of reasons, including price volatility, levels of trading activity, differences between the normal trading hours for the Trust and the underlying SOL market, the calculation methodology of the NAV, demand or supply for Shares of the
Trust in excess of an Authorized Participant’s ability to create or redeem Shares and/or the closing of SOL trading platforms due to fraud, failure, security breaches or otherwise. As a result, the NAV of the Shares included in Creation Baskets may
differ from the market price of the Shares.
Cash Creations and Redemptions. The extent of the Trust’s use of cash creations and redemptions, as opposed to in-kind creations and redemptions, may
adversely affect the arbitrage transactions by Authorized Participants intended to keep the price of the Shares closely linked to the price of SOL and, as a result, the price of the Shares may fall or otherwise diverge from NAV. The use of cash
creations and redemptions could cause delays in trade execution due to potential operational issues arising from implementing a cash creation and redemption model. Such delays could cause the execution price associated with such trades to materially
deviate from the Benchmark price used to determine the NAV. Even though the Authorized Participant is responsible for the dollar cost of such difference in prices, Authorized Participants could default on their obligations to the Trust, or such
potential risks and costs could lead to Authorized Participants to elect to not participate in the Trust’s Share creation and redemption processes, which may adversely affect the arbitrage mechanism, and as a result, the price of the Shares may fall
or otherwise diverge from NAV. If the arbitrage mechanism is not effective, purchases or sales of
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Shares on the secondary market could occur at a premium or discount to NAV, which could harm Shareholders.
In-Kind Creations and Redemptions. The use of in-kind creations and redemptions of Shares, as opposed to cash creations and redemptions, could lead to
inefficiencies in the arbitrage mechanism. This may result in Shares trading at significant premiums or discounts to their NAV. The Trust’s ability to create and redeem in-kind is new, and broker-dealers may struggle to comply with regulations,
affecting their ability to participate in in-kind transactions. Consequently, the Trust may have to rely more on cash transactions, which could impair liquidity and widen bid/ask spreads. This reliance on cash creations and redemptions could also
increase costs for investors and other market participants, particularly during times of market volatility. Additionally, there is no assurance that broker-dealers will be willing to serve as Authorized Participants for in-kind transactions,
potentially impacting the Trust’s performance and the value of the Shares.
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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, as well as information
found in documents incorporated by reference in this Prospectus, before you decide to purchase any Shares. These risk factors may be amended, supplemented or superseded from time to time by risk factors contained in any periodic report, prospectus
supplement, post-effective amendment or in other reports filed with the SEC in the future.
Risks Related to Solana.
Digital asset networks face significant scaling challenges and efforts to increase the volume and speed of transactions may not be successful.
Many digital asset networks, including the Solana network, face significant scaling challenges due to the fact that public blockchains generally face a tradeoff between security and scalability.
One means through which public blockchains achieve security is decentralization, meaning that no intermediary is responsible for securing and maintaining these systems. For example, a greater degree of decentralization generally means a given digital
asset network is less susceptible to manipulation or capture. In practice, this typically means that every single validator on a given digital asset network is responsible for securing the system by processing every transaction and every single full
node is responsible for maintaining a copy of the entire state of the network. As a result, a digital asset network may be limited in the number of transactions it can process by the fact that all validators participate in validating in each block
and the capabilities of each single fully participating node. Many developers are actively researching and testing scalability solutions for public blockchains that do not necessarily result in lower levels of
security or decentralization, such as off-chain payment channels. Off-chain payment channels would allow parties to transact without requiring the full processing power of a blockchain.
On September 30, 2025, the Solana network handled approximately 976 transactions per second. In an effort to increase the volume of transactions that can
be processed on a given digital asset network, many digital assets are being upgraded with various features to increase the speed and throughput of digital asset transactions. As corresponding increases in throughput lag the growth in demand to
settle transactions on digital asset networks, average fees and settlement times may increase considerably. Since inception, transaction fees on the Solana network have been comprised of a fixed base fee of 0.000005 SOL per transaction, plus a
variable fee component based on the computation resources used during the transaction as well as aggregate network activity. SOL holders can also pay an additional prioritization fee to expedite their transaction. The 30-day average transaction fee
on September 30, 2025 was $0.0127, which was equivalent to 0.00058 SOL. Increased fees and decreased settlement speeds could preclude certain uses for SOL (e.g., micropayments), and could reduce demand for, and the price of, SOL, which could
adversely impact the value of the Shares.
The rapid development of other competing scalability solutions, such as those which would rely on handling the bulk of computational work relating to transactions or smart contracts and
applications built on the Solana network (consistent with common usage, all such applications are referred to as “decentralized applications” or “DApps”, whether or not decentralized in fact) outside of the main
Solana network and Solana blockchain, has caused alternatives to sharding to emerge. “Layer 2” is a collective term for solutions which are designed to help increase throughput and reduce transaction fees by
handling or validating transactions off the main Solana network (known as “Layer 1”) and then attempting to take advantage of the perceived security and integrity advantages of the Layer 1 Solana network by
uploading the transactions validated on the Layer 2 protocol back to the Layer 1 Solana network. The details of how this is done vary significantly between different Layer 2 technologies and implementations. To date, the Solana network
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community has not coalesced overwhelmingly around any particular Layer 2 solution, though this could change.
There is no guarantee that any of the mechanisms in place or being explored for increasing the speed and throughput of settlement of Solana network
transactions will be effective, or how long these mechanisms will take to become effective, which could cause the Solana network to not adequately resolve scaling challenges and adversely impact the adoption
of SOL and the Solana network and the value of the Shares. There is no guarantee that any potential scaling solution, whether a change to the Layer 1 Solana network like sharding or the introduction of a Layer 2 solution, will achieve widespread
adoption. It is possible that proposed changes to the Layer 1 Solana network could divide the community, potentially even causing a hard fork, or that the decentralized governance of the Solana network causes network participants to fail to coalesce overwhelmingly around any particular solution, causing the Solana network to suffer reduced adoption or causing nodes, users or
validators to migrate to other blockchain networks. It is also possible that scaling solutions could fail to work as intended or could introduce bugs, coding defects or flaws, security risks, or other problems that could cause them to suffer
operational disruptions. Alternatively, if a widely-used Layer 2 network were to fail, it could reduce demand for SOL because it would eliminate a source of demand for using SOL to record transactions from the Layer 2 onto the Layer 1 Solana
network. Any of the foregoing could adversely affect the price of SOL or the value of the Shares.
Market and Volatility Risk. SOL has exhibited high price volatility relative to more traditional asset classes. For example, there were steep increases in
the value of certain digital assets, including SOL, over the course of 2021. These increases were followed by steep drawdowns throughout 2022. These episodes of rapid price appreciation followed by steep drawdowns have occurred multiple times
throughout SOL’s history. Over the past three years (using data ending September 30, 2025), Solana has exhibited a historical annualized volatility of 95% and maximum annual price decrease of -42%. As of the date of this Prospectus, digital asset
prices continued to fluctuate in 2025.
The price of SOL on public digital asset trading platforms has a limited history, and during this history, has experienced periods of extreme volatility due to several unique factors. Since its
launch in 2020, the Solana network has suffered several high-profile network outages and technical issues, which triggered sharp price swings. For example, in September 2021, the Solana network experienced a significant disruption and was offline
for 17 hours and only returned to full functionality 24 hours later. This network outage was later attributed to a type of denial of service attack. In 2022, the price of SOL experienced extreme volatility due to the collapse of FTX Trading Ltd.
(“FTX”) and Alameda Research and their close association with the Serum protocol, a decentralized exchange on the Solana network. In February 2023, a malfunction caused a validator to transmit an exceptionally large block of SOL, which was several
orders of magnitude larger than a standard block, and caused an outage of nearly 19 hours. In February 2024, a bug in Agave (a validator program that is a fork of the original Solana validator program), caused all validators running the program to
stall on the validation of a block, which caused a 5-hour outage. The SOL ecosystem has grown rapidly since its creation, especially in its use of DeFi or open finance platforms and launching NFTs on the Solana blockchain. This rapid growth
attracted speculative capital, which amplified SOL price movements. Further, SOL exhibits a high degree of concentration in ownership, which increases the susceptibility to large-scale sell-offs. These features, combined with the technical
complexity and innovation risk inherent in SOL’s architecture, may result in price movements that are more severe and less correlated with broader digital asset market trends, particularly during periods of network stress or significant ecosystem
developments. The development of the Solana network is ongoing and any disruption could have a material adverse effect on the value of SOL and an investment in the Shares.
Extreme volatility may persist and the value of the Shares may significantly decline in the future without recovery. The digital asset markets may still be experiencing a bubble or may
experience a bubble again in the future. For example, in the first half of 2022, each of Celsius Network, Voyager Digital Ltd., and Three
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Arrows Capital declared bankruptcy, resulting in a loss of confidence in participants of the digital asset ecosystem and negative publicity surrounding digital assets more broadly. In November
2022, FTX, one of the largest digital asset trading platforms by volume at the time, halted customer withdrawals amid rumors of the company’s liquidity issues and likely insolvency, which were subsequently corroborated by its CEO. Shortly
thereafter, FTX’s CEO resigned and FTX and many of its affiliates filed for bankruptcy in the United States, while other affiliates have entered insolvency, liquidation, or similar proceedings around the globe, following which the U.S. Department
of Justice brought criminal fraud and other charges, and the SEC and CFTC brought civil securities and commodities fraud charges, against certain of FTX’s and its affiliates’ senior executives, including its former CEO. In addition, several other
entities in the digital asset industry filed for bankruptcy following FTX’s bankruptcy filing, such as BlockFi Inc. and Genesis Global Capital, LLC (“Genesis”). In response to these events, the digital asset markets have experienced extreme price
volatility and other entities in the digital asset industry have been, and may continue to be, negatively affected, further undermining confidence in the digital asset markets. These events have also negatively impacted the liquidity of the digital
asset markets as certain entities affiliated with FTX engaged in significant trading activity. Some sources report the price of Solana declined 94% overall in 2022, including over 50% in the two months following FTX’s declaration of bankruptcy. The
2022 events also negatively impacted the liquidity of the digital asset markets as certain entities affiliated with FTX engaged in significant trading activity. If the liquidity of the digital asset markets continues to be negatively impacted by
these or similar events, digital asset prices, including SOL, may continue to experience significant volatility or price declines and confidence in the digital asset markets may be further undermined.
While regulatory and enforcement scrutiny increased through the end of 2024, including from, among others, the Department of Justice, the SEC, the CFTC, the White House and Congress, as well as
state regulators and authorities, the new U.S. presidential administration has signaled its desire to strengthen U.S. leadership in the digital assets space through the issuance of executive orders and the establishment of an interagency working
group that is tasked with proposing a regulatory framework governing the issuance and operation of digital assets in the United States in early 2025. Meanwhile, the SEC officially rescinded Staff Accounting Bulletin 121 and established a new “Crypto
Task Force” focused on providing clarity on the application of the federal securities laws to digital assets and collaborating with the digital assets industry and the public towards establishing an appropriate regulatory framework. Certain members
of Congress have also outlined a proposed bicameral roadmap for digital asset legislation to address inconsistencies in digital asset classifications. In 2023, the D.C. Circuit Court found that the SEC’s denial of the Grayscale Bitcoin Trust’s
listing was “arbitrary and capricious” under the Administrative Procedures Act in light of the SEC’s approval of two similar bitcoin futures-based exchange-traded products (“ETPs”). In the immediate aftermath of this court decision, the price of
bitcoin increased from nearly $26,000 to over $28,100. After the results of the U.S. presidential election in November 2024, the price of bitcoin rallied to an all-time high of over $100,000 in December 2024 based, in part, on the market’s perception
that the new presidential administration would be pro-cryptocurrency. The exact timeline and impact of these recent regulatory developments on the Trust’s business is uncertain and it is not possible to predict at this time what risks, if any, that
regulatory developments may pose to the Trust, its service providers or to the digital asset industry as a whole.
Extreme volatility in the future, including further declines in the trading prices of SOL, could have a material adverse effect on the value of the Shares and the Shares could lose all or
substantially all of their value. The Trust is not actively managed and will not take any actions to take advantage, or mitigate the impacts, of volatility in the price of SOL.
The value of the Trust’s investments in SOL could decline rapidly, including to zero.
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SOL’s historical volatility may be due to speculation regarding potential future appreciation in value, which could adversely affect an investment in the
Shares.
Momentum investing typically is associated with growth stocks and other assets whose valuation, as determined by the investing public, is impacted by anticipated future appreciation in value.
Momentum investing in SOL may have contributed, and may continue to contribute, to speculation regarding potential future appreciation in the value of SOL, inflating and making these prices more volatile. As a result, SOL may be more likely to
fluctuate in value due to changing investor confidence in future appreciation or depreciation in prices, which could adversely affect the price of SOL, and, in turn, an investment in the Trust.
Some market observers have asserted that the SOL market often experiences pricing “bubbles” and have predicted that, in time, the value of SOL will fall to
a fraction of its current value, or even to zero.
SOL has not been in existence long enough for market participants to assess these predictions with any precision, but if these observers are even partially correct, an investment in the Shares may
turn out to be substantially worthless.
The price of SOL may be impacted by the behavior of a small number of influential individuals or companies.
The price of SOL has experienced increased volatility resulting from the statements and actions of individuals in the SOL and broader technology community. Filings by companies and social media
statements by prominent individuals have in the past and may in the future have an outsized impact on the price of SOL relative to fundamental value considerations. To the extent that the actions of one or more companies or individuals leads to an
increase in the price of SOL, a reversal of such position by the company or individual may have a sharp, negative impact on the price of SOL and the value of the Shares.
Adoption Risk.
User adoption of SOL may slow down, stop, or reverse.
The further development and acceptance of the Solana network, which is part of a new and rapidly changing industry, is subject to a variety of factors that are difficult to evaluate. For example,
the Solana network faces significant obstacles to increasing the usage of SOL without resulting in higher fees or slower transaction settlement times, and attempts to increase the volume of transactions may not be effective. The slowing, stopping or
reversing of the development or acceptance of the Solana network may adversely affect the price of SOL and therefore an investment in the Shares.
The use of SOL to, among other things, buy and sell goods and services is part of a new and rapidly evolving industry that employs digital assets based upon computer-generated mathematical and/or
cryptographic protocols. SOL is a prominent, but not unique, part of this industry. The growth of this industry is subject to a high degree of uncertainty. The factors affecting the further development of this industry, include, but are not limited
to:
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continued worldwide growth or possible cessation or reversal in the adoption and use of SOL and other digital assets;
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government and quasi-government regulation of SOL and other digital assets and their use, including taxation of SOL transactions, or restrictions on or regulation of access to and operation of the Solana network and other digital asset
networks;
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changes in consumer demographics and public tastes and preferences, including the possibility that market participants may come to prefer other digital assets to SOL for a variety of reasons, including that such other digital currencies
may have features (like different consensus mechanisms) or uses that SOL lacks;
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the maintenance and development of the open-source software protocol of the Solana network;
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the availability and popularity of other forms or methods of buying and selling goods and services, including new means of using fiat currencies;
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the use of the networks supporting digital assets for developing smart contracts and distributed applications;
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general economic conditions and the regulatory environment relating to digital assets;
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because of the energy usage required for mining certain digital assets (applicable to proof-of-work blockchains), regulation stemming from energy usage and/or climate concerns; and
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negative consumer or public perception of SOL specifically and other digital assets generally.
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Currently, there is relatively limited use of SOL in the retail and commercial marketplace in comparison to relatively extensive use as a store of value,
thus contributing to price volatility that could adversely affect an investment in the Shares.
SOL has only recently and very selectively been accepted as a means of payment for goods and services by some retail and commercial outlets, and the use of SOL by consumers to pay such retail and
commercial outlets remains extremely limited. Banks and other established financial institutions may refuse to process funds for SOL transactions; process wire transfers to or from SOL trading platforms, SOL-related companies or service providers; or
maintain accounts for persons or entities transacting in SOL or providing SOL-related services. In addition, some taxing jurisdictions, including the U.S., treat the use of SOL as a medium of exchange for goods and services to be a taxable sale of
SOL, which could discourage the use of SOL as a medium of exchange, especially for a holder of SOL that has appreciated in value. See “—Regulatory Risk—The tax treatment of SOL (including staking of SOL) and transactions involving SOL for U.S.
federal income tax purpose is uncertain and may change, which could adversely affect the value of an investment in the Shares.”
Conversely, a significant portion of SOL’s demand is generated by investors seeking to profit from the short- or long-term holding of the asset. Price volatility undermines SOL’s role as a medium
of exchange, as retailers are much less likely to accept it as a form of payment. Use of SOL as a medium of exchange and payment method may always be low. A lack of expansion by SOL into retail and commercial markets, or a contraction of such use,
may result in damage to the public perception of SOL and the utility of SOL as a payment system, increased volatility or a reduction in the value of SOL, all of which could adversely impact an investment in the Shares. There can be no assurance that
such acceptance will grow, or not decline, in the future.
While bitcoin, the first widely used digital asset, and many other digital assets were created and mainly serve as a form of money, digital assets can be used to do more complicated things. Some
digital assets were built specifically with more complex use cases in mind. For example, the Solana network was designed primarily to facilitate smart contracts, with the digital asset SOL serving as the transactional mechanism for many portions of
such contracts. Smart contracts are programs that automatically execute on a blockchain, allowing for a myriad of interesting applications to be built. It is possible that market demand for digital assets with use cases beyond serving as a form of
money could over time reduce the market demand for SOL, which would adversely impact the price of SOL and, as a result, an investment in the Shares. Additionally, certain digital assets use non-blockchain technologies, like Directed Acyclic Graph
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data structures, to maintain consensus. To the extent market participants come to prefer these other consensus mechanisms or digital assets that use non-blockchain technology, the value of SOL, and
therefore an investment in the Shares, may be adversely affected.
Competition from central bank digital currencies (“CBDCs”) and other digital assets could adversely affect the value of SOL and other digital assets.
Central banks have introduced digital forms of legal tender (CBDCs). China’s CBDC project, known as Digital Currency Electronic Payment, has reportedly been tested in a live pilot program conducted
in multiple cities in China. A recent study published by the Bank for International Settlements estimated that at least 36 central banks have published retail or wholesale CBDC work ranging from research to pilot projects. Whether or not they
incorporate blockchain or similar technology, CBDCs, as a form of legal tender in the issuing jurisdiction, could have an advantage in competing with, or replace, SOL and other digital assets as a medium of exchange or store of value. As a result,
the value of SOL could decrease, which could adversely affect an investment in the Trust.
Competing digital assets may adversely affect the value of SOL and digital assets.
Promoters of other digital assets claim that those digital assets have solved certain of the purported drawbacks of the Solana network, for example, allowing faster settlement times, reducing gas
fees, or reducing electricity usage in connection with mining. If these digital assets are successful, such success could reduce demand for SOL and adversely affect the value of SOL and an investment in the Trust.
Prices of SOL may be affected due to stablecoins (including Tether and U.S. Dollar Coin (“USDC”)), the activities of stablecoin issuers and their regulatory
treatment.
While the Trust does not invest in stablecoins, it may nonetheless be exposed to these and other risks that stablecoins pose for the SOL market through its trading in SOL. Stablecoins are digital assets designed to
have a stable value over time as compared to typically volatile digital assets, and are typically marketed as being pegged to a fiat currency, such as the U.S. dollar. Although the prices of stablecoins are intended to be stable, in many cases their
prices fluctuate, sometimes significantly. This volatility has in the past apparently impacted the price of SOL. Stablecoins are a relatively new phenomenon, and it is impossible to know all of the risks that they could pose to participants in the
SOL market. In addition, some have argued that some stablecoins, particularly Tether, are improperly issued without sufficient backing in a way that could cause artificial rather than genuine demand for SOL, raising its price, and also argue that
those associated with certain stablecoins are involved in laundering money. For example, on February 17, 2021, the New York Attorney General entered into an agreement with Tether’s operators, requiring them to cease any further trading activity with
New York persons and pay $18.5 million in penalties for false and misleading statements made regarding the assets backing Tether. On October 15, 2021, the CFTC announced a settlement with Tether’s operators in which they agreed to pay $42.5 million
in fines to settle charges that, among others, Tether’s claims that it maintained sufficient U.S. dollar reserves to back every Tether stablecoin in circulation with the “equivalent amount of corresponding fiat currency” held by Tether were untrue.
USDC is a reserve-backed stablecoin issued by Circle Internet Financial that is commonly used as a method of payment in digital asset markets, including the SOL market. The issuer of USDC uses the
Circle Reserve Fund to hold cash, U.S. Treasury bills, notes and other obligations issued or guaranteed as to principal and interest by the U.S. Treasury, and repurchase agreements secured by such obligations or cash, which serve as reserves backing
USDC stablecoins. While USDC is designed to maintain a stable value at 1 U.S. dollar at all times, on March 10, 2023, the value of USDC fell below $1.00 for multiple days after Circle Internet Financial disclosed that $3.3 billion of the USDC
reserves were held at Silicon Valley Bank, which had
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entered FDIC receivership earlier that day. Stablecoins are reliant on the U.S. banking system and the U.S. treasuries market, and the failure of either to function normally could impede the
function of stablecoins, and therefore could adversely affect the value of the Shares.
Given the foundational role that stablecoins play in global digital asset markets, their fundamental liquidity can have a dramatic impact on the broader digital asset market, including the market
for SOL. Because a large portion of the digital asset market still depends on stablecoins such as Tether and USDC, there is a risk that a disorderly de-pegging or a “run” on Tether or USDC could lead to dramatic market volatility in digital assets
more broadly. In the United States, the GENIUS Act, which establishes a federal regulatory framework for stablecoins, was passed by the U.S. Congress and signed into law by President Trump on July 18, 2025. Although increasing regulatory clarity for
stablecoins is generally viewed in a positive light, volatility in stablecoins, operational issues with stablecoins (for example, technical issues that prevent settlement), concerns about the sufficiency of any reserves that support stablecoins or
potential manipulative activity when unbacked stablecoins are used to pay for other digital assets (including SOL), or regulatory compliance concerns about stablecoin issuers or intermediaries, such as trading platforms, that support stablecoins,
could impact individuals’ willingness to trade on trading platforms that rely on stablecoins, reduce liquidity in the SOL market, and affect the value of SOL, and in turn impact an investment in the Shares.
The open-source structure of the Solana network protocol means that certain core developers and other contributors may not be directly compensated for their
contributions in maintaining and developing the Solana network protocol. A failure to properly monitor and upgrade the Solana network protocol could damage the Solana network.
The Solana network operates based on open-source protocol maintained by a group of core developers and other contributors, largely on the GitHub resource section dedicated to Solana network development. As new SOL are
rewarded solely for validator activity (other than the 500 million minted in 2018 upon launch of the Solana testnet) and are not sold on an ongoing basis to generate revenue to support development activity, and the Solana network protocol itself is
made available for free rather than sold or made available subject to licensing or subscription fees and its use does not generate revenues for its development team, the core developers are generally not compensated for maintaining and updating the
source code for the Solana network protocol. Consequently, there is a lack of financial incentive for developers to maintain or develop the Solana network and the core developers may lack the resources to adequately address emerging issues with the
Solana network protocol. Although the Solana network is currently supported by the core developers, there can be no guarantee that such support will continue or be sufficient in the future. The perception that high-profile contributors may no longer
contribute to the network may have an adverse effect on the market price of any related digital assets. For example, in June 2017, an unfounded rumor circulated that Ethereum core developer Vitalik Buterin had died. Following the rumor, the price of
ether decreased approximately 20% before recovering after Buterin himself dispelled the rumor. Some have speculated that the rumor led to the decrease in the price of ether. In the event a high-profile contributor to the Solana network, such as
Anatoly Yakovenko, is perceived as no longer contributing to the Solana network due to death, retirement, withdrawal, incapacity, or otherwise, whether or not such perception is valid, it could negatively affect the price of Solana, which could
adversely impact the value of the Shares.
Alternatively, some developers may be funded by entities whose interests are at odds with other participants in the Solana network. In addition, a bad actor could also attempt to interfere with the operation of the
Solana network by attempting to exercise a malign influence over a core developer. To the extent that material issues arise with the Solana network protocol and the core developers and open-source contributors are unable to address the issues
adequately or in a timely manner, the Solana network and an investment in the Trust may be adversely affected.
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Lack of clarity in the corporate governance of SOL may lead to ineffective decision-making that slows development or prevents the Solana network from
overcoming important obstacles.
Governance of decentralized networks, such as the Solana network, is by voluntary consensus and open competition. Solana has no central decision-making body or clear manner in which participants
can come to an agreement other than through overwhelming consensus. The lack of clarity on governance may adversely affect SOL’s utility and ability to grow and face challenges, both of which may require solutions and a directed effort to overcome
problems, especially long-term problems.
To the extent lack of clarity in corporate governance of SOL leads to ineffective decision-making that slows development and growth, the value of the Shares may be adversely affected.
Cybersecurity Risk Related to Solana.
Flaws in the source code of Solana, or flaws in the underlying cryptography, could leave the Solana network vulnerable to a multitude of attack vectors.
If the source code or cryptography underlying SOL proves to be flawed or ineffective, malicious actors may be able to steal SOL held by others, which could negatively impact the demand for SOL and
therefore adversely impact the price of SOL. In the past, flaws in the source code for SOL have been discovered, including those that resulted in the loss of users’ SOL. Several errors and defects have been publicly found and corrected, including
those that disabled some functionality for users and exposed users’ personal information. Discovery of flaws in or exploitations of the source code that allow malicious actors to take or create money in contravention of known network rules have
occurred. In addition, the cryptography underlying SOL could prove to be flawed or ineffective, or developments in mathematics and/or technology, including advances in digital computing, algebraic geometry and quantum computing, could result in such
cryptography becoming ineffective. In any of these circumstances, a malicious actor may be able to steal SOL held by others, which could adversely affect the demand for SOL and therefore adversely impact the price of SOL. Even if the affected digital
asset is not SOL, any reduction in confidence in the source code or cryptography underlying digital assets generally could negatively impact the demand for SOL and therefore adversely affect an investment in the Shares.
The Solana network is currently vulnerable to several types of attacks, including:
| • |
“>33% attack” where, if a validator or group of validators were to gain control of more than 33% of the total staked SOL on the Solana network, a malicious actor could temporarily impede or delay block confirmation or even cause a
temporary fork in the blockchain.
|
| • |
“>50% attack” where, if a validator or group of validators acting in concert were to gain control of more than 50% of the total staked SOL on the Solana network, a malicious actor would be able to gain full control of the Solana network
and the ability to manipulate future transactions on the blockchain, including censoring transactions, double-spending and fraudulent block propagation, potentially for an extended period or even permanently. In theory, the minority
non-attackers might reach social consensus to reject blocks proposed by the malicious majority attacker, reducing the attacker’s ability to engage in malicious activity, but there can be no assurance this would happen or that non-attackers
would be able to coordinate effectively.
|
| • |
“>66% attack” where, if a validator or group of validators acting in concert were to gain control of more than 66% of the total staked SOL on the Solana network, a malicious actor could permanently and irreversibly manipulate the
blockchain, including censorship, double-spending and fraudulent block propagation. The attacker could finalize their preferred chain without any consideration for the votes of other stakers and could also revert finalized blocks.
|
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If a malicious actor, group or botnet (a voluntary or hacked collection of computers controlled by networked software coordinating the actions of the computers) obtains a majority (over 50%) of the
validating power on the Solana network, it may be able to alter the Solana blockchain on which transactions in SOL rely by constructing fraudulent blocks or preventing certain transactions from completing in a timely manner, or at all. The malicious
actor or botnet could also control, exclude or modify the ordering of transactions. Although the malicious actor or botnet would not be able to generate new tokens or transactions using such control, it could “double-spend” its own tokens (i.e.,
spend the same tokens in more than one transaction) and prevent the confirmation of other users’ transactions for so long as it maintained control (over 50%). To the extent that such malicious actor or botnet did not yield its control of the
validating power on the Solana network or the Solana community did not reject the fraudulent blocks as malicious, reversing any changes made to the Solana blockchain may not be possible. If the malicious actor were to gain control of more than 33% of
the total staked SOL on the Solana network, they could temporarily impede or delay block confirmation or even cause a temporary fork in the blockchain, but it is not believed that they could in double-spending or fraudulent block propagation. Even
without 33% control, a malicious actor or botnet could create a flood of transactions in order to slow down the Solana network (similar to a denial-of-service attack).
Some digital asset networks have been subject to malicious activity achieved through control over 50% of the processing power on the network. For example, on May 24, 2018, it was reported that
attackers compromised the Bitcoin Gold network in this manner and were successfully able to double-spend units of ether gold in a series of transactions over the course of at least one week and in a total amount of at least $18 million. In addition,
in May 2019, the Bitcoin Cash network experienced a 51% attack when two large mining pools reversed a series of transactions in order to stop an unknown miner from taking advantage of a flaw in a recent Bitcoin Cash protocol upgrade. Although this
particular attack was arguably benevolent, the fact that such coordinated activity was able to occur may negatively impact perceptions of the Bitcoin Cash network. Although the two attacks described above took place on proof-of-work-based networks,
it is possible that a similar attack may occur on the proof-of-stake Solana network, which could negatively impact the value of SOL and the value of the Shares. Furthermore, in August 2020, the Ethereum Classic Network was the target of two
double-spend attacks by an unknown actor or actors that gained more than 50% of the processing power of the Ethereum Classic network. The attacks resulted in reorganizations of the Ethereum Classic blockchain that allowed the attacker or attackers to
reverse previously recorded transactions in excess of $5.0 million and $1.0 million. Other digital assets such as Verge, Monacoin and Electroneum have also suffered similar attacks. To the extent that the Solana ecosystem, including the core
developers and the administrators of mining pools, does not act to ensure greater decentralization of mining processing power, the feasibility of a malicious actor obtaining control of the processing power on the Solana network will increase, which
may adversely affect an investment in the Shares. See “—Regulatory Risk.”
Although there are no known reports of malicious activity on, or control of, the Solana network, it is possible that certain groups of coordinating or connected SOL holders may together have more than 50% of
outstanding SOL, which if staked and if the users run validators, would permit them to exert authority over the validation of SOL transactions. This risk is heightened if over 50% of the processing power on the network falls within the jurisdiction
of a single governmental authority. If network participants, including the core developers and the administrators of validating pools, do not act to ensure greater decentralization of SOL, the feasibility of a malicious actor obtaining control of the
validating power on the Solana network will increase, which may adversely affect the value of the Shares.
A malicious actor may also obtain control over the Solana network through its influence over core or influential developers. For example, this could allow the malicious actor to stymie legitimate
network development efforts or attempt to introduce malicious code to the network under the guise of a software improvement proposal by such a developer. To the extent that the Solana ecosystem fails to attract a
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significant number of users, the possibility that a malicious actor may be able to obtain control of the Solana network in this manner will remain heightened.
By using cancer nodes, a malicious actor can disconnect the target user from the SOL economy entirely by refusing to relay any blocks or transactions.
Separate from the cybersecurity risks of the Solana protocol, entities that custody or facilitate the transfers or trading of SOL have been frequent and successful targets of cybersecurity attacks,
leading to significant theft of SOL.
See “Solana and the Solana Market—Solana and the Solana Network—Forms of Attack Against the Solana Network.”
If any of these exploitations or attacks occur, it could result in a loss of public confidence in SOL and a decline in the value of SOL and, as a result, adversely impact an investment in the
Shares.
Smart contracts are new and their ongoing development and operation may result in problems or be subject to errors or hacks, which could reduce the demand
for SOL or cause a wider loss of confidence in the Solana network, either of which could have an adverse impact on the value of SOL.
Since smart contracts typically cannot be stopped or reversed, vulnerabilities in their programming (i.e., coding errors) can have damaging effects. For instance, coding errors may potentially
create vulnerabilities that allow an attacker to drain the funds associated with the smart contract, cause issues or render the protocol unusable. There have been a number of vulnerabilities in various smart contract implementations exploited by
hackers since the launch of the Ethereum network in 2015 that have resulted in the loss of ether from accounts. For example, in February 2022, a vulnerability in a smart contract for Wormhole, a bridge between the Ethereum and Solana networks, led to
a $320 million theft of ether. While persons associated with Solana Labs and/or the Solana Foundation are understood to have played a key role in bringing the network back online, the broader community also played a key role, as Solana validators
coordinated to upgrade and restart the network. Problems with the development, deployment, and operation of smart contracts may have an adverse effect on the value of SOL.
In some cases, smart contracts can be controlled by one or more “admin keys” or users with special privileges, or “super users”. These users may have the ability to unilaterally make changes to the
smart contract, enable or disable features on the smart contract, change how the smart contract receives external inputs and data, and make other changes to the smart contract.
Many applications associated with DeFi are currently deployed on the Solana network, and smart contracts relating to DeFi applications currently represent a significant source of demand for SOL.
For smart contracts that hold a pool of digital asset reserves, smart contract super users or admin key holders may be able to extract funds from the pool, liquidate assets held in the pool, or take other actions that decrease the value of the
digital assets held by the smart contract in reserves. Even for digital assets that have adopted a decentralized governance mechanism, such as smart contracts that are governed by the holders of a governance token, such governance tokens can be
concentrated in the hands of a small group of core community members, who would be able to make similar changes unilaterally to the smart contract. If any such super user or group of core members unilaterally make adverse changes to a smart contract,
the design, functionality, features and value of the smart contract, its related digital assets may be harmed. In addition, assets held by the smart contract in reserves may be stolen, misused, burnt, locked up or otherwise become unusable and
irrecoverable. Super users can also become targets of hackers and malicious attackers. Furthermore, the underlying smart contracts may be insecure, contain bugs or other vulnerabilities, or otherwise may not work as intended. Any of the foregoing
could cause users of the DeFi application to be
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negatively affected, or could cause the DeFi application to be the subject of negative publicity. Because DeFi applications may be built on the Solana network and represent a significant source of
demand for SOL, public confidence in the Solana network itself could be negatively affected, and the value of SOL could decrease.
SOL transactions are irrevocable and stolen or incorrectly transferred SOL may be irretrievable. As a result, any incorrectly executed SOL transactions
could adversely affect an investment in the Trust.
SOL transactions are not reversible. Once a transaction has been verified and recorded in a block that is added to the Solana blockchain, an incorrect transfer of a digital asset, such as SOL, or a
theft of SOL generally will not be reversible and the Trust may not be capable of seeking compensation for any such transfer or theft. To the extent that the Trust is unable to successfully seek redress for such error or theft, such loss could
adversely affect an investment in the Trust.
The custody of the Trust’s SOL is handled by the Solana Custodian, and the transfer of SOL to and from Authorized Participants or their agents is directed by the Sponsor. If the Solana Custodian’s
internal procedures and controls are inadequate to safeguard the Trust’s SOL holdings, and the Trust’s private key(s) is (are) lost, destroyed or otherwise compromised and no backup of the private key(s) is (are) accessible, the Trust will be unable
to access its SOL, which could adversely affect an investment in the Shares of the Trust. In addition, if the Trust’s private key(s) is (are) misappropriated and the Trust’s SOL holdings are stolen, including from or by the Solana Custodian, the
Trust could lose some or all of its SOL holdings, which could adversely impact an investment in the Shares of the Trust.
Security threats to the Trust’s account with the Solana Custodian could result in the halting of Trust operations and a loss of Trust assets or damage to
the reputation of the Trust, each of which could result in a reduction in the price of the Shares.
The Trust and its service providers’ use of internet, technology and information systems (including mobile devices and cloud-based service offerings) may expose the Trust to potential risks linked
to cyber-security breaches of those technological or information systems. Security breaches, computer malware, ransomware and computer hacking attacks have been a prevalent concern in relation to digital assets. The Sponsor believes that the Trust’s
SOL held in the Trust’s account with the Solana Custodian will be an appealing target to hackers or malware distributors seeking to destroy, damage or steal the Trust’s SOL and will only become more appealing as the Trust’s assets grow. To the extent
that the Trust, the Sponsor or the Solana Custodian is unable to identify and mitigate or stop new security threats or otherwise adapt to technological changes in the digital asset industry, the Trust’s SOL may be subject to theft, loss, destruction
or other attack.
The Sponsor has evaluated the security procedures in place for safeguarding the Trust’s SOL. Nevertheless, the security procedures cannot guarantee the prevention of any loss due to a security
breach, software defect or act of God that may be borne by the Trust.
The security procedures and operational infrastructure may be breached due to the actions of outside parties, error or malfeasance of an employee of the Sponsor, the Solana Custodian, or otherwise,
and, as a result, an unauthorized party may obtain access to the Trust’s account with the Solana Custodian, the private keys (and therefore SOL) or other data of the Trust. Additionally, outside parties may attempt to fraudulently induce employees of
the Sponsor, the Solana Custodian, or the Trust’s other service providers to disclose sensitive information in order to gain access to the Trust’s infrastructure. As the techniques used to obtain unauthorized access, disable or degrade service, or
sabotage systems change frequently, or may be designed to remain dormant until a predetermined event and often are not recognized until launched against a target,
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the Sponsor and the Solana Custodian may be unable to anticipate these techniques or implement adequate preventative measures.
An actual or perceived breach of the Trust’s account with the Solana Custodian could harm the Trust’s operations, result in partial or total loss of the Trust’s assets, damage the Trust’s
reputation and negatively affect the market perception of the effectiveness of the Trust, all of which could in turn reduce demand for the Shares, resulting in a reduction in the price of the Shares. The Trust may also cease operations, the
occurrence of which could similarly result in a reduction in the price of the Shares.
While the Sponsor has established business continuity plans and systems that it believes are reasonably designed to prevent cyber attacks, there are inherent limitations in such plans and systems
including the possibility that certain risks have not been, or cannot be, identified. Service providers may have limited indemnification obligations to the Trust, which could be negatively impacted as a result.
If the Solana Custody Agreement is terminated or the Solana Custodian or the Prime Broker or Staking Provider fail to provide services as required, the
Sponsor may need to find and appoint a replacement custodian, prime broker and/or staking provider, which could pose a challenge to the safekeeping and safe transfer of the Trust’s SOL, and the Trust’s ability to continue to operate may be adversely
affected.
The Trust is dependent on the Solana Custodian and Prime Broker to operate. The Solana Custodian performs essential functions in terms of safekeeping the Trust’s SOL, and its affiliate, Coinbase
may be utilized by the Trust to facilitate the selling of SOL by the Trust to pay the Sponsor Fee and, to the extent applicable, other Trust expenses, to liquidate staking rewards for cash to pay quarterly distributions, or in certain
circumstances, to purchase and sell SOL in connection with cash creation or redemption transactions. If the Solana Custodian or Prime Broker fail to perform the functions they perform for the Trust due to insolvency, business failure or
interruption, default, failure to perform, security breach, or other problems affecting the Solana Custodian or the Prime Broker, the Trust may be unable to operate or create or redeem Creation Baskets, which could force the Trust to liquidate or
adversely affect the price of the Shares.
Additionally, the Trust depends on Staking Provider to execute staking. Staking rewards proceeds will depend on the success of the Staking Provider, including the technology used by such parties.
If the Solana Custodian or a Staking Provider experiences technical difficulties or service outages, or is otherwise unable to optimally execute the staking program the Trust's receipt of staking rewards and the value of the Shares may be adversely
affected.
Similarly, if an Authorized Participant or a Solana Trading Counterparty suffers insolvency, business failure or interruption, default, failure to perform, security breach, or in certain circumstances a force majeure
event or if an Authorized Participant or a Solana Trading Counterparty chooses not to participate in the creation and redemption process of the Trust, and the Trust is unable to engage replacement Authorized Participants or Solana Trading
Counterparties or access alternative services on commercially acceptable terms or at all, then the creation and redemption process of the Trust, the arbitrage mechanism used to keep the Shares in line with the NAV and the Trust’s operations generally
could be negatively affected.
In the event of any future SEC or other governmental, regulatory or other enforcement action of litigation, Coinbase could be required, as a result of a judicial determination, or could choose,
to restrict or curtail the services it offers, or its financial condition and ability to provide prime brokerage services to the Trust could be affected. If Coinbase were to be required or choose, as a result of a regulatory action or litigation to
restrict or curtail the services it offers, it could negatively affect the Trust’s ability to operate or process creations or redemptions of Creation Baskets, which could force the Trust to liquidate or adversely affect the price of the Shares.
While the Solana Custodian was not named in the complaint, if Coinbase Global,
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as the parent of the Solana Custodian, is required, as a result of a judicial determination, or could choose, to restrict or curtail the services its subsidiaries provide to the Trust, or its
financial condition is negatively affected, it could negatively affect the Trust’s ability to operate.
If the Solana Agreement is terminated, the Sponsor may not be able to find a party willing to serve as the custodian of the Trust’s SOL or as the Trust’s prime broker under the same terms as the
current Solana Custody Agreement or at all. To the extent that Sponsor is not able to find a suitable party willing to serve as the custodian or prime broker, the Sponsor may be required to terminate the Trust and liquidate the Trust’s SOL. In
addition, to the extent that the Sponsor finds a suitable party but must enter into a modified Solana Custody Agreement that is less favorable for the Trust or Sponsor, the value of the Shares could be adversely affected.
Loss of a critical banking relationship for, or the failure of a bank used by, the Execution Agent could adversely impact the Trust’s ability to create or
redeem Creation Baskets, or could cause losses to the Trust.
The Execution Agent is responsible for selling SOL on behalf of the Trust to pay the Sponsor Fee and, to the extent applicable, other Trust expenses. In addition, the Execution Agent will purchase
or sell SOL in connection with cash creations and redemptions. The Execution Agent may rely on bank accounts to provide its execution services and hold any cash related to a customer’s purchase or sale of SOL. To the extent that the Execution Agent
faces difficulty establishing or maintaining banking relationships, the loss of the Execution Agent’s banking partners or the imposition of operational restrictions by these banking partners and the inability for the Execution Agent to utilize other
financial institutions may result in a disruption of creation and redemption activity of the Trust, or cause other operational disruptions or adverse effects for the Trust.
The Trust could also suffer losses in the event that a bank in which the Execution Agent holds customer cash fails, becomes insolvent, enters receivership, is taken over by regulators, enters
financial distress, or otherwise suffers adverse effects to its financial condition or operational status. For example, Silvergate Bank, Silicon Valley Bank, Signature Bank, and First Republic Bank recently experienced financial distress, including
voluntary liquidation and receiverships.
Changing circumstances and market conditions, some of which may be beyond the Trust’s or the Sponsor’s control, could impair the Trust’s ability to access the Trust’s cash associated with the
Trust’s orders to purchase or sell SOL in connection with payment of the Sponsor Fee, and to the extent applicable, other Trust expenses, or in connection with creation and redemption transactions. If the Execution Agent were to experience financial
distress or its financial condition is otherwise affected by the failure of its banking partners, the Execution Agent’s ability to provide services to the Trust could be affected. Moreover, the future failure of a bank at which the Execution Agent
maintains customer cash could result in losses to the Trust, to the extent the balances are not subject to deposit insurance.
The Execution Agent may utilize the services of the Prime Broker to route Trust orders through certain Connected Trading Venues. The loss or failure of any
such Connected Trading Venues may adversely affect the Execution Agent’s ability to execute the Trust’s SOL transactions and cause losses for the Trust.
In connection with selling SOL on behalf of the Trust, the Execution Agent (acting as agent of the Trust) may elect to route SOL purchase or sale orders to a trading platform operated by Coinbase,
Inc., the Prime Broker. The Prime Broker provides access to a number of trading platforms and venues where the Execution Agent, acting on behalf of the Trust, may execute orders to buy and sell SOL (each such venue, a “Connected Trading Venue”). In
connection with these activities, the Prime Broker may hold SOL with such Connected Trading Venues for a short time in order to effect the Trust’s orders. If the Prime Broker
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were unable to access to these Connected Trading Venues, its trading services (and therefore the Execution Agent’s services as well) could be adversely affected to the extent that the Execution
Agent is limited in its ability to execute order flow for the Trust, and the Trust could suffer resulting losses or disruptions to its operations. While the Prime Broker has policies and procedures to oversee Connected Trading Venues, if any of these
venues experience any technical, legal, regulatory or other adverse events, such as shutdowns, delays, system failures, suspension of withdrawals, illiquidity, insolvency, or loss of customer assets, the Execution Agent, on behalf of the Trust, might
not be able to fully recover the Trust’s SOL.
A disruption of the internet may affect the use of SOL and subsequently the value of the Shares.
Solana is dependent upon the internet. A significant disruption in internet connectivity could disrupt the Solana network’s operations until the disruption is resolved and have an
adverse effect on the price of SOL. In particular, some variants of digital assets have been subjected to a number of denial-of-service attacks, which have led to temporary delays in block creation and in the transfer of the digital assets. While in
certain cases in response to an attack, an additional hard fork has been introduced to increase the cost of certain network functions, the relevant network has continued to be the subject of additional attacks. Moreover, it is possible that if SOL
increases in value, it may become a bigger target for hackers and subject to more frequent hacking and denial-of-service attacks.
Any future attacks that impact the ability to transfer SOL could have a material adverse effect on the price of SOL and the value of an investment in the Shares.
Regulatory Risk.
As SOL and the broader digital assets ecosystem has grown, it has begun to attract more regulatory attention around the globe. The future regulatory
environment is uncertain and may vary by country or even within countries. Failure to appropriately regulate the digital assets ecosystem could stifle innovation, which could adversely impact the value of the Shares.
As SOL and digital assets have grown in both popularity and market size, the U.S. Congress and a number of U.S. federal and state agencies (including the Financial Crimes Enforcement Network
(“FinCEN”), SEC, OCC, CFTC, FINRA, the Consumer Financial Protection Bureau (“CFPB”), the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the U.S. Internal Revenue Service (the “IRS”), state financial
institution regulators, and others) have been examining the operations of digital asset networks, digital asset users and the digital asset trading platform market. Many of these state and federal agencies have brought enforcement actions and issued
advisories and rules relating to digital asset markets. Although such actions were dismissed in 2025, since 2023 the SEC has charged certain large U.S. digital asset trading platforms (Binance, Coinbase and Kraken) with supporting the trading and
settlement of securities in violation of the U.S. federal securities laws. The U.S. Congress is also actively preparing new legislation to address certain market structure issues relating to digital assets and stablecoins. The outcome of this
legislation is unknown. Ongoing and future regulatory actions and federal legislation with respect to digital assets generally or any single digital asset in particular may alter, perhaps to a materially adverse extent, the nature of an investment in
the Shares and/or the ability of the Trust to continue to operate.
For example, the events of 2022, including among others the bankruptcy filings of FTX and its subsidiaries, Three Arrows Capital, Celsius Network, Voyager Digital, Genesis, BlockFi and others, and
other developments in the digital asset markets, have resulted in calls for heightened scrutiny and regulation of the digital asset industry, with a specific focus on intermediaries such as digital asset trading platforms and custodians. Federal and
state legislatures and regulatory agencies may introduce and enact new laws and regulations to regulate crypto asset intermediaries, such as digital asset trading platforms and custodians.
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The March 2023 collapses of Silicon Valley Bank, Silvergate Bank, and Signature Bank, which in some cases provided services to the digital assets industry, or similar future events, may amplify
and/or accelerate these trends. On January 3, 2023, the federal banking agencies issued a joint statement on crypto-asset risks to banking organizations following events which exposed vulnerabilities in the crypto-asset sector, including the risk of
fraud and scams, legal uncertainties, significant volatility, and contagion risk. Although banking organizations are not prohibited from crypto-asset related activities, the agencies have expressed significant safety and soundness concerns with
business models that are concentrated in crypto-asset related activities or have concentrated exposures to the crypto-asset sector.
U.S. federal and state regulators, as well as the White House, issued reports and releases concerning crypto assets, including Solana and crypto asset markets. Further, in 2023 the House of
Representatives formed two new subcommittees: the Digital Assets, Financial Technology and Inclusion Subcommittee and the Commodity Markets, Digital Assets, and Rural Development Subcommittee, each of which were formed in part to analyze issues
concerning crypto assets and demonstrate a legislative intent to develop and consider the adoption of federal legislation designed to address the perceived need for regulation of and concerns surrounding the crypto industry. However, the extent and
content of any forthcoming laws and regulations are not yet ascertainable with certainty, and it may not be ascertainable in the near future. A divided Congress makes any prediction difficult. We cannot predict how these and other related events will
affect us or the crypto asset business.
President Trump has issued executive orders addressing the administration’s intention to establish a comprehensive digital asset regulatory framework. There have also been several bills introduced
in Congress that propose to establish additional regulation and oversight of the digital asset markets.
On January 21, 2025, the SEC’s acting Chairman Mark T. Uyeda announced the SEC Crypto Task Force. The task force has an objective of developing a comprehensive and clear regulatory framework for
crypto assets. Following the task force announcement, on January 23, 2025, President Trump executed the Strengthening American Leadership in Digital Financial Technology Executive Order. It is currently unknown how the actions or recommendations of
the task force and this Executive Order or future governmental actions may impact the status of Solana or any other digital asset as a “security” or how Solana or the Trust would be treated under any new or revised regulatory framework.
President Trump’s January 23, 2025 Executive Order, titled “Strengthening American Leadership in Digital Financial Technology”, aimed to reorient the federal governments approach to digital assets.
The Executive Order emphasized the importance of the digital asset industry in innovation and economic development, and outlined policies to support the growth and use of digital assets, blockchain technology and related technologies. President
Trump’s order also revoked former President Biden’s March 9, 2022 Executive Order, titled, “Responsible Development of Digital Assets” and the U.S. Department of Treasury’s July 7, 2022 “Framework for International Engagement of Digital Assets” and
all policies, directives and guidance issued pursuant to those items produced by the previous administration. In July of 2025, President Trump’s Working Group on Digital Asset Markets released a report, “Strengthening American Leadership in Digital
Financial Technology”, which directed the SEC and other government agencies to provide additional clarity to on certain regulatory considerations in U.S. cryptocurrency markets. The consequences of federal regulation of digital assets and digital
asset activities could have a material adverse effect on the Trust and the Shares. If the Sponsor determines not to comply with such regulatory and registration requirements, it may seek to cease certain or all of the Trust’s operations. Any such
action could have a material adverse effect on our business, financial condition and results of operations.
It is not possible to predict whether, or when, any of these developments will lead to Congress granting additional authorities to the SEC or other regulators, what the nature of such additional
authorities might be, how additional legislation and/or regulatory oversight might impact the ability of digital asset markets
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to function or how any new regulations or changes to existing regulations might impact the value of digital assets generally and SOL held by the Trust specifically. The consequences of increased
federal regulation of digital assets and digital asset activities could have a material adverse effect on the Trust and the Shares.
FinCEN requires any administrator or exchanger of convertible digital assets to register with FinCEN as a money transmitter and comply with the anti-money laundering regulations applicable to money
transmitters. Entities which fail to comply with such regulations are subject to fines, may be required to cease operations, and could have potential criminal liability. For example, in 2015, FinCEN assessed a $700,000 fine against a sponsor of a
digital asset for violating several requirements of the Bank Secrecy Act by acting as a money services business and selling the digital asset without registering with FinCEN, and by failing to implement and maintain an adequate anti-money laundering
program. In 2017, FinCEN assessed a $110 million fine against BTC-e, a now defunct digital asset trading platform, for similar violations. The requirement that trading platforms that do business in the U.S. register with FinCEN and comply with
anti-money laundering regulations may increase the cost of buying and selling SOL and therefore may adversely affect the price of SOL and an investment in the Shares.
The Office of Foreign Assets Control (“OFAC”) of the U.S. Department of the Treasury (the “U.S. Treasury Department”) has added digital currency addresses to the list of Specially Designated
Nationals whose assets are blocked, and with whom U.S. persons are generally prohibited from dealing. Such actions by OFAC, or by similar organizations in other jurisdictions, may introduce uncertainty in the market as to whether a digital asset that
has been associated with such addresses in the past can be easily sold. This “tainted” digital asset may trade at a substantial discount to an untainted digital asset. Reduced fungibility in the digital asset markets may reduce the liquidity of such
digital assets and therefore adversely affect their price.
In February 2020, then-U.S. Treasury Secretary Steven Mnuchin stated that digital assets were a “crucial area” on which the U.S. Treasury Department has spent significant time. Secretary Mnuchin
announced that the U.S. Treasury Department is preparing significant new regulations governing digital asset activities to address concerns regarding the potential use for facilitating money laundering and other illicit activities. In December 2020,
FinCEN, a bureau within the U.S. Treasury Department, proposed a rule that would require financial institutions to submit reports, keep records, and verify the identity of customers for certain transactions to or from so-called “unhosted” wallets,
also commonly referred to as self-hosted wallets. In January 2021, U.S. Treasury Secretary nominee Janet Yellen stated her belief that regulators should “look closely at how to encourage the use of digital assets for legitimate activities while
curtailing their use for malign and illegal activities.”
Under regulations from the New York State Department of Financial Services (“NYSDFS”), businesses involved in digital asset business activity for third parties in or involving New York, excluding
merchants and consumers, must apply for a license, commonly known as a BitLicense, from the NYSDFS and must comply with anti-money laundering, cyber security, consumer protection, and financial and reporting requirements, among others. As an
alternative to a BitLicense, a firm can apply for a charter to become a limited purpose trust company under New York law qualified to engage in certain digital asset business activities. Other states have considered or approved digital asset business
activity statutes or rules, passing, for example, regulations or guidance indicating that certain digital asset business activities constitute money transmission requiring licensure. The regulation of digital asset activity under state money
transmission laws varies substantially.
The inconsistency in applying money transmitting licensure requirements to certain businesses may make it more difficult for these businesses to provide services, which may affect consumer adoption
of SOL and its price. In an attempt to address these issues, the Uniform Law Commission passed a model law in July 2017, the Uniform Regulation of Virtual Currency Businesses Act, which has many similarities to the
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BitLicense and features a multistate reciprocity licensure feature, wherein a business licensed in one state could apply for accelerated licensure procedures in other states. It is still unclear,
however, how many states, if any, will adopt some or all of the model legislation.
The transparency of blockchains has in the past facilitated investigations by law enforcement agencies. However, certain privacy-enhancing features have been, or are expected to be, introduced to a number of digital
asset networks, and these features may provide law enforcement agencies with less visibility into transaction histories. If the Solana network was to adopt any of these privacy-enhancing features, these features may provide law enforcement agencies
with less visibility into transaction-level data. For example, “privacy pools,” zero knowledge proofs, and other technologies that could enhance privacy have been discussed by participants in the Solana network, Europol, the European Union’s law
enforcement agency, released a report in October 2017 noting the increased use of privacy-enhancing digital assets like Zcash and Monero in criminal activity on the internet. In August 2022, OFAC banned all U.S. citizens from using Tornado Cash, a
digital asset protocol designed to obfuscate blockchain transactions, by adding certain Ethereum wallet addresses associated with the protocol to its Specially Designated Nationals list. On October 19, 2023, FinCEN published a proposed rulemaking to
apply the authorities in Section 311 of the USA PATRIOT Act to impose requirements on financial institutions that engage in convertible virtual currency (“CVC”) transactions with CVC mixers. The proposed rule, if adopted, would require covered
financial institutions to report to FinCEN any CVC transactions they process that involves CVC mixing within or involving a jurisdiction outside the United States. The term “CVC mixing” covers more than just transactions that involve CVC mixers like
Tornado Cash, and seemingly could cover a broader range of conduct involving technologies, services, or methods that have the effect of obfuscating the source, destination, or amount of a CVC transaction, whether or not the obfuscation was
intentional. If the rule were to be adopted as proposed and if the Solana network were to be deemed to or were to adopt features which come within the rule’s ambit, it could cause covered financial institutions - such as many virtual currency
exchanges, or the Trust’s service providers, such as the Prime Broker or Cash Custodian - to reduce support for or cease offering services for Solana or to the Trust, which could impair the utility of Solana, the value of the Shares and the Trust’s
ability to operate in compliance with new laws and regulations. Although no regulatory action has been taken to treat privacy-enhancing digital assets differently, this may change in the future.
In addition, a determination that SOL is a security under U.S. or foreign law could adversely affect an investment in the Shares. See “—Future regulations may require the Trust and the Sponsor to
become registered, which may cause the Trust to liquidate.”
As an owner of Shares, you will not have the rights normally associated with ownership of other types of shares.
Shares are not entitled to the same rights as shares issued by a corporation. By acquiring Shares, you are not acquiring the right to elect directors, to receive dividends, to vote on most matters
regarding the issuer of the Shares or to take other actions normally associated with the ownership of shares.
The Sponsor and the Trustee may agree to amend the Trust Agreement without the consent of the Shareholders.
The Sponsor and the Trustee may agree to amend the Trust Agreement without Shareholder consent. The Sponsor shall determine the content and manner of delivery of any notice of any Trust Agreement
amendment. Such notice may be provided on the Trust’s website, in a prospectus supplement, through a current report on Form 8-K and/or in the Trust’s annual or quarterly reports. If an amendment to the Trust Agreement imposes new fees and charges or
increases existing fees or charges, including the Sponsor Fee (except for taxes and other governmental charges, registration fees or other such expenses), or prejudices a
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substantial existing right of Shareholders, it will become effective for outstanding Shares 30 days after notice of such amendment is given to registered owners. Shareholders that are not
registered owners (which most Shareholders will not be) may not receive specific notice of a fee increase other than through an amendment to the Prospectus. Moreover, at the time an amendment becomes effective, by continuing to hold Shares,
Shareholders are deemed to consent and agree to the amendment and to be bound by the Trust Agreement as amended without specific agreement to such increase (other than through the “negative consent” procedure described above).
Shareholders do not have the protections associated with ownership of Shares in an investment company registered under the 1940 Act or the protections
afforded by the CEA.
The Trust is not an investment company subject to the 1940 Act, and the Sponsor believes that the Trust is not required to register under such act. Accordingly, investors do not have the
protections afforded by that statute, which is designed to ensure that registered funds are acting in their investors’ best interests, minimize conflicts of interest and provide for the impartial oversight of investment companies. For example,
registered investment companies subject to the 1940 Act must have a board of directors, a certain minimum percentage of whom must be independent (generally, at least a majority). Further, registered investment companies’ advisory and sub-advisory
contracts must be annually reapproved by a majority of (1) the entire board of directors and (2) the independent directors. Additionally, such registered investment companies are subject to prohibitions and restrictions on transactions with their
affiliates and required to maintain fund assets with special types of custodians (generally, banks or broker-dealers). Moreover, such registered investment companies are subject to significant limits on the use of leverage, as well as limits on the
form of capital structure and the types of securities a registered fund can issue. In addition, under Section 36(b) of the 1940 Act, investment advisers to registered investment companies have an express fiduciary duty with respect to their receipt
of compensation for services.
The Trust will not hold or trade in commodity interests regulated by the CEA, as administered by the CFTC. Furthermore, the Sponsor believes that the Trust is not a commodity pool for purposes of
the CEA, and that neither the Sponsor nor the Trustee is subject to regulation by the CFTC as a commodity pool operator or a commodity trading advisor in connection with the operation of the Trust. Consequently, Shareholders will not have the
regulatory protections provided to investors in CEA-regulated instruments or commodity pools.
The exclusive jurisdiction for certain types of actions and proceedings and waiver of trial by jury clauses set forth in the Trust Agreement may have the
effect of limiting a Shareholder’s rights to bring legal action against the Trust and could limit a purchaser’s ability to obtain a favorable judicial forum for disputes with the Trust.
The Trust Agreement provides that the Court of Chancery of the State of Delaware or, if such court does not have subject matter jurisdiction, any other courts located in Delaware will be the
exclusive jurisdiction for any claims, suits, actions or proceedings, provided that (i) the forum selection provisions do not apply to suits brought to enforce a duty or liability created by the Exchange Act or any other claim for which the federal
courts have exclusive jurisdiction and (ii) the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under any federal securities law. By
purchasing Shares in the Trust, Shareholders waive certain claims that the courts of the State of Delaware and any other courts located in Delaware is an inconvenient venue or is otherwise inappropriate. As such, Shareholder could be required to
litigate a matter relating to the Trust in a Delaware court, even if that court may otherwise be inconvenient for the Shareholder.
The Trust Agreement also provides that each Shareholder waives the right to trial by jury in any such claim, suit, action or proceeding. If a lawsuit is brought against the Trust, it may be heard
only by a judge or justice
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of the applicable trial court, which would be conducted according to different civil procedures and may result in different outcomes than a trial by jury would have, including results that could be
less favorable to the plaintiffs in any such action. No Shareholder can waive compliance with respect to the U.S. federal securities laws and the rules and regulations promulgated thereunder.
If a Shareholder opposed a jury trial demand based on the waiver, the applicable court would determine whether the waiver was enforceable based on the facts and circumstances of that case in
accordance with applicable federal laws. To the Trust’s knowledge, the enforceability of a contractual pre-dispute jury trial waiver in connection with claims arising under the U.S. federal securities laws has not been finally adjudicated by the U.S.
Supreme Court. However, the Trust believes that a contractual jury trial waiver provision is generally enforceable, including under the laws of the State of Delaware, which govern the Trust Agreement. By purchasing Shares in the Trust, Shareholders
waive a right to a trial by jury which may limit a Shareholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with the Trust.
As the Sponsor and its management have relatively limited history of operating investment vehicles like the Trust, their experience may be inadequate or
unsuitable to manage the Trust.
While the Sponsor, its management team, and the Execution Agent operate other investment vehicles that, like the Trust, specifically invest in digital assets, including a spot bitcoin
exchange-traded product and a spot ether exchange-traded product, they have a relatively limited track record. This limited experience poses several potential risks to the effective management and operation of the Trust. Digital assets, such as SOL,
are known for their high volatility, unique technical, legal and regulatory challenges, and rapidly evolving market dynamics. The Sponsor’s relatively limited experience in this specific field may not fully equip them to navigate these complexities
effectively, but by managing its own products and through its relationships with the Execution Agent and the Solana Custodian, the Sponsor has amassed significant knowledge regarding SOL and the digital asset markets in general.
The past performance of the Sponsor’s or the Execution Agent’s management in other investment vehicles are no indication of their ability to manage an investment vehicle such as the Trust. The
unique nature of digital assets makes past performance an unreliable indicator of future success in this area. The digital asset market is technology-driven and requires a deep understanding of the underlying blockchain technology and security
considerations. The Sponsor’s limited experience may not fully encompass the technical expertise required to mitigate risks such as cyber threats, technological failures, or operational errors related to digital asset transactions and custody.
Should the experience of the Sponsor, its management team, or the Execution Agent prove inadequate or unsuitable for managing a digital asset-based investment vehicle like the Trust, it could
result in suboptimal decision-making, increased operational risks, and potential legal or regulatory non-compliance. These factors could adversely affect the Trust’s operations, leading to potential losses for investors or a decrease in the Trust’s
overall value.
Furthermore, the Sponsor and the Execution Agent are currently engaged in the management of other investment vehicles which could divert their attention and resources. If the Sponsor were to
experience difficulties in the management of such other investment vehicles that damaged the reputation of either the Sponsor or the Execution Agent, it could have an adverse impact on their ability to continue to serve as Sponsor or Execution Agent,
respectively, for the Trust.
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Future regulations may require the Trust and the Sponsor to become registered, which may cause the Trust to liquidate.
Current and future federal or state legislation, SEC and CFTC rulemaking, and other regulatory developments may impact the manner in which SOL is treated for classification and clearing purposes.
In particular, certain transactions in SOL may be deemed to be commodity interests under the CEA or SOL may be classified by the SEC as a “security” under U.S. federal securities laws. The Sponsor and the Trust cannot be certain as to how future
regulatory developments will impact the treatment of SOL (including staking) under the law. In the face of such developments, the required registrations and compliance steps may result in extraordinary, nonrecurring expenses to the Trust. If the
Sponsor decides to dissolve the Trust in response to the changed regulatory circumstances, the Trust may be dissolved or liquidated at a time that is disadvantageous to Shareholders.
To the extent that SOL is deemed to fall within the definition of a “commodity interest” under the CEA, the Trust and the Sponsor may be subject to additional regulation under the CEA and CFTC regulations. The Sponsor
may be required to register as a commodity pool operator or commodity trading adviser with the CFTC and become a member of the National Futures Association (“NFA”) and may be subject to additional regulatory requirements with respect to the Trust,
including disclosure and reporting requirements. These additional requirements may result in extraordinary, recurring and/or nonrecurring expenses of the Trust, thereby materially and adversely impacting the Shares. If the Sponsor determines it is
not feasible or desirable to comply with such additional regulatory and registration requirements, the Sponsor will likely terminate the Trust. Any such termination could result in the liquidation of the Trust’s SOL at a time that is disadvantageous
to Shareholders.
To the extent that SOL is deemed to fall within the definition of a security under U.S. federal securities laws, the Trust, the Trustee and the Sponsor may be subject to additional requirements under the Investment
Company Act and the Sponsor may be required to register as an investment adviser under the Investment Advisers Act. Such additional registration may result in extraordinary, recurring and/or non‑recurring expenses of the Trust, thereby materially and
adversely impacting the Shares. If the Sponsor determines it is not feasible or desirable to comply with such additional regulatory and registration requirements, the Sponsor will likely terminate the Trust. Any such termination could result in the
liquidation of the Trust’s SOL at a time that is disadvantageous to Shareholders.
The SEC has not asserted regulatory authority over SOL or trading or ownership of SOL and has not expressed the view that SOL should be classified or treated as a security for purposes of U.S.
federal securities laws. In March 2018, it was reported that the SEC was examining as many as 100 investment funds with strategies focused on digital assets. The reported focus of the examinations is on the accuracy of risk disclosures to investors
in these funds, digital asset pricing practices, and compliance with rules meant to prevent the theft of investor funds, as well as on information gathering so that the SEC can better understand new technologies and investment products. It has
further been reported that some of these funds have received subpoenas from the SEC’s Enforcement Division. The SEC also has determined that certain digital assets are securities under the U.S. securities laws. In these determinations, the SEC
reasoned that the unregistered offer and sale of digital assets can, in certain circumstances, including ICOs, be considered illegal public offering of securities. A significant amount of funding for digital asset startups has come from ICOs, and if
ICOs are halted or face obstacles, or companies that rely on them face legal action or investigation, it could have a negative impact on the value of digital assets, including SOL. However, the SEC’s “Crypto Task Force” has indicated that it
is re-examining how digital assets are considered “securities” under the federal securities laws and the timeline and outcome of such action is uncertain at this time. Finally, the SEC’s Division of Examinations (“Examinations”) has stated that
digital assets are an examination priority for 2025. In particular, Examinations has expressed its intent to focus its
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examination on the offer, sale, recommendation, advice, trading, and other activities involving crypto assets that are offered and sold as securities or related products, such as spot bitcoin or
ether ETPs.
The SEC has recently proposed amendments to the custody rules under Rule 206(4)-2 of the Investment Advisers Act. The proposed rule changes would amend the definition of a “qualified custodian” under Rule
206(4)-2(d)(6) and expand the current custody rule in 206(4)-2 to cover all digital assets, including SOL, and related advisory activities. If enacted as proposed, these rules would likely impose additional regulatory requirements with respect to the
custody and storage of digital assets, including SOL. The Sponsor is studying the impact that such amendments may have on the Trust and its arrangements with the Solana Custodian and Prime Broker. It is possible that such amendments, if adopted,
could prevent the Solana Custodian and Prime Broker from serving as service providers to the Trust, or require potentially significant modifications to existing arrangements under the Custody Agreement and Prime Broker Agreement, which could cause
the Trust to bear potentially significant increased costs. If the Sponsor is unable to make such modifications or appoint successor service providers to fill the roles that the Solana Custodian and Prime Broker currently play, the Trust’s operations
(including in relation to creations and redemptions of Creation Units and the holding of SOL) could be negatively affected, the Trust could be terminated (including at a time that is potentially disadvantageous to Shareholders), and the value of the
Shares or an investment in the Trust could be affected. Further, the proposed amendments could have a severe negative impact on the price of SOL and therefore the value of the Shares if enacted, by, among other things, making it more difficult for
investors to gain access to SOL, or causing certain holders of SOL to sell their holdings.
SOL and other digital assets currently face an uncertain regulatory landscape in many foreign jurisdictions such as the European Union, China, the United Kingdom, Australia, Russia, Israel, Poland,
India and Canada. Cybersecurity attacks by state actors, particularly for the purpose of evading international economic sanctions, are likely to attract additional regulatory scrutiny to the acquisition, ownership, sale and use of digital assets,
including SOL. Moreover, other events, such as the interruption in telecommunications or internet services, cyber-related terrorist acts, civil disturbances, war or other catastrophes, could also negatively affect the digital asset economy in one or
more jurisdictions. For example, Russia’s invasion of Ukraine on February 24, 2022 led to volatility in digital asset prices, with an initial steep decline followed by a sharp rebound in prices. The effect of any existing regulation or future
regulatory change or other events on the Trust or SOL is impossible to predict, but such change could be substantial and adverse to the Trust and the value of the Shares. Various foreign jurisdictions have adopted, and may continue to adopt in the
near future, laws, regulations or directives that affect SOL, particularly with respect to SOL trading platforms and service providers that fall within such jurisdictions’ regulatory scope. Laws, regulations or directives in foreign countries may
conflict with those of the United States and may negatively impact the acceptance of SOL by users, merchants and service providers outside the United States and may therefore impede the growth or sustainability of the SOL economy in these
jurisdictions as well as in the United States and elsewhere, or otherwise negatively affect the value of SOL, and, in turn, the value of the Shares.
If regulatory changes or interpretations of an Authorized Participant’s, the Trust’s or the Sponsor’s activities require the regulation of an Authorized
Participant, the Trust or the Sponsor as a money service business under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act or as a money transmitter or digital asset business under state regimes for the licensing
of such businesses, an Authorized Participant, the Trust or the Sponsor may be required to register and comply with such regulations, which could result in extraordinary, recurring and/or nonrecurring expenses to the Authorized Participant, Trust or
Sponsor or increased commissions for the Authorized Participant’s clients, thereby reducing the liquidity of the Shares.
To the extent that the activities of any Authorized Participant, the Trust or the Sponsor cause it to be deemed a “money services business” under the regulations promulgated by FinCEN under the
authority of the U.S.
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Bank Secrecy Act, such Authorized Participant, the Trust or the Sponsor may be required to comply with FinCEN regulations, including those that would mandate the Authorized Participant to implement
anti-money laundering programs, make certain reports to FinCEN and maintain certain records. Similarly, the activities of an Authorized Participant, the Trust or the Sponsor may require it to be licensed as a money transmitter or as a digital asset
business, such as under NYSDFS’ BitLicense regulation.
Such additional regulatory obligations may cause an Authorized Participant, the Trust or the Sponsor to incur extraordinary expenses. If an Authorized Participant, the Trust or the Sponsor decide
to seek the required licenses, there is no guarantee that they will timely receive them. In addition, to the extent an Authorized Participant, the Trust, or the Sponsor is found to have operated without appropriate state or federal licenses, it may
be subject to investigation, administrative or court proceedings, and civil or criminal monetary fines and penalties, all of which could harm the reputation of the Authorized Participant, the Trust or the Sponsor and affect the value of the Shares.
Furthermore, an Authorized Participant, the Trust, or the Sponsor may not be able to timely acquire necessary state licenses or be capable of complying with certain federal or state regulatory obligations applicable to money services businesses,
money transmitters, and businesses engaged in digital asset activity. An Authorized Participant may also instead decide to terminate its role as Authorized Participant of the Trust, or the Sponsor may decide to dissolve the Trust. Dissolution by an
Authorized Participant may decrease the liquidity of the Shares, which may adversely affect the value of the Shares, and any dissolution of the Trust in response to the changed regulatory circumstances may be at a time that is disadvantageous to the
Shareholders.
The tax treatment of SOL, SOL staking and transactions involving SOL for U.S. federal income tax purpose is uncertain and may change, which could adversely
affect the value of an investment in the Shares.
Current IRS guidance indicates that SOL should be treated and taxed as property, not as currency, for U.S. federal income tax purposes, and that transactions involving the payment of SOL in return for goods and
services should be treated as barter transactions. Such exchanges result in gain or loss measured by the difference between the price at which SOL is exchanged and the taxpayer’s basis in the SOL. However, because SOL is a new technological
innovation, because IRS guidance has taken the form of administrative pronouncements that may be modified without prior notice and comment, and because there is as yet little case law on the subject, the U.S. federal income tax treatment of an
investment in SOL or in transactions relating to investments in SOL may change from that described in this Prospectus, possibly with retroactive effect. Any such change in the U.S. federal income tax treatment of SOL may have a negative effect on
prices of SOL and may adversely affect the value of the Shares. In this regard, the IRS has indicated that it has made it a priority to issue additional guidance related to the taxation of virtual currency transactions, such as transactions
involving SOL. In addition, the IRS and U.S. Department of Treasury have proposed regulations regarding the tax information reporting rules for cryptocurrency transactions. In November of 2025, the U.S. Department of the Treasury and IRS issued a
revenue procedure (the "Staking Revenue Procedure") setting forth a safe harbor under which the Trust will engage in certain staking activities in reliance on the Staking Revenue Procedure. The Trust seeks to comply with the safe harbor and to
maintain its status as an investment trust and as a grantor trust for U.S. federal income tax purposes. The requirements under the safe harbor and under existing law are subject to interpretation and there can be no certainty that regulatory
authorities will agree with the Trust's interpretation and application of the guidance or that the Trust will satisfy the Staking Revenue Procedure's safe harbor conditions. Whether any future guidance will adversely affect the U.S. federal income
tax treatment of an investment in SOL or in transactions relating to investments in SOL is unknown. Moreover, future developments that may arise with respect to digital currencies may increase the uncertainty with respect to the treatment of
digital currencies for U.S. federal income tax purposes.
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Investors should consult their personal tax advisors before making any decision to purchase the Shares of the Trust. Additionally, the tax considerations
contained herein are in summary form and may not be used as the sole basis for the decision to invest in the Shares from a tax perspective, since the individual situation of each investor must also be taken into account. Accordingly, the
considerations regarding taxation contained herein should not be used as any sort of material information or tax advice nor are they in any way to be construed as a representation or warranty with respect to specific tax consequences. The tax
treatment of SOL, staking and transactions involving SOL for state and local tax purposes is uncertain and may change, which could adversely affect the value of an investment in the Shares.
Because SOL is a new technological innovation, the tax treatment of SOL for state and local tax purposes, including without limitation state and local income and sales and use taxes, is not
settled. A number of states have issued their own guidance regarding the tax treatment of certain digital assets for state income or sales and use tax purposes. It is uncertain what guidance, if any, on the treatment of SOL for state and local tax
purposes may be issued in the future. Such treatment may have negative consequences for investors in digital assets, including the potential imposition of a greater tax burden on investors in digital assets or the potential imposition of greater
costs on the acquisition and disposition of digital assets. In either case, such different tax treatment may potentially have a negative effect on the price of SOL and a negative impact on the NAV of the Trust.
A hard “fork” or airdrop of the Solana blockchain could result in Shareholders incurring a tax liability.
If a hard fork, airdrop or similar event occurs in the Solana blockchain, the Sponsor will instruct the Trust to immediately and irrevocably disclaim all rights to the IR Assets so created.
Although the Sponsor will instruct the Trust to immediately and irrevocably disclaim all rights to the IR Assets so created, it is possible that Shareholders may still incur a federal income tax liability as a result of a hard fork, airdrop or
similar event if, for example, the IRS does not recognize such a disclaimer. Under current guidance, the IRS has held that a hard fork resulting in the receipt of new units of cryptocurrency is a taxable event giving rise to ordinary income. While
the IRS has not addressed all situations in which airdrops occur, it is clear from the reasoning of the IRS’s current guidance that it generally would treat an airdrop as a taxable event giving rise to ordinary income.
Current IRS guidance does not address whether income recognized by a non-U.S. person as a result of a hard fork, airdrop or similar occurrence could be subject to the 30% withholding tax imposed on
U.S. source “fixed or determinable annual or periodical gains, profits and income” (“FDAP”). A Non-U.S. Shareholder (as defined under “U.S. Federal Income Tax Consequences” below) should assume that, in the absence of guidance, a withholding agent
(including the Sponsor) is likely to withhold 30% of any such income recognized by a Non-U.S. Shareholder in respect of its Shares, including by deducting such withheld amounts from proceeds that such Non-U.S. Shareholder would otherwise be entitled
to receive in connection with a distribution of the new digital asset. There is also the possibility that the Trust may be required to remit a withholding payment to the U.S. Treasury even if there are no distributions to such Non-U.S. Shareholder
in the taxable year in which the hard fork, airdrop or similar event occurs.
The receipt, distribution and/or sale of the new digital asset may cause Shareholders to incur a United States federal, state, and/or local, or non-U.S. tax liability. Any tax liability could
adversely impact an investment in the Shares and may require Shareholders to prepare and file tax returns they would not otherwise be required to prepare and file.
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A U.S. Tax-Exempt Shareholder may recognize “unrelated business taxable income” as a consequence of an investment in the Shares.
Under current IRS guidance, hard forks, airdrops, staking rewards and similar events with respect to digital assets will under certain circumstances be treated as taxable events giving rise to
ordinary income. In the absence of guidance to the contrary, it is possible that any such income recognized by a U.S. Tax-Exempt Shareholder (as defined under “U.S. Federal Income Tax Consequences” below) would constitute “unrelated business taxable
income” (“UBTI”). U.S. Tax-Exempt Shareholders should consult their tax advisers regarding whether such Shareholders may recognize UBTI as a consequence of an investment in the Shares.
Intellectual property rights claims may adversely affect the operation of the Solana network.
Third parties may assert intellectual property claims relating to the holding and transfer of SOL and its source code. Regardless of the merit of any intellectual property or other legal action,
any threatened action that reduces confidence in long-term viability or the ability of end-users to hold and transfer SOL may adversely affect an investment in the Trust. Additionally, a meritorious intellectual property claim could prevent the Trust
and other end-users from accessing, holding or transferring SOL, which could force the liquidation of the Trust’s holdings of SOL. As a result, an intellectual property claim against the Trust or other large SOL participants could adversely affect an
investment in the Shares.
Risks Related to the Markets and Service Ecosystems for SOL
The venues through which cryptocurrencies (including SOL) trade are relatively new and may be more exposed to operational problems or failure than trading
platforms for other assets, which could adversely affect the value of SOL and therefore adversely affect an investment in the Shares.
Platforms through which SOL trades are relatively new. SOL trading platforms are generally subject to different regulatory requirements than venues for trading more traditional assets, and may be
subject to limited or no regulation, especially outside the U.S. Furthermore, many such trading platforms, including exchanges and over-the-counter trading venues, do not provide the public with significant information regarding their ownership
structure, management teams, corporate practices or regulatory compliance, and may take the position that they are not subject to laws and regulations that would apply to a national securities exchange or designated contract market in the United
States, or may, as a practical matter, be beyond the ambit of U.S. regulators. SOL trading platforms may impose daily, weekly, monthly or customer-specific transaction or distribution limits or suspend withdrawals entirely, rendering the exchange of
SOL for fiat currency difficult or impossible. Participation in SOL trading on some venues requires users to take on credit risk by transferring digital assets from a personal account to a third party’s account, which could discourage trading on
those platforms.
Over the past several years, a number of cryptocurrency trading platforms have been closed due to fraud, failure or security breaches. In many of these instances, the customers of such platforms
were not compensated or made whole for the partial or complete losses of their account balances in such exchanges. While smaller trading platforms are less likely to have the infrastructure and capitalization that make larger trading platforms more
stable, larger trading venues are more likely to be appealing targets for hackers and “malware” (i.e., software used or programmed by attackers to disrupt computer operation, gather sensitive information or gain access to private computer systems)
and their shortcomings or ultimate failures are more likely to have contagion effects on the digital asset ecosystem. For example, in 2014, the largest bitcoin trading platform at the time, Mt. Gox, filed for bankruptcy in Japan amid reports the
trading platform lost up to 850,000 bitcoin, valued then at over $450 million.
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As another example, in January 2015, Bitstamp announced that approximately 19,000 bitcoin had been stolen from its operational or “hot” wallets. In August 2016, it was reported that almost 120,000
bitcoin worth around $78 million were stolen from Bitfinex, a large bitcoin trading platform. The value of bitcoin immediately decreased by more than 10% following reports of the theft at Bitfinex. In addition, in December 2017, Yapian, the operator
of Seoul-based digital asset trading platform Youbit, suspended digital asset trading and filed for bankruptcy following a hack that resulted in a loss of 17% of Yapian’s assets. Following the hack, Youbit users were allowed to withdraw approximately
75% of the digital assets in their trading platform accounts, with any potential further distributions to be made following Yapian’s pending bankruptcy proceedings. In January 2018, Japan-based exchange Coincheck reported that over $500 million worth
of the digital asset NEM had been lost due to hacking attacks, resulting in significant decreases in the prices of bitcoin, ether and other digital assets as the market grew increasingly concerned about the security of digital assets. Following South
Korean-based trading platform Coinrail’s announcement in early June 2018 about a hacking incident, the price of bitcoin and ether dropped more than 10%. In September 2018, Japan-based trading platform Zaif announced that approximately $60 million
worth of digital assets, was stolen due to hacking activities. In May 2019, one of the world’s largest digital asset trading platforms, Binance, was hacked, resulting in losses of approximately $40 million. Further, in November 2022, FTX Trading Ltd.
(“FTX”), one of the largest digital asset trading platforms by volume at the time, halted customer withdrawals amid rumors of the company’s liquidity issues and likely insolvency, which were subsequently corroborated by its CEO. Shortly thereafter,
FTX’s CEO resigned and FTX and many of its affiliates filed for bankruptcy in the United States, while other affiliates have entered insolvency, liquidation, or similar proceedings around the globe, following which the U.S. Department of Justice
brought criminal fraud and other charges, and the SEC and CFTC brought civil securities and commodities fraud charges, against certain of FTX’s and its affiliates’ senior executives, including its former CEO. Around the same time, there were reports
that approximately $300-600 million of digital assets were removed from FTX and the full facts remain unknown, including whether such removal was the result of a hack, theft, insider activity, or other improper behavior. Various claims and issues
related to FTX have not yet been resolved.
More recently, in February 2025, the crypto exchange Bybit was hacked, resulting in the theft of over $1.5 billion of ether. SOL trading platforms that are regulated typically must comply with
minimum net worth, cybersecurity, and anti-money laundering requirements, but are not typically required to protect customers to the same extent as regulated securities exchanges or futures exchanges.
Some academics and market observers have put forth evidence to support claims that manipulative trading activity has occurred on certain digital asset trading platforms. For example, in a 2017
paper titled “Price Manipulation in the Bitcoin Ecosystem” sponsored by the Interdisciplinary Cyber Research Center at Tel Aviv University, a group of researchers used publicly available trading data, as well as leaked transaction data from a 2014
Mt. Gox security breach, to identify and analyze the impact of “suspicious trading activity” on Mt. Gox between February and November 2013, which, according to the authors, caused the price of bitcoin to increase from around $150 to more than $1,000
over a two-month period. In August 2017, it was reported that a trader or group of traders nicknamed “Spoofy” was placing large orders on Bitfinex without actually executing them, presumably in order to influence other investors into buying or
selling by creating a false appearance that greater demand existed in the market. In December 2017, an anonymous blogger (publishing under the pseudonym Bitfinex’d) cited publicly available trading data to support his or her claim that a trading bot
nicknamed “Picasso” was pursuing a paint-the-tape-style manipulation strategy by buying and selling bitcoin and bitcoin cash between affiliated accounts in order to create the appearance of substantial trading activity and thereby influence the price
of such assets.
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Anonymity and illicit financing risk.
Although transaction details of peer-to-peer transactions are recorded on the Solana blockchain, a buyer or seller of digital assets on a peer-to-peer basis directly on the Solana network may never
know to whom the public key belongs or the true identity of the party with whom it is transacting. Public key addresses are randomized sequences of alphanumeric characters that, standing alone, do not provide sufficient information to identify users.
In addition, certain technologies may obscure the origin or chain of custody of digital assets. The opaque nature of the market poses asset verification challenges for market participants, regulators and auditors and gives rise to an increased risk
of manipulation and fraud, including the potential for Ponzi schemes, bucket shops and pump and dump schemes. Digital assets have in the past been used to facilitate illicit activities. If a digital asset was used to facilitate illicit activities,
businesses that facilitate transactions in such digital assets could be at increased risk of potential criminal or civil lawsuits, or of having banking or other services cut off, and such digital asset could be removed from digital asset trading
platforms. Any of the aforementioned occurrences could adversely affect the price of the relevant digital asset, the attractiveness of the respective blockchain network and an investment in the Shares. While the Trust’s SOL transactions are expected
to be effected by the Execution Agent over-the-counter with known counterparties, if the Trust or the Sponsor were to transact with a sanctioned entity, the Trust or the Sponsor would be at risk of potential criminal or civil lawsuits or liability.
The Trust takes measures with the objective of reducing illicit financing risks in connection with the Trust’s activities. However, illicit financing risks are present in the digital asset markets,
including markets for SOL. There can be no assurance that the measures employed by the Trust will prove successful in reducing illicit financing risks, and the Trust is subject to the complex illicit financing risks and vulnerabilities present in the
digital asset markets. If such risks eventuate, the Trust or the Sponsor or their affiliates could face civil or criminal liability, fines, penalties, or other punishments, be subject to investigation, have their assets frozen, lose access to banking
services or services provided by other service providers, or suffer disruptions to their operations, any of which could negatively affect the Trust’s ability to operate or cause losses in value of the Shares.
Furthermore, Authorized Participants, as broker-dealers, and the Execution Agent, Prime Broker and Solana Custodian, as entities licensed to conduct virtual currency business activity by the New
York Department of Financial Services and a limited purpose trust company subject to New York Banking Law, respectively, are “financial institutions” subject to the U.S. Bank Secrecy Act, as amended (“BSA”), and U.S. economic sanctions laws. The
Trust will only accept SOL in connection with creation and redemption requests from Solana Counterparties who have represented to the Trust or the Execution Agent that they have implemented compliance programs that are designed to ensure compliance
with applicable sanctions and anti-money laundering laws. In addition, with respect to all SOL delivered to the Trust by Solana Counterparties in connection with creation requests, the Solana Counterparties must represent to the Trust or the
Execution Agent that it will form a reasonable belief (i) as to the identities of, and conduct necessary diligence with respect to, any counterparties from whom the Solana Counterparty obtains SOL being transferred and (ii) that such SOL being
transferred by the Solana Counterparty to the Trust were not derived from, or associated with, unlawful or criminal activity.
The Sponsor, the Execution Agent and the Trust have adopted and implemented policies and procedures that are designed to ensure that they do not violate applicable AML and sanctions laws and
regulations and to comply with any applicable KYC laws and regulations. Each of the Sponsor, the Execution Agent and the Trust will only interact with known third party service providers with respect to whom it has engaged in a due diligence process
including a thorough KYC process, such as the Authorized Participants and the Solana Custodian. Authorized Participants, as broker-dealers, and the Solana Custodian, as a limited purpose trust company subject to New York Banking Law, are subject to
the BSA and U.S. economic sanctions laws.
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The Solana Custodian has adopted and implemented an anti-money laundering and sanctions compliance program that provides protections intended to ensure that the Sponsor and the Trust do not
transact with a sanctioned party. Notably, the Solana Custodian performs Know-Your-Transaction (“KYT”) screening using blockchain analytics to identify, detect, and mitigate the risk of transacting with a sanctioned or other unlawful actor. Pursuant
to the Solana Custodian’s KYT program, any SOL that is delivered to the Trust’s custody account will undergo screening to ensure that the origins of that SOL are not illicit.
There is no guarantee that such procedures will always be effective. If the Authorized Participants, the Execution Agent, the Solana Custodian or the Prime Broker were to have inadequate policies,
procedures and controls for complying with applicable anti-money laundering and applicable sanctions laws or the Trust’s diligence is ineffective, violations of such laws could result, which could result in regulatory liability for the Trust, the
Sponsor, the Trustee or their affiliates under such laws, including governmental fines, penalties, and other punishments, as well as potential liability to or cessation of services by the Solana Custodian. Any of the foregoing could result in losses
to the Shareholders or negatively affect the Trust’s ability to operate.
Spot Solana markets may be exposed to fraud and market manipulation.
The blockchain infrastructure could be used by certain market participants to exploit arbitrage opportunities through schemes such as front-running, spoofing, pump-and-dump and fraud across different
systems, platforms or geographic locations. As a result of reduced oversight, these schemes may be more prevalent in digital asset markets than in the general market for financial products.
The SEC has identified possible sources of fraud and manipulation in the digital asset market generally, including, among others (1) “wash trading”; (2) persons with a dominant position in digital
asset manipulating the digital asset’s pricing; (3) hacking of the digital asset’s peer-to-peer network and trading platforms; (4) malicious control of the digital asset network; (5) trading based on material, non-public information (for example,
plans of market participants to significantly increase or decrease their holdings in digital assets, new sources of demand for digital asset, etc.) or based on the dissemination of false and misleading information; (6) manipulative activity involving
purported “stablecoins,” including Tether; and (7) fraud and manipulation at digital asset trading platforms.
Over the past several years, a number of digital asset spot markets have been closed or faced issues due to fraud. In many of these instances, the customers of such digital asset spot markets were not
compensated or made whole for the partial or complete losses of their account balances in such digital asset trading platforms.
For example, in 2019, there were reports claiming that 80.95% of bitcoin trading volume on digital asset trading platforms was false or noneconomic in nature, with specific focus on unregulated
trading platforms located outside of the United States. Such reports alleged that certain overseas trading platforms have displayed suspicious trading activity suggestive of a variety of manipulative or fraudulent practices.
The potential consequences of a spot market’s failure or failure to prevent market manipulation could adversely affect the value of the Shares. Any market abuse, and a loss of investor confidence in
digital assets may adversely impact pricing trends in digital assets markets broadly, as well as an investment in Shares of the Trust.
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Spot SOL markets may be exposed to wash trading.
Spot markets on which SOL trades may be susceptible to wash trading. Wash trading occurs when offsetting trades are entered into for other than bona fide reasons, such as the desire to inflate
reported trading volumes. Wash trading may be motivated by non-economic reasons, such as a desire for increased visibility on popular websites that monitor markets for digital assets so as to improve their attractiveness to investors who look for
maximum liquidity, or it may be motivated by the ability to attract listing fees from token issuers who seek the most liquid and high-volume trading platforms on which to list their coins. Results of wash trading may include unexpected obstacles to
trade and erroneous investment decisions based on false information.
Even in the United States, and even on regulated venues there have been allegations of wash trading. Any actual or perceived false trading in the digital asset trading platform market, and any
other fraudulent or manipulative acts and practices, could adversely affect the value of SOL and/or negatively affect the market perception of SOL.
To the extent that wash trading either occurs or appears to occur in spot markets on which SOL trades, investors may develop negative perceptions about SOL and the digital assets industry more
broadly, which could adversely impact the price SOL and, therefore, the price of Shares. Wash trading also may place more legitimate digital asset trading platforms at a relative competitive disadvantage.
Spot SOL markets may be exposed to front-running.
Spot markets on which SOL trades may be susceptible to “front-running,” which refers to the process when someone uses technology or market advantage to get prior knowledge of upcoming transactions.
Front-running is a frequent activity on centralized as well as decentralized trading platforms. By using bots functioning on a millisecond-scale timeframe, bad actors are able to take advantage of the forthcoming price movement and make economic
gains at the cost of those who had introduced these transactions. The objective of a front runner is to buy a group of tokens at a low price and later sell them at a higher price while simultaneously exiting the position. Front-running happens via
manipulations of gas prices or timestamps, also known as slow matching. To extent that front-running occurs, it may result in investor frustration and concerns as to the price integrity of digital asset trading platforms and digital assets more
generally.
Political or economic crises may motivate large-scale sales of SOL, which could result in a reduction in the prices of SOL and adversely affect an
investment in the Shares.
As an alternative to fiat currencies that are backed by central governments, SOL is subject to supply and demand forces based upon the desirability of an alternative, decentralized means of buying
and selling goods and services, and it is unclear how such supply and demand will be impacted by geopolitical events. Nevertheless, political or economic crises may motivate large-scale acquisitions or sales of SOL, either globally or locally.
Large-scale sales of SOL would result in a reduction in its price and adversely affect an investment in the Shares.
Validators may suffer losses due to staking, or staking may prove unattractive to validators, which could make the Solana network less attractive.
Validation on the Solana network requires SOL to be transferred into smart contracts on the underlying blockchain networks not under the Trust’s or anyone
else’s control. If the Solana network source code or protocol fail to behave as expected, suffer cybersecurity attacks or hacks, experience security issues, or encounter other problems, such assets may be
irretrievably lost. The Solana network imposes three types
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of sanctions for validator misbehavior or inactivity, which would result in a portion of their staked SOL being destroyed or “burned”: penalties, slashing and inactivity leaks. A validator may face
penalties if it fails to take certain actions, such as providing a timely attestation to a block proposed by another validator. Under this scenario, a validator’s staked SOL could be burned in an amount equal to the reward to which it would have been
entitled for performing the actions. A more severe sanction (i.e., “slashing”) is imposed if a validator commits malicious acts related to the proposal or attestation of blocks with invalid transactions. Slashing can result in the validator having a
portion of its staked SOL immediately confiscated, withdrawn or burned by the network, resulting in losses to them. After this initial slashing, the validator is queued for forceful removal from the Solana network’s validator “pool,” and more of the
validator’s stake is burned over a period of approximately 36 days with the exact amount of SOL burned and time period determined by the network regardless of whether the validator makes any further slashable errors, at which point the validator is
automatically removed from the validator pool. To date, no slashing penalty has been assessed on the Solana network. Staked SOL may also be burned through a process known as an “inactivity leak,” which is triggered if the Solana network has gone too
long without finalizing a new block. For a new block to be successfully added to the blockchain, validators that account for at least two-thirds of all staked SOL must agree on the validity of a proposed block. This means that if validators
representing more than one-third of the total staked SOL are offline, no new blocks can be finalized. To prevent this, an inactivity leak causes the SOL staked by the inactive validators to gradually “bleed away” until these inactive validators
represent less than one-third of the total stake, thereby allowing the remaining active validators to finalize proposed blocks. This provides a further incentive for validators to remain online and continue performing validation activities. Within
the post-Merge Solana network, as part of the “activating” and “exiting” processes of staking, staked SOL will be inaccessible for a variable period of time determined by a range of factors, including network congestion, resulting in potential
inaccessibility during those periods. “Activation” is the funding of a validator to be included in the active set, thereby allowing the validator to participate in the Solana network’s proof-of-stake consensus protocol. “Exit” is the request to exit
from the active set and no longer participate in the Solana network’s proof-of-stake consensus protocol. As part of these “activating” and “exiting” processes of staking on the Solana network, any staked SOL will be inaccessible for a period of time.
The duration of activating and exiting periods are dependent on a range of factors, including network conditions. Un-staking generally takes up to three days to complete on the Solana network, however, depending on demand, un-staking can take between
hours, days or weeks to complete. Furthermore, the Solana network requires the payment of base fees and the practice of paying tips is common, and such fees can become significant as the amount and complexity of the transaction grows, depending on
the degree of network congestion and the price of SOL. Any cybersecurity attacks, security issues, hacks, penalties, slashing events, or other problems could damage validators’ willingness to participate in validation, discourage existing and future
validators from serving as such, and adversely impact the Solana network’s adoption or the price of SOL. Any disruption of validation on the Solana network could interfere with network operations and cause the Solana network to be less attractive to
users and application developers than competing blockchain networks, which could cause the price of SOL to decrease. The limited liquidity during the “activation” or “exiting” processes could dissuade potential validators from participating, which
could interfere with network operations or security and cause the Solana network to be less attractive to users and application developers than competing blockchain networks, which could cause the price of SOL to decrease.
Ownership of SOL is pseudonymous, and the supply of accessible SOL is unknown. Entities with substantial holdings in SOL may engage in large-scale sales or
distributions, either on nonmarket terms or in the ordinary course, which could result in a reduction in the price of SOL and adversely affect an investment in the Shares.
There is no registry showing which individuals or entities own SOL or the quantity of SOL that is owned by any particular person or entity. It is possible, and in fact, reasonably likely, that a
small group of early SOL adopters hold a significant proportion of the SOL that has been created to date. There are no
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regulations in place that would prevent a large holder of SOL from selling SOL it holds. To the extent such large holders of SOL engage in large-scale sales or distributions, either on nonmarket
terms or in the ordinary course, it could result in a reduction in the price of SOL and adversely affect an investment in the Shares.
A temporary or permanent blockchain “fork” could adversely affect an investment in the Shares.
The Solana network operates using open-source protocols, meaning that any user can download the software, modify it and then propose that the users and validators of SOL adopt the modification.
When a modification is introduced and a substantial majority of users and validators consent to the modification, the change is implemented and the network remains uninterrupted. However, if less than a substantial majority of users and validators
consent to the proposed modification, and the modification is not compatible with the software prior to its modification, the consequence would be what is known as a “hard fork” of the Solana network, with one group running the pre modified software
and the other running the modified software. The effect of such a fork would be the existence of two versions of SOL running in parallel on separate networks using separate blockchain ledgers, yet lacking interchangeability. A forthcoming “hard fork”
called “Alpenglow” was announced by developers of the Solana network in May of 2025 and is expected to reduce transaction finality time and enhance network security. Alpenglow and other future updates could be improperly implemented or not
implemented at all, potentially creating vulnerabilities, outages and disruptions in the Solana network, which would impact the price of SOL and the Shares.
Furthermore, a hard fork can introduce new security risks. For example, when Ethereum and Ethereum Classic split in July 2016, replay attacks, in which transactions from one network were
rebroadcast to nefarious effect on the other network, plagued trading platforms through at least October 2016. A trading platform announced in July 2016 that it had lost 40,000 ether tokens from the Ethereum Classic network, which was worth about
$100,000 at that time, as a result of replay attacks. Another possible result of a hard fork is an inherent decrease in the level of security. After a hard fork, it may become easier for an individual validator or validator pool to exceed 50% of the
processing power of the Solana network, thereby making the network more susceptible to attack.
A fork could also be introduced by an unintentional, unanticipated software flaw in the multiple versions of otherwise compatible software users run. Such a fork could adversely affect SOL’s
viability. It is possible, however, that a substantial number of users and validators could adopt an incompatible version of SOL while resisting community-led efforts to merge the two chains. This would result in a permanent fork, as in the case of
Ethereum and Classic Ethereum Classic, as detailed above.
A fork could also be introduced by an unintentional, unanticipated software flaw in the multiple versions of otherwise compatible software users run. Such a fork could adversely affect SOL’s
viability. It is possible, however, that a substantial number of validators could adopt an incompatible version of SOL while resisting community-led efforts to merge the two chains. This would result in a permanent fork, as in the case of Ethereum
and Ethereum Classic, as detailed above.
As another example of the effects of hard forks on digital assets, on September 15th, 2022, the Ethereum network successfully completed its Merge, moving from a Proof-of-Work (“PoW”) model to a
Proof-of-Stake (“PoS”) model. Ethereum PoW miners who disagreed with the new consensus mechanism forked the network, which resulted in the EthereumPoW network (“ETHW”). ETHW was driven by a small but vocal group of miners who wished to hold onto
revenue as Ethereum switched to PoS. The vast majority of token holder votes preferred the new PoS consensus method. There was no material impact on the Ethereum network as a result of the fork. All ether holders were airdropped ETHW tokens as a
result of the hard fork.
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However, not all liquidity providers were able to trade the new token and the ETHW token almost immediately lost most of its value.
In the event of a hard fork of the Solana network, the Sponsor will instruct the Trust to immediately and irrevocably disclaim all rights to the ether, cash or other assets or rights received as a
result of a hard fork or airdrop in respect of SOL (“IR Assets”) so created. As a result, shareholders will not receive the benefits of any hard fork or airdrop. SOL is the only digital asset that will be held by the Trust. In the event the Trust
seeks to change its treatment of Incidental Rights or IR Assets, an application would need to be filed with the SEC by the Exchange seeking approval to amend its listing rules.
In the event of a fork, the Sponsor will, as permitted by the terms of the Trust Agreement, determine which network it believes is generally accepted as the Solana network and should therefore be
considered the appropriate network, and the associated asset as SOL, for the Trust’s purposes. If the Trust modifies its policy on forks and airdrops, notice to Shareholders will be provided on the Trust’s website, in a prospectus supplement, through
a current report on Form 8-K and/or in the Trust’s annual or quarterly reports.
The SEC has approved generic listing standards for commodity-based trust shares and may approve other applications under Rule 19b-4 of the Exchange Act to
list competing digital asset backed investment vehicles as exchange-traded products, which could reduce demand for, and the price of, Solana and adversely impact the value of the Shares.
To date the SEC has approved applications under Rule 19b-4 of the Exchange Act to list spot digital asset exchange-traded products which hold Bitcoin and Ether as well as generic listing
standards for commodity-based trust shares holding digital assets. To the extent competing digital asset exchange-traded products, other than those which hold SOL, come to represent a significant proportion of the demand for digital assets
generally, demand for, and the price of, SOL could be reduced. Such reduced demand could in turn negatively affect the value of the Shares of the Trust. Accordingly, there can be no assurance that the Trust will be able to achieve its intended
competitive positioning, which could adversely affect the performance of the Trust and the value of the Shares.
Risks Related to the Trust and the Shares.
Several factors may affect the Trust’s ability to achieve its investment objective on a consistent basis.
There is no guarantee that the Trust will meet its investment objective. Factors that may affect the Trust’s ability to meet its investment objective include:
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the development and maintenance of an active trading market for Shares;
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the continued participation of Authorized Participants;
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the ability of Authorized Participants to obtain and dispose of SOL in an efficient manner to effectuate creation and redemption orders;
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the liquidity of the SOL market and the Trust's staking activities;
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the functioning of the markets on which SOL trades;
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the compliance of the Trust’s portfolio holdings and staking activities with investment restrictions, policies or regulatory or tax law requirements; and
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the ability of the Trust to achieve or maintain an economically viable size.
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The Trust is subject to risks due to its concentration of investments in a single asset.
Unlike other funds that may invest in diversified assets, the Trust’s investment strategy is concentrated in a single asset: SOL. This concentration maximizes the degree of the Trust’s exposure to
a variety of market risks associated with SOL, including the rise or fall in its price, sometimes rapidly or unexpectedly. By concentrating its investment strategy solely in SOL, any losses suffered as a result of a decrease in the value of SOL can
be expected to reduce the value of an interest in the Trust and will not be offset by other gains if the Trust were to invest in underlying assets that were diversified.
Shareholders will not receive the benefits of any forks or “airdrops.”
The Solana blockchain may be subject to forks or airdrops that create new digital assets. See “Solana and the Solana Market—Solana and the Solana network—Forks and Airdrops.” Shareholders may not
receive the benefits of any forks, the Trust may not choose, or be able, to participate in an airdrop, and the timing of receiving any benefits from a fork, airdrop or similar event is uncertain. The Sponsor refers to the right to receive any such
benefit as an “Incidental Right” and any such virtual currency acquired through an Incidental Right as “IR Assets.” If a hard fork, airdrop or similar event occurs in the Solana blockchain, the Sponsor will instruct the Trust to immediately and
irrevocably disclaim all rights to the IR Assets so created. SOL is the only digital asset that will be held by the Trust. In the event the Trust seeks to change its treatment of Incidental Rights or IR Assets, an application would need to be filed
with the SEC by the Exchange seeking approval to amend its listing rules.
Although the Sponsor is under no obligation to do so, an inability to realize the economic benefit of a hard fork or airdrop could adversely affect the value of the Shares. Investors who prefer to
have a greater degree of control over events such as forks, airdrops, and similar events, and any assets made available in connection with each, should consider investing in SOL directly rather than purchasing Shares.
The Trust is subject to management and operational risks from its Sponsor and service providers.
The Trust is subject to management risk because it relies on the Sponsor’s ability to achieve its investment objective. Shareholders will have very limited voting rights, which will limit their
ability to influence matters such as amendment of the Trust Agreement, change in the Trust’s basic investment policy, dissolution of the Trust, or the sale or distribution of the Trust’s assets.
The Trust also is subject to the risk of loss as a result of other services provided by the Sponsor and other service providers, including benchmark, custody, administrative, accounting, tax,
legal, custody, transfer agency and other services. Operational risk includes the possibility of loss caused by inadequate procedures and controls, human error and cyber attacks, disruptions and failures affecting, or by, a service provider. In
addition, the Sponsor may be required to indemnify its officers, directors and key employees with respect to their activities on behalf of the Trust and other accounts, if the need for indemnification arises. This potential indemnification could
cause the Sponsor’s assets to decrease. If the Sponsor’s sources of income are not sufficient to compensate for the indemnification, it could cease operations, which could in turn result in Trust losses and/or dissolution of the Trust.
In addition, the Trust’s service providers, including the Solana Custodian, act in similar capacities for a number of other digital asset ETPs. If those digital asset ETPs experience operational
challenges or regulatory problems that impact or implicate one or more of the Trust’s service providers, the Trust’s operations may be adversely impacted as a result. The Sponsor will monitor the services provided by the Trust’s service providers to
detect and identify any such potential issues with the service providers.
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The Trust as well as the Sponsor and its service providers are vulnerable to the effects of public crises, which may arise in the future, which may
adversely affect the performance of the Trust’s investment in SOL and your investment in the Trust.
Pandemics and other public health crises may cause a curtailment of business activities which may potentially impact the ability of the Sponsor and its service providers to operate. Such events also
could adversely impact the Trust by causing operating delays and disruptions, market disruption and shutdowns (including as a result of government regulation and prevention measures). The COVID-19 pandemic, for example, had substantive effects on
social, economic and financial systems, including significant uncertainty and volatility in the financial market.
The Trust’s Prime Broker or Solana Custodian could become insolvent or become subject to a receivership or bankruptcy proceeding, which may result in a loss
of or delay in access to Trust assets.
In the event of an insolvency or bankruptcy of the Prime Broker (in the case of the Trading Balance) or the Solana Custodian (in the case of the Vault Balance) in the future, given that the
contractual protections and legal rights of customers with respect to digital assets held on their behalf by third parties are relatively untested in a bankruptcy of an entity such as the Solana Custodian or Prime Broker in the virtual currency
industry, there is a risk that customers’ assets—including the Trust’s assets—may be considered the property of the bankruptcy estate of the Prime Broker (in the case of the Trading Balance) or the Solana Custodian (in the case of the Vault Balance),
and customers—including the Trust—may be at risk of being treated as general unsecured creditors of such entities and subject to the risk of total loss or markdowns on value of such assets.
The Solana Custody Agreement contains an agreement by the parties to treat the SOL credited to the Trust’s Vault Balance as financial assets under Article 8 of the New York Uniform Commercial Code
(“Article 8”), in addition to stating that the Solana Custodian will serve as fiduciary and custodian on the Trust’s behalf. The Solana Custodian’s parent, Coinbase Global, has stated in its most recent public securities filings that in light of the
inclusion in its custody agreements of provisions relating to Article 8 it believes that a court would not treat custodied digital assets as part of its general estate in the event the Solana Custodian were to experience insolvency. However, due to
the novelty of digital asset custodial arrangements courts have not yet considered this type of treatment for custodied digital assets and it is not possible to predict with certainty how they would rule in such a scenario. If the Solana Custodian
became subject to insolvency proceedings and a court were to rule that the custodied SOL were part of the Solana Custodian’s general estate and not the property of the Trust, then the Trust would be treated as a general unsecured creditor in the
Solana Custodian’s insolvency proceedings and the Trust could be subject to the loss of all or a significant portion of its assets. Moreover, in the event of the bankruptcy of the Solana Custodian, an automatic stay could go into effect and
protracted litigation could be required in order to recover the assets held with the Solana Custodian, all of which could significantly and negatively impact the Trust’s operations and the value of the Shares.
There is a risk that the Trading Balance, in which the Trust’s SOL and cash is held in omnibus accounts by the Prime Broker (in the latter case, as described below in “Cybersecurity Risk Related to
Solana —Loss of a critical banking relationship for, or the failure of a bank used by, the Execution Agent could adversely impact the Trust’s ability to create or redeem Creation Baskets, or could cause losses to the Trust.”), could be considered
part of the Prime Broker’s bankruptcy estate in the event of the Prime Broker’s bankruptcy. The Solana Custody Agreement contains an Article 8 opt-in clause with respect to the Trust’s assets held in the Trading Balance. The Prime Broker is not
required to hold any of the SOL or cash in the Trust’s Trading Balance in segregation. Within the Trading Balance, the Solana Custody Agreement provides that the Trust does not have an identifiable claim to any particular SOL (and cash). Instead, the
Trust’s Trading
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Balance represents an entitlement to a pro rata share of the SOL (and cash) the Prime Broker has allocated to the omnibus wallets the Prime Broker holds, as well as the accounts in the Prime
Broker’s name that the Prime Broker maintains at Connected Trading Venues (which are typically held on an omnibus, rather than segregated, basis). If the Prime Broker suffers an insolvency event, there is a risk that the Trust’s assets held in the
Trading Balance could be considered part of the Prime Broker’s bankruptcy estate and the Trust could be treated as a general unsecured creditor of the Prime Broker, which could result in losses for the Trust and Shareholders. Moreover, in the event
of the bankruptcy of the Prime Broker, an automatic stay could go into effect and protracted litigation could be required in order to recover the assets held with the Prime Broker, all of which could significantly and negatively impact the Trust’s
operations and the value of the Shares. There are no policies that would limit the amount of SOL that can be held temporarily in the Trading Balance maintained by the Prime Broker.
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The Trust has entered into a written agreement with the Staking Provider, which could harm the value of the Shares.
In seeking to achieve its investment objective, the Trust will hold SOL and will seek to stake substantially all of its SOL to earn staking rewards to the extent the Trust, in the Sponsor’s sole
discretion, can engage in staking without undue legal or regulatory risk, including without jeopardizing its status as a grantor trust for U.S. federal income tax purposes (the “Staking Condition”). The
Sponsor has determined that the Staking Condition has been satisfied. As of the date of this Prospectus, the Sponsor intends to engage in staking on behalf of the Trust of substantially all of the Trust's SOL, subject to an amount that it
determines to invest in the Liquidity Sleeve.
If the Trust engaging in staking activities raised concerns about the safety or liquidity of the Trust's SOL, the Trust may cease some or all of its staking activities. Staking on the Solana
network involves delegating of SOL to validators and carries risks discussed further below. Staked SOL may be subject to community-determined penalties for validator misbehavior, or slashing. If the Staking Provider causes the Trust’s staked SOL
to be subject to such slashing losses, the Trust could suffer losses of the staked SOL. Additionally, the staking process includes protocol-defined warm-up, activation and withdrawal periods, during which staked SOL is temporarily locked and
inaccessible. These phases affect when SOL begins earning rewards, participates in consensus and becomes available for transfer or redelegation.
Staking Provider will stake the Trust’s SOL as the node operator and will operate a validator to stake the Trust’s SOL. The Staking Provider will perform its staking services in collaboration with
the Solana Custodian, as the SOL will be staked directly from the Trust’s SOL account with the Solana Custodian. The Trust will maintain control of the SOL while it is staked because it will remain in the Trust’s account with the Solana Custodian
(i.e., it will be kept in a separate account for which the Trust is the beneficial and record owner and will not be commingled other parties' accounts with the Solana Custodian). The Trust will maintain the power to unstake its SOL. Each Staking
Provider will not have this capability. Staking will be a passive activity for the Trust, as it will not operate its staking program. The Trust’s role will be limited to evaluating and contracting with one or more Staking Providers and instructing
the Staking Provider on when to stake and/or unstake the Trust’s SOL.
The Trust will receive a portion of the staking rewards earned through its staking program in the form of SOL. The Staking Provider and Sponsor are entitled to receive a fee for their respective
roles in facilitating the Trust's staking activities (collectively, "Staking Expenses"). The Trust will pay Staking Expenses at a rate of 3% of the gross staking rewards received by the Trust. The expenses of staking the Trust’s SOL will be paid
from the proceeds of the Trust's staking program and the Trust will retain the remaining amount of the staking rewards. The staking rewards earned by the Trust will accrue to the Trust’s account with the
Solana Custodian and will generally be staked in the same way as the Trust’s already staked SOL.
The Trust’s risk management processes and policies may prove to not be adequate to prevent any loss of the Trust’s SOL.
The Sponsor will continue to monitor and evaluate the Trust’s risk management processes and policies and believes that the current risk management processes and procedures are reasonably designed
and effective. The Sponsor believes that the security procedures that the Sponsor and the Solana Custodian utilize, such as hardware redundancy, segregation and offline data storage (i.e., the maintenance of data on computers and/or storage media
that is not directly connected to or accessible from the internet and/or networked with other computers, also known as “cold storage”) protocols are reasonably designed to safeguard the Trust’s SOL from theft, loss, destruction or other issues
relating to hackers and technological attack. Despite the number of security procedures that the Sponsor and Solana Custodian employ, it is impossible to guarantee the prevention of any loss due to a security breach, software defect, act of God,
pandemic or riot that may be borne by the Trust. Notwithstanding the above, the Solana Custodian is responsible for its own gross
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negligence, willful misconduct or bad faith. In the event that the Trust’s risk management processes and policies prove to not be adequate to prevent any loss of the Trust’s SOL and such loss is
not covered by insurance or is otherwise recoverable, the value of the Shares will decrease as a result and investors would experience a decrease in the value of their investment.
The Trust’s Policy for managing the liquidity risks of staking may not fully prevent the Trust from experiencing liquidity challenges, especially in extreme or
stressed market conditions.
The Trust’s staking program involves the temporary loss of the ability to transfer or otherwise dispose of the Trust’s SOL. The Sponsor expects that under normal conditions, the Trust will generally regain complete
control over the Trust’s SOL in up to three days of instructing the Solana Custodian to unstake or "exit" the Trust’s staked SOL positions. However, there can be no guarantee that such process will result in the Trust regaining complete control of
its SOL in time to satisfy its current obligations.
The Trust may reduce the amount of its SOL that is staked as part of managing its liquidity. The Trust will not utilize leverage, derivatives or similar instruments or transactions in seeking to meet its investment
objective; however, the Trust may utilize a short term credit facility or an alternative liquidity arrangement for the purposes of obtaining funds necessary to meet redemptions from the Trust. Accordingly, investors could still experience delays or
limitations on redemptions if the Trust is unable to unstake the necessary amount of SOL in time to satisfy its current obligations.
The development and commercialization of the Trust is subject to competitive pressures and may be adversely affected by competition from competing products
and other investment vehicles focused on SOL or other digital assets.
The Trust and the Sponsor face competition with respect to the creation of competing products. The Sponsor’s competitors may have greater financial, technical and human resources than the Sponsor.
These competitors may also compete with the Sponsor in recruiting and retaining qualified personnel. Smaller or early-stage companies may also prove to be effective competitors, particularly through collaborative arrangements with large and
established companies. Accordingly, the Sponsor’s competitors may commercialize a product involving SOL more rapidly, effectively or for a lower fee than the Sponsor is able to, which could adversely affect the Sponsor’s competitive position, the
likelihood that the Trust will achieve initial market acceptance and the Sponsor’s ability to generate meaningful revenues from the Trust. For exchange-traded products similar to the Trust, there have been significant “first-mover” advantages in
terms of asset gathering, trading volume and media coverage. In many cases, the first mover in an asset class has been able to maintain these advantages for extended periods.
Investors may invest in SOL through means other than the Shares, including through direct investments in SOL and other potential financial vehicles, possibly including securities backed by or
linked to SOL and digital asset financial vehicles similar to the Trust, or SOL futures-based products. Market and financial conditions, and other conditions beyond the Sponsor’s control, may make it more attractive to invest in other financial
vehicles or to invest in SOL directly, which could limit the market for, and reduce the liquidity of, the Shares. In addition, to the extent digital asset financial vehicles other than the Trust tracking the price of SOL are formed and represent a
significant proportion of the demand for SOL, large purchases or redemptions of the securities of these digital asset financial vehicles, or private funds holding SOL, could negatively affect the Benchmark, the Trust’s SOL holdings, the price of the
Shares, the net asset value of the Trust and the NAV.
If the Trust fails to achieve sufficient scale due to competition, the Sponsor may have difficulty raising sufficient revenue to cover the costs associated with launching and maintaining the Trust,
and such
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shortfalls could impact the Sponsor’s ability to properly invest in robust ongoing operations and controls of the Trust to minimize the risk of operating events, errors, or other forms of losses to
the Shareholders. In addition, the Trust may also fail to attract adequate liquidity in the secondary market due to such competition, resulting in a sub-standard number of Authorized Participants willing to make a market in the Shares, which in turn
could result in a significant premium or discount in the Shares for extended periods and the Trust’s failure to reflect the performance of the price of SOL.
In addition, the Trust will compete with direct investments in SOL, SOL futures-based products, other digital assets and other potential financial vehicles, possibly including securities backed by
or linked to digital assets and other investment vehicles that focus on other digital assets. Market and financial conditions, and other conditions beyond the Trust’s control, may make it more attractive to invest directly or in other vehicles, which
could adversely affect the performance of the Trust.
The value of the Shares may be influenced by a variety of factors unrelated to the value of SOL.
The value of the Shares may be influenced by a variety of factors unrelated to the price of SOL that may have an adverse effect on the price of the Shares. These factors include:
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The Trust could experience unanticipated problems or issues with respect to the mechanics of the Trust’s operations and the trading of the Shares, in particular due to the fact that the mechanisms and procedures governing the creation and
offering of the Shares and storage of SOL have been developed specifically for this product;
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The Trust could experience difficulties in operating and maintaining its technical infrastructure, including in connection with expansions or updates to such infrastructure, which are likely to be complex and could lead to unanticipated
delays, unforeseen expenses and security vulnerabilities;
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The Trust could experience unforeseen issues relating to the performance and effectiveness of the security procedures, such as algorithms, codes, passwords, multiple signature systems, encryption and telephone call-backs, used to protect
the Trust’s account with the Solana Custodian, or the security procedures may not protect against all errors, software flaws or other vulnerabilities in the Trust’s technical infrastructure, which could result in theft, loss or damage of its
assets; or
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If the Solana network introduces privacy enhancing features in the future, service providers may decide to terminate their relationships with the Trust due to concerns that the introduction of privacy enhancing features to the Solana
network may increase the potential for SOL to be used to facilitate crime, exposing such service providers to potential reputational harm.
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Staking involves the risk of loss of the Trust's SOL, which would adversely affect the value of the Shares.
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Liquidity challenges related to unstaking the Trust's SOL to meet redemption requests could result in certain liquidity risks to the Trust, including possible delays in the satisfaction of redemption requests.
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The uncertain legal and regulatory environment regarding staking, especially as it relates to the U.S. federal income tax consequences of staking in a grantor trust structure.
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There is a possibility that the Trust's staking activities could result in potential tax liabilities for beneficial owners of Shares without receiving corresponding distributions from the Trust in connection with the Trust's staking
activities, even though the Trust will liquidate staking rewards to pay quarterly distributions to Shareholders.
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Any of these factors could affect the value of the Shares, either directly or indirectly through their effect on the Trust’s assets.
The NAV may not always correspond to the market price of the Shares.
The NAV of the Trust may not always correspond to the market price of its Shares. Shareholders should be aware that the public trading price per Share may be different from the NAV for a number of
reasons, including price volatility, trading activity, normal trading hours for the Trust, the calculation methodology of the NAV, demand or supply for Shares of the Trust in excess of an Authorized Participant’s ability to create or redeem Shares
and/or the closing of SOL trading platforms due to fraud, failure, security breaches or otherwise, and the fact that supply and demand forces at work in the secondary trading market for Shares are related, but not identical, to the supply and demand
forces influencing the market price of SOL. Additionally, SOL is traded on trading platform markets and over-the-counter 24-hours a day and seven days a week, and the value of the Shares may therefore change on days and at times when an investor is
not able to buy or sell Shares.
The Trust and the Sponsor believe that slippage in trading (i.e., the difference between the expected price and the price at which the trade is executed) is not necessarily more pronounced in the
trading of digital assets as compared to other asset classes or in the trading of SOL as compared to other digital assets. To monitor the trading of SOL and other digital assets, the Execution Agent requests quotes from liquidity providers to trade
SOL or other digital asset as a spread off a corresponding index. While trading slippage is not expected to have a material impact on the Trust over the long term, trading slippage may from time to time be material on a given day. The Trust does not
currently intend to take specific steps to limit the impact of trading slippage.
An Authorized Participant may be able to create or redeem a Creation Basket at a discount or a premium to the public trading price per Share. To the extent creations or redemptions take place in
kind, the Trust’s operations will therefore not be directly impacted by any discount or premium in the market price of its Shares.
Shareholders may be adversely affected by an overstatement or understatement of the NAV calculation of the Trust due to the valuation methodology employed
on the date of the NAV calculation.
If the Benchmark is not available or the Sponsor determines, in its sole discretion, that the Benchmark should not be used, the Trust’s SOL investments may be valued using techniques other than
reliance on the price established by the Benchmark. The value established by using the Benchmark may be different from what would be produced through the use of another methodology. SOL valued using techniques other than those employed by the
Benchmark, including SOL investments that are “fair valued,” may differ from the value established by the Benchmark.
Benchmark correlation risk.
The Trust expects to outperform the Benchmark before taking its expenses and liabilities into account due to its plans to receive SOL staking rewards but may not achieve the desired correlation to
the Benchmark and thus may not achieve its investment objective. The difference in performance between the Trust and the Benchmark may be due to factors such as fees, transaction costs, redemptions of, and subscriptions for, Shares, differences in
the timing of the addition or removal of constituent trading platforms underlying the Benchmark, staking rewards earned by the Trust, pricing differences or the cost to the Trust of complying with various new or existing regulatory requirements.
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To the extent the Trust makes use of cash creations and redemptions, it may adversely affect arbitrage transactions by Authorized Participants intended to
keep the price of the Shares closely linked to the price of SOL and, as a result, the price of the Shares may fall or otherwise diverge from NAV.
The use of cash creations and redemptions, as opposed to in-kind creations and redemptions, could cause delays in trade execution due to potential operational issues arising from implementing a
cash creation and redemption model, which involves greater operational steps (and therefore execution risk) than the creation and redemption model. Such delays could cause the execution price associated with such trades to materially deviate from the
Benchmark price used to determine the NAV. Even though the Authorized Participant is responsible for the dollar cost of such difference in prices, Authorized Participants could default on their obligations to the Trust, or such potential risks and
costs could lead to Authorized Participants, who would otherwise be willing to purchase or redeem Baskets to take advantage of any arbitrage opportunity arising from discrepancies between the price of the Shares and the price of the underlying SOL,
to elect to not participate in the Trust’s Share creation and redemption processes. This may adversely affect the arbitrage mechanism intended to keep the price of the Shares closely linked to the price of SOL, and as a result, the price of the
Shares may fall or otherwise diverge from NAV. If the arbitrage mechanism is not effective, purchases or sales of Shares on the secondary market could occur at a premium or discount to NAV, which could harm Shareholders by causing them buy Shares at
a price higher than the value of the underlying SOL held by the Trust or sell Shares at a price lower than the value of the underlying SOL held by the Trust, causing Shareholders to suffer losses. Further, the Trust may not be able to successfully
implement in-kind creation and redemption transactions, which could put the Trust at a disadvantage compared to other digital asset ETPs that are able to implement in-kind creations and redemptions.
SOL buying and selling activity associated with the creation and redemption of Creation Baskets, or withdrawal from participation by an Authorized
Participant, may adversely affect an investment in the Shares of the Trust.
The Trust’s or the Execution Agent’s purchase of SOL in connection with Creation Basket purchase orders may cause the price of SOL to increase, which will result in higher prices for the Shares.
Increases in SOL prices may also occur as a result of SOL purchases by other market participants who attempt to benefit from an increase in the market price of SOL when Creation Baskets are issued. The market price of SOL may therefore decline
immediately after Creation Baskets are issued.
Selling activity associated with sales of SOL by the Trust or the Execution Agent in connection with redemption orders may decrease the SOL prices, which will result in lower prices for the Shares.
Decreases in SOL prices may also occur as a result of selling activity by other market participants.
In addition to the effect that purchases and sales of SOL by the Trust or the Execution Agent may have on the price of SOL, sales and purchases of SOL by similar investment vehicles (if developed)
could impact the price of SOL. If the price of SOL declines, the trading price of the Shares will generally also decline.
The Trust’s and the Authorized Participants’ ability to buy or sell SOL may be adversely affected by limited trading volume, lack of a market maker, or legal restrictions. It is also possible that a SOL spot market
or governmental authority may suspend or restrict trading in SOL altogether. Therefore, it may not always be possible to execute a buy or sell order at the desired price or to liquidate an open position due to market conditions on spot markets,
regulatory issues affecting SOL or other issues affecting counterparties. SOL is a relatively new asset with a very limited trading history. Therefore, the markets for SOL may be less liquid and more volatile than other markets for more
established products.
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Authorized Participant risk.
The Trust has a limited number of financial institutions that may act as Authorized Participants and engage in creation or redemption transactions directly with the Trust, and none of those
Authorized Participants is obligated to engage in creation and/or redemption transactions. In the event that one or more Authorized Participants that have substantial interests in the Trust’s Shares exit the business or are unable to proceed with
participation in the purchase (creation) or sale (redemption) of the Trust’s Shares, and no other Authorized Participant is able to step forward to create or redeem Creation Baskets, this may result in a significantly diminished trading market for
the Shares, and the Shares may be more likely to trade at a premium or discount to the Trust’s NAV and to face trading halts and/or delisting. Further, the Trust’s Authorized Participants may act as authorized participants for a number of other
digital asset ETPs. If those digital asset ETPs experience operational challenges or regulatory problems that impact or implicate one or more of the Trust’s Authorized Participants, the Trust may be adversely impacted. In addition, if one or more of
the Trust’s Authorized Participants discontinue serving as an Authorized Participant with respect to the Trust but not to other digital asset ETPs, the liquidity of Shares and the value of an investment in the Shares may be adversely affected.
Finally, in periods of heightened SOL price volatility, the Authorized Participants may not be able to effectively make markets in several impacted digital asset ETPs at once, which could lead to larger bid-ask spreads or Share price premiums and
discounts. The Sponsor will monitor the activity and operations of the Trust’s Authorized Participants to identify any such potential issues.
The inability of Authorized Participants to hedge their SOL exposure may adversely affect the liquidity of Shares and the value of an investment in the
Shares.
Authorized Participants will generally want to hedge their exposure in connection with Creation Basket creation and redemption orders. To the extent Authorized Participants are unable to hedge
their exposure due to market conditions (e.g., insufficient SOL liquidity in the market, inability to locate an appropriate hedge counterparty, extreme volatility in the price of SOL, etc.), such conditions may make it difficult to create or redeem
Creation Baskets or cause them to not create or redeem Creation Baskets. In addition, the hedging mechanisms employed by Authorized Participants to hedge their exposure to SOL may not function as intended, which may make it more difficult for them to
enter into such transactions. Such events could negatively impact the market price of the Trust and the spread at which the Trust trades on the open market.
The market infrastructure of the SOL spot market could result in the absence of active Authorized Participants able to support the trading activity of the
Trust.
SOL is extremely volatile, and concerns exist about the stability and reliability of many trading platforms where SOL trades. In a highly volatile market, or if one or more trading platforms
supporting the SOL market face an issue, it could be extremely challenging for any Authorized Participants to provide continuous liquidity in the Shares. There can be no guarantee that the Sponsor will be able to find an Authorized Participant to
actively and continuously support the Trust.
SOL spot trading platforms are not subject to the same regulatory oversight as traditional equity exchanges, which could negatively impact the ability of
Authorized Participants to implement arbitrage mechanisms.
The trading for spot SOL occurs on multiple domestic and foreign trading platforms that have various levels and types of regulation, but are not regulated in the same manner as traditional stock
and bond trading platforms. If these trading platforms do not operate smoothly or face technical, security or regulatory issues, that could impact the ability of Authorized Participants to make markets in the Shares. In such an event, trading in the
Shares could occur at a material premium or discount to the NAV.
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In addition, trading on these trading platforms may be halted or disrupted due to regulatory actions, operational problems at the trading platforms or third parties, cybersecurity incidents or acts
of fraud or misconduct, among others. In the event a trading platform experiences such a disruption, the Trust may be impacted and the value of the Shares may decline. Further, the price and availability of SOL on these trading platforms may differ,
and if the Trust transacts at one trading platform at a time where the price and/or availability of SOL is materially worse than that of another trading platform, the value of Shares may be impacted. Operational problems or failures by SOL trading
platforms and fluctuations in SOL prices may reduce confidence in these platforms or in SOL generally, which could adversely affect the price of SOL and therefore adversely affect an investment in the Shares.
Only Authorized Participants may transact in Creation Baskets.
The Trust will process all creations and redemptions of Shares in transactions with financial firms that are authorized to do so (known as “Authorized Participants”). Shareholders that are not
Authorized Participants or who are unable to transact in Creation Baskets through Authorized Participants may only purchase or sell their Shares in secondary trading markets, and the conditions associated with trading in secondary markets may
adversely affect Shareholders’ investment in the Shares. Although shares of the Trust are listed for trading on the Exchange, there can be no assurance that an active trading market for such shares will develop or be maintained. Secondary market
trading in Shares may be halted by the Exchange because of market conditions or for other reasons. Shares of the Trust, similar to shares of other issuers listed on a stock exchange, may be sold short and are therefore subject to the risk of
increased volatility and price decreases associated with being sold short. Shares trade on the Exchange at prices at, above or below the most recent NAV. The NAV is calculated at the end of each Business Day and fluctuates with changes in the market
value of the Trust’s SOL. The trading price of the Shares fluctuates continuously throughout trading hours based on both market supply of and demand for Shares and the underlying value of the Trust’s SOL or the Trust’s NAV. As a result, the trading
prices of Shares may deviate significantly from NAV during periods of market volatility. Any of these factors, among others, may lead to the Shares trading at a premium or discount to NAV. While the creation/redemption feature is designed to make it
more likely that Shares normally will trade on the Exchange at prices close to the next calculated NAV, market prices are not expected to correlate exactly with the Trust’s NAV due to timing reasons, supply and demand imbalances and other factors. In
addition, disruptions to creations and redemptions, including disruptions at Authorized Participants, or other market participants, and during periods of significant market volatility, may result in trading prices for Shares that differ significantly
from its NAV. Authorized Participants may be less willing to create or redeem Shares if there is a lack of an active market for such Shares or its underlying investments, which may contribute to the Shares trading at a premium or discount to NAV.
Buying or selling Shares on the Exchange involves two types of costs that apply to all securities transactions. When buying or selling Shares through a broker, Shareholders will likely incur a brokerage commission and other charges. In addition,
Shareholders may incur the cost of the “spread”; that is, the difference between what investors are willing to pay for Shares (the “bid” price) and the price at which they are willing to sell Shares (the “ask” price). The spread, which varies over
time for Shares based on trading volume and market liquidity, is generally narrower if the Trust has more trading volume and market liquidity and wider if the Trust has less trading volume and market liquidity. In addition, increased market
volatility may cause wider spreads. There may also be regulatory and other charges that are incurred as a result of trading activity. Because of the costs inherent in buying or selling Shares, frequent trading may detract significantly from
investment results and an investment in Shares may not be advisable for investors who anticipate regularly making small investments through a brokerage account.
Solana Counterparty risk.
There can be no guarantee that the Execution Agent will be able to find Solana Counterparties to actively and continuously provide SOL liquidity to the Trust. Because the Solana Counterparties are
not
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contractually obligated to provide SOL liquidity to the Trust, if the Trust is unable to find sufficient sources of SOL liquidity, the Execution Agent may not be able to purchase or sell SOL on
behalf of the Trust at prices and at times that will enable the Trust to track the Benchmark. If the Execution Agent is unable to transact in SOL on the Trust’s behalf on a timely and cost-efficient basis, it could adversely affect the price of SOL
and therefore adversely affect an investment in the Shares. To the extent that the unavailability of SOL liquidity results in a diminished trading market for the Shares, the Shares may be more likely to trade at a premium or discount to the Trust’s
NAV and to face trading halts and/or delisting. Further, if one or more Solana Counterparties or trading platforms or venues supporting the SOL market are unwilling or unable to provide liquidity to the Trust, it could be challenging for any
Authorized Participants to provide continuous liquidity in the Shares.
Shareholders may be adversely affected by creation or redemption orders that are subject to postponement, suspension or rejection under certain
circumstances.
The Trust may, in its discretion, suspend the right of creation or redemption or may postpone the purchase or redemption settlement date, for (1) any period during which the Exchange is closed
other than customary weekend or holiday closings, or trading on the Exchange is suspended or restricted, (2) any period during which an emergency exists as a result of which the fulfillment of a purchase order or the redemption distribution is not
reasonably practicable, (3) such other period as the Sponsor determines to be necessary for the protection of the Trust or its Shareholders (for example, where acceptance of the total deposit required to create each Creation Basket would have certain
adverse tax consequences to the Trust or its Shareholders), or (4) as agreed upon between the Sponsor and Authorized Participant. An emergency could include situations where the Trust is unable to transact in SOL or where the Trust is unable to value
its SOL holdings. Such a situation may arise when trading of SOL is suspended on one or more of the digital asset trading platforms that are included in the Benchmark (for example, as a result of a significant technical failure, power outage or
network error) or the Trust is unable to access the SOL in the Trust’s SOL custody account at the Solana Custodian due to technical or operating issues at the Trust or the Solana Custodian. Because the Trust’s SOL transactions are expected to be
effected by the Execution Agent over-the-counter, it is unlikely that the Trust’s SOL transactions would be directly impacted by a trading halt on one or more digital asset trading platforms. However, such disruptions may have an effect on overall
SOL liquidity or cause price spreads of SOL to widen.
In addition, the Trust may reject a redemption order if the order is not in proper form as described in the authorized participant agreement by and among the Trust, the Sponsor and the Authorized
Participants (the “Authorized Participant Agreement”) or if the fulfillment of the order might be unlawful. Any such postponement, suspension or rejection could adversely affect a redeeming Authorized Participant. Suspension of creation privileges
may adversely impact how the Shares are traded and arbitraged on the secondary market, which could cause them to trade at levels materially different (premiums and discounts) from the fair value of their underlying holdings.
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Due to the time involved in “exiting” the staking process, there is a risk that the Trust could become unable to timely meet excessive redemption
requests in amounts that are greater than the portion of the Trust’s SOL that remains unstaked, leading to temporary delays in settlement and, in extreme scenarios, the temporary unavailability of the Trust’s redemption program. Moreover, any
staked SOL which must be unstaked in order to fulfill a redemption (to the extent such redemption cannot be fulfilled utilizing the portion of the Trust's SOL that has not been staked, or through another mechanism to manage liquidity in connection
with redemption orders) will be unstaked only after the redemption request is approved by the Trust, the Sponsor executes an unstake or withdrawal transaction through the Solana Custodian, and such transaction is processed by the Solana network.
The Staking Provider will not be able to transfer unstaked SOL or staking rewards to another address on the Solana network. The Exchange on which the Shares are listed may halt trading in the Trust’s Shares, which would adversely impact a
Shareholder’s ability to sell Shares.
The Trust’s Shares are listed for trading on the Exchange under the ticker symbol QSOL. Trading in Shares may be halted due to market conditions or, in light of the Exchange rules and procedures,
for reasons that, in the view of the Exchange, make trading in Shares inadvisable. In addition, trading is subject to trading halts caused by extraordinary market volatility pursuant to “circuit breaker” rules that require trading to be halted for a
specified period based on a specified market decline. Additionally, there can be no assurance that the requirements necessary to maintain the listing of the Trust’s Shares will continue to be met or will remain unchanged.
The lack of active trading markets for the Shares of the Trust may result in losses on Shareholders’ investments at the time of disposition of Shares.
Although Shares of the Trust are expected to be publicly listed and traded on an exchange, there can be no guarantee that an active trading market for the Trust will develop or be maintained. If
Shareholders need to sell their Shares at a time when no active market for them exists, the price Shareholders receive for their Shares, assuming that Shareholders are able to sell them, will likely be lower than the price that Shareholders would
receive if an active market did exist and, accordingly, a Shareholder may suffer losses.
Shareholders could incur a tax liability without an associated distribution of the Trust.
In the normal course of business, Shareholders could incur a taxable gain as a result of the sale of SOL (including sales of SOL to pay the Sponsor Fee and other Trust expenses), which gain does
not correspond to a distribution to Shareholders (so-called “phantom income”). Any tax liability could adversely impact an investment in the Shares and may require Shareholders to prepare and file tax returns. In that event, Shareholders may be
subject to tax on any realized capital gain resulting from their pro-rata share of the SOL sold by the Trust even though there is not a corresponding distribution from the Trust, although the Sponsor intends to make quarterly distributions, on
behalf of the Trust, of staking rewards to Shareholders. See “U.S. Federal Income Tax Consequences—Taxation of U.S. Shareholders” and “U.S. Federal Income Tax Consequences—Taxation of the Trust.”
The amount of SOL represented by the Shares will decline over time.
The amount of SOL represented by the Shares will be reduced during the life of the Trust each time the Trust accrues the Sponsor Fee, and to pay for any extraordinary expenses. This dynamic will
occur irrespective of whether the value of the Trust’s assets, or the trading price of the Shares, rises or falls.
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Each outstanding Share represents a fractional, undivided interest in the SOL held by the Trust. The Trust transfers SOL to pay for the Sponsor Fee, and to pay for any extraordinary expenses,
including, but not limited to, taxes and governmental charges, any applicable brokerage commissions, financing fees, borrowing costs under a short term credit facility or alternative liquidity arrangement, Solana network fees and similar
transaction fees, expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the interests of Shareholders (including, for example, in connection with any
fork of the Solana blockchain), any indemnification of the Sponsor, Cash Custodian, Solana Custodian, Staking Provider, Administrator or other agents, service providers or counterparties of the Trust and extraordinary legal fees and expenses,
including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters. Therefore, the amount of SOL represented by each Share will gradually decline over time. This is also true with respect
to Shares that are issued in exchange for additional deposits of SOL or cash used to acquire SOL over time, as the amount of SOL required to create Shares proportionally reflects the amount of SOL represented by the Shares outstanding at the time
of such Share issuance. Assuming a constant SOL price, the trading price of the Shares is expected to gradually decline relative to the price of SOL at the rate of the Sponsor Fee and other expenses.
Any errors or changes in calculations used to value the Trust’s SOL holdings and SOL holdings per Share may have an adverse effect on the value of the
Shares.
The value of Trust’s SOL holdings is typically determined on a daily basis as of 4:00 p.m. ET on each Business Day. This determination is made utilizing data from the operations of the Trust,
calculated as of 4:00 p.m. ET on such day. In the event that the value of the Trust’s SOL holdings or SOL holdings per Share is incorrectly calculated, the Sponsor and the Administrator will not be liable for any error and such misreporting of
valuation data could adversely affect the value of the Shares.
The value of the Shares will be adversely affected if the Trust is required to indemnify the Sponsor, the Trustee, the Transfer Agent, the Solana Custodian,
Staking Provider or the Cash Custodian.
Under the Trust Agreement, the Trustee and the Sponsor will have a right to be indemnified by the Trust for certain liabilities or expenses that it incurs without gross negligence, bad faith or
willful misconduct on its part. The Trust has also agreed to indemnify the Transfer Agent, Solana Custodian, Staking Provider and Cash Custodian under their respective agreements with the Trust for certain liabilities or expenses that such party
incurs, subject to certain qualifications. Therefore, the Trustee, Sponsor, Transfer Agent, the Solana Custodian, Staking Provider or the Cash Custodian may require that the assets of the Trust be sold in order to cover losses or liability suffered
by it. Any sale of that kind would reduce the SOL holdings of the Trust and the value of the Shares.
The Sponsor and its affiliates are subject to conflicts of interest that could adversely affect an investment in the Trust.
The Sponsor and its affiliates and their respective officers, directors and employees and other related parties engage in a broad spectrum of activities and may expand the range of services that
they provide over time. The Sponsor and its related parties will generally not be restricted in the scope of their business or in the performance of any such services (whether now offered or undertaken in the future), even if such activities could
give rise to conflicts of interest, and whether or not such conflicts are described herein. In the ordinary course of their business activities, the Sponsor and its related parties may engage in activities where the interests of the Sponsor and its
related parties or the interests of their clients conflict with the interests of the Trust. Certain employees of the Sponsor also have responsibilities relating to the business of one or more related parties. These employees are not restricted in the
amount of time that may be allocated to the
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business activities of the Sponsor’s related parties, and the allocation of such employees’ time between the Sponsor and its related parties may change over time.
The Sponsor and its related parties are responsible for managing other accounts in addition to the services that they provide to the Trust, including other accounts of the Sponsor or its
affiliates. Other accounts may include, without limitation, private or SEC-registered funds, separately managed accounts, offshore funds or accounts, or investments owned by the Sponsor or its affiliates. Management of other accounts in addition to
services provided to the Trust can present certain conflicts of interest. The other accounts might have similar or different investment objectives or strategies as the Trust, or otherwise hold, purchase or sell investments that are eligible to be
held, purchased or sold by the Trust, or may take positions that are opposite in direction from those taken by the Trust.
The Sponsor may devote unequal time and attention to the management of different accounts. As a result, the Sponsor may not be able to fulfill its obligations to the Trust as might be the case if
it were to devote substantially more attention to the management of a single account. The effects of this potential conflict may be more pronounced where accounts overseen by the Sponsor have different investment strategies.
A conflict of interest arises where the financial or other benefits available to the Sponsor or its related parties differ among the accounts that it manages. Where the structure of the Sponsor’s
or its related party’s fee differs among accounts (such as where certain accounts pay higher management fees or a performance or incentive fee), the Sponsor might be motivated to help certain accounts over others. In addition, the Sponsor might be
motivated to favor accounts in which it has an interest and/or its related parties have interests. Similarly, the desire to maintain or raise assets under management or to enhance the Sponsor’s or its related parties’ performance record or to derive
other rewards, financial or otherwise, could influence the Sponsor to give preferential treatment to those accounts that could most significantly benefit the Sponsor.
The Trust’s service providers (including its Solana Custodian, Administrator, auditor and legal counsel) may provide services to other pooled investment vehicles with similar investment strategies
and objectives and, accordingly, may have conflicts of interest. The Trust’s Sponsor and other service providers and their principals, employees or affiliates may invest or trade in digital assets for their own accounts, which activities may conflict
or compete with the Trust.
The Sponsor or its related parties may purchase Shares from the Trust from time to time, and may hold a material position in the Trust. The Trust will not receive any of the proceeds from the
resale by the Sponsor or its affiliates of these Shares, and the sale of such Shares may impact the price at which you may be able to sell your Shares. The Sponsor and its related parties reserve the right, subject to compliance with applicable law,
to sell into the market or redeem in Creation Baskets through an Authorized Participant at any time some or all of the Shares of the Trust acquired for their own accounts. The Sponsor or its related parties face conflicting interests in determining
whether, when and in what amount to sell or redeem Shares of the Trust. The Sponsor and its related parties are under no obligation to consider the effect of redemptions on the Trust and other Shareholders in deciding whether to sell or redeem their
Shares.
The Sponsor is responsible for selecting and engaging the Trust’s service providers, including the Benchmark Provider. To the extent that the Sponsor has other commercial arrangements with the
service providers, the Sponsor may face conflicts of interest with respect to its oversight and supervision of the service providers. Further, to the extent that the Sponsor has investments in SOL and/or in Shares, and due to the fact that the
Sponsor Fee is payable based on the value of the Shares, the Sponsor may face potential conflicts of interest with respect to the Benchmark Provider’s valuation of Shares.
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Investment vehicles advised or managed by affiliates of the Sponsor hold a minority interest in Coinbase Global, the parent of Coinbase Inc., which serves
as the Trust’s Prime Broker and operates one of the digital asset trading platforms included in the Benchmark price and is the parent of the Solana Custodian.
Investment vehicles advised or managed by affiliates of the Sponsor own shares in many public companies listed in the United States, including Coinbase Global, the parent of Coinbase Inc. which
operates the Coinbase trading platform and serves as the Trust’s Prime Broker. The Trust values its digital assets by reference to the Benchmark price. Coinbase is one of the digital asset trading platforms included in the Benchmark.
Although neither the Sponsor nor any affiliates of the Sponsor nor any investment vehicles managed or advised by any of them exercise control over Coinbase, it is possible that positions of
investment vehicles managed by affiliates of the Sponsor in Coinbase may present risks to Shareholders to the extent affiliates of the Sponsor cause the Sponsor to favor Coinbase’s interests over the interests of the Trust or its Shareholders with
respect to, for example, fees charged, and the quality of service provided by Coinbase as Prime Broker. Similarly, investors could have concerns that the Sponsor or affiliates of the Sponsor could influence market data provided by Coinbase in a way
that benefits the Sponsor, for example by artificially inflating the values of SOL in order to increase the Sponsor’s fees. This could make the Trust’s Shares less attractive to investors than the shares of similar vehicles that do not present these
concerns, adversely affect investor sentiment about the Trust and negatively affect Share trading prices.
Coinbase Global is also the parent company of the Solana Custodian. The Solana Custodian serves as a fiduciary and custodian on the Trust’s behalf, and is responsible for safeguarding digital
assets held by the Trust, and holding the private keys that provide access to the Trust’s digital wallets and vaults. The positions of investment vehicles managed by affiliates of the Sponsor in the parent company of the Solana Custodian may present
risks to Shareholders to the extent affiliates of the Sponsor cause the Sponsor to favor the Solana Custodian’s interests over the interests of the Trust or its Shareholders with respect to, for example, fees charged, and the quality of service
provided by the Solana Custodian. Similarly, it is possible that investors could have concerns that the interests owned by investment vehicles managed by affiliates of the Sponsor in Coinbase could cause it to refrain from taking actions that are in
the best interests of the Trust but that could harm the Solana Custodian. This could make the Trust’s Shares less attractive to investors than the shares of similar vehicles that do not present these concerns, adversely affect investor sentiment
about the Trust and negatively affect Share trading prices.
There is no guarantee that every employee, officer, director or similar person associated with the Sponsor, the Execution Agent or their affiliates will
comply with the policies, duties and training and refrain from engaging in insider trading in violation of their duties to the Trust, the Sponsor or the Execution Agent.
While the Sponsor has adopted and implemented policies and will adopt standard operating practices requiring that certain applicable personnel pre-clear personal trading activity in which SOL is
the referenced asset, there is no way to guarantee that every employee, officer, director, or similar person associated the Sponsor, the Execution Agent or their affiliates will comply at all times with such policies, duties and training and refrain
from engaging in insider trading in violation of their duties to the Trust, the Sponsor or the Execution Agent. This risk is present in traditional financial markets and is not unique to SOL. If such employees or others affiliated with the Trust,
Sponsor, Execution Agent, or affiliates respectively do engage in illegal conduct or conduct which fails to meet applicable regulatory standards, the Trust, Sponsor, Execution Agent, or relevant affiliate respectively could be the target of civil or
criminal fines, penalties, punishments, or other regulatory or other sanctions or lawsuits or could be the target of an investigation, whether directly or indirectly, such as on a failure to diligently supervise theory. Any of these outcomes could
cause the Trust and Shareholders to suffer harm.
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The Sponsor, the Execution Agent and their affiliates may also participate in transactions related to SOL, either for their own account (subject to certain internal employee trading operating
practices) or for the account of other clients, and such transactions may occur prior to, during, or after the commencement of this offering. Such transactions may not serve to benefit the Shareholders of the Trust and may have a positive or negative
effect on the value of the SOL held by the Trust and, consequently, on the market value of SOL.
Limited recourse.
The Solana Custodian has limited liability for any loss, claim, or damage to the Trust, impairing the ability of the Trust to recover losses relating to its SOL and any recovery may be limited,
except to the extent that such loss, claim or damage directly resulted from the negligence, bad faith, willful misconduct or fraud of the Solana Custodian. In addition, the Solana Custodian is generally not liable for any loss caused, directly or
indirectly, by the failure of the Trust to provide true, correct and complete information to the Solana Custodian, or a force majeure event. Furthermore, the Solana Custodian is generally not liable for a loss caused, directly or indirectly, by any
failure or delay to act by any service provider to the Solana Custodian or any system failure in respect of a third party’s automated system that prevents the Solana Custodian from fulfilling its obligations.
Under the Trust Agreement, the Trustee and the Sponsor will not be liable for any liability or expense incurred absent fraud, gross negligence, bad faith or willful misconduct on the part of the
Trustee or the Sponsor or breach by the Sponsor of the Trust Agreement, as the case may be. As a result, the recourse of the Trust or the Shareholder to Trustee or the Sponsor may be limited.
Risks Related to the Benchmark.
The Benchmark has a limited history.
The Benchmark has a limited history. A longer history of actual performance through various economic and market conditions would provide greater and more reliable information for an investor to
assess the Benchmark’s performance. The Benchmark Provider has substantial discretion at any time to change the methodology used to calculate the Benchmark, including the spot markets that contribute prices to the Trust’s NAV. The Benchmark Provider
does not have any obligation to take the needs of the Trust, the Trust’s Shareholders, or anyone else into consideration in connection with such changes. There is no guarantee that the methodology currently used in calculating the Benchmark will
appropriately track the price of SOL in the future, and the Benchmark could be calculated now or in the future in a way that adversely affects an investment in the Trust.
The Benchmark Pricing Sources used by the Benchmark are digital asset spot markets that facilitate the buying and selling of SOL and other digital assets. Although many Benchmark Pricing Sources
refer to themselves as “exchanges,” they are not registered with, or supervised by, the SEC or CFTC and do not meet the regulatory standards of a national securities exchange or designated contract market. For these reasons, among others, purchases
and sales of SOL may be subject to temporary distortions or other disruptions due to various factors, including the lack of liquidity in the markets and government regulation and intervention. These circumstances could affect the price of SOL used in
Benchmark calculations and, therefore, could affect the SOL price as reflected by the Benchmark.
The Benchmark is based on various inputs which include price data from various third-party SOL spot markets. The Benchmark Provider does not guarantee the validity of any of these inputs, which may
be subject to technological error, manipulative activity, or fraudulent reporting from their initial source.
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Right to change the Benchmark.
The Sponsor, in its sole discretion, may cause the Trust to utilize an index or standard other than the Benchmark (an “Alternative Benchmark”) at any time, with at least 60 days’ prior notice to
the Shareholders (where possible). The Sponsor may utilize an Alternative Benchmark for a variety of reasons, including, without limitation, if investment conditions change such that the Sponsor believes that an Alternative Benchmark better reflects
a fair value price for SOL, the Sponsor has concerns regarding the Benchmark Provider’s ability to continue to publish the Benchmark, or the Sponsor otherwise believes that the use of an Alternative Benchmark would be in the best interest of the
Trust. The Sponsor, however, is under no obligation whatsoever to make such changes in any circumstance. In the event that the Sponsor intends to establish the Trust’s NAV by reference to an Alternative Benchmark, it will provide Shareholders with
notice in a prospectus supplement and/or through a current report on Form 8-K or in the Trust’s annual or quarterly reports.
The trading platforms that may be designated as a principal market under the Benchmark Provider’s methodology face a number of risks.
Unlike traditional stock and commodity exchanges, cryptocurrency trading platforms face a number of risks, including but not limited to, distributed denial-of-service (“dDoS”), interruption of
trading, hacking of user accounts, lack of standards and naming convention for symbols, and an unstable technological and legal environment (causing changes in fee structure, blocking of funds withdrawal, etc.). Suspension or disruption of market
trading in SOL on one or more Benchmark Pricing Sources may adversely affect the value of the Benchmark.
The Benchmark is subject to the limitations of its methodology and the Solana market.
Though the Benchmark is designed to be representative of the SOL market or otherwise align with its stated objective, it may not be representative in every case or achieve its stated objective in
all instances. The Benchmark is designed and calculated strictly to follow the rules of its methodology, and any Benchmark price or other output is limited in its usefulness to such design and calculation. In addition, the Benchmark will necessarily
be composed of a limited number of potential principal markets, and thus the Benchmark may not reflect the value of SOL on crypto trading platforms not considered in the Benchmark. Furthermore, the Benchmark Provider publicizes its methodology as a
whitepaper available for download on the Benchmark Provider’s website.
The SOL market can be volatile, including those market interests which the Benchmark intends to measure or upon which the Benchmark is dependent in order to achieve its stated objective. For
example, illiquidity can have an impact on the quality or amount of data available to the Benchmark Provider for calculation, and may cause the Benchmark to produce unpredictable or unanticipated results. In addition, market trends and changes to
market structure may render the objective of the Benchmark unachievable or cause the Benchmark to become impractical to replicate.
The Benchmark Provider could experience system failures or errors.
If the computers or other facilities of the Benchmark Provider, Benchmark Pricing Sources, data providers and/or relevant stock exchange malfunction for any reason, calculation and dissemination of
the Benchmark may be delayed. Errors in Benchmark data, the Benchmark computations and/or construction may occur from time to time and may not be identified and/or corrected for a period of time or at all, which may have an adverse impact on the
Trust and the Shareholders. Any of the foregoing may lead to the errors in the Benchmark, which may lead to a different investment outcome for the Trust and its Shareholders than would have been the case had such events not occurred. The Benchmark is
the reference price for
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calculating the Trust’s NAV. Consequently, losses or costs associated with the Benchmark’s errors or other risks described above will generally be borne by the Trust and the Shareholders and
neither the Sponsor nor its affiliates or agents make any representations or warranties regarding the foregoing.
If the Benchmark is not available, the Trust’s holdings may be fair valued in accordance with the policy approved by the Sponsor. See “Calculation of NAV—General.” To the extent the valuation
determined in accordance with the policy approved by the Sponsor differs materially from the actual market price of SOL, the price of the Shares may no longer track, whether temporarily or over time, the global market price of SOL, which could
adversely affect an investment in the Trust by reducing investors’ confidence in the Shares’ ability to track the global market price of SOL. To the extent such prices differ materially from the market price for SOL, investors may lose confidence in
the Shares’ ability to track the market price of SOL, which could adversely affect the value of the Shares. The Sponsor does not anticipate that the need to “fair value” SOL will be a common occurrence.
Risks related to pricing.
As set forth under “Calculation of NAV” below, the Trust’s portfolio will be priced, including for purposes of determining the NAV, based upon the estimated fair market value (“FMV”) for SOL
determined by the Benchmark Provider. The price of SOL in U.S. Dollars or in other currencies available from other data sources may not be equal to the prices used to calculate the NAV. The Benchmark Provider has substantial discretion at any time to
change the methodology used to determine the FMV of SOL, including the spot markets underlying its methodology. The Benchmark Provider does not have any obligation to take the needs of the Trust, the Trust’s Shareholders, or anyone else into
consideration in connection with such changes.
The Benchmark Pricing Sources used by the Benchmark Provider are digital asset spot markets that facilitate the buying and selling of SOL and other digital assets. Although many Benchmark Pricing
Sources refer to themselves as “exchanges,” they are not registered with, or supervised by, the SEC or CFTC and do not meet the regulatory standards of a national securities exchange or designated contract market. For these reasons, among others,
purchases and sales of SOL may be subject to temporary distortions or other disruptions due to various factors, including the lack of liquidity in the markets and government regulation and intervention. These circumstances could affect the price of
SOL determined by the Benchmark Provider.
The NAV of the Trust will change as fluctuations occur in the market price of the Trust’s SOL holdings. Shareholders should be aware that the public trading price per Share may be different from
the NAV for a number of reasons, including price volatility, trading activity, the closing of SOL trading platforms due to fraud, failure, security breaches or otherwise, and the fact that supply and demand forces at work in the secondary trading
market for Shares are related, but not identical, to the supply and demand forces influencing the market price of SOL. An Authorized Participant may be able to create or redeem a Creation Basket at a discount or a premium to the public trading price
per Share.
Shareholders also should note that the size of the Trust in terms of total SOL held may change substantially over time and as Creation Baskets are created and redeemed.
In the event that the value of the Trust’s SOL holdings or SOL holdings per Share is incorrectly calculated, neither the Sponsor nor the Administrator will be liable for any error and such
misreporting of valuation data could adversely affect the value of the Shares.
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SOLANA AND THE SOLANA MARKET
This section of the Prospectus provides a more detailed description of SOL, including information about the historical development of SOL, how a person holds SOL, how to use SOL in transactions,
how to trade SOL, the markets where SOL can be bought, held and sold, the SOL over-the-counter (“OTC”) market and government oversight of SOL.
Solana and the Solana Network
Solana is a digital asset that is created and transmitted through the operations of the peer-to-peer Solana network, which is a network of computers, known as nodes, that operates on cryptographic computer-code based
logic, called a protocol. No single entity owns or operates the Solana network, the infrastructure of which is collectively maintained by a distributed user base, a phenomenon known as decentralization. The Solana network allows people to exchange
tokens of value, called Solana, which are recorded on a public transaction ledger known as the Solana blockchain. Solana can be used to pay for goods and services, including computational power on the Solana network, or it can be converted to fiat
currencies, such as the U.S. dollar, at rates determined on platforms that enable trading in Solana or in individual end-user-to-end-user transactions under a barter system.
The Solana network allows users to write and implement computer programs called smart contracts-that is, general-purpose code that executes on every computer in the network and can instruct the transmission of
information and value based on a sophisticated set of logical conditions. Using smart contracts, users can create markets, store registries of debts or promises, represent the ownership of property, move funds in accordance with conditional
instructions and create digital assets other than Solana on the Solana network. Smart contract operations are executed on the Solana blockchain in exchange for payment of Solana. The Solana network is one of a number of projects intended to expand
blockchain use beyond just a peer-to-peer money system.
The Solana protocol introduced the Proof-of-History (PoH) timestamping mechanism. PoH automatically orders on-chain transactions by creating a historical record that proves an event has occurred at a specific moment in
time. PoH is intended to provide a transaction processing speed and capacity advantage over other blockchain networks like Bitcoin and Ethereum, which rely on sequential production of blocks and can lead to delays caused by validator confirmations.
PoH is a new blockchain technology that is not widely used. PoH may not function as intended. For example, it may require more specialized equipment to participate in the network and fail to attract a significant number of users, or may be subject to
outages or fail to function as intended. In addition, there may be flaws in the cryptography underlying PoH, including flaws that affect functionality of the Solana network or make the network vulnerable to attack.
In addition to the PoH mechanism described above, the Solana network uses a proof-of-stake consensus mechanism to incentivize Solana holders to validate transactions. Unlike proof-of-work, in which miners expend
computational resources to compete to validate transactions and are rewarded coins in proportion to the amount of computational resources expended, in proof-of-stake, validators risk or “stake” coins to compete to be randomly selected to validate
transactions and are rewarded coins in proportion to the amount of coins staked. Any malicious activity, such as disagreeing with the eventual consensus or otherwise violating protocol rules, results in the forfeiture or “slashing” of a portion of
the staked coins. Proof-of-stake is viewed as more energy efficient and scalable than proof-of-work and is sometimes referred to as “virtual mining.”
History of Solana
The Solana protocol was first conceived by Anatoly Yakovenko in a 2017 whitepaper.
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Development of the Solana network is overseen by the Solana Foundation, a Swiss non-profit organization, and Solana Labs, Inc. (“Solana Labs”), a Delaware corporation, which administered the
original network launch and token distribution. Although Solana Labs and the Solana Foundation continue to exert significant influence over the direction of the development of Solana, the Solana network, like the Ethereum network, is understood to be
decentralized and does not require governmental authorities or financial institution intermediaries to create, transmit or determine the value of SOL.
In order to own, transfer or use SOL directly on the Solana network (as opposed to through an intermediary, such as a custodian), a person generally must have internet access to connect to the
Solana network. SOL transactions may be made directly between end-users without the need for a third-party intermediary. To prevent the possibility of double-spending Solana, a user must notify the Solana network of the transaction by broadcasting
the transaction data to its network peers. The Solana network provides confirmation against double-spending by memorializing every transaction in the Solana blockchain, which is publicly accessible and transparent. This memorialization and
verification against double-spending is accomplished through the Solana network validation process, which adds “blocks” of data, including recent transaction information, to the Solana blockchain. Unlike other blockchains that rely solely on
sequential production of blocks through proof-of-work or proof-of-stake mechanisms, however, the Solana network introduces PoH, which creates a historical record that proves an event has occurred at a specific moment in time.
Smart Contracts and Development on the Solana network
Smart contracts are programs that run on a blockchain that can execute automatically when certain conditions are met. Smart contracts facilitate the exchange of anything representative of value,
such as money, information, property, or voting rights. Using smart contracts, users can send or receive digital assets, create markets, store registries of debts or promises, represent ownership of property or a company, move funds in accordance
with conditional instructions and create new digital assets. Smart contracts and DApps can execute their code on the execution layer of the Layer 1 (as defined below) Solana network, through Execution Clients located on the Layer 1 Solana network.
Alternatively, one proposed path to enabling the Solana network to scale - i.e., removing some computational load and thus network congestion from the Layer 1 Solana network - is to facilitate smart contracts and DApps executing their code on Layer
2s (as defined below) and rolling up (as defined below) their transactions back to the main Layer 1 Solana network through the Layer 1 network’s consensus mechanism.
Development on the Solana network involves building more complex tools on top of smart contracts, such as DApps; organizations that are autonomous, known as decentralized autonomous organizations
(“DAOs”); and entirely new decentralized networks. For example, a company that distributes charitable donations on behalf of users could hold donated funds in smart contracts that are paid to charities only if the charity satisfies certain
pre-defined conditions.
In total, as of June 1, 2025, more than 200 DApps are currently built on the Solana network, including DApps in the collectible non-fungible token, gaming, music streaming, and decentralized finance categories.
Moreover, the Solana network has also been used as a platform for creating new digital assets and conducting their associated initial coin offerings.
More recently, the Solana network has been used for DeFi or open finance platforms, which seek to democratize access to financial services, such as borrowing, lending, custody, trading, derivatives
and insurance, by removing third-party intermediaries. DeFi can allow users to lend and earn interest on their digital assets, exchange one digital asset for another and create derivative digital assets such as stablecoins, which are digital assets
pegged to a reserve asset such as fiat currency. Over the course of 2025, between
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$6 billion and $13 billion worth of digital assets were locked up as collateral on DeFi platforms on the Solana network.
In addition, the Solana network and other smart contract platforms have been used for creating non-fungible tokens (“NFTs”). Unlike digital assets native to smart contract platforms which are
fungible and enable the payment of fees for smart contract execution. Instead, NFTs allow for digital ownership of assets that convey certain rights to other digital or real-world assets. This new paradigm allows users to own rights to other assets
through NFTs, which enable users to trade them with others on the Solana network. For example, an NFT may convey rights to a digital asset that exists in an online game or a DApp, and users can trade their NFT in the DApp or game, and carry them to
other digital experiences, creating an entirely new free-market internet-native economy that can be monetized in the physical world.
Overview of the Solana Network Operations
In order to own, transfer or use SOL directly on the Solana network on a peer-to-peer basis (as opposed to through an intermediary, such as a custodian or centralized exchange), a person generally
must have internet access to connect to the Solana network. SOL transactions may be made directly between end-users without the need for a third-party intermediary. To prevent the possibility of double-spending SOL, a user must notify the Solana
network of the transaction by broadcasting the transaction data to its network peers. The Solana network provides confirmation against double-spending by memorializing every peer-to-peer transaction in the Solana blockchain, which is publicly
accessible and transparent. This memorialization and verification against double-spending of peer-to-peer transactions is accomplished through the Solana network validation process, which adds “blocks” of data, including recent transaction
information, to the Solana blockchain. Unlike other blockchains that rely solely on sequential production of blocks through proof-of-work or proof-of-stake mechanisms, however, the Solana network introduces PoH, which creates a historical record that
proves an event has occurred at a specific moment in time.
Summary of a Solana Transaction
Prior to engaging in Solana transactions directly on the Solana network, a user generally must first install on its computer or mobile device a Solana network software program that will allow the
user to generate a private and public key pair associated with a Solana address. The Solana network software program and the Solana address also enable the user to connect to the Solana network and transfer Solana to, and receive Solana from, other
users.
Each user’s Solana network address, or wallet, is associated with a unique “public key” and “private key” pair. To receive Solana in a peer-to-peer transaction, the Solana recipient must provide
its public key to the party initiating the transfer. This activity is analogous to a recipient for a transaction in U.S. dollars providing a routing address in wire instructions to the payor so that cash may be wired to the recipient’s account. The
payor approves the transfer to the address provided by the recipient by “signing” a transaction that consists of the recipient’s public key with the private key of the address from which the payor is transferring the Solana. The recipient, however,
does not make public or provide to the sender its related private key, only its public key.
Neither the recipient nor the sender reveal their private keys in a peer-to-peer transaction, because the private key authorizes transfer of the funds in that address to other users. Therefore, if
a user loses their private key, the user may permanently lose access to the Solana contained in the associated address. Likewise, Solana is irretrievably lost if the private key associated with them is deleted and no backup has been made. When
sending Solana, a user’s Solana wallet must validate the transaction with the sender’s associated private key. In addition, since every computation on the Solana network requires processing power, there is a transaction fee involved with the transfer
that is paid by the payor and the resulting digitally
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validated transaction is sent by the user’s Solana network software program to the Solana network validators to allow transaction confirmation.
Solana network validators record and confirm transactions when they validate and add blocks of information to the Solana blockchain. No minimum amount of Solana is required to become a validator,
which allows them to activate a unique validator key pair (consisting of a public and private validator key). When a validator is selected to validate a block, it creates that block, which includes data relating to (i) the verification of newly
submitted transaction requests and accepted transactions and (ii) a reference to the prior block in the Solana blockchain to which the new block is being added. The validator becomes aware of outstanding unrecorded transactions through the data
packet transmission and distribution discussed above.
Upon the addition of a block of Solana transactions, the Solana network software program of both the spending party and the receiving party will show confirmation of the transaction on the Solana
blockchain and reflect an adjustment to the Solana balance in each party’s Solana network public key, completing the Solana transaction. Once a transaction is confirmed on the Solana blockchain, it is irreversible.
Some Solana transactions are conducted “off-blockchain” and are therefore not recorded in the Solana blockchain. Some “off-blockchain transactions” involve the transfer of control over, or
ownership of, a specific digital wallet holding Solana or the reallocation of ownership of certain Solana in a digital wallet containing assets owned by multiple persons, such as a digital wallet maintained by a digital assets platform. In contrast
to on-blockchain transactions, which are publicly recorded on the Solana blockchain, information and data regarding off-blockchain transactions are generally not publicly available. Therefore, off-blockchain transactions are not truly Solana
transactions in that they do not involve the transfer of transaction data on the Solana network and do not reflect a movement of Solana between addresses recorded in the Solana blockchain. For these reasons, off-blockchain transactions are subject to
risks as any such transfer of Solana ownership is not protected by the protocol behind the Solana network or recorded in, and validated through, the blockchain mechanism.
Creation of New Solana
Initial Creation of Solana
Unlike other digital assets such as Bitcoin, which are solely created through a progressive mining process, 500 million SOL were created in connection with the launch of the Solana network. The initial 500 million
Solana were distributed as follows:
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Investors: 189 million SOL, or 37.8% of the supply, was sold in private sales to venture capital and other investors conducted between 2018 to 2021.
|
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Solana Foundation: 52 million SOL, or 10.4% of the supply, was distributed to the SOL Foundation for operational costs incurred in the development of the Solana network.
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Solana Labs, Inc.: 64 million SOL, or 12.8% of the supply, was retained by Solana Labs to be used, at least in part, to compensate the employees of Solana Labs.
|
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Community: 195 million SOL, or 39.0% of the supply, was distributed to the Solana Foundation to be deployed as bounties, incentive programs, marketing and grants.
|
Following the launch of the Solana network, SOL supply increases through a progressive minting process. SOL supply and issuance rate varies based on factors such as recent use of the network.
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Proof-of-Stake Process
Unlike proof-of-work, in which validators expend computational resources to compete to validate transactions and are rewarded coins in proportion to the amount of computational resources expended,
in proof-of-stake, validators risk or “stake” coins to compete to be randomly selected to validate transactions and are rewarded coins in proportion to the amount of coins staked. Any malicious activity, such as validating multiple blocks,
disagreeing with the eventual consensus or otherwise violating protocol rules, results in the forfeiture or “slashing” of a portion of the staked coins. Proof-of-stake is believed by some to be more energy efficient and scalable than proof-of-work.
Under a proof-of-stake protocol, token holders who voluntarily commit to staking are given the exclusive right to validate transactions and participate in consensus. Token holders can elect to
stake their SOL in order to earn SOL tokens as staking rewards. Token holders can actively participate in the staking of their SOL by operating a validator node.
Alternatively, token holders can participate in staking by delegating their SOL to a validator node operated by another party. Validator nodes are selected by the Solana network to validate
transactions and earn staked SOL rewards for completing such validation. Approximately every 400-600 milliseconds, a new block is added to the Solana network with the latest transactions processed by the network, and the validator that generated this
block is awarded SOL. As such, there is not a competitive race to solve a mathematical puzzle that prevails in a proof-of-work consensus mechanism.
Fees are paid to validators that participate in the consensus and propose new blocks on the blockchain and other validators earn much lower fees for attesting to each block. Validators perform both
roles on a continuous basis and are called upon on a basis determined by the protocol. The SOL trading market may be impacted by the supply of SOL that voluntarily elects to commit to staking. The Solana network issues a fixed amount of rewards for
voting on blocks, which are divided among the participating validators. The less validators and the less users staking their SOL, the more rewards are available, and vice versa.
Staking
The Sponsor seeks to stake substantially all of the Trust’s assets through one or more trusted Staking Providers. In consideration for any staking activity in which the Trust may engage, the
Trust would receive certain staking rewards of SOL tokens, which may be treated as income for U.S. federal income tax purposes. The amount of SOL the Trust may receive as reward for its staking activity can vary significantly. Staking activity
comes with a risk of loss of SOL. Staked assets are not subject to the protections enjoyed by depositors with FDIC or SIPC member institutions. The Trust may also be subject to “slashing” penalties. Slashings occur when a validator attests to two
different histories of the chain and penalties occur when a validator is offline for a prolonged period of time. In combination, they deter malicious validators from attacking blockchains. To date, no slashing penalty has been assessed on the
Solana network. The Sponsor believes that the Staking Providers are reputable and will not engage in harmful behavior that could lead to slashing or penalties but the Sponsor cannot guarantee that there will be no slashing penalties assessed.
In May of 2025 the SEC Division of Corporation Finance's staff issued a “Statement on Protocol Staking Activities” (the “Statement”). The Statement gave the SEC staff’s view regarding staking on
networks that use a proof-of-stake consensus mechanism. The staff's view is that some of these activities do not involve the offer and sale of securities within the meaning of the Securities Act and the Exchange Act. Accordingly, under such an
interpretations, the participants in such staking activities do not need to register these transactions with the SEC under the Securities Act. The Sponsor believes that the Trust’s staking activities are of the type described in the Statement and
therefore does not involve the purchase and sale of securities.
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However, if the staff or the SEC were to disagree with the Sponsor’s position, or if the SEC or the staff were to take a position counter to the position stated in the Statement, the Trust or its
service providers may be deemed to be in violation of federal securities laws. The SEC Division of Corporation Finance subsequently gave a similar statement with regard to certain liquid staking activities in August of 2025.
Staking rewards are computed and issued once per Epoch. Generally, an Epoch is approximately two days long on the Solana network. Rewards accrued in a given Epoch are issued to all validators
and delegators in the first block of the following Epoch. Staking yield is presented as an annualized figure, though the number varies each Epoch as the inflation rate and total active stake continually changes. Staking rewards have historically
ranged from a low of 5.33% in June 2022 to a high of 12.36% in January 2025.
The treatment of staking in a grantor trust for U.S. federal income tax purposes is still developing. As a grantor trust, the Trust can undertake only certain types of activities. Please see
“Taxation of the Trust” below for more details.
Limits on Solana Supply.
The rate at which new SOL supply has been minted and put into circulation has varied since network launch. Additionally, the Solana protocol reduces the SOL supply by eliminating 50% of transaction
fees paid to the network. As a result, net changes in SOL supply are expected to vary in the future.
At network launch, the SOL circulating supply was 8 million SOL. Between network launch and September 30, 2025, the circulating supply of SOL increased by roughly 6,800% to approximately 544 million SOL.
In February 2021, the SOL supply inflation rate was changed from 0.1% to a new initial inflation rate of 8%. The 8% initial inflation rate is scheduled to decline in 15% increments until a long-term inflation rate of
1.5% is reached. As of September 30, 2025, the SOL supply issuance rate was approximately 4.2% on an annual basis before any offsets for eliminated transaction fees.
Modifications to the Solana Protocol
Historically, the Solana network’s development has been overseen by Solana Labs, the Solana Foundation and other core developers. The Solana Foundation and core developers are able to access and alter the Solana
network source code and, as a result, they are responsible for quasi-official releases of updates and other changes to the Solana network’s source code.
For example, in March 2020, the Solana network launched the Mainnet Beta version of the Solana network, one month after launching the testnet, Tour de SOL. Solana Labs led the development of these reference
implementations.
The Solana network operates using open-source protocols, meaning that any user can become a node by downloading the Solana Client and participating in the Solana network, and no permission of a central authority or
body is needed to do so. In addition, anyone can propose a modification to the Solana network’s source code and then propose that the Solana network community support the modification. These proposed modifications to the Solana network’s source code,
if adopted, can lead to forks (referred to as “planned forksˮ because they take place through a formal process). A forthcoming “hard fork” called “Alpenglow” was announced by developers of the Solana network in May of 2025 and is expected to reduce
transaction finality time and enhance network security. Alpenglow and other future updates could be improperly implemented or not implemented at all, potentially creating vulnerabilities, outages and disruptions in the Solana network, which would
impact the price of SOL and the Shares.
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In the case of planned forks, the core developers, including those associated with or funded by the Solana Foundation, are able to access and alter the Solana network source code and, as a result, they are typically
responsible for proposing quasi-official or widely publicized releases of updates and other changes to the Solana network’s source code called SIMDs. Any user can propose an idea for modifying the Solana network’s source code, and the core developers
are responsible for merging the proposed idea into the SIMD repository on GitHub, where it formally becomes a SIMD. However, the release of proposed updates to the Solana network’s source code by core developers does not guarantee that the updates
will be adopted. The developers of each Solana Client must agree to implement the SIMD’s changes to the Solana network in the source code for their respective client software, nodes must accept the changes made available by the developers of the
Solana Client software they use by choosing to individually download the modified Solana Client software, and ultimately a critical mass of validators and users - such as DApp and smart contract developers, as well as end users of DApps and smart
contracts, and anyone else who transacts on the Solana blockchain or Solana network - must support the shift, or the upgrades will lack adoption.
Typically in the case of a planned fork, once the SIMDs are formally introduced by being merged into the SIMD repository on GitHub, a robust debate within the Solana community as to the advisability of the proposed
change ordinarily follows. Assuming the core developers at the protocol level and the developers of individual Solana Clients reach a broad consensus among themselves in favor of introducing the change into the respective source code they are
responsible for developing and maintaining, the source code modification will be introduced and made available to download. A modification of the Solana network’s source code is only effective with respect to the Solana nodes that download it and
modify their Solana Clients accordingly, and in practice such decisions are heavily influenced by the preferences of validators and users. Typically, after a modification introduced and if a sufficiently broad critical mass of users and validators
support the modification and nodes download the modification into their individual Solana Clients, the change is implemented and the Solana network continues to operate uninterrupted, assuming there are no software issues (e.g., bugs, outages, etc.).
However, if less than a sufficiently broad critical mass (in practice, amounting to a substantial majority) of users and validators support the proposed modification and nodes refuse to download the modification to their Solana Clients, and the
modification is not backwards compatible with the Solana blockchain or network or the Solana Clients of nodes prior to their modification, the consequence would be what is known as a “hard fork” of the Solana network, with one group of nodes running
the pre-modified software, with users and validators continuing to use the pre-modified software, while the other group would adopt and run the modified software. See “Risk Factors -A temporary or permanent “fork” or “clone” could adversely affect an
investment in the Shares.”
Core development of the Solana source code has increasingly focused on modifications of the Solana protocol to increase speed and scalability and to allow for financial and non-financial next generation uses. The
Trust’s activities will not directly relate to scalability or upgrade projects, though such projects may potentially increase demand for Solana and the utility of the Solana network as a whole. Conversely, if they are unsuccessful or they cause users
or application or smart contract developers to migrate away from the Solana blockchain, demand for SOL could potentially be reduced. Also, projects that operate and are built within the Layer 1 Solana blockchain and network may increase the data flow
on the Solana network and could either “bloat” the size of the Solana blockchain or slow confirmation times.
Forks and Airdrops
A “hard fork” of the Solana network (or any other a proof-of-stake digital asset network) occurs when there is a disagreement among users and validators over modifications to the network, which are
typically made through software upgrades and subsequently accepted or rejected through downloads or lack thereof of the relevant software upgrade by users. If less than a substantial majority of users and validators consent to a proposed
modification, and the modification is not compatible with the software prior to its modification, a fork in the blockchain results, with one prong running the pre-modified software and the other running
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the modified software. The effect of such a fork is the existence of two versions of the network running in parallel, yet lacking interchangeability. After a fork, holders of the original digital
asset typically end up holding equal amounts of the original digital asset and the new digital asset.
For example, in August 2017, bitcoin “forked” into bitcoin and a new digital asset, bitcoin cash, as a result of a several-year dispute over how to increase transaction throughput. The solution
favored by the majority of users and miners was to make software changes that would allow “off-chain” scaling solutions, such as the Lightning Network, which works by allowing secure transactions to occur in a separate network of bilateral payment
channels that only periodically settle through a transaction on the main Bitcoin network. A minority group favored a less complex approach of simply increasing the number of transactions that can be validated at the same time. A sizable minority of
miners adopted software that implemented the latter approach, which effectively created a new network, the Bitcoin Cash network, with a transaction history identical to that of the Bitcoin Network. The identical transaction history meant that each
holder of bitcoin at the time of the new network’s formation continued to hold bitcoin for use on the Bitcoin Cash network, but also received an equal amount of Bitcoin Cash for use on the new network.
Forks may also occur after a significant security breach. For example, in June 2016, a smart contract developed and deployed on the Ethereum network was hacked and approximately $60 million worth of
ether was stolen, which resulted in most participants in the Ethereum ecosystem electing to adopt a hard fork that effectively reversed the hack. However, a minority of users continued to develop the old blockchain, now referred to as “Ethereum
Classic” with the digital asset on that blockchain also named ether, or ETC. Ethereum Classic’s ether remains traded on several digital asset trading platforms.
Additionally, a fork could be introduced by an unintentional, unanticipated software flaw in the multiple versions of otherwise compatible software users run for any given digital asset. Such a fork
could adversely affect SOL’s viability. It is possible, however, that a substantial number of users and validators could adopt an incompatible version of the network while resisting community-led efforts to merge the two chains, resulting in a
permanent fork.
A hard fork can introduce new security risks. Another possible result of a hard fork is an inherent decrease in the level of security. After a hard fork, it may become easier for an individual
validator or validator pool to exceed 50% of the processing power of the Solana network, thereby making the network more susceptible to attack. A fork in the Solana network could adversely affect an investment in the Shares.
In addition to forks, SOL (or any other digital asset) may become subject to a similar occurrence known as an “airdrop.” In an airdrop, the promoters of a new digital asset announce to holders of
another digital asset that they will be entitled to claim a certain amount of the new digital asset for free simply by virtue of having held the original digital asset at a certain point in time leading up to the airdrop. For example, in March 2017,
the promoters of Stellar Lumens announced that anyone that owned ether as of June 26, 2017 could claim, until August 27, 2017, a certain amount of Stellar Lumens. Airdrops could create operational security, legal or regulatory, or other risks for the
Trust, the Sponsor, Authorized Participants, or other entities.
From time to time, the Trust may be entitled to Incidental Rights or IR Assets by virtue of its ownership of SOL, generally through a fork in the Solana blockchain, an airdrop offered to holders of SOL or other similar
event.
In the event the Trust becomes entitled to Incidental Rights or IR Assets by virtue of its ownership of SOL, the Sponsor will instruct the Trust to immediately and irrevocably disclaim all rights
to the IR Assets so created. SOL is the only digital asset that will be held by the Trust. In the event the Trust seeks to change
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its treatment of Incidental Rights or IR Assets, an application would need to be filed with the SEC by the Exchange seeking approval to amend its listing rules.
In the event of a fork, the Sponsor will, as permitted by the terms of the Trust Agreement, determine which network it believes is generally accepted as the Solana network and should therefore be
considered the appropriate network, and the associated asset as SOL, for the Trust’s purposes.
If the Trust modifies its policy on forks and airdrops, notice to Shareholders will be provided on the Trust’s website, in a prospectus supplement, through a current report on Form 8-K and/or in
the Trust’s annual or quarterly reports.
Forms of Attack Against the Solana network
All networked systems are vulnerable to various kinds of attacks. As with any computer network, the Solana network contains certain vulnerabilities. For example, the Solana network is currently
vulnerable to a “51% attack” where, if a validator or group of validators acting in concert were to gain control of more than the relevant threshold of the staked SOL, a malicious actor would be able to gain full control of the network and the
ability to manipulate the Solana blockchain. Although referred to generically as “51% attacks”, there are different thresholds that could lead to different types of attack on the consensus process. For more information, see “Risk Factors—Flaws in
the source code of Solana, or flaws in the underlying cryptography, could leave the Solana network vulnerable to a multitude of attack vectors.” As of September 30, 2025, the top three largest staking pools controlled nearly 69% of the SOL staked
on the Solana network.
In addition, many digital asset networks have been subjected to a number of denial-of-service attacks, which has led to temporary delays in block creation and in the transfer of SOL. Any similar
attacks on the Solana network that impact the ability to transfer SOL could have a material adverse effect on the price of SOL and the value of the Shares.
For example, on September 14, 2021, the Solana network experienced a significant disruption, later attributed to a type of denial-of-service attack, and was offline for 17 hours, only returning to full functionality 24
hours later. While persons associated with Solana Labs and/or the Solana Foundation are understood to have played a key role in bringing the network back online, the broader community also played a key role, as Solana validators coordinated to
upgrade and restart the network. Any similar attacks on the Solana network that impact the ability to transfer Solana could have a material adverse effect on the price of SOL and the value of the Shares.
This is not intended as an exhaustive list of all forms of attack against the Solana network. For additional information, see the “Risk Factors” section of this Prospectus.
Market Participants
Validators
In proof-of-stake, validators risk or stake coins to compete to be randomly selected to validate transactions and are rewarded for performing their responsibilities and behaving in accordance with
protocol rules. Malfunctions that cause validators to go offline and, in turn, inhibit them from performing their duties, can result in financial penalties (e.g., inactivity leak). Any malicious activity, such as validating multiple blocks for the
same slot, making incorrect attestations or otherwise violating protocol rules, results in the penalization or in extreme cases slashing of staked coins and forced exit from performing validator duties. The penalty varies depending on the type of
offense and correlation to potential offenses by other validators.
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Validators range from SOL enthusiasts to professional operations that design and build dedicated machines and data centers, including “clusters,” which are groups of validators that act cohesively and combine their
processing to confirm transactions. On the Solana network, a validator does not have any minimum staking requirement in order to participate in maintaining the network. When a validator confirms a transaction, the validator and any associated
stakers receive fees, including a base fee and a discretionary tip (“block rewards”). During the course of ordering transactions and validating blocks, validators may be able to prioritize certain transactions in return for increased transaction
fees, an incentive system known as “Maximal Extractable Value” or MEV. For example, in blockchain networks that facilitate DeFi protocols in particular, such as the Ethereum network, users may attempt to gain an advantage over other users by
increasing offered transaction fees to incentivize validators to give their submitted transaction requests priority. Validators less commonly capture MEV in the Solana network because, unlike the Ethereum network, it does not publicly expose
transactions before they are accepted by a validator. However, some efforts are underway to help Solana Validators consistently capture MEV.
Block rewards are not newly minted SOL from inflation but are composed of transaction fees, with half the fee being burned and the other half going to the validator who produces and validates the block. Validators
also earn through inflation rewards for securing the network and may receive additional revenue from the MEV. Validators are paid immediately upon block production, and delegators receive their share of rewards from the validator they stake with,
usually at the end of an epoch. As such, block rewards and transaction fees are not considered staking rewards and will not accrete to the Trust.
Investment and Speculative Sector
This sector includes the investment and trading activities of both private and professional investors and speculators. Historically, larger financial services institutions are publicly reported to
have limited involvement in investment and trading in digital assets, although the participation landscape is beginning to change. Currently, there is relatively limited use of digital assets in the retail and commercial marketplace in comparison to
relatively extensive use by speculators, and a significant portion of demand for digital assets is generated by speculators and investors seeking to profit from the short- or long-term holding of digital assets.
Retail Sector
The retail sector includes users transacting in direct peer-to-peer SOL transactions through the direct sending of SOL over the Solana network. The retail sector also includes transactions in which
consumers pay for goods or services from commercial or service businesses through direct transactions or third-party service providers, although the use of SOL as a means of payment is still developing and has not been accepted in the same manner as
bitcoin due to SOL’s relative nascency and because SOL has a generally different purpose than bitcoin. In addition, end users of DApps and smart contracts built on the Layer 1 Solana network can access many types of goods and services and engage in a
variety of transactions using the functionality of the relevant DApp or smart contract.
Service Sector
This sector includes companies that provide a variety of services including the buying, selling, payment processing and storing of SOL. For example, Coinbase, Kraken, and Gemini are some of the
larger Solana trading platforms by volume traded. Coinbase Custody Trust Company, LLC, the Solana Custodian for the Trust, is a digital asset custodian that provides custodial accounts that store SOL for users. If Solana network continues grows in
adoption, it is anticipated that service providers may expand the currently available range of services and that additional parties will enter the service sector for the Solana network.
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Competition
As of September 2025, over 17,000 different digital tokens are tracked CoinGecko.com, of which Solana is currently the 6th largest digital asset by market capitalization. While Solana
has enjoyed some success in its limited history, the aggregate value of outstanding SOL is smaller than that of bitcoin and ether and may be eclipsed by the more rapid development of other digital assets. In addition, a number of newer digital assets
also function as smart contracts platforms, including Avalanche and Cardano. Some industry groups are also creating private, permissioned blockchain versions of Solana.
Government Oversight
As digital assets have grown in both popularity and market size, the U.S. Congress and a number of U.S. federal and state agencies (including FinCEN, SEC, OCC, CFTC, FINRA, the CFPB, the Department
of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS, the Office of the Comptroller of the Currency, the FDIC, the Federal Reserve and state financial institution and regulators) have been examining the
operations of digital asset networks, digital asset users and the digital asset markets, with particular focus on the extent to which digital assets can be used to launder the proceeds of illegal activities or fund criminal or terrorist enterprises
and the safety and soundness of exchanges or other service providers that hold or custody digital assets for users. Many of these state and federal agencies have issued consumer advisories regarding the risks posed by digital assets to investors.
Recently, President Trump has issued executive orders addressing the administration’s intention to establish a comprehensive digital asset regulatory framework. It is not possible to predict
whether, or when, any of these developments will lead to Congress granting additional authorities to the SEC or other regulators, what the nature of such additional authorities might be, how additional legislation and/or regulatory oversight might
impact the ability of digital asset markets to function or how any new regulations or changes to existing regulations might impact the value of digital assets generally and SOL held by the Trust specifically. The consequences of increased federal
regulation of digital assets and digital asset activities could have a material adverse effect on the Trust and the Shares.
In addition, the SEC, U.S. state securities regulators and several foreign governments have issued warnings and instituted legal proceedings in which they argue that certain digital assets may be
classified as securities and that both those digital assets and any related initial coin offerings are subject to securities regulations. The outcomes of these proceedings, as well as ongoing and future regulatory actions may alter, perhaps to a
materially adverse extent, the nature of an investment in the Shares or the ability of the Trust to continue to operate. Additionally, U.S. state and federal, and foreign regulators and legislatures have taken action against virtual currency
businesses or enacted restrictive regimes in response to adverse publicity arising from hacks, consumer harm, or criminal activity stemming from virtual currency activity.
Various foreign jurisdictions have, and may continue to, in the near future, adopt laws, regulations or directives that may affect a digital asset network, the digital asset markets, and their users, particularly
digital asset exchanges and service providers that fall within such jurisdictions’ regulatory scope.
Spot Solana Markets
Solana spot markets typically permit investors to open accounts with the market and then purchase and sell SOL via websites or through mobile applications. Prices for trades on Solana spot markets are typically
reported publicly. An investor opening a trading account must deposit an accepted government-issued currency into their account with the spot market, or a previously acquired digital asset, before they can purchase or sell assets on the spot market.
The process of establishing an account with a Solana market and trading SOL is different from, and should not be confused with, the process of users sending SOL from one
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Solana address to another Solana address on the Solana blockchain. This latter process is an activity that occurs on the Solana network, while the former is an activity that occurs entirely on the private website
operated by the spot market. The spot market typically records the investor’s ownership of SOL in its internal books and records, rather than on the Solana blockchain. The spot market ordinarily does not transfer SOL to the investor on the Solana
blockchain unless the investor makes a request to the exchange to withdraw the SOL in their exchange account to an off-exchange Solana wallet.
Outside of the spot markets, SOL can be traded in the over the counter (“OTC”) market in transactions that are not publicly reported. The OTC market is largely institutional in nature, and OTC market participants
generally consist of institutional entities, such as firms that offer two-sided liquidity for SOL, investment managers, proprietary trading firms, high-net-worth individuals that trade SOL on a proprietary basis, entities with sizeable SOL holdings,
and family offices. The OTC market provides a relatively flexible market in terms of quotes, price, quantity, and other factors, although it tends to involve large blocks of SOL. The OTC market has no formal structure and no open-outcry meeting
place. Parties engaging in OTC transactions will agree upon a price - often via phone or email - and then one of the two parties will then initiate the transaction. For example, a seller of SOL could initiate the transaction by sending the SOL to the
buyer’s Solana address. The buyer would then wire U.S. dollars to the seller’s bank account. OTC trades are sometimes hedged and eventually settled with concomitant trades on Solana spot markets.
THE TRUST
Overview of the Trust
The Trust is an exchange-traded fund that issues Shares that trade on the Exchange under the ticker symbol QSOL. The Trust’s investment objective is to reflect the performance of the spot price of
SOL as measured using the Benchmark, as adjusted to reflect the SOL staking rewards earned by the Trust and the Trust’s expenses and other liabilities. The Trust expects to outperform the Benchmark before taking its expenses and liabilities into
account due to its plans to receive SOL staking rewards
In seeking to achieve its investment objective, the Trust will hold SOL and will seek to stake substantially all of its SOL to earn staking rewards to the extent the Trust, in the Sponsor’s sole
discretion, can engage in staking without undue legal or regulatory risk, including jeopardizing its status as a grantor trust for U.S. federal income tax purposes (the “Staking Condition”). The Sponsor has determined that the Staking Condition
has been satisfied. As of the date of this Prospectus, the Sponsor intends to engage in staking on behalf of the Trust of substantially all of the Trust's SOL, subject to an amount that it determines to invest in the Liquidity Sleeve. The Trust
will value its Shares daily based on the value of the Benchmark as of 4:00 p.m. ET. The value of SOL held by the Trust is determined based on the fair market value (“FMV”) price for SOL, reflecting the execution price of SOL on its principal market
as determined by the Benchmark Provider. Invesco Capital Management LLC is the sponsor of the Trust, CSC Delaware Trust Company is the trustee of the Trust, and the Solana Custodian will hold all of the Trust’s SOL on the Trust’s behalf.
The Trust will process all creations and redemptions of Shares in transactions with Authorized Participants. When the Trust issues or redeems its Shares, it will do so only in blocks of 5,000
Shares (a "Creation Basket") based on the quantity of SOL attributable to each Share of the Trust (net of accrued but unpaid Sponsor fees and any accrued but unpaid expenses or liabilities).
Creation and redemption transactions will be conducted in exchange for SOL in-kind or cash.
When purchasing Creation Baskets in-kind with SOL, Authorized Participants and/or their designees will deliver SOL to the Solana Custodian. After confirming receipt of the SOL by the Solana
Custodian, the Transfer Agent is
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authorized by the Sponsor to issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of the creation order.
When purchasing Creation Baskets for cash, Authorized Participants will deliver cash to the Cash Custodian. The Execution Agent will be responsible for acquiring the requisite amount of SOL on
behalf of the Trust on an agency basis on the value date of the order. Once the Execution Agent selects a Solana Counterparty, the Cash Custodian will transfer cash to the Solana Counterparty in payment for the requisite amount of SOL. The SOL
acquired from the Solana Counterparty will be transferred to the Solana Custodian. After receipt of the SOL by the Solana Custodian, the Transfer Agent will issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of
the creation order.
When redeeming Creation Baskets in-kind for SOL, the Transfer Agent will redeem the Shares and the Solana Custodian will distribute the resulting SOL to the redeeming Authorized Participant
and/or its designee in satisfaction of the redemption order.
When redeeming Creation Baskets for cash, the Execution Agent will be responsible for selling the requisite amount of SOL on behalf of the Trust on an agency basis. Once the Execution Agent selects
a Solana Counterparty, the Solana Custodian will transfer SOL to the Solana Counterparty in return for the requisite cash payment. The cash received from the Solana Counterparty will be delivered to the Cash Custodian. After receipt of the cash
payment, the Transfer Agent will redeem the Shares and the Cash Custodian will distribute the resulting cash to the redeeming Authorized Participant in satisfaction of the redemption order.
In connection with both cash creation and cash redemption transactions, the Execution Agent, pursuant to the oversight of the Sponsor, will decide how and with which Solana Counterparty to
transact on the Trust’s behalf.
Subject to specific instructions from the Sponsor, the Execution Agent in its discretion is responsible for selecting the method of transacting, the price, the Solana Counterparty or Counterparties
and the trading platform or venue (if any) for the execution of each purchase and sale of SOL on behalf of the Trust. The Execution Agent has established policies and procedures for identifying, monitoring and performing due diligence on potential
Solana Counterparties and trading platforms or venues, with entities being added or removed from consideration on an ongoing basis. In addition, the Execution Agent evaluates Solana Counterparties and trading platforms or venues on a per-transaction
basis. At the time it selects a Solana Counterparty for any specific transaction, the Execution Agent may consider a number of factors in an effort to seek to achieve “best execution,” including price, transaction costs, speed, and likelihood of
execution and settlement, taking into account the size of the transaction and the experience and capabilities of the Solana Counterparty. Relying on its history of transacting in SOL, the Execution Agent assesses Solana Counterparties in seeking to
achieve the best overall outcome for the Trust. Although the Trust is relatively new, and therefore does not have a long history of trading SOL, the Execution Agent (and its asset management affiliates) have extensive experience, having traded over
$12.5 Billion in digital assets in 2020 across over ten counterparties for other accounts.
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As of the date of this Prospectus, Virtu Financial Singapore Pte. Ltd. , JSCT, LLC, Flow Traders B.V., FalconX Bravo, Inc., and Cumberland DRW LLC have been identified by the Execution Agent as
Solana Counterparties. Each of these Solana Counterparties are, and any other Solana Counterparty the Execution Agent, on behalf of the Trust, places orders with in the future will be, subject to U.S. federal and/or state licensing requirements or
similar laws in non-U.S. jurisdictions, and maintain practices and policies designed to comply with AML and KYC regulations or similar laws in non-U.S. jurisdictions. The Execution Agent, on behalf of the Trust, may engage additional Solana
Counterparties at any time. JSCT, LLC is an affiliate of Jane Street Capital LLC and Virtu Financial Singapore Pte. Ltd. is an affiliate of Virtu Americas LLC. Each of Jane Street Capital LLC and Virtu Americas LLC is an Authorized Participant.
The Trust expects to purchase or sell SOL in connection with cash creation or redemption transactions, and may direct the Execution Agent to sell SOL on behalf of the Trust to pay certain
expenses, including the Sponsor Fee and as part of liquidating staking rewards for cash to pay quarterly distributions to Shareholders. Each creating or redeeming Authorized Participant will be charged (i) a transaction fee and (ii) the Custody
Transaction Fee in connection with each creation or redemption transaction.
To support the ability of Authorized Participants to provide liquidity at prices that reflect the value of the Trust’s assets and to facilitate orderly transactions in the Shares, the Trust will
ordinarily process redemptions of Creation Baskets within two business days following receipt of a redemption request by an Authorized Participant.
Creation Baskets are expected to be created when there is sufficient demand for Shares, including when the market price per Share is at a premium to the NAV. Authorized Participants are expected to
sell such Shares to the public at prices that reflect, among other factors, the value of the Trust’s assets, supply of and demand for Shares and market conditions at the time of a transaction. Similarly, Creation Baskets are expected to be redeemed
when the market price per Share is at a discount to the NAV. Investors seeking to purchase or sell Shares on any day are expected to transact in the secondary market, on the Exchange or other national securities exchanges, at the market price per
Share, rather than through the creation or redemption of Creation Baskets.
The Sponsor believes that the design of the Trust will enable Investors to effectively and efficiently implement strategic and tactical asset allocation strategies that use SOL by investing in the
Shares rather than directly in SOL.
Description of Lukka Prime Solana Reference Rate
The Benchmark is designed to provide an estimated fair market value for SOL, in a manner that aligns with U.S. GAAP and IFRS accounting guidelines regarding fair market value measurements. In this
regard, the Benchmark Provider seeks to identify a “principal market” each day for SOL, by evaluating eligible Solana trading platforms across a variety of different criteria, including the trading platforms’ oversight and governance frameworks,
microstructure efficiency, trading volume, data transparency and data integrity. As of September 30, 2025, the following trading platforms are considered to be eligible trading platforms by the Benchmark Provider: Binance, Bitfinex, Bitflyer,
Bitstamp, Bullish, Coinbase, Crypto.com, Gate.io, Gemini, HitBTC, Huobi, itBit, Kraken, KuCoin, LMAX, MEXC Global, OKX and Poloniex (collectively, “Benchmark Pricing Sources”). The Benchmark Provider reviews trading platforms eligible for inclusion
in the Benchmark quarterly. In determining which trading platforms to include, the Benchmark Provider evaluates each trading platform using proprietary ratings criteria. The Benchmark Provider periodically reassesses the trading platforms eligible to
be considered Benchmark Pricing Sources, and makes adjustments as needed.
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In pursuit of its commitment to provide the highest quality, institutional grade product offerings, the Benchmark Provider adheres to strict oversight practices. As part of this oversight, the
Benchmark Provider maintains formal governance boards to oversee its data products. The Benchmark Provider’s Price Integrity Oversight Board (“PIOB”) seeks to ensure the integrity and validity of the Benchmark Provider’s pricing and valuation
products and to also ensure that products remain fit for purpose. One of the PIOB’s responsibilities, among others, is to determine the market data that is utilized in the Benchmark Provider’s pricing and valuation processes. This includes any
approval of new sources of market data and the suspension or discontinuation of existing sources of market data. Additionally, the Benchmark Provider’s PIOB regularly reviews eligible trading platforms, including any new sources of pricing
information. As it pertains to the impact on the NAV of the Trust, the continuous monitoring of pricing data helps ensure that pricing accurately reflects the economic reality that the benchmark is intended to measure. A change in the Benchmark
Pricing Sources may result in a change in the Trust’s NAV.
The Benchmark Provider launched the Benchmark in August 2024, and the Benchmark has been back-populated to August 24, 2020. The below graph compares the historical Benchmark returns to the prices
on each of the Benchmark Pricing Sources with U.S. Dollar-SOL trading pairs from January 1, 2024 to June 1, 2025.
As is evident from the foregoing graph and as expected given arbitrage activity across trading platforms, the historic Benchmark returns have aligned closely to the prices of SOL on each of the
Benchmark Pricing Sources with U.S. Dollar-SOL trading pairs.
The below table contains the market share and volume information for each Benchmark Pricing Source with U.S. Dollar-SOL trading pairs. The below table shows the percentage that each Benchmark
Pricing Source’s volume represents out of the sum of the volumes of all of the Benchmark Pricing Sources with U.S. Dollar- Solana trading pairs. Note that the Benchmark Provider will prioritize U.S. Dollar trading pairs before using trading platforms
where other pairs, such as stablecoins, are used:
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|
Lukka Prime Solana Volumes SOLN-USD (Jan 1, 2024 to Sept 30, 2025)
|
||
|
Trading Platform
|
Volume (SOLN)
|
Volume (%)
|
|
Bitfinex
|
16,655,013
|
1.33%
|
|
Bitstamp
|
44,242,422
|
3.53%
|
|
Bullish
|
6,360,204
|
0.51%
|
|
Coinbase
|
743,432,916
|
59.27%
|
|
Crypto.com
|
145,226,394
|
11.58%
|
|
Gemini
|
21,097,082
|
1.68%
|
|
itBit
|
2,661,912
|
0.21%
|
|
Kraken
|
228,893,543
|
18.25%
|
|
LMAX
|
38,844,161
|
3.10%
|
|
OKEx
|
6,963,458
|
0.56%
|
Trading platforms with U.S. Dollar trading pairs:
Bitfinex: A British Virgin Islands-based trading platform registered as a Money Services Business with the Financial Crimes Enforcement
Network. Bitfinex is also licensed as a Digital Asset Service Provider from the Central Reserve Bank of El Salvador.
Bitflyer: A Japan-based trading platform registered as a Virtual Currency Exchange from the Japan Financial Services Agency. Bitflyer is
also licensed as a virtual currency business under the NYSDFS BitLicense.
Bittrex: A Liechtenstein-based trading platform registered as a Money Services Business with the Financial Crimes Enforcement Network.
Bittrex is also licensed in Bermuda and Liechtenstein. On November 20, 2023, Bittrex announced its intention to wind down its operations and disable trading activity effective December 4, 2023. On November 21, 2023, Bittrex was removed as a Benchmark
Pricing Source as a result of its announcement.
Bitstamp: A U.K.-based trading platform registered as a Money Services Business with the Financial Crimes Enforcement Network. Bitstamp is
also licensed as a virtual currency business under the NYSDFS BitLicense.
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Coinbase: A U.S.-based trading platform registered as a Money Services Business with the Financial Crimes Enforcement Network. Coinbase is
also licensed as a virtual currency business under the NYSDFS BitLicense.
Crypto.com: A Singapore-based trading platform with a Digital Token License from the Monetary Authority of Singapore. Crypto.com is also
registered as a Money Services Business with the Financial Crimes Enforcement Network.
Gemini: A U.S.-based trading platform registered as a Money Services Business with the Financial Crimes Enforcement Network. Gemini is
also licensed as a virtual currency business under the NYSDFS BitLicense.
itBit: A U.S.-based trading platform registered as a Money Services Business with the Financial Crimes Enforcement Network. itBit is also
chartered by the NYSDFS as a limited purpose trust company.
Kraken: A U.S.-based trading platform registered as a Money Services Business with the Financial Crimes Enforcement Network. Kraken is
also registered as a Digital Currency Exchange Provider with the Australian Transaction Reports and Analysis Centre.
LMAX: A Gibraltar-based trading platform registered as a Money Services Business with the Financial Crimes Enforcement Network. LMAX is
also registered as a DLT provider by the Gibraltar Financial Services Commission.
Trading platforms without U.S. Dollar trading pairs:
Binance: A Cayman Islands-based trading platform with a Digital Asset Service Provider registration from the Autorité des Marchés
Financiers, MVP Preparatory License from Dubai’s Virtual Assets Regulatory Authority and a variety of other licenses across the European and Asia-Pacific regions.
Gate.io: A Cayman Islands-based trading platform registered as a Money Services Business with the Financial Crimes Enforcement Network.
Gate.io is also registered as a DLT provider by the Gibraltar Financial Services Commission and a variety of other licenses across the European and Asia-Pacific regions.
HitBTC: A British Virgin Islands-based trading platform that currently does not hold any licenses from any licensing authorities.
Huobi: A Gibraltar-based trading platform with a Distributed Ledger Technology Provider License from the Gibraltar Financial Services
Commission. Huobi is also registered as a Digital Currency Exchange Provider with the Australian Transaction Reports and Analysis Centre.
KuCoin: A Seychelles-based trading platform that currently does not hold any licenses from any licensing authorities.
MEXC Global: A Seychelles-based trading platform registered as a Digital Currency Exchange Provider with the Australian Transaction
Reports and Analysis Centre and a variety of other licenses across the European region.
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OKX (fka OKEx): A Seychelles-based trading platform with an MVP Preparatory License from Dubai’s Virtual Assets Regulatory Authority.
Poloniex: A Seychelles-based trading platform that currently does not hold any licenses from any licensing authorities.
The Trust confirms that the Sponsor may, in its sole discretion, change either the Benchmark or Benchmark Provider without Shareholder approval.
In the event that the Benchmark Provider changes the methodology of the Benchmark, the Benchmark Provider will inform the Sponsor of the nature of the change and the timeline for implementation.
The Sponsor will notify investors of material changes to the Benchmark, or the Sponsor’s decision to change the Benchmark or the Benchmark Provider, by providing notice to investors and market participants as promptly as practicable through some
combination of press release, website disclosure, 8-K filing or registration statement supplement, in addition to any notice to the listing exchange required under applicable listing rules.
In determining the value of SOL, the Benchmark Provider applies a five-step weighting process for identifying the principal trading platform for SOL and the last price on that trading platform. A
Base Exchange Score (“BES”) that takes into account the criteria above is assigned to each Benchmark Pricing Source in order to select the most appropriate primary trading platform and then an executed trading platform price is determined at 4:00
p.m. ET. The characteristics of each trading platform are weighted as follows for their BES:
| • |
Oversight (35%): This score reflects the rules in place to protect and to give access to investors and is a function of a variety of factors. The score assigned for trading platform oversight will
depend on parameters such as jurisdiction, regulation, “Know Your Customer and Anti-Money Laundering Compliance” (KYC/AML), etc. Benchmark Participants will receive a higher score if they are subject to more stringent regulation, including
comprehensive KYC/AML screening, and the level of currency oversight and regulation in their home jurisdiction.
|
| • |
Microstructure Efficiency (30%): The second trading platform characteristic is microstructure efficiency. The Benchmark takes the effective bid-ask spread as a proxy for efficiency. For each trading
platform and currency pair, the Benchmark takes an estimate of the “effective spread,” which is a common approach to measuring trade execution costs.
|
| • |
Data Integrity (25%): Data Integrity provides a metric of how consistent a trading platform’s trading activity is with its underlying market microstructure. This is done by aligning a trading
platform’s trade data for a given product with quotes data pertaining to the same market. Trading platforms whose traded prices deviate outside the spreads indicated by the quotes data are penalized. This would potentially expose nefarious
actions such as wash trading or other potential manipulation of data. The metric is computed by joining a sample of trades with quotes by trading platform, product and time. With this, the Benchmark Provider computes the maximum observed ask
price and the minimum observed bid price over a rolling window in time. This serves to define a range of possible trade prices that would be expected based on the quotes data. The Benchmark Provider then aggregates this dataset by trading
platform, computing the fraction of transactions where the trade price was within the expected range as computed in the prior step. This fraction is multiplied by 100 to give the data integrity score.
|
| • |
Data Transparency (10%): Transparency is the term used for a quality score that is determined by the level of detail of the data offered by a trading platform. Similar to the jurisdiction hierarchy,
Level 1, the highest level in the transparency hierarchy, is assigned 100 points and is reduced by
|
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20 points for each subsequent lower level. The most transparent (Level 1) trading platforms offer order-level data, followed by order book (Level 2), trade-level (Level 3),
candles (Level 4), and then no data (Level 5).
For financial reporting purposes, the Trust will determine the principal market for SOL in accordance with ASC Topic 820-10, and such determination is considered from the Trust’s perspective. The
Benchmark follows a methodology designed to identify the principal market for SOL at a given time. Procedures will be implemented by the Sponsor to review and confirm the prices utilized to value SOL reflect fair value in accordance with ASC Topic
820 and will be reviewed by the Sponsor’s Valuation Committee on a periodic basis.
With respect to the Trust’s Authorized Participants or their affiliates, the Trust notes that it has no authority over which trading platforms the Authorized Participants or their affiliates might
transact on, although the Trust expects that most Authorized Participants or their affiliates may transact on several of the trading platforms that are Benchmark Pricing Sources for the Benchmark Provider. The Trust notes that for transactions in
which it is selling SOL, it may do so in principal-to-principal transactions arranged by the Execution Agent, although the Trust is eligible to execute trades on all of the trading platforms used by the Benchmark Provider. While the principal to
principal market is the market in which the Execution Agent, on the Trust’s behalf, would normally transact for sales of SOL, in considering all information reasonably available in accordance with the guidance in ASC 820-10-35-5A, the Trust notes
that the identification of a principal market is completed by the Benchmark Provider based on a variety of different criteria including but not limited to trading platforms’ oversight and governance frameworks, microstructure efficiency, trading
volume, data transparency and data integrity. The Trust views this evidence to the contrary as appropriate basis to determine a primary market that is not the principal-to-principal market, in accordance with the guidance in ASC 820-10-35-5A. The
Sponsor performed extensive back testing of the Benchmark, comparing the Benchmark Provider’s historical designation of the primary trading platform and the daily pricing from said trading platform, relative to where the Trust is expected to
transact. The Sponsor concluded that the methodology consistently resulted in a principal market that aligns with the Trust’s expected transaction activities. Procedures will be implemented to review and confirm the above on at least a quarterly
basis, adjusting the frequency of that review if determined necessary by the Sponsor’s Valuation Committee.
The Trust and the Sponsor are not responsible for the calculations performed by the Benchmark Provider or for the development or implementation of the Benchmark Provider’s methodologies.
WITHOUT LIMITING THE FOREGOING, NONE OF LUKKA INC., THE SPONSOR, OR ANY OF THEIR RESPECTIVE SUBSIDIARIES OR AFFILIATES SHALL HAVE ANY LIABILITY FOR
ANY ERRORS,
OMISSIONS, DELAYS OR INTERRUPTIONS IN THE BENCHMARK PRICING PROCESS NONE OF LUKKA INC., THE SPONSOR, OR ANY OF THEIR RESPECTIVE SUBSIDIARIES OR AFFILIATES MAKES ANY EXPRESS OR IMPLIED WARRANTIES,
AND EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE WITH RESPECT TO THE PRICING SERVICES OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL LUKKA INC., THE SPONSOR,
OR ANY OF THEIR RESPECTIVE SUBSIDIARIES OR AFFILIATES HAVE ANY LIABILITY FOR ANY LOST PROFITS OR INDIRECT, PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES OR LOSSES, EVEN IF NOTIFIED OF THE POSSIBILITY THEREOF. THERE ARE NO THIRD-PARTY BENEFICIARIES OF
ANY AGREEMENTS OR ARRANGEMENTS BETWEEN LUKKA INC. AND THE SPONSOR OTHER THAN THEIR RESPECTIVE SUBSIDIARIES AND AFFILIATES.
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The Trust’s Expenses
The Trust will pay the Sponsor a unified fee of 0.25% per annum (the “Sponsor Fee”) as compensation for services performed under the Trust Agreement (as defined herein). The Trust’s only ordinary,
recurring expense is the Sponsor Fee.
The Sponsor Fee will be accrued daily and paid monthly in arrears in U.S. dollars, and will be calculated by the Administrator. The Sponsor may, at its sole discretion and from time to time,
waive all or a portion of the Sponsor’s Fee for stated periods of time. The Sponsor is under no obligation to waive any portion of its fees and any such waiver shall create no obligation to waive any such fees during any period not covered by the
waiver. The Administrator will calculate the Sponsor Fee on a daily basis by applying the 0.25% annualized rate to the Trust’s total net assets. To cover the Sponsor Fee, and extraordinary expenses not assumed by the Sponsor, the Sponsor or its
delegate will cause the Trust (or its delegate) to instruct the Execution Agent to convert SOL held by the Trust into U.S. dollars. At the direction of the Trust, the Execution Agent will seek to sell SOL at approximately the price at which it is
valued by the Trust and in the smallest amounts required to permit such payments as they become due, with the intention of minimizing the Trust’s holdings of assets other than SOL. Accordingly, the amount of SOL to be sold may vary from time to
time depending on the level of the Trust’s expenses and liabilities and the market price of SOL. Any cash held by the Trustee will not bear any interest. Each sale of SOL by the Trust to pay the Sponsor Fee or other Trust expenses will give rise to
taxable gain or loss to Shareholders. See “U.S. Federal Income Tax Consequences—Taxation of U.S. Shareholders.” The NAV of the Trust and the number of SOL represented by a Share will decline each time the Trust accrues the Sponsor Fee or any Trust
expenses not assumed by the Sponsor. The Trust is not responsible for paying any costs associated with the transfer of SOL to or from the Trust in connection with paying the Sponsor Fee or in connection with creation and redemption transactions,
except for potential borrowing costs under a short-term credit facility or alternative liquidity arrangement.
Except as noted below, the Sponsor has agreed to pay all of the Trust’s ordinary expenses out of the Sponsor Fee, including, but not limited to, the Trustee’s fees, the fees of the Administrator
and the Transfer Agent, the fees of the Solana Custodian, the fees of the Execution Agent, Exchange listing fees, SEC registration fees, printing and mailing costs, legal costs and audit fees. The Sponsor’s payment of such Trust expenses is not
subject to a cap. The Sponsor also paid the costs of the Trust’s organization.
The Trust will receive a portion of the staking rewards earned through its staking program in the form of SOL. The Staking Provider and Sponsor are entitled to receive a fee for their respective
roles in facilitating the Trust's staking program (collectively, "Staking Expenses"). The Trust will pay the Staking Expenses at a rate of 3% of the gross staking rewards received by the Trust. The staking rewards earned by the Trust will accrue to
the Trust’s account with the Solana Custodian and will generally be staked in the same way as the Trust’s already staked SOL. The expenses of staking the Trust’s SOL will be paid from the proceeds of the Trust's staking program and the Trust will
retain the remaining amount of the staking rewards.
The Trust may incur certain extraordinary expenses that are not assumed by the Sponsor. These include, but are not limited to, taxes and governmental charges, any applicable brokerage
commissions, financing fees, borrowing costs under a short term credit facility or alternative liquidity arrangement, Solana network fees and similar transaction fees, expenses and costs of any extraordinary services performed by the Sponsor (or
any other service provider) on behalf of the Trust to protect the Trust or the interests of Shareholders (including, for example, in connection with any fork of the Solana blockchain), any indemnification of the Sponsor, Cash Custodian, Solana
Custodian, Staking Provider, Administrator or other agents, service providers or counterparties of the Trust and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory
enforcement or investigation matters.
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CALCULATION OF NAV
General
The Shares are valued each Business Day as of 4:00 p.m. ET. The value of SOL held by the Trust is determined based on the fair market value price for SOL determined by the Benchmark Provider. In
this regard, the Benchmark Provider seeks to identify a “principal market” for SOL each day, by evaluating eligible SOL trading platforms across a variety of different criteria, including the trading platforms’ oversight and governance frameworks,
microstructure efficiency, trading volume, data transparency and data integrity. The Sponsor believes that use of the Benchmark mitigates against idiosyncratic exchange risk, as the failure of any individual Benchmark Pricing Source will not
materially impact pricing for the Trust. It also allows the Administrator to calculate the NAV in a manner that significantly deters manipulation.
As discussed, the fact that the NAV is based on data from multiple trading platforms makes manipulation more difficult in a well-arbitraged and fractured market, as a malicious actor would need to
manipulate multiple trading platforms simultaneously to impact the NAV.
The Trust’s NAV is an amount denominated in U.S. dollars and is not utilized in determining the number of Shares that an Authorized Participant will receive in creating Shares, or the value of SOL
that an Authorized Participant will receive in redeeming Shares, as those transactions are based on the Trust’s SOL holdings per Share. See “Creation and Redemption of Shares.”
The Trust’s NAV is calculated by:
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taking the current market value of its SOL (calculated by the Benchmark Provider) and any other assets;
|
| • |
subtracting any liabilities (including accrued but unpaid expenses); and
|
| • |
dividing that total by the total number of outstanding Shares.
|
The Administrator calculates the NAV of the Trust once each Business Day. The end-of-day SOL price is calculated using the execution price of SOL on the principal market selected by the Benchmark
Provider as of 4:00 p.m. ET. However, NAVs are not officially struck until later in the day (often by 5:30 p.m. ET and almost always by 8:00 p.m. ET). The daily valuation process will be overseen by the Sponsor’s Valuation Team. The pause between
4:00 p.m. ET and 5:30 p.m. ET (or later) provides the Sponsor’s Valuation Team an opportunity to algorithmically detect, flag, investigate, and address unusual pricing should it occur.
Consistent with the daily pricing of all assets held in the Sponsor’s funds that are registered under the 1940 Act, daily valuation oversight resides with the Sponsor’s Valuation Team. The
Sponsor’s Valuation Team is an independent control function within the Sponsor with the responsibility for oversight of asset pricing. Standardized controls (such as exception-based reports) are in place and run daily prior to NAV dissemination to
detect “unusual pricing.” This includes, but is not limited to, missing price reports, unchanged price reports, and large daily price variance reports. Specifically with respect to the Trust, the Sponsor’s Valuation Team will monitor the pricing of
the Benchmark to ensure that the Trust’s NAV is determined based on consistent, accurate pricing that the Sponsor believes is reflective of the value of the Trust’s SOL, and also a transparent methodology and process. In addition, the Sponsor’s
Valuation Team may seek information and recommendations from the Execution Agent, the Benchmark Provider, the Solana Custodian, the Prime Broker or others regarding SOL valuation issues and potential SOL market events.
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All price updates are communicated to the Administrator only by the Sponsor’s pricing team. No members of the Sponsor’s investment or other business-related teams are authorized to provide pricing
instructions to the Administrator. Price updates are communicated to the Administrator prior to NAV finalization and therefore would be incorporated in that day’s NAV.
The Sponsor’s Valuation Team will monitor for significant events related to digital assets that may impact the value of the Trust’s SOL, and will determine in good faith whether to fair value the
Trust’s SOL on a given day based on whether certain pre-determined criteria have been met. For example, if the price of SOL represented by the Benchmark deviates by more than 25 basis points from the level established by one or more Alternative
Benchmarks, then the Sponsor’s Valuation Team may (but is under no obligation to) perform additional analyses and make a recommendation as to whether to utilize an Alternative Benchmark. The Sponsor’s Valuation Team may also fair value the Trust’s
SOL using observed market transactions from various trading platforms, including some or all of the trading platforms included in the Benchmark.
In the event the Benchmark becomes unavailable or if the Sponsor or Administrator determines that the Benchmark does not reflect an accurate SOL price, an independent assessment to designate the
Trust’s principal market is performed by looking at pricing and transaction volume information from eligible trading platforms in which the Trust transacts only incorporating those. Typically, this will involve a multi-step process conducted by the
Sponsor’s Valuation Team to identify the principal market for SOL on a given day:
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First, a list of eligible SOL trading platforms in which the Trust transacts is compiled and ranked in descending order based on the prior twelve months of volume of SOL traded on each trading platform.
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Second, any trading platforms that do not comply with licensing requirements which are applicable to the Trust and the Authorized Participants are excluded.
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Third, reviews of intra-day pricing are completed to identify any material variances which may impact the price information provided by a particular trading platform. A SOL trading platform is then selected as the Trust’s principal market
and pricing consumed from that trading platform. Even if the Benchmark is deemed to be available and reliable, the aforementioned process is completed periodically as deemed necessary by the Sponsor’s Valuation Team in order to assess and
evaluate the effectiveness of the process.
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The SOL markets are generally open on days when U.S. markets are closed, which means that the value of the SOL owned by the Trust could change on days when Shares cannot be bought or sold.
The website for the Trust, www.invesco.com/QSOL, which will be publicly accessible at no charge, will contain the following information: (a) the prior Business Day’s NAV; (b) the prior
Business Day’s official closing price; (c) calculation of the premium or discount of such Cboe official closing price against such NAV; (d) data in chart form displaying the frequency distribution of discounts and premiums of the Cboe official
closing price against the NAV, within appropriate ranges for each of the four previous calendar quarters (or for the life of the Trust, if shorter); (e) the Prospectus; and (f) other applicable quantitative information. The Administrator will also
disseminate the Trust’s SOL holdings on a daily basis on the Trust’s website. The NAV for the Trust will be calculated by the Administrator once a day and will be disseminated daily to all market participants at the same time. Quotation and last sale
information regarding the Shares will be disseminated through the facilities of the Consolidated Tape Association (“CTA”).
The Trust’s periodic financial statements may not utilize the net asset value of the Trust determined by reference to the Benchmarks to the extent the methodology used to calculate the Benchmark is
deemed not to be consistent with GAAP. The Trust’s periodic financial statements will be prepared in accordance with
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the Financial Accounting Standards Board (“FASB”) ASC Topic 820 and utilize an exchange-traded price from the Trust’s principal market for SOL on the Trust’s financial statement measurement date.
The Sponsor will determine in its sole discretion the valuation sources and policies used to prepare the Trust’s financial statements in accordance with GAAP. The Trust intends to engage a third-party vendor to obtain a price from a principal market
for SOL, which will be determined and designated by such third-party vendor daily based on its consideration of several trading platform characteristics, including oversight, and the volume and frequency of trades. Under GAAP, such a price is
expected to be deemed a Level 1 input in accordance with the ASC Topic 820 because it is expected to be a quoted price in an active market for identical assets or liabilities.
To determine which market is the Trust’s principal market (or in the absence of a principal market, the most advantageous market) for purposes of determining fair value in preparing the Trust’s
financial statements, the Trust follows ASC 820-10, which outlines the application of fair value accounting. ASC 820-10 determines fair value to be the price that would be received for SOL in a current sale, which assumes an orderly transaction
between market participants on the measurement date. ASC 820-10 requires the Trust to assume that SOL is sold in its principal market to market participants or, in the absence of a principal market, the most advantageous market. Market participants
are defined as buyers and sellers in the principal or most advantageous market that are independent, knowledgeable, and willing and able to transact. The Trust may transact through Solana Counterparties, in multiple markets, and its application of
ASC 820-10 reflects this fact. The Trust anticipates that, while multiple venues and types of markets will be available to the Solana Trading Counterparties from whom the Sponsor acquires or disposes of the Trust’s SOL, the principal market in each
scenario is determined by looking at the market-based level of volume and SOL trading activity. Solana Counterparties may transact in a Brokered Market, a Dealer Market, Principal-to-Principal Markets and Exchange Markets, each as defined in the FASB
ASC Master Glossary. Based on information reasonably available to the Trust, Exchange Markets have the greatest volume and level of activity for the asset. The Trust therefore looks to accessible Exchange Markets as opposed to the Brokered Market,
Dealer Market and Principal-to-Principal Markets to determine its principal market. As a result of the aforementioned analysis, an Exchange Market has been selected as the Trust’s principal market. The Trust determines its principal market (or in the
absence of a principal market the most advantageous market) on a quarterly basis to determine which market is its Principal Market for the purpose of calculating fair value for the creation of quarterly and annual financial statements.
The process that the Sponsor has developed for identifying a principal market, as prescribed in ASC 820-10, which outlines the application of fair value accounting. The process begins by
identifying publicly available, well established and reputable SOL trading platforms (Exchange Markets, as defined in the FASB ASC Master Glossary), which are selected by the Sponsor and its affiliates in their sole discretion. Those markets include
Binance, Bitfinex, Bitflyer, Bitstamp, Bullish, Coinbase Pro, Crypto.com, Gate.io, Gemini, HitBTC, Huobi, itBit, Kraken, KuCoin, LMAX, MEXC Global, OKx, and Poloniex. The Sponsor then, through a service provider, calculates on each valuation period,
the highest volume venue during the 60-minute period prior to 4:00 ET for SOL. The Sponsor then identifies that market as the principal market for SOL during that period, and uses the price for SOL from that venue at 4:00 ET as the principal market
price.
Intraday Indicative Value
In order to provide updated information relating to the Trust for use by Shareholders and market professionals, the Benchmark Provider will calculate and disseminate during each day the NYSE is
open for regular trading an updated intraday indicative value (“IIV”). The IIV will be calculated by using the prior day’s closing NAV as a base and updating that value throughout the trading day to reflect changes in the most recently reported price
of SOL as reported by the Benchmark Provider or another reporting service.
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The IIV disseminated during each day the NYSE is open for regular trading should not be viewed as an actual real time update of the NAV, because NAV is calculated only once at the end of each
trading day based upon the relevant end of day value of the Trust’s SOL. The IIV will be calculated every second from 9:30 a.m. to 4:00 p.m. ET and disseminated on a per Share basis every 15 seconds during each day the NYSE is open for regular
trading. Lukka Inc. will disseminate the IIV value through the facilities of CTA/CQ High Speed Lines. In addition, the IIV will be published on the Exchange’s website and will be available through on-line information services such as Bloomberg and
Reuters. The IIV as of the time that the NAV is calculated on a given day may differ from the NAV for such day due to the differences in the time window of trades used to calculate each price (the NAV uses a 15-minute window, whereas the IIV draws
prices from the last trade on each trading platform in an effort to produce a relevant, real-time price).
There are many instances in the market today where the IIV as of the time that the NAV is calculated on a given day and the NAV of an ETF for such day are subtly different, whether due to the
calculation methodology, market hours overlap or other factors. The Sponsor has seen limited or no negative impact on trading, liquidity or other factors for exchange-traded funds in this situation. The Sponsor believes that the IIV will closely
track the globally integrated SOL price as reflected on the Benchmark Pricing Sources.
Dissemination of the IIV provides additional information that is not otherwise available to the public and is useful to Shareholders and market professionals in connection with the trading of the
Shares on the Exchange. Shareholders and market professionals will be able throughout the trading day to compare the market price of the Shares and the IIV. If the market price of the Shares diverges significantly from the IIV, market professionals
will have an incentive to execute arbitrage trades. For example, if the Trust appears to be trading at a discount compared to the IIV, a market professional could buy Shares on the Exchange and sell short futures contracts. Such arbitrage trades can
tighten the tracking between the market price of the Shares and the IIV, and thus can be beneficial to all market participants.
Stock Splits
The Sponsor reserves the right to adjust the Share price of the Trust in the future to maintain convenient trading ranges for Shareholders in the secondary market. Any adjustments would be
accomplished through stock splits or reverse stock splits. Such splits would decrease (in the case of a split) or increase (in the case of a reverse split) the proportionate NAV, but would have no effect on the net assets of the Trust or the
proportionate voting rights of Shareholders or the value of any Shareholder’s investment.
Other Assets
The fair values of any liquid assets held by the Trust primarily in the form of cash and certificates of deposits are included in the determination of NAV.
Liabilities
The fair value of the Trust’s liabilities is included in the determination of NAV. These liabilities are expected generally to consist only of the Sponsor Fee, although liabilities may also include
extraordinary expenses from time to time. See “The Trust—The Trust’s Expenses.”
Impact of Trust Expenses on the Trust’s NAV
The amount of SOL represented by the Shares will be reduced during the life of the Trust each time the Trust accrues the Sponsor Fee, and to pay for any extraordinary expenses. This dynamic will
occur irrespective of whether the value of the Trust’s assets, or the trading price of the Shares, rises or falls. Staking activities could have the opposite effect.
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ADDITIONAL INFORMATION ABOUT THE TRUST
The Trust
The Trust is a Delaware statutory trust, formed on June 12, 2025, pursuant to the Delaware Statutory Trust Act (“DSTA”). The Trust continuously issues common shares representing fractional
undivided beneficial interest in and ownership of the Trust that may be purchased and sold on the Exchange. The Trust operates pursuant to its Amended and Restated Declaration of Trust and Trust Agreement, dated as of November 28, 2025 (the “Trust
Agreement”). CSC Delaware Trust Company, a Delaware trust company, is the Delaware trustee of the Trust.
The Trust is not registered as an investment company under the 1940 Act 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 neither the Sponsor, nor the Trustee is subject to regulation as a commodity pool operator or a commodity trading adviser in connection with the
Shares.
The Trust is passively-managed and the Sponsor does not actively manage the SOL held by the Trust. This means that the Sponsor does not sell SOL at times when its price is high or acquire SOL at
low prices in the expectation of future price increases. It also means that the Sponsor does not make use of any of the hedging techniques available to professional SOL investors to attempt to reduce the risks of losses resulting from price
changes. The Trust will not utilize leverage, derivatives or any similar arrangements in seeking to meet its investment objective; however, the Trust may utilize a short term credit facility or an alternative liquidity arrangement for the purposes
of obtaining funds necessary to meet redemptions from the Trust.
The number of outstanding Shares is expected to increase and decrease from time to time as a result of the creation and redemption of Creation Baskets. The Trust creates and redeems Shares from
time to time, but only in one or more Creation Baskets. Creation and redemption transactions will be conducted in exchange for SOL in-kind or cash.
The Trust has no fixed termination date.
Dissolution of the Trust
The Trust will dissolve at the direction of the Sponsor, and the Sponsor will promptly notify Shareholders of such dissolution, if any of the following dissolution events occur:
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Shares are delisted from the Exchange and are not approved for listing on another national securities exchange within five Business Days of their delisting;
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180 days have elapsed since the Trustee notified the Sponsor of the Trustee’s election to resign or since the Sponsor removed the Trustee, and a successor trustee has not been appointed and accepted its appointment;
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the SEC determines that the Trust is an investment company under the 1940 Act, and the Sponsor has made the determination that dissolution of the Trust is advisable;
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the CFTC determines that the Trust is a commodity pool under the CEA, and the Sponsor has made the determination that dissolution of the Trust is advisable;
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the Trust is determined to be a “money service business” under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act, as amended (the “BSA”) and is required
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to comply with certain FinCEN regulations thereunder or is determined to be a “money transmitter” (or equivalent designation) under the laws of any state in which the Trust operates and is
required to seek licensing or otherwise comply with state licensing requirements, and the Sponsor has made the determination that dissolution of the Trust is advisable;
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a U.S. regulator requires the Trust to shut down or forces the Trust to liquidate its SOL;
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SOL is determined to be a “security” and is subject to regulation under U.S. federal securities laws;
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any ongoing event exists that either prevents the Trust from making or makes impractical the Trust’s reasonable efforts to make a fair determination of the price of SOL for purposes of determining the NAV of the Trust;
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the Sponsor determines that the aggregate net assets of the Trust in relation to the operating expenses of the Trust make it unreasonable or imprudent to continue the business of the Trust;
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the Trust fails to qualify for treatment, or ceases to be treated, as a “grantor trust” under the Internal Revenue Code of 1986, as amended (the “Code”) or any comparable provision of the laws of any State or other jurisdiction where that
treatment is sought, and the Sponsor determines that, because of that tax treatment or change in tax treatment, dissolution of the Trust is advisable;
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60 days have elapsed since Depository Trust Company (“DTC”) or another depository has ceased to act as depository with respect to the Shares, and the Sponsor has not identified another depository that is willing to act in such capacity;
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the Trustee elects to dissolve the Trust after the Sponsor is conclusively deemed 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 and a successor sponsor has not been appointed;
or
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the Sponsor elects to dissolve the Trust after the Trustee, Execution Agent, Administrator or the Solana Custodian (or any successor trustee, administrator or custodian) resigns or otherwise ceases to be the trustee, administrator or
custodian of the Trust, as applicable, and no replacement trustee, administrator and/or custodian acceptable to the Sponsor is engaged.
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In addition, the Trust may be dissolved at any time for any reason by the Sponsor in its sole discretion. In respect of dissolution events that rely on Sponsor determinations to dissolve the Trust
(e.g., if the SEC determines that the Trust is an investment company under the 1940 Act; the CFTC determines that the Trust is a commodity pool under the CEA; the Trust is determined to be a money transmitter under the regulations promulgated by
FinCEN; the Trust fails to qualify for treatment, or ceases to be treated, as a grantor trust for U.S. federal income tax purposes; or, following a resignation by a trustee or custodian, the Sponsor determines that no replacement is acceptable to
it), the Sponsor may consider, without limitation, the profitability to the Sponsor and other service providers of the operation of the Trust, any obstacles or costs relating to the operation or regulatory compliance of the Trust and the ability to
market the Trust to investors. To the extent that the Sponsor determines to continue operation of the Trust following a determination’s triggering event, the Trust will be required to alter its operations to comply with the triggering event. In the
instance of a determination that the Trust is an investment company, the Trust and the Sponsor would have to comply with the regulations and disclosure and reporting requirements applicable to investment companies and investment advisers. In the
instance of a determination that the Trust is a commodity pool, the Trust and the Sponsor would have to comply with regulations and disclosure and reporting requirements applicable to commodity pools and commodity pool operators or commodity trading
advisers. In the event of a determination that the Trust is a money transmitter, the Trust and the Sponsor will have to comply with applicable federal and state registration and regulatory requirements for
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money transmitters and/or money service businesses. In the event that the Trust ceases to qualify for treatment as a grantor trust for U.S. federal income tax purposes, the Trust will be required
to alter its disclosure and tax reporting procedures and may no longer be able to operate or to rely on pass-through tax treatment. In each such case and in the case of the Sponsor’s determination as to whether a potential successor trustee or
custodian is acceptable to it, the Sponsor will not be liable to anyone for its determination of whether to continue or to dissolve the Trust.
If the Trust is required to terminate and liquidate, or the Sponsor determines in accordance with Chapter 38 of Title 12 of the Delaware Code, 12 Del. C. § 3801 et seq. (the “Delaware Act”) that it
is appropriate to terminate and liquidate the Trust, the Sponsor will instruct the Execution Agent to sell the Trust’s SOL and will distribute to the Shareholders any amounts of the cash proceeds of the liquidation remaining after the satisfaction of
all outstanding liabilities of the Trust and the establishment of reserves for applicable taxes, other governmental charges and contingent or future liabilities as the Sponsor will determine. Shareholders of record on the record date fixed by the
Transfer Agent for a distribution will be entitled to receive their pro rata portions of any distribution. Following the liquidation of the Trust’s SOL, any remaining outstanding Shares will be redeemed for cash and distributed to Shareholders in
accordance with the provisions of the Trust Agreement.
Upon dissolution of the Trust, following completion of winding up of its business by the Sponsor, the Trustee, upon written directions of the Sponsor, will cause a certificate of cancellation of
the Trust’s Certificate of Trust to be filed in accordance with applicable Delaware law. Upon completion of the winding up of the business of the Trust, the Sponsor will be discharged from all obligations under the Trust Agreement except for its
certain obligations that survive dissolution of the Trust Agreement.
Amendments
The Trust Agreement provides that it may be amended by the Sponsor in its sole discretion and without the Shareholders’ consent. Any such amendment to the Trust Agreement will be effective on such
date as designated by the Sponsor in its sole discretion, except that any amendment that imposes or increases any fees or charges or prejudices a substantial existing right of the Shareholders will not become effective until thirty (30) days after
notice of such amendment is given to the Shareholders. However, any amendment to the Trust Agreement that affects the rights or duties of the Trustee will require the Trustee’s prior written consent. Every Shareholder, at the time any amendment so
becomes effective, will 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. The Sponsor does not expect to make any amendment that would
impair the right of Authorized Participants to surrender Creation Baskets and receive therefore the amount of Trust assets represented thereby (less fees in connection with the surrender of Shares and any applicable taxes or other governmental
charges), except in order to comply with mandatory provisions of applicable law.
THE TRUST’S SERVICE PROVIDERS
The Sponsor
The Sponsor arranged for the creation of the Trust and is responsible for the ongoing registration of the Shares for their public offering and the listing of Shares on the Exchange. The Sponsor
will not exercise day-to-day oversight over the Trustee or the Solana Custodian. Except as noted in “The Trust—The Trust’s Expenses” above, the Sponsor has agreed to pay all of the Trust’s ordinary expenses out of the Sponsor Fee, including, but not
limited to, the Trustee’s fees, the Administrator’s fee, the Transfer Agent’s fee, the Solana Custodian’s fee, the Execution Agent’s fees, Exchange listing fees, SEC registration fees, printing and mailing costs, legal costs and audit fees. The
Sponsor also paid the costs of the Trust’s organization.
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The Sponsor is a wholly-owned subsidiary of Invesco Ltd. Invesco Ltd. and its subsidiaries, including the Sponsor, are an independent global investment management group.
The Sponsor has significant experience overseeing exchange-traded products, including both 1940 Act-registered exchange-traded products and non-1940 Act-registered
exchange-traded products, including a spot bitcoin exchange-traded product and a spot ether exchange-traded product. As of December 31, 2024, the Sponsor oversees over 200 exchange-traded products with assets over $700 billion. The Sponsor’s
relatively limited experience in this specific field may not fully equip them to navigate the complexities of digital asset markets effectively, but by managing its own products and through its relationships with the Execution Agent and the Solana
Custodian, the Sponsor has amassed significant knowledge regarding SOL and the digital asset markets.
The Trustee
CSC Delaware Trust Company, a Delaware trust company located at 251 Little Falls Drive, Wilmington, DE 19808, acts as the trustee of the Trust as required to create a Delaware statutory trust in
accordance with the Trust Agreement and the DSTA. The Trustee is appointed to serve as the trustee of the Trust in the State of Delaware for the sole purpose of satisfying the requirement of Section 3807(a) of the DSTA that the Trust have at least
one trustee with a principal place of business in the State of Delaware.
General Duty of Care of Trustee
The Trust Agreement provides that, to the extent that, at law or at equity, the Trustee has duties (including fiduciary duties) and liabilities relating thereto to the Trust, the Sponsor, the
Shareholders or any other person, such duties and liabilities are eliminated and replaced by the duties and liabilities of the Trustee expressly set forth in the Trust Agreement. Under the Trust Agreement, the duties of the Trustee shall be limited
to (i) accepting legal process served on the Trust in the State of Delaware and (ii) the execution of any certificates required to be filed with the Secretary of State of the State of Delaware which the Trustee is required to execute under Section
3811 of the Delaware Act.
Resignation, Discharge or Removal of Trustee; Successor Trustees
The Trustee may resign at any time by giving at least 60 days advance written notice to the Sponsor. The Sponsor may remove the Trustee at any time by giving at least 60 days advance written notice
to the Trustee. Upon effective resignation or removal, the Trustee will be discharged of its duties and obligations.
If the Trustee resigns or is removed, the Sponsor, acting on behalf of the Shareholders, is required to use reasonable efforts to appoint a successor trustee. Any successor Trustee must satisfy the
requirements of Section 3807 of the DSTA. Any resignation or removal of the Trustee and appointment of a successor Trustee cannot become effective until a written acceptance of appointment is delivered by the successor Trustee to the outgoing Trustee
and the Sponsor and any fees and other expenses due to the outgoing Trustee are paid or waived by the outgoing Trustee. Following compliance with the preceding sentence, the successor will become fully vested with the rights, powers, duties and
obligations of the outgoing Trustee under the Trust Agreement, with like effect as if originally named as Trustee, and the outgoing Trustee shall be discharged of its duties and obligations herein. If no successor Trustee shall have been appointed
and shall have accepted such appointment within forty-five (45) days after the giving of such notice of resignation or removal, the Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee.
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If the Trustee resigns and no successor trustee is appointed within 180 days after the date the Trustee issues its notice of resignation, the Sponsor will dissolve and liquidate the Trust and
distribute its remaining assets in cash, although in certain circumstances a Shareholder may request an in-kind liquidating distribution.
The Administrator
Under the trust administration and accounting agreement, the Administrator provides necessary administrative, tax and accounting services and financial reporting for the maintenance and operations
of the Trust, including calculating the NAV of the Trust and determining the net assets of the Trust, and calculating the size of the Creation Baskets.
The Transfer Agent
The Transfer Agent is responsible for (1) issuing and redeeming Shares in connection with creation and redemption transactions, (2) responding to correspondence by Shareholders and others relating
to its duties, (3) maintaining Shareholder accounts and (4) making periodic reports to the Trust.
The Solana Custodian
Under the Solana Custody Agreement, the Solana Custodian is responsible for (1) safekeeping all of the sol owned by the Trust, (2) opening one or more accounts that hold the Trust’s SOL and (3)
facilitating the transfer of SOL required for the operation of the Trust as directed by the Sponsor. The Solana Custodian is chartered as a limited purpose trust company by the NYSDFS and is authorized by the NYSDFS to provide digital asset custody
services. The Solana Custodian is a wholly-owned subsidiary of Coinbase Global, Inc.
The Cash Custodian
Under the Cash Custody Agreement, the Cash Custodian is responsible for holding the Trust’s cash in connection with creation and redemption transactions effected in cash. The Cash Custodian is a
New York state-chartered bank and a member of the Federal Reserve System.
The Marketing Agent
The Marketing Agent is responsible for: (1) working with the Transfer Agent to review and approve, or reject, purchase and redemption orders of Creation Baskets placed by Authorized Participants
with the Transfer Agent; and (2) reviewing and approving the marketing materials prepared by the Trust for compliance with applicable SEC and FINRA advertising laws, rules, and regulations.
The Staking Provider
If the Staking Condition is satisfied and the Trust seeks to engage in staking of its SOL, the Trust has entered into an agreement with Galaxy Blockchain Infrastructure LLC, an affiliate of the Execution Agent. The
Staking Provider will stake the Trust’s SOL as the node operator and will operate a validator by which the Trust’s SOL is staked. The Staking Provider will perform its staking services in collaboration with the Solana Custodian, as the SOL will be
staked directly from the Trust’s account with the Solana Custodian.
The Execution Agent
The Sponsor has entered into an agreement with Galaxy Digital Funds LLC, a subsidiary of Galaxy Digital LP (“Galaxy” or the “Execution Agent”) to serve as Execution Agent. At the direction of the
Sponsor, the
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Execution Agent is responsible for selling SOL on behalf of the Trust to the extent necessary to permit the payment of the Trust’s expenses. The Trust also will utilize the services of the
Execution Agent to purchase or sell SOL in connection with cash creations and redemptions. When acquiring or disposing of SOL on behalf of the Trust in connection with a cash creation or cash redemption transaction, the Sponsor will provide
instructions to the Execution Agent, who will identify a Solana Counterparty. The Solana Counterparty will not have a pre-existing material relationship with the Trust, except that in some cases the Solana Counterparty may be an affiliate of a
service provider to the Trust. In connection with both cash creation and cash redemption transactions, the Execution Agent, pursuant to the oversight of the Sponsor, will decide how and with which Solana Counterparty to transact on the Trust’s
behalf.
Pursuant to the Execution Agent Agreement, and subject to specific instructions from the Sponsor, the Execution Agent in its discretion is responsible for selecting the method of transacting, the
price, the Solana Counterparty or Counterparties and the trading platform or venue (if any) for the execution of each purchase and sale of SOL on behalf of the Trust. The Execution Agent has established policies and procedures for identifying,
monitoring and performing due diligence on potential Solana Counterparties and trading platforms or venues, with entities being added or removed from consideration on an ongoing basis. In addition, the Execution Agent evaluates Solana Counterparties
and trading platforms or venues on a per-transaction basis. At the time it selects a Solana Counterparty for any specific transaction, the Execution Agent may consider a number of factors in an effort to seek to achieve “best execution,” including
price, transaction costs, speed, and likelihood of execution and settlement, taking into account the size of the transaction and the experience and capabilities of the Solana Counterparty. Relying on its history of transacting in SOL, the Execution
Agent assesses Solana Counterparties in seeking to achieve the best overall outcome for the Trust. Although the Trust is relatively new, and therefore does not have a long history of trading SOL, the Execution Agent (and its asset management
affiliates) have extensive experience, having traded over $12.5 billion in digital assets since 2020 across over ten counterparties for other accounts.
As of the date of this Prospectus, Virtu Financial Singapore Pte. Ltd. , JSCT, LLC, Flow Traders B.V., FalconX Bravo, Inc., and Cumberland DRW LLC have been identified by the Execution Agent as
Solana Counterparties. Each of these Solana Counterparties are, and any other Solana Counterparty the Execution Agent, on behalf of the Trust, places orders with in the future will be, subject to U.S. federal and/or state licensing requirements or
similar laws in non-U.S. jurisdictions, and maintain practices and policies designed to comply with AML and KYC regulations or similar laws in non-U.S. jurisdictions. The Execution Agent, on behalf of the Trust, may engage additional Solana
Counterparties at any time. JSCT, LLC is an affiliate of Jane Street Capital LLC and Virtu Financial Singapore Pte. Ltd. is an affiliate of Virtu Americas LLC. Each of Jane Street Capital LLC and Virtu Americas LLC is an Authorized Participant.
In addition, as part of this agreement, the Execution Agent has agreed to co-brand and co-market the Trust, and the Sponsor has licensed the use of certain Execution Agent trademarks, service marks
and trade names in connection with the Trust. The Execution Agent is a leader in digital asset investing and trading and has extensive knowledge of and experience with digital asset investing and related services and markets.
The Execution Agent offers passive private funds in both the Solana and Solana markets, including funds in Brazil and Canada which track the price of SOL. Galaxy also offers active strategies such
as its Flagship Liquid Crypto Fund, which seeks to provide access to the current and next generation of essential digital assets. Galaxy also has experience in the SOL and digital asset markets through its affiliates, including Galaxy Digital Capital
Management LP, which has been appointed as a fiduciary in the bankruptcy liquidation of FTX Trading Ltd. and acts as a fiduciary managing outside capital.
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Galaxy is a subsidiary of Galaxy Digital Holdings LP (“Galaxy Holdings”). Galaxy Digital Holdings Ltd., which holds a limited partner interest in Galaxy Holdings, is listed on the Toronto Stock
Exchange under the symbol “GLXY.”
Authorized Participants
The Trust will process all creations and redemptions of Shares in transactions with Authorized Participants. Creation and redemption transactions will be conducted in exchange for SOL in-kind or
cash.
When purchasing Creation Baskets in-kind with SOL, Authorized Participants and/or their designees deliver SOL to the Solana Custodian. After confirming receipt of the SOL by the Solana
Custodian, the Transfer Agent is authorized by the Sponsor to issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of the creation order.
When purchasing Creation Baskets for cash, Authorized Participants will deliver cash to the Cash Custodian. The Execution Agent will be responsible for acquiring the requisite amount of SOL on
behalf of the Trust on an agency basis on the value date of the order. Once the Execution Agent selects a Solana Counterparty, the Cash Custodian will transfer cash to the Solana Counterparty in payment for the requisite amount of SOL. The SOL
acquired from the Solana Counterparty will be transferred to the Solana Custodian. After receipt of the SOL by the Solana Custodian, the Transfer Agent will issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of
the creation order.
When redeeming Creation Baskets in-kind for SOL, the Transfer Agent will redeem the Shares and the Solana Custodian will distribute the resulting SOL to the redeeming Authorized Participant
and/or its designee in satisfaction of the redemption order.
When redeeming Creation Baskets for cash, the Execution Agent will be responsible for selling the requisite amount of SOL on behalf of the Trust on an agency basis. Once the Execution Agent selects
a Solana Counterparty, the Solana Custodian will transfer SOL to the Solana Counterparty in return for the requisite cash payment. The cash received from the Solana Counterparty will be delivered to the Cash Custodian. After receipt of the cash
payment, the Transfer Agent will redeem the Shares and the Cash Custodian will distribute the resulting cash to the redeeming Authorized Participant in satisfaction of the redemption order.
In connection with both cash creation and cash redemption transactions, the Execution Agent, pursuant to the oversight of the Sponsor, will decide how and with which Solana Counterparty to
transact on the Trust’s behalf.
Authorized Participants are expected to sell Shares to the public at prices that reflect, among other factors, the value of the Trust’s assets, supply of and demand for Shares and market conditions
at the time of a transaction.
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As of the date of the Prospectus, the Trust has entered into Authorized Participant Agreements with Jane Street Capital, LLC and Virtu Americas LLC.
CUSTODY OF THE TRUST’S ASSETS
Custody of the Trust’s SOL
The Solana Custodian will keep the private keys associated with the Trust’s SOL in a “cold storage” environment where the private keys are generated and secured (the “Prime Custody Vault”). The
Trust intends to conduct its regular SOL transactions, including in connection with creation and redemption transactions and selling SOL to pay the Trust’s expenses, directly from the Trust’s Prime Custody Vault in over-the-counter transactions
directly with counterparties selected by the Execution Agent. While the Trust does not expect to utilize the services of the Coinbase, Inc. (“Coinbase” or the “Prime Broker”), in connection with transactions where the Trust’s SOL is being processed
in connection with certain creation or redemption transactions or it is being sold to pay Trust expenses, the Execution Agent may elect to transact through the Prime Broker. In such circumstances, the Trust’s SOL may be maintained in a trading
account (the “Trading Balance”) with the Prime Broker, an affiliate of the Solana Custodian. The Trust’s SOL will be maintained by the Solana Custodian and Coinbase in accounts that are required to be segregated from the assets held by the Solana
Custodian or Coinbase as principal and, when held in the Prime Custody Vault, the assets of their other customers. “Cold storage” refers to a safeguarding method by which the private keys corresponding to the Trust’s SOL are generated and stored in
an offline manner using computers or devices that are not directly connected to the internet, which is intended to make them more resistant to hacking, or similarly secure technology. All of the Trust’s SOL will be held in the Prime Custody Vault
except that it may be maintained in the Trading Balance in connection with certain creation or redemption transactions or when it is being sold to pay the Sponsor Fee or Trust expenses not assumed by the Sponsor. To the extent the Trust maintains a
Trading Balance with Coinbase, such short-term holdings represent an omnibus claim on Coinbase’s SOL held on behalf of clients; these holdings exist across a combination of omnibus hot wallets, omnibus cold wallets or in accounts in Coinbase’s name
on a trading platform (including third-party venues and Coinbase’s own execution venue) where Coinbase executes orders to buy and sell SOL on behalf of clients.
Custody of SOL typically involves the generation, storage and utilization of private keys. These private keys are used to effect transfer transactions (i.e., transfers of SOL from an address
associated with the private key to another address). Cold storage is a safeguarding method with multiple layers of protections and protocols, by which the private key(s) corresponding to the Trust’s SOL is (are) generated and stored in an offline
manner.
Private keys are generated in offline computers that are not connected to the internet so that they are resistant to being hacked. Cold storage of private keys involves keeping key material on
storage devices not directly connected to the internet. In accordance with the Trust’s instructions, the Solana Custodian will keep the Trust’s SOL in cold storage on an ongoing basis. Please see “Risk Factors—Cybersecurity Risk Related to Solana,”
“—Risks Related to the Markets and Service Ecosystem for Solana,” and “—Risks Related to the Trust and the Shares” for a discussion of custody risks.
Solana Custodian Access to Private Keys and Whitelisting
The Solana Custodian uses two distinct wallet architectures to support the Trust’s operations. There is the Prime Custody Vault environment that provides the storage where assets will be secured
when not involved in creation or redemption transactions. Additionally, there is the Trading Balance environment where assets move through the Coinbase trading wallets for matching, settlement, and trade execution.
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Prime Custody Vault
The following groups of personnel are involved in the Prime Custody Vault wallet digital signing process. Solana Custodian personnel that participate in wallet private key use activities each have
access to material that is necessary to complete a transaction, but the material they have access to is not by itself sufficient to use a wallet private key and sign a transaction unilaterally (e.g., there is segregation of duties enforced between
those that can initiate a private key use request, and those that can participate in wallet private key use).
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The Trust: The Sponsor, acting on behalf of the Trust is responsible for creating and approving the transaction (including specifying transaction details) within the Prime Custody Vault. Clients have
the ability to manage address whitelist, where funds are permitted to be sent outside the boundaries of Solana Custodian’s environment. Modifications to the address book require client consensus and client-owned hardware two-factor
authentication (2FA).
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Facilitation: The Solana Custodian has a back-office operations team that supports validation of transaction intent, facilitates optional client video authorization calls, and collaborates with the
operators to track transaction processing.
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Key Management & Physical Access: Private keys are encrypted and secured with cryptographically enforced consensus policies and stored in offline vaults. A secure system is responsible for
uploading encrypted key share materials from a secure storage facility based on authorization from human operators. Access to a Solana Custodian secure storage facility and materials therein is physically and logically restricted from a
different operator group required for wallet private key use.
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Key Use: A group of human operators is responsible for providing the necessary cryptographic material to allow access to the private key. Cryptographic consensus must be achieved across this group of
human operators before a wallet private key can be used, and transactions signed to be broadcast on-chain.
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Upon cryptographic consensus being achieved the transaction is processed. The Solana Custodian securely signs the transaction and broadcasts to the blockchain. All system-to-system authentication
and authorization is enforced to ensure that unauthorized services are blocked from accessing resources supporting wallet operations.
Trading Balance
For the ETF trading and settlement environment, clients have configurable security controls that mirror those of the Vault wallet.
Specifically, the Sponsor, on behalf of the Trust, has the ability to manage their address allowlist where funds are permitted to be sent outside the boundaries of the Solana Custodian’s
environment. Modifications to the address book require client consensus and client- owned hardware two-factor authentication (2FA).
The wallet private keys are secured in an online, isolated, high security system that leverages hardware security modules (HSMs). Transaction signing occurs automatically within this secure
environment.
In the Trading Balance, any human access to the environment is exceptional, requiring additional secure authentication protocols, and is actively monitored and logged. The private keys are
encrypted at rest, and stored in a non-exportable format. All system-to-system authentication and authorization is enforced to ensure that unauthorized services are blocked from accessing resources supporting wallet operations.
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Verifying Existence of Solana
The Solana Custodian issues Systems and Organizational Control (“SOC”) reports for the Prime Custody Vault, to verify the existence of digital assets among other objectives. It ensures controls are
designed and operating effectively, providing reasonable assurance that customer digital asset positions held in the Solana Custodian and Prime Broker are authorized, executed, and accurately and completely recorded.
Moving Assets from Cold Storage
To summarize, any movement of funds initiated by the Solana Custodian on behalf of its customers adhere to the cold storage principles described above, which are inclusive of cryptographic
consensus enforcement and segregation of duties between personnel among other security features.
Moving Assets into Cold Storage
The Solana Custodian supports transfer of funds between a client’s Trading Balance and Prime Custody Vault. This process requires a user to comply with the account’s configured Transfer Policy
which governs the approval requirements to be met before a transfer can be processed. The transfer is considered processed when it receives the appropriate blockchain confirmations.
Specifically, the transaction would be broadcasted from the Trading Balance wallet environment and received by a specific Prime Custody Vault wallet. Moving assets from the Trading Balance to Prime
Custody Vault can be initiated by the client via the Solana Custodian’s platform UI/API and must comply with client configured Transfer Policies.
Insurance of the Solana Custodian
The Solana Custodian purchases commercial crime and cyber coverage with comprehensive coverage terms and conditions. The commercial crime insurance program covers both cold and hot storage assets
held by Coinbase Global, Inc. (“Coinbase Global”) and all its subsidiaries, including the Solana Custodian and Coinbase, Inc. (collectively, “Coinbase”). Assets held within the Solana Custodian are secured within Coinbase’s cold storage environment.
Coinbase Global currently maintains a commercial crime insurance policy. Coinbase Global has maintained a commercial crime insurance policy since 2013, which is designed to be comprehensive and intended to cover the
loss of client assets held by the Solana Custodian and the Prime Broker (collectively, Coinbase Global and its subsidiaries are referred to as the “Coinbase Insureds”), including from employee collusion or fraud, theft, damage of key material,
security breach or hack, and fraudulent transfer. The commercial crime insurance policy is intended to provide the Coinbase Insureds and their clients with some of the broadest and deepest insurance coverage in the crypto industry, with comprehensive
coverage terms and conditions. This policy is renewed annually and the insurance amounts are subject to review and change. The Solana Custodian has advised the Sponsor that this insurance is maintained at a commercially reasonable amount for the
digital assets custodied on behalf of the Coinbase Insureds’ clients, including the Trust’s SOL custodied by the Solana Custodian. The insurance maintained by Coinbase Global is shared among all of the Coinbase Insured’s customers, is not specific to
the Trust or to customers holding SOL with the Solana Custodian or Prime Broker, and may not be available or sufficient to protect the Trust from all possible losses or sources of losses. Further, the coverage will not be sufficient to fully cover
losses for the Trust in the event of a catastrophic, large scale or simultaneous incident affecting multiple Coinbase clients. Coinbase Global may choose not to renew, or may be unable to renew any portion or all of these insurance policies, which
may further expose the Trust and its Shareholders to the risk of loss.
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Operation of the Solana Custodian
Solana which is custodied by the Solana Custodian is held in segregated wallets and is not commingled with assets of Solana Custodian or its affiliates or with assets of other customers of the
Solana Custodian. The Solana Custodian has also agreed in the Solana Custody Agreement that it will not, directly or indirectly, lend, pledge, hypothecate or rehypothecate any of the Trust’s SOL, and that the Trust’s SOL assets are not treated as
general assets of the Solana Custodian but are instead considered custodial assets that remain the Trust’s property. Additionally, the Solana Custodian has agreed to provide the Trust or its authorized independent public accountant with confirmation
of or access to information sufficient to confirm the SOL held by the Solana Custodian for the Trust and that the Trust’s SOL is held in a separate, segregated account under the Trust’s name. Under the Solana Custody Agreement, the Solana Custodian
is required to obtain and maintain, at its sole expense, commercially reasonable insurance coverage for the custody services it provides to the Trust. The Solana Custody Agreement does not require that private key information with respect to the
Trust’s SOL be kept in a particular physical location. The Sponsor will continuously evaluate the Solana Custodian’s performance and operations by engaging in regular communications and scheduled meetings to ensure that the Solana Custodian operates
consistent with the standards set forth in the Solana Custody Agreement and the Solana Custodian’s policies and procedures.
The Solana Custodian may receive deposits of SOL but may not send SOL without use of the corresponding private keys. In order to send SOL kept in cold storage, private keys must be accessed from
offline cold storage and used to sign transactions. At that point, the Solana Custodian can upload the fully signed transaction to an online network and transfer the SOL. Because the Solana Custodian may need to access private keys from offline
storage prior to initiating transactions, the initiation or crediting of withdrawals or other transactions may be delayed.
The Solana Custodian carefully considers the design of the physical, operational and cryptographic systems for secure storage of the Trust’s private keys in an effort to lower the risk of loss or
theft. No such system is perfectly secure and loss or theft due to operational or other failure is always possible. See “Risk Factors—Risks Related to Solana —Cybersecurity Risk Related to Solana .”
The Trust may engage third-party custodians or vendors besides the Solana Custodian and the Cash Custodian to provide custody and security services for all or a portion of its SOL and/or cash, and
the Sponsor will pay the custody fees and any other expenses associated with any such third-party custodian or vendor. The Sponsor is responsible for overseeing the Solana Custodian and the Trust’s other service providers. The Sponsor may, in its
sole discretion, add or terminate Solana custodians at any time. The Sponsor may, in its sole discretion, change the custodian for the Trust’s SOL holdings, but it will have no obligation whatsoever to do so or to seek any particular terms for the
Trust from other such custodians. However, the Sponsor will only enter into SOL custody arrangements with custodians that meet the Sponsor’s criteria, including an agreement to maintain Trust assets in a segregated account, to maintain insurance and
to store the Trust’s private keys in cold storage or in such other manner as the Sponsor determines provides reasonable protection for the Trust’s assets from loss or theft.
Under the Solana Custody Agreement, the Solana Custodian’s liability is subject to the following limitations, among others: (i) other than with respect to claims and losses arising from fraud or
willful misconduct, the Solana Custodian’s aggregate liability under the Solana Custody Agreement shall not exceed the greater of (A) the aggregate fees paid by the Trust to the Solana Custodian in the 12 months prior to the event giving rise to the
Solana Custodian’s liability, and (B) the value of the affected SOL giving rise to the Solana Custodian’s liability; (ii) the Solana Custodian’s aggregate liability in respect of each cold storage address shall not exceed $100 million; and (iii) in
respect of any incidental, indirect, special, punitive, consequential or similar losses, the Solana Custodian is not liable, even if the Solana Custodian has been advised of or knew or should have known of the possibility thereof. The Solana
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Custodian is not liable for delays, suspension of operations, failure in performance, or interruption of service to the extent it is directly due to a cause or condition beyond the reasonable
control of the Solana Custodian. While the Solana Custodian does not limit the size of each wallet to $100 million in SOL, and there is no guarantee that the amount of SOL in each Trust wallet will remain below this threshold, the Sponsor intends to
monitor each Trust wallet and adjust the amount of SOL (valued in USD) in any given Trust wallet (including moving SOL into additional wallets) in an effort to maintain the amount of SOL in each Trust wallet below $100 million.
The Trust is not a banking institution and is not a member of the FDIC or Securities Investor Protection Corporation (“SIPC”) and, therefore, investments in the Trust are not subject to the
protections enjoyed by depositors with FDIC or SIPC member institutions. Likewise, the Solana Custodian is not a depository institution and is not a member of the FDIC or SIPC and, therefore, the Trust’s assets held with the Solana Custodian are not
subject to FDIC or SIPC insurance coverage. In addition, neither the Trust nor the Sponsor insure the Trust’s SOL.
Also pursuant to the Solana Custody Agreement, Coinbase, an affiliate of the Solana Custodian, may provide prime broker services, including SOL trade execution, from time to time as requested by
the Sponsor. The Trust may engage in purchases or sales of SOL by placing orders with Coinbase. Coinbase will route orders placed by the Sponsor through Coinbase’s execution platform to a Connected Trading Venue where the order will be executed. Each
order placed with Coinbase by the Sponsor will be sent, processed and settled at each Connected Trading Venue to which it is routed. Subject to the foregoing, and to certain policies and procedures that the Solana Custody Agreement requires Coinbase
to have in place to mitigate conflicts of interest when executing the Trust’s orders, the Solana Custody Agreement provides that Coinbase shall have no liability, obligation, or responsibility whatsoever for the selection or performance of any
Connected Trading Venue, and that other Connected Trading Venues and/or trading platforms not used by Coinbase may offer better prices and/or lower costs than the Connected Trading Venue used to execute the Trust’s orders.
Orders to sell SOL on behalf of the Trust may be executed by Coinbase at venues that have been approved in accordance with the Coinbase’s due diligence and risk assessment process. Due diligence
includes reviews conducted by the legal, compliance, security, privacy and finance/credit-risk teams for every trading venue that Coinbase’s multi-venue execution capability connects to, helping ensure that the Coinbase only partners with secure and
compliant liquidity partners. Coinbase also adheres to a maximum amount of assets that can ever be held on a venue, which is unique for each venue based on Coinbase’s venue diligence and continually refreshed.
Coinbase may execute orders as an agent on behalf of the Trust. Coinbase does not operate a dealer and does not trade against its clients–all orders are routed to the venues listed above based on a
variety of routing criteria, including pricing, liquidity and depth of order book.
Custody of the Trust’s Cash
The Trust generally does not intend to hold cash or cash equivalents. However, the Trust may hold cash and cash equivalents on a temporary basis to pay expenses or in connection with cash creation
and redemption transactions. The Trust has entered into the Cash Custody Agreement with BNYM under which BNYM acts as custodian of the Trust’s cash and cash equivalents, if any.
THE PRIME BROKER
Pursuant to the Solana Custody Agreement, a portion of the Trust’s SOL holdings and cash holdings from time to time may be held with the Prime Broker, an affiliate of the Solana Custodian, in the
Trading Balance,
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in connection with the creation and redemption of Shares via cash transactions or to pay for Trust expenses not assumed by the Sponsor in consideration for the Sponsor Fee. The Trust, however,
intends to conduct its regular SOL transactions, including in connection with paying the Trust’s expenses, directly from the Trust’s Prime Custody Vault over the counter with counterparties selected by the Execution Agent. If the Sponsor or the
Execution Agent determines to transact with the Prime Broker, the amount of SOL that may be held in the Trading Balance will be limited to the amount necessary to process a given creation or redemption transaction, as applicable, or to pay for Trust
expenses not assumed by the Sponsor in consideration for the Sponsor Fee.
The Sponsor may, in its sole discretion, add or terminate prime brokers at any time. The Sponsor may, in its sole discretion, change the Prime Broker for the Trust, but it will have no obligation
whatsoever to do so or to seek any particular terms for the Trust from other such prime brokers.
These periodic holdings held in the Trading Balance with the Prime Broker represent an omnibus claim on the Prime Broker’s SOL held on behalf of clients; these holdings exist across a combination
of omnibus hot wallets, omnibus cold wallets or in accounts in the Prime Broker’s name on a Connected Trading Venue.
The Prime Broker is not required by the Solana Custody Agreement to hold any of the SOL in the Trust’s Trading Balance in cold storage or to hold any such SOL in a segregated account, and neither
the Trust nor the Sponsor can control the method by which the Prime Broker holds the SOL credited to the Trust’s Trading Balance. SOL in the Trust’s Trading Balance is held in FBO omnibus trading accounts subject to robust accounting controls in
order to ensure that the beneficial interest of the Trust’s assets are properly ledgered at all times.
The Solana Custody Agreement contains an agreement by the parties to treat the SOL credited to the Trust’s Trading Balance as financial assets under Article 8 of the New York Uniform Commercial
Code (“Article 8”). Article 8 provides additional protection for the Trust’s SOL in the Trading Balance by creating a security entitlement in favor of the Trust while imposing various duties on the Prime Broker. The Prime Broker’s parent, Coinbase
Global, has stated in its most recent public securities filings that in light of the inclusion in its custody agreements of provisions relating to Article 8 it believes that a court would not treat custodied digital assets as part of its general
estate in the event the Prime Broker were to experience insolvency. However, due to the novelty of digital asset custodial arrangements courts have not yet considered this type of treatment for custodied digital assets and it is not possible to
predict with certainty how they would rule in such a scenario.
To the extent the Trust sells SOL through the Prime Broker, the Trust’s orders will be executed at Connected Trading Venues that have been approved in accordance with the Prime Broker’s due
diligence and risk assessment process. The Prime Broker has represented that its due diligence on Connected Trading Venues include reviews conducted by the legal, compliance, security, privacy and finance and credit-risk teams.
In the event the Sponsor, on behalf of the Trust, places an order to purchase or sell SOL on the Trading Platform in connection with the creation or redemption of Shares via a cash transaction, the
associated SOL or cash used to fund or fill the order, if any, will be placed on hold and will generally not be eligible for other use or withdrawal from the Trust’s Trading Balance. The Trust’s Vault Balance may be used directly to fund orders. With
each Connected Trading Venue, the Prime Broker shall establish an account in the Prime Broker’s name, or in its name for the benefit of clients, to trade on behalf of its clients, including the Trust, and the Trust will not, by virtue of the Trading
Balance the Trust maintains with the Prime Broker, have a direct legal relationship, or account with, any Connected Trading Venue.
In any SOL transactions between an Authorized Participant, the Solana Custodian and the Prime Broker, the Authorized Participant will be responsible for any fees associated with SOL transactions.
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Either the Trust or the Prime Broker may terminate the Solana Custody Agreement in its entirety for any reason and without Cause (as defined below) by providing at least ninety (90) days’ prior
written notice to the other party.
The Prime Broker and the Solana Custodian may, in their sole discretion, suspend, restrict or terminate the Trust’s prime broker services, including by suspending, restricting or closing any
account of the Trust covered under the Solana Custody Agreement for Cause, at any time and with prior notice to the Trust.
For purposes of the Solana Custody Agreement, “Cause” shall mean: (i) a default occurs and is continuing with respect to Trust; (ii) the Trust materially breaches this Prime Broker Agreement,
including any agreement, exhibit, appendix, addendum, policy referenced herein, or supplement attached hereto, and, to the extent capable of remedy, such breach is not cured within five business days following written notice from the Prime Broker to
the Trust of such breach; (iii) a requirement of a facially valid subpoena, court order, or binding order of a government authority; (iv) The Trust’s account with the Prime Broker is subject to any pending litigation, investigation, or government
proceeding and/or the Prime Broker reasonably perceives a heightened risk of legal or regulatory non-compliance associated with the Trust’s use of the Prime Broker services; or (v) the Prime Broker reasonably suspects the Trust of attempting to
circumvent the Prime Broker’s controls or uses the Prime Broker services in a manner the Prime Broker otherwise deems inappropriate or potentially harmful to itself or third parties.
A decision by the Prime Broker or the Solana Custodian to take certain actions, including suspending, restricting or terminating the Trust’s accounts covered under the Solana Custody Agreement, may
be based on confidential criteria that are essential to the Prime Broker’s risk management and security practices and agrees that the Prime Broker and the Solana Custodian are under no obligation to disclose the details of its risk management and
security practices to the Trust.
Pursuant to the Solana Custody Agreement, the Trust compensates the Prime Broker through (i) a “Settlement Fee” assessed per settlement in the Trust’s Trading Balance, (ii) a “Primer Broker Custody
ETP Services Fee” assessed as a tiered rate of the Trust’s assets under custody in its custodial account, and (iii) a “Trading Account Fee” assessed as a fixed percentage rate of each executed order. The Prime Broker will invoice the Trust for the
Settlement Fee and the Prime Broker Custody ETP Services Fee on a monthly basis and the Trust shall pay all amounts to the Prime Broker within 30 days of the Trust’s receipt of an invoice for such fees.
The parent company of the Solana Custodian and Prime Broker, Coinbase Global, maintains a commercial crime insurance policy, which is intended to cover the loss of client assets held by Coinbase
Global and all of its subsidiaries, including the Coinbase Insureds. This policy covers the loss of client assets held by the Solana Custodian and Prime Broker, including from employee collusion or fraud, physical loss including theft, damage of key
material, security breach or hack and fraudulent transfer. The insurance maintained by the Coinbase Insureds is shared among all of their customers, is not specific to the Trust or to customers holding SOL with the Solana Custodian or Prime Broker
and may not be available or sufficient to protect the Trust from all possible losses or sources of losses.
Under the Solana Custody Agreement, the Prime Broker’s liability is limited in the following respects, among others: (i) other than with respect to claims and losses arising from fraud or willful
misconduct, the Prime Broker’s aggregate liability under the Solana Custody Agreement shall not exceed the greater of (A) the aggregate fees paid by the Trust to the Prime Broker in the 12 months prior to the event giving rise to the Prime Broker’s
liability, and (B) the value of the affected SOL giving rise to the Prime Broker’s liability; (ii) the Prime Broker’s aggregate liability in respect of each cold storage address shall not exceed $100 million; and (iii) in respect of any incidental,
indirect, special, punitive, consequential or similar losses, the Prime Broker is not liable, even if the Prime Broker has been advised of or knew or should have known of
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the possibility thereof. Both the Trust and the Prime Broker and its affiliates (including the Solana Custodian) are required to indemnify each other under certain circumstances. The Solana Custody
Agreement is governed by New York law and provides that disputes arising under it are subject to arbitration.
FORM OF SHARES
Registered Form
Shares are issued in registered form in accordance with the Trust Agreement. The Transfer Agent has been appointed registrar and transfer agent for the purpose of transferring Shares in
certificated form. The Transfer Agent keeps a record of all Shareholders and holders of the Shares in certified form in the registry. The Sponsor recognizes transfers of Shares in certificated form only if done in accordance with the Trust Agreement.
The beneficial interests in such Shares are held in book-entry form through participants and/or accountholders in DTC.
Book Entry
Individual certificates are not issued for the Shares. Instead, Shares are represented by one or more global certificates, which are deposited by the Transfer Agent on behalf of the Trust with DTC
and registered in the name of Cede & Co., as nominee for DTC. The global certificates evidence all of the Shares outstanding at any time. 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 who hold interests in the Shares through DTC Participants or Indirect Participants,
in each case who satisfy the requirements for transfers of Shares. DTC Participants acting on behalf of Shareholders holding Shares through such participants’ accounts in DTC will follow the delivery practice applicable to securities eligible for
DTC’s Same-Day Funds Settlement System. Shares are credited to DTC Participants’ securities accounts following confirmation of receipt of payment.
DTC
The Trust understands that DTC is a limited purpose trust company organized under the laws of the State of New York and is 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 holds securities for DTC Participants and facilitates the clearance and settlement of
transactions between DTC Participants through electronic book-entry changes in accounts of DTC Participants.
TRANSFER OF SHARES
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 are made in accordance with standard securities industry practice.
Transfers of interests in Shares with DTC are made in accordance with the usual rules and operating procedures of DTC and the nature of the transfer. DTC has established procedures to facilitate
transfers among the participants and/or accountholders of DTC. Because DTC can only act on behalf of DTC Participants, who in turn act on behalf of Indirect Participants, the ability of a person or entity having an interest in a global certificate to
pledge such interest to persons or entities that do not participate in DTC,
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or otherwise take actions in respect of such interest, may be affected by the lack of a certificate or other definitive document representing such interest.
The Trust understands that DTC will take any action permitted to be taken by a Shareholder (including, without limitation, the presentation of a global certificate for exchange) only at the
direction of one or more DTC Participants in whose account with DTC interests in global certificates are credited and only in respect of such portion of the aggregate principal amount of the global certificate as to which such DTC Participant or
Participants has or have given such direction.
PLAN OF DISTRIBUTION
Buying and Selling Shares
Most investors buy and sell Shares of the Trust in secondary market transactions through brokers. Shares trade on the Exchange under the ticker symbol QSOL. Shares are bought and sold throughout
the trading day like other publicly traded securities. When buying or selling Shares through a broker, most investors incur customary brokerage commissions and charges, as well as any bid-ask spread. Shareholders are encouraged to review the terms of
their brokerage account for details on applicable charges.
Authorized Participants
The offering of Shares is a best efforts offering. The Trust continuously offers Creation Baskets consisting of 5,000 Shares to Authorized Participants. Authorized Participants may pay (i) a
transaction fee and (ii) the Custody Transaction Fee for each order they place to create or redeem Creation Baskets.
The offering of Shares is being made in compliance with Rule 2310 of the FINRA Rules. Accordingly, Authorized Participants will not make any sales to any account over which they have discretionary
authority without the prior written approval of a purchaser of Shares. An Authorized Participant is not required to sell any specific number or dollar amount of Shares.
By executing an Authorized Participant Agreement, an Authorized Participant becomes part of the group of parties eligible to purchase Creation Baskets from, and have Creation Baskets redeemed by,
the Trust. An Authorized Participant is under no obligation to create or redeem Creation Baskets or to offer to the public any Shares it does create. A broker-dealer participating in the distribution of Shares may be deemed to be an “underwriter”
within the meaning of Section 2(a)(11) of the 1933 Act, in connection with such sales.
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.
Authorized Participants, other broker-dealers and other persons are cautioned that some of their activities may result in their being deemed participants in a distribution in a manner that would render them statutory underwriters and subject them to
the prospectus delivery and liability provisions of the Securities Act. Any purchaser who purchases Shares with a view towards distribution of such Shares may be deemed to be a statutory underwriter. In addition, an Authorized Participant, other
broker-dealer firm or its client will be deemed a statutory underwriter if it purchases a Creation Basket from the Trust, breaks the Creation Basket down into the constituent Shares and sells the Shares to its customers; or if it chooses to couple
its purchases of Shares from the Trust with an active selling effort involving solicitation of secondary market demand for the Shares. In contrast, Authorized Participants may engage in secondary market or other transactions in Shares that would not
be deemed “underwriting.” For example, an Authorized Participant may act in the capacity of a broker or dealer with respect to Shares that were previously distributed by other Authorized Participants. A determination of whether a particular market
participant is an underwriter must take into account all the
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facts and circumstances pertaining to the activities of the broker-dealer or its client in the particular case, and the examples mentioned above should not be considered a complete description of
all the activities that would lead to designation as an underwriter and subject them to the prospectus delivery and liability provisions of the Securities Act.
Dealers who are neither Authorized Participants nor “underwriters” but are nonetheless participating in a distribution (as contrasted to ordinary secondary trading transactions), and thus dealing
with Shares that are part of an “unsold allotment” within the meaning of Section 4(a)(3)(C) of the Securities Act, would be unable to take advantage of the prospectus delivery exemption provided by Section 4(a)(3) of the Securities Act.
While the Authorized Participants may be indemnified by the Sponsor, they will not be entitled to receive a discount or commission from the Trust or the Sponsor for their purchases of Creation
Baskets.
Seed Capital Investor; Selling Shareholders
The Trust was seeded with $100,000 on October 16, 2025, through the sale of 4,000 Shares at a per-Share price of $25.00 (the “Initial Seed Shares”) by the Trust to Invesco Ltd. Invesco Ltd. is
expected to purchase five initial seed creation baskets, equal to 25,000 shares, before the Trust is listed on the Exchange at a price per Share based on the Benchmark price as of 4:00 p.m. Eastern Time on the date of the transaction (the “Seed
Creation Baskets”). The Initial Seed Shares will be redeemed for cash prior to the purchase of the Seed Creation Baskets. Invesco Ltd. (“Invesco” has acted as a statutory underwriter in connection with its purchase of the applicable shares. Invesco
may sell some or all of the shares underlying its purchases pursuant to the registration statement for the Trust (Invesco Ltd., in such role, the “Selling Shareholder”), which shares have been registered to permit the resale from time to time after
purchase. The Selling Shareholder may make a public offering of the Shares held by it at a price per Share that will depend, among other factors, on the net asset value per Share and the trading price of Shares on the Exchange at the time of the
offer. The price of Shares offered by the Selling Shareholder was acquired by the Selling Shareholder as described in the registration statement, and could be sold at different times and at different offering prices. The Trust will not receive any
of the proceeds from the resale by the Selling Shareholder of these shares. The Selling Shareholder will not receive any fee or other compensation from the Sponsor in connection with the sale of the Shares. Prior to this offering, pursuant to this
Prospectus, there has been no public market for the Shares. The Shares are expected to be listed for trading, subject to notice of issuance, on the Exchange under the ticker symbol QSOL. Investing in the Trust involves risks similar to those
involved with an investment directly in SOL, as well as other significant risks.
It is anticipated that the Seed Capital Investor will redeem the Seed Capital Baskets or sell its shares to a third party in the weeks following the initial listing of Shares on the Exchange, if
third-party investments in the Trust exceed the value of the Seed Capital Investor’s entire investment. The Seed Capital Investor may sell some or all of the shares underlying the Seed Creation Baskets held by it pursuant to the registration
statement for the Trust (the Seed Capital Investor in such role, the “Selling Shareholder”), which shares have been registered to permit the resale from time to time after purchase. The Trust will not receive any of the proceeds of the redemption
of any Seed Creation Baskets by the Seed Capital Investor or from the resale by the Selling Shareholder of its shares. The Seed Capital Investor will not receive any fee or other compensation from the Sponsor in connection with the sale of the Seed
Capital Baskets.
The Selling Shareholder may sell Shares owned by it directly or through broker-dealers, in accordance with applicable law, on any national securities exchange on which the Shares may be listed
or quoted at the time of sale, through trading systems, in the OTC market or in transactions other than on these exchanges or systems at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of
sale, or at negotiated prices. These sales may be effected through brokerage transactions,
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privately negotiated trades, block sales, entry into options or other derivatives transactions or through any other means authorized by applicable law. The Selling Shareholder may redeem Shares
held in Creation Basket size through an Authorized Participant.
CREATION AND REDEMPTION OF SHARES
The Trust creates and redeems Shares from time to time, but only in one or more Creation Baskets. The value of Creation Baskets are based on the quantity of SOL attributable to each Share of the
Trust (net of accrued but unpaid Sponsor fees and any accrued but unpaid expenses or liabilities) being created or redeemed determined as of 4:00 p.m. ET on the Business Day the order to create or redeem Creation Baskets is properly received.
Creation and redemption transactions will be conducted in exchange for SOL in-kind or cash.
When purchasing Creation Baskets in-kind with SOL, Authorized Participants and/or their designees will deliver SOL to the Solana Custodian. After confirming receipt of the SOL by the Solana
Custodian, the Transfer Agent is authorized by the Sponsor to issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of the creation order.
When purchasing Creation Baskets for cash, Authorized Participants will deliver cash to the Cash Custodian. The Execution Agent will be responsible for acquiring the requisite amount of SOL on
behalf of the Trust on an agency basis on the value date of the order. Once the Execution Agent selects a Solana Counterparty, the Cash Custodian will transfer cash to the Solana Counterparty in payment for the requisite amount of SOL. The SOL
acquired from the Solana Counterparty will be transferred to the Solana Custodian. After receipt of the SOL by the Solana Custodian, the Transfer Agent will issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of
the creation order.
When redeeming Creation Baskets in-kind for SOL, the Transfer Agent will redeem the Shares and the Solana Custodian will distribute the resulting SOL to the redeeming Authorized Participant
and/or its designee in satisfaction of the redemption order.
When redeeming Creation Baskets for cash, the Execution Agent will be responsible for selling the requisite amount of SOL on behalf of the Trust on an agency basis. Once the Execution Agent selects
a Solana Counterparty, the Solana Custodian will transfer SOL to the Solana Counterparty in return for the requisite cash payment. The cash received from the Solana Counterparty will be delivered to the Cash Custodian. After receipt of the cash
payment, the Transfer Agent will redeem the Shares and the Cash Custodian will distribute the resulting cash to the redeeming Authorized Participant in satisfaction of the redemption order.
The Sponsor recognizes that the size of the Creation Baskets may impact the effectiveness of the arbitrage mechanism of the Trust’s creation and redemption process, and accordingly may adjust the
size of the Creation Baskets to enhance the activities of the Authorized Participants in the secondary market for the Trust’s shares.
Authorized Participants are the only persons that may place orders to create and redeem Creation Baskets. Authorized Participants must be: (1) registered broker-dealers or other securities market
participants, such as banks or other financial institutions, that are not required to register as broker-dealers to engage in securities transactions as described below, and (2) DTC Participants. To become an Authorized Participant, a person must
enter into an Authorized Participant Agreement. The Authorized Participant Agreement provides the procedures for the creation and redemption of Shares. The delivery of SOL to or from the Trust in connection with creation and redemption transactions,
may settle on the Solana network and is thus subject to the risks associated with Solana network transactions, including the irreversibility of transactions made in error. The Authorized Participant Agreement and the related procedures attached
thereto may be
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amended by the Trust and the Sponsor, without the consent of any Shareholder or Authorized Participant. Authorized Participants will pay (i) a transaction fee and (ii) Custody Transaction Fee for
each order they place to create or redeem Shares. The transaction fee may be reduced, increased or otherwise changed by the Trust and the Sponsor. Authorized Participants receive no fees, commissions or other form of compensation or inducement of any
kind from either the Trust or the Sponsor, and no such person will have any obligation or responsibility to the Sponsor or the Trust to effect any sale or resale of Shares.
Certain Authorized Participants or their affiliates may be capable of participating directly in the spot markets. Some Authorized Participants or their affiliates may from time to time buy or sell
SOL and may profit in these instances. See “Risk Factors—Risks Related to the Trust and the Shares—The Sponsor and its affiliates are subject to conflicts of interest that could adversely affect your investment in the Trust.” To the extent that the
activities of Authorized Participants or their affiliates have a meaningful effect on the Solana market, it could affect the price of SOL and impact the ability of the Authorized Participants or their affiliates to effectively arbitrage the
difference between the price at which the shares trade and the NAV of the Trust’s Shares. While the Sponsor currently expects that Authorized Participants’ or their affiliates direct activities in the Solana or the secondary market in connection with
the creation and redemption activities of the Trust will not significantly affect the price of SOL or the Shares, the impact of the activities of the Trust and its Authorized Participants on SOL or the secondary market is unknown and beyond the
control of the Sponsor.
Each Authorized Participant will be required to be registered as a broker-dealer under the Exchange Act and a member in good standing with FINRA, or exempt from being or otherwise not required to
be licensed as a broker-dealer or a member of FINRA, 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 may also be regulated under
federal and state banking laws and regulations. Each Authorized Participant has its own set of rules and procedures, internal controls and information barriers as it determines is appropriate in light of its own regulatory regime.
The following description of the procedures for the creation and redemption of Creation Baskets is only a summary and a Shareholder should refer to the relevant provisions of the form of Authorized
Participant Agreement for more detail. The form of Authorized Participant Agreement is filed as an exhibit to the registration statement of which this Prospectus is a part.
Creations and redemptions may be “off-chain” transactions that are represented in the books and records of the Prime Broker or “on-chain” transactions reflected in the Trust’s Prime Custody Vault
Account. The creating or redeeming Authorized Participant will be responsible for any on-chain transaction fees, as well as any transaction fees imposed by the Trust and any transaction charges imposed by the Execution Agent in connection with
acquiring or disposing of SOL in connection with creation or redemption transactions.
Authorized Participants will place orders through the Transfer Agent. The Transfer Agent will coordinate with the Trust’s Solana Custodian in order to facilitate settlement of the Shares and cash
and/or SOL as described in more detail in the “—Creation Procedures” and “—Redemption Procedures” sections below.
Creation Procedures
On any Business Day, an Authorized Participant may place an order through the Transfer Agent’s electronic order delivery system to create one or more Creation Baskets. The Transfer Agent will
acknowledge the purchase order unless the Trustee or the Sponsor decides to refuse the deposit as described below under “Rejection of Purchase Orders.” For cash creations orders to purchase Shares (“Purchase Orders”) must be placed by 2:30 p.m. ET or
the close of regular trading on the Exchange, whichever is earlier (the “Cash Order Cutoff Time”). For in-kind creations, Purchase Orders must be placed by 4:00 p.m. or the close of
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regular trading on the Exchange, whichever is earlier (the In-Kind Order Cutoff Time”). The day on which a valid order is received by the Transfer Agent is considered the “Purchase Order Date.”
The Sponsor may in its sole discretion limit the number of Shares created pursuant to Purchase Orders on any specified day without providing notice to the Authorized Participants and may direct the
Transfer Agent to reject any Purchase Orders in excess of such capped amount. The Sponsor may choose to limit the number of Shares created pursuant to Purchase Orders when it deems so doing to be in the best interest of Shareholders. The Sponsor may
choose to do so when it believes the market is too volatile to execute a SOL transaction, when it believes the price of SOL is being inconsistently, irregularly, or discontinuously published from SOL trading venues and other data sources, or when it
believes other similar circumstances may create a scenario in which accepting Purchase Orders would not be in the best interests of the Shareholders. The Sponsor does not believe that the Trust’s ability to arrive at such a determination will have a
significant impact on the Shares in the secondary market because it believes that the ability to create Shares would be reinstated shortly after such determination is made, and any entity desiring to create Shares would be able to do so once the
ability to create Shares is reinstated. However, it is possible that such a determination would cause the Shares to trade at premiums or discounts relative to the Trust’s NAV on the secondary market if arbitrageurs believe that there is risk that the
creation and redemption process is not available, as this process is a component of keeping the price of the Shares on the secondary market closely aligned to the Trust’s NAV.
If the Trustee accepts the Purchase Order, the Transfer Agent will transmit to the Authorized Participant, via electronic mail message or other electronic communication, no later than 5:00 p.m. ET
on the date such Purchase Order is received, or deemed received, a copy of the Purchase Order endorsed “Accepted” by the Transfer Agent and indicating the Creation Basket Deposit that the Authorized Participant must deliver to the Solana Custodian or
Prime Broker in exchange for each Creation Basket. In the case of Purchase Orders submitted via the Transfer Agent’s electronic order entry system, the Authorized Participant will receive an automated email indicating the acceptance of the Purchase
Order and the Purchase Order will be marked “Accepted” in the Transfer Agent’s electronic order entry system. Prior to the Transfer Agent’s acceptance as specified above, a Purchase Order will only represent the Authorized Participant’s unilateral
offer to deposit the requisite amount of SOL or cash in exchange for Creation Baskets and will have no binding effect upon the Trust, the Sponsor, the Trust Administrator, the Transfer Agent, the Solana Custodian or any other party.
If required by the Sponsor and the Trust, prior to the delivery of Creation Baskets for a Purchase Order, the Authorized Participant must have wired to the Transfer Agent the nonrefundable
transaction fee due for the Purchase Order. Authorized Participants may not withdraw a Purchase Order.
The manner by which Creation Baskets are made is dictated by the terms of the Authorized Participant Agreement. By placing a Purchase Order, an Authorized Participant agrees to facilitate the
deposit of the requisite amount of SOL or cash with the Trust’s Solana Custodian or Cash Custodian, respectively. If an Authorized Participant fails to consummate the foregoing, the Purchase Order will be cancelled. For cash creation transactions,
the Execution Agent will be responsible for acquiring the requisite amount of SOL on behalf of the Trust.
The Sponsor and Transfer Agent shall reject any purchase order or redemption order that is not in proper form. Upon receipt of the SOL deposit amount in the Trust’s Solana account, the Solana
Custodian will notify the Transfer Agent, the Authorized Participant and the Sponsor that the SOL has been deposited. The Transfer Agent will then direct DTC to credit the number of Shares created to the Authorized Participant’s DTC account.
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SOL transactions that occur on the blockchain are susceptible to delays due to Solana network outage, congestion, spikes in transaction fees demanded by validators, or other problems or
disruptions. To the extent that SOL transfers from the Trust’s Trading Balance to the Trust’s Prime Custody Vault are delayed due to congestion or other issues with the Solana network, such SOL will not be held in cold storage in the Prime Custody
Vault until such transfers can occur.
Cash Creation Transaction
The total cash deposit required to create each cash Creation Basket is an amount of cash equivalent to the amount of SOL described below in the subsection entitled “Determination of Required
Deposits,” plus any amount above the Benchmark on each Purchase Order Date that the Trust agrees to pay in order to acquire the required amount of SOL as described in the subsection entitled “Determination of Required Deposits.” The Sponsor causes to
be published each night the amount of SOL that will be acquired in exchange for each Purchase Order, from which can be computed the estimated amount of cash required to create each cash Creation Basket, prior to accounting for any additional cash
required to acquire the requisite amount of SOL if the price paid by the Trust is in excess of the Benchmark on each Purchase Order Date.
When purchasing Creation Baskets for cash, Authorized Participants will deliver cash to the Cash Custodian. The Execution Agent will be responsible for acquiring the requisite amount of SOL on
behalf of the Trust on an agency basis. Once the Execution Agent selects a Solana Counterparty, the Cash Custodian will transfer cash to the Solana Counterparty in payment for the requisite amount of SOL. The SOL acquired from the Solana Counterparty
will be transferred to the Solana Custodian. After receipt of the SOL by the Solana Custodian, the Transfer Agent will issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of the creation order.
The Execution Agent, pursuant to the oversight of the Sponsor, will decide how and with which Solana Counterparty to transact on the Trust’s behalf.
As between the Trust and the Authorized Participant, the expense and risk of the difference between the value of SOL calculated by the Administrator for daily valuation using the Benchmark and the
price at which the Trust acquires the SOL will be borne solely by the Authorized Participant to the extent that the Trust pays more for SOL than the price used by the Trust for daily valuation. Any such additional cash amount will be included in the
amount of cash calculated by the Administrator on the Purchase Order Date (identified as a variable transaction fee), communicated to the Authorized Participant on the Purchase Order Date, and wired by the Authorized Participant to the Cash Custodian
on the day following the Purchase Order Date. If the Solana Counterparty fails to deliver the SOL to the Solana Custodian, no cash is sent from the Cash Custodian to the Solana Counterparty, no Shares are transferred to the Authorized Participant’s
DTC account, the cash is returned to the Authorized Participant, and the Cash Purchase Order is cancelled.
In-Kind Creation Transactions
The total amount of SOL required to be deposited by an Authorized Participant and/or its designee to create each in-kind Creation Basket is described below in the subsection entitled
“Determination of Required Deposits.” The Sponsor causes to be published each night the amount of SOL that will be acquired in exchange for each Purchase Order.
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When purchasing Creation Baskets in-kind for SOL, Authorized Participants and/or their designees will deposit SOL related to the Authorized Participant’s purchase order with the Solana
Custodian. After receipt of the SOL by the Solana Custodian, the Transfer Agent will issue Creation Baskets of Shares to the creating Authorized Participant in satisfaction of the creation order.
Determination of Required Deposits
The quantity of SOL required to create each Creation Basket (“Creation Basket Deposit”) changes from day to day. On each day that the Exchange is open for regular trading, the Sponsor will publish
the Creation Basket after market close, which is composed of an amount of SOL or an amount of cash and/or SOL required to purchase a Creation Basket the following day. After the Trust’s NAV is struck on a Business Day, the Administrator adjusts the
quantity of SOL constituting the Creation Basket Deposit for the next Business Day as appropriate to reflect accrued expenses. The computation is made by the Administrator as promptly as practicable after 4:00 p.m. ET. The Administrator calculates
the Creation Basket Deposit for a given day by multiplying the NAV by the number of Shares in a Creation Basket (5,000) divided by the price of SOL at 4:00 p.m. ET as determined consistent with the Benchmark to determine the cash amount required for
a Creation Basket. Fractions of a SOL smaller than 0.00000001 are disregarded for purposes of the computation of the Creation Basket Deposit. Although the Administrator applies the SOL price to the calculation of the Creation Basket value, the
Administrator plays no role in the determination of the SOL price used by the Trust; rather the SOL price used in calculating the cash value of a Creation Basket is identical to the SOL price used in determining the Trust’s NAV.
Each Business Day, the Sponsor will communicate the final Creation Basket Deposit for that same Business Day and an estimated Creation Basket Deposit for the next Business Day. The Creation Basket
Deposit so determined is communicated daily via electronic mail message to all Authorized Participants. Authorized Participants may use the value of the SOL in the Creation Basket to estimate the amount of cash needed for a Purchase Order.
The date the Transfer Agent receives a valid Purchase Order will determine the Creation Basket Deposit the Authorized Participant needs to deposit. However, Purchase Orders received by the
Transfer Agent after 2:30 p.m. ET with respect to cash creation transactions and 4:00 p.m. ET with respect to in-kind creation transaction (or the close of regular trading on the Exchange, whichever is earlier) will be rejected and should be
resubmitted on the following Business Day.
For cash creation transactions, to the extent there is a difference between the price actually paid by the Trust to acquire a Creation Basket worth of SOL in the creation process compared to the
cash value of the Creation Basket (i.e., if there is a difference between the amount paid by the Execution Agent on behalf of the Trust to purchase the requisite amount of SOL and the valuation of SOL as part of the Trust’s NAV calculation), that
difference will also be charged to the creating Authorized Participant in the form of a variable fee.
Delivery of Required Deposits
An Authorized Participant who places a Purchase Order must follow the procedures outlined in the “—Creation Procedures” section above. When purchasing Creation Baskets for cash, Authorized
Participants will deliver cash to the Cash Custodian. The Execution Agent will be responsible for acquiring the requisite amount of SOL on behalf of the Trust on an agency basis. Once the Execution Agent selects a Solana Counterparty, the Cash
Custodian will transfer cash to the Solana Counterparty in payment for the requisite amount of SOL. The SOL acquired from the Solana Counterparty will be transferred to the Solana Custodian. After receipt of the SOL by the Solana Custodian, the
Solana Custodian will notify the Sponsor and the Transfer Agent that the SOL has been received, and the Transfer Agent will direct DTC to credit
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the number of Creation Baskets ordered to an Authorized Participant’s DTC account on the next Business Day following the Purchase Order Date.
When purchasing Creation Baskets in-kind with SOL, Authorized Participants and/or their designees deliver SOL to the Solana Custodian. After receipt of the SOL by the Solana Custodian, the
Transfer Agent will direct DTC to credit the number of Creation Baskets ordered to an Authorized Participant’s DTC account on the next Business Day following the Purchase Order Date.
The expense and risk of delivery and ownership of SOL until SOL has been received by the Solana Custodian on behalf of the Trust, including transaction fees from the Solana network’s blockchain,
will be borne solely by the Authorized Participant. If SOL is to be delivered to the Trust other than as described above, the Sponsor is authorized to establish such procedures and to appoint such custodians and establish such custody accounts as the
Sponsor determines to be desirable, or to reject such Purchase Order or Creation Basket Deposit.
Rejection of Purchase Orders
The Sponsor or its designee has the absolute right, but does not have any obligation, to reject any Purchase Order or Creation Basket Deposit if the Sponsor determines that:
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the Purchase Order or Creation Basket Deposit is not in proper form as described in the Authorized Participant Agreement;
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the acceptance of the Purchase Order or Creation Basket Deposit would not be in the best interest of the Trust;
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the acceptance of the Purchase Order or the Creation Basket Deposit would have adverse tax consequences to the Trust or its Shareholders;
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the acceptance of the Creation Basket Deposit presents a security or regulatory risk to the Trust, the Sponsor, the Transfer Agent or the Solana Custodian;
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the acceptance or receipt of the Purchase Order or Creation Basket Deposit would, in the opinion of counsel to the Sponsor, be unlawful; or
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circumstances outside the control of the Trust, the Sponsor or the Solana Custodian or Cash Custodian make it impractical or not feasible to process Creations Baskets.
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None of the Sponsor, the Transfer Agent or the Solana Custodian will be liable for the rejection of any Purchase Order or Creation Basket Deposit.
Redemption Procedures
An order to redeem Creation Baskets is a “Redemption Order.” On any Business Day, an Authorized Participant may place an order through the Transfer Agent’s electronic order delivery system to
redeem one or more Creation Baskets. The Transfer Agent will acknowledge the Redemption Order unless the Trustee or the Sponsor decides to refuse the deposit as described below under “Suspension or Rejection of Redemption Orders.” For cash
redemptions, Redemption Orders must be placed by the Cash Order Cutoff Time. For in-kind redemptions, Redemption Orders must be placed by the In-Kind Order Cutoff Time. The day on which a valid order is received by the Transfer Agent is considered
the “Redemption Order Date.”
When a Redemption Order is received, the Trust will instruct the Solana Custodian to move the corresponding amount of SOL from the Trust’s Prime Custody Vault Balance to the Trading Balance by a
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specified time on the settlement date. Transfers of SOL from the Trust’s Prime Custody Vault Balance to the Trust’s Trading Balance are “on-chain” transaction represented on the Solana blockchain.
SOL transactions that occur on the blockchain are susceptible to delays due to Solana network outages, congestion, spikes in transaction fees demanded by validators, or other problems or
disruptions. To the extent that SOL transfers from the Trust’s Prime Custody Vault to the Trust’s Trading Balance are delayed due to congestion or other issues with the Solana network, redemptions in the Trust could be delayed.
Disruption of services at the Solana Custodian and/or the Staking Provider would have the potential to delay settlement of the SOL related to Redemption Orders.
Cash Redemption Transactions
When redeeming Creation Baskets for cash, the Execution Agent will be responsible for selling the requisite amount of SOL on behalf of the Trust on an agency basis. Once the Execution Agent selects
a Solana Counterparty, the Solana Custodian will transfer SOL to the Solana Counterparty in return for the requisite cash payment. The cash received from the Solana Counterparty will be delivered to the Cash Custodian. After receipt of the cash
payment, the Transfer Agent will redeem the Shares and the Cash Custodian will distribute the resulting cash to the redeeming Authorized Participant in satisfaction of the Redemption Order. The Execution Agent, pursuant to the oversight of the
Sponsor, will decide how and with which Solana Counterparty to transact on the Trust’s behalf.
In connection with cash redemption transactions (and, as noted above, cash creation transactions), the Execution Agent, pursuant to the oversight of the Sponsor, will decide how and with which
Solana Counterparty to transact on the Trust’s behalf. The Trust will redeem shares by delivering SOL to a third-party that is not the Authorized Participant and the Trust (through the Execution Agent, on an agency basis)—not the Authorized
Participant—is responsible for selecting the third-party to receive the SOL. Further, the third-party will not be acting as an agent of the Authorized Participant with respect to the receipt of the SOL from the Trust or acting at the direction of the
Authorized Participant with respect to the receipt of the SOL from the Trust.
In-Kind Redemption Transactions
When redeeming Creation Baskets for SOL, the Transfer Agent will redeem the Shares and the Solana Custodian will distribute the resulting SOL to the redeeming Authorized Participant and/or its
designee in satisfaction of the redemption order.
The Trust instructs the Solana Custodian to prepare to move the associated SOL from the Trust’s Vault Balance with the Solana Custodian to the Trust’s Trading Balance with the Solana Custodian. For
settlement of a redemption, the Authorized Participant delivers the necessary Shares to the Trust and the Trustee instructs the Execution Agent to deliver the resulting SOL to the redeeming Authorized Participant.
Determination of Redemption Distribution
The redemption distribution from the Trust will consist of a transfer to the redeeming Authorized Participant and/or its designee of an amount of SOL or cash that is determined in the same
manner as the determination of Creation Basket Deposits discussed above.
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Delivery of Redemption Distribution
The redemption distribution due from the Trust will generally be delivered to the Authorized Participant within two Business Days following the Redemption Order date if, by 9:00 a.m. ET on such
Business Day, the Transfer Agent’s DTC account has been credited with the Creation Baskets to be redeemed. If the Transfer Agent’s DTC account has not been credited with all of the Creation Baskets to be redeemed by such time, the redemption
distribution will also be delayed. The expense and risk of delivery and ownership of SOL in redemption distributions, including transaction fees from the Solana network’s blockchain, will be borne solely by the Authorized Participant.
While the Trust generally intends to reserve sufficient amounts of unstaked SOL to satisfy foreseeable redemption requests, there may be circumstances in which a Redemption Order exceeds the
amount of unstaked SOL reserved by the Trust. When the Trust receives such a Redemption Order, the Sponsor will request to un-stake an amount of staked SOL, as necessary, to satisfy the Redemption Order. Staked SOL is subject to the Solana
network’s cooldown period before it can be transferred or sold, and the cooldown period is ordinarily around 48 hours. Accordingly, the Sponsor will typically satisfy these redemption requests within two business days.
The Solana network utilizes what is known as an “epoch-based” staking mechanism. When a user on the Solana network (such as the Sponsor) initiates a request to un-stake, the request does not take
effect immediately. It is queued and only processed at the end of the epoch. Each epoch on the Solana network lasts approximately two days. As a result, if the un-stake request is issued just after a new epoch has begun, the Trust may have to wait
nearly a full epoch before its SOL begins transitioning to an inactive (withdrawable) state. This means the total un-staking period could extend beyond two days. This could occur as a result of factors outside of the Trust’s control, such as if the
validator that it is utilizing to stake its SOL is offline, lagging or underperforming and its un-stake request is not processed at the desired time. Additionally, an extended cooldown period could occur during periods of uniquely high transaction
volume on the Solana network or general network instability on the Solana network. Furthermore, if the Solana network undergoes a network upgrade, the cooldown period for staked Solana could extend beyond two days.
For these, or any other reason, the Trust’s SOL may not become un-staked in a timely enough fashion to satisfy Redemption Orders within two business days without taking additional action.
A circumstance where the Trust was unable to satisfy Redemption Orders could have significant negative consequences for the Trust. Disruptions to the Trust’s creation and redemption mechanism could
widen the bid-ask spreads for the Shares or cause Shares to trade at an increased premium or discount to NAV. If Authorized Participants are unable to reliably redeem Baskets within the expected timeframe, they may decline to provide such services to
the Trust, which would cause additional increases in bid-ask spreads and larger premiums and discounts. Furthermore, the Sponsor and the Trust’s service providers could face reputational and regulatory scrutiny which could ultimately have a negative
impact on the Trust.
Suspension or Rejection of Redemption Orders
The Sponsor may, in its discretion, suspend the right of redemption, or postpone the redemption settlement date, (1) for any period during which the Exchange is closed other than customary weekend
or holiday closings, or trading on the Exchange is suspended or restricted, (2) for any period during which an emergency exists as a result of which delivery, disposal or evaluation of SOL is not reasonably practicable, (3) for such other period as
the Sponsor determines to be necessary for the protection of the Trust or its Shareholders (for example, where acceptance of the total deposit required to create each Creation Basket would have certain adverse tax consequences to the Trust or its
Shareholders), or (4) as agreed upon
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between the Sponsor and Authorized Participant. For example, the Sponsor may determine that it is necessary to suspend redemptions to allow for the orderly liquidation of the Trust’s assets. An
emergency could include situations where the Trust is unable to transact in SOL or where the Trust is unable to value its SOL holdings. Such a situation may arise when trading of SOL is suspended on one or more of the digital asset trading
platforms that are included in the Benchmark (for example, as a result of a significant technical failure, power outage or network error) or the Trust is unable to access the SOL in the Trust’s SOL custody account at the Solana Custodian due to
technical or operating issues at the Trust or the Solana Custodian. Because the Trust’s SOL transactions in connection with a cash redemption transaction are expected to be effected by the Execution Agent over-the-counter, it is unlikely that the
Trust’s SOL transactions in connection with a cash redemption transaction would be directly impacted by a trading halt on one or more digital asset trading platforms. However, such disruptions may have an effect on overall SOL liquidity or cause
price spreads of SOL to widen. None of the Sponsor, the person authorized to take Redemption Orders in the manner provided in the Authorized Participant Agreement, or the Solana 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.
Redemption Orders must be made in whole Creation Baskets. The Sponsor or its designee has the absolute right, but does not have any obligation, to reject any Redemption Order if the Sponsor
determines that:
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the Redemption Order is not in proper form as described in the Authorized Participant Agreement;
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the acceptance of the Redemption Order would not be in the best interest of the Trust;
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the acceptance of the Redemption Order would have adverse tax consequences to the Trust or its Shareholders;
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the acceptance of the Redemption Order presents a security risk to the Trust, the Sponsor, the Transfer Agent or the Solana Custodian;
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the acceptance of the Redemption Order would, in the opinion of counsel to the Sponsor, be unlawful; or
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circumstances outside the control of the Trust, the Sponsor, or the Solana Custodian make it impractical or not feasible for the Shares to be delivered under the Redemption Order.
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The Sponsor may also reject a Redemption Order if the number of Shares being redeemed would reduce the remaining outstanding Shares to 100,000 Shares (i.e., 20 Creation Baskets) or less.
In the event that the Sponsor intends to suspend or postpone redemptions, it will provide Shareholders with notice in a prospectus supplement and/or through a current report on Form 8-K or in the
Trust’s annual or quarterly reports.
Creation and Redemption Transaction Fee
To compensate the Transfer Agent and/or Solana Custodian for expenses incurred in connection with the creation and redemption of Creation Baskets, an Authorized Participant may be required to pay a
transaction fee to the Transfer Agent and a Custody Transaction Fee to the Solana Custodian to create or redeem Creation Baskets, which are not expected to vary in accordance with the number of Creation Baskets in such order, except to the extent
that the fee in connection with a cash transaction is generally higher than the fee in connection with an in-kind transaction. The transaction fee may be reduced, increased or otherwise changed by the Sponsor and the Trust. The Sponsor will notify
Authorized Participants of any change in the transaction fee and will not implement any increase in the fee for the redemption of Shares until thirty (30) days after the date of notice. Additionally, for any creation or redemption transaction, to the
extent there is a difference (i) in the case of a creation for cash, between the price actually paid by the
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Trust to acquire a Creation Basket worth of SOL in the creation process compared to the cash value of the Creation Basket (i.e., if there is a difference between the amount paid by the Execution
Agent on behalf of the Trust to purchase the requisite amount of SOL and the valuation of SOL as part of the Trust’s NAV calculation); or (ii) in the case of a redemption for cash, between the cash proceeds of selling a Creation Basket worth of SOL
in the redemption value compared to the cash value of the Creation Basket (i.e., if there is a difference between the amount received by the Trust from a Solana Counterparty in selling the requisite amount of SOL and the valuation of SOL as part of
the Trust’s NAV calculation), that difference will also be charged to the creating Authorized Participant in the form of a variable fee.
Tax Responsibility
Authorized Participants are responsible for any transfer tax, sales or use tax, stamp tax, recording tax, value added tax or similar tax or governmental charge applicable to the creation or
redemption of Creation Baskets, regardless of whether or not such tax or charge is imposed directly on the Authorized Participant, and agree to indemnify the Sponsor and the Trust if they are required by law to pay any such tax, together with any
applicable penalties, additions to tax and interest thereon.
Secondary Market Transactions
As noted, the Trust will create and redeem Shares from time to time, but only in one or more Creation Baskets. The creation and redemption of Shares are made in exchange for delivery to the Trust
or the distribution by the Trust of the amount of SOL or cash determined as described above.
As discussed above, Authorized Participants are the only persons that may place orders to create and redeem Creation Baskets. Authorized Participants must be registered broker-dealers or other
securities market participants, such as banks and other financial institutions that are not required to register as broker-dealers to engage in securities transactions. An Authorized Participant is under no obligation to create or redeem Creation
Baskets, and an Authorized Participant is under no obligation to offer to the public any Shares it does create.
Authorized Participants that do offer to the public Shares from the Creation Baskets they create will do so at per-Share offering prices that reflect, among other factors, the value of the Trust’s
assets, supply of and demand for Shares and market conditions at the time of a transaction. Creation Baskets are generally redeemed when the market price per Share is at a discount to the NAV. Shares initially constituting the same Creation Basket
but offered by Authorized Participants to the public at different times may have different offering prices. An order for one or more Creation Baskets may be placed by an Authorized Participant on behalf of multiple clients. Authorized Participants
who make deposits with the Trust in exchange for Creation Baskets receive no fees, commissions or other forms of compensation or inducement of any kind from either the Trust or the Sponsor, and no such person has any obligation or responsibility to
the Sponsor to effect any sale or resale of Shares.
Shares are expected to trade in the secondary market on the Exchange. Shares may trade in the secondary market at prices that are lower or higher relative to their NAV. The amount of the discount
or premium in the trading price relative to the NAV may be influenced by various factors, including the value of the Trust’s assets, supply and demand for the Shares and market conditions at the time of a transaction.
USE OF PROCEEDS
Proceeds received by the Trust from the issuance of Creation Baskets consist of in-kind SOL and cash deposits. SOL deposits are held by the Solana Custodian on behalf of the Trust until (i)
delivered to Authorized Participants or their designated agent or client in connection with an in-kind redemption or sold
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in connection with a cash redemption or (ii) sold to pay the Sponsor’s Fee and Trust expenses of liabilities not assumed by the Sponsor. Cash deposits are held by the Cash Custodian on behalf of
the Trust until (i) transferred in connection with the purchase of SOL, (ii) delivered to Authorized Participants in connection with a redemption of Creation Baskets; or (iii) transferred to pay the Sponsor Fee or for extraordinary expenses and
liabilities not assumed by the Sponsor. Subject to satisfaction of the Staking Condition and any other applicable requirements related to the Staking Condition, proceeds may also be used in staking activities.
OWNERSHIP OR BENEFICIAL INTEREST IN THE TRUST
The beneficial interest in the Trust is divided into Shares. Each Share of the Trust represents an equal beneficial interest in the net assets of the Trust, and each holder of Shares is entitled
to receive such holder’s pro rata share of distributions of income and capital gains, if any. The Trust will liquidate staking rewards to pay quarterly distributions to Shareholders.
All Shares are fully paid and non-assessable. No Share will have any priority or preference over any other Share of the Trust. All distributions, if any, will be made ratably among all Shareholders
from the assets of the Trust according to the number of Shares held of record by such Shareholders on the record date for any distribution or on the date of termination of the Trust, as the case may be. Except as otherwise provided by the Sponsor,
Shareholders will have no preemptive or other right to subscribe to any additional Shares or other securities issued by the Trust.
The Sponsor will have full power and authority, in its sole discretion, without seeking the approval of the Trustee or the Shareholders (a) to establish and designate and to change in any manner
and to fix such preferences, voting powers, rights, duties and privileges of the Trust as the Sponsor may from time to time determine, (b) to divide the beneficial interest in the Trust into an unlimited amount of Shares, with or without par value,
as the Sponsor will determine, (c) to issue Shares without limitation as to number (including fractional Shares), to such persons and for such amount of consideration, subject to any restriction set forth in the By-Laws, if any, at such time or times
and on such terms as the Sponsor may deem appropriate, (d) to divide or combine the Shares into a greater or lesser number without thereby materially changing the proportionate beneficial interest of the Shares in the assets held, and (e) to take
such other action with respect to the Shares as the Sponsor may deem desirable. The ownership of Shares will be recorded on the books of the Trust or the Transfer Agent for the Trust. No certificates certifying the ownership of Shares will be issued
except as the Sponsor may otherwise determine from time to time. The Sponsor may make such rules as it considers appropriate for the issuance of Share certificates, transfer of Shares and similar matters. The record books of the Trust as kept by the
Trust, or the Transfer Agent, as the case may be, will be conclusive as to the identity of the Shareholders and as to the number of Shares held from time to time by each.
CONFLICTS OF INTEREST
There are present and potential future conflicts of interest in the Trust’s structure and operation you should consider before you purchase Shares. The Sponsor will use this notice of conflicts as
a defense against any claim or other proceeding made. If the Sponsor is not able to resolve these conflicts of interest adequately, it may impact the Trust’s ability to achieve its investment objective.
The officers, directors and employees of the Sponsor do not devote their time exclusively to the Trust. These persons are directors, officers or employees of other entities which may compete with
the Trust for their services. They could have a conflict between their responsibilities to the Trust and to those other entities.
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The Sponsor has the authority to manage the investments and operations of the Trust, and this may allow it to act in a way that furthers its own interests which may create a conflict with your best
interests. Shareholders have very limited voting rights, which will limit their ability to influence matters such as amendment of the Trust Agreement, change in the Trust’s basic investment policy, dissolution of the Trust, or the sale or
distribution of the Trust’s assets.
The Sponsor serves as the sponsor to the Trust. The Sponsor may have a conflict to the extent that its trading decisions for the Trust may be influenced by the effect they would have on other funds
its affiliates may manage. In addition, the Sponsor may be required to indemnify its officers, directors and key employees with respect to their activities on behalf of other funds, if the need for indemnification arises. This potential
indemnification could cause the Sponsor’s assets to decrease. If the Sponsor’s other sources of income are not sufficient to compensate for the indemnification, it could cease operations, which could in turn result in Trust losses and/or termination
of the Trust.
If the Sponsor acquires knowledge of a potential transaction or arrangement that may be an opportunity for the Trust, it will have no duty to offer such opportunity to the Trust. The Sponsor will
not be liable to the Trust or the Shareholders for breach of any fiduciary or other duty if Sponsor pursues such opportunity or directs it to another person or does not communicate such opportunity to the Trust. Neither the Trust nor any Shareholder
has any rights or obligations by virtue of the Trust Agreement, the trust relationship created thereby, or this Prospectus in such business ventures or the income or profits derived from such business ventures. The pursuit of such business ventures,
even if competitive with the activities of the Trust, will not be deemed wrongful or improper.
The Sponsor, the Prime Broker, the Execution Agent and their respective affiliates and/or employees may hold or participate in transactions related to SOL, either for their own account or for the
account of others, such as clients. Such transactions may occur prior to, during, or after the commencement of this offering. Such transactions may not serve to benefit the Shareholders of the Trust and may have a positive or negative effect on the
value of the SOL held by the Trust and, consequently, on the market value of SOL. Because these parties may trade SOL for their own accounts at the same time as the Trust, prospective Shareholders should be aware that such persons may take positions
in SOL which are opposite, or ahead of, the positions taken for the Trust. There can be no assurance that any of the foregoing will not have an adverse effect on the performance of the Trust.
The Prime Broker and the Execution Agent may be subject to certain conflicts of interest, including: (i) the Trust’s orders may be routed to the Prime Broker’s own execution venue or to the
Execution Agent’s principal market, where the Trust’s orders may be executed against other customers of the Prime Broker or Execution Agent, or with the Prime Broker acting as principal, (ii) the beneficial identity of the counterparty purchaser or
seller with respect to the Trust’s orders may be unknown and therefore may inadvertently be another client of the Prime Broker or the Execution Agent, (iii) neither the Prime Broker nor the Execution Agent engages in front-running, but each is aware
of the Trust’s orders or imminent orders and may execute a trade for its own inventory (or the account of an affiliate) while in possession of that knowledge, and (iv) the Prime Broker or Execution Agent may act in a principal capacity with respect
to certain orders. As a result of these and other conflicts, when acting as principal, the Prime Broker or the Execution Agent may have an incentive to favor its own interests and the interests of its affiliates over the Trust’s interests. While the
Prime Broker and the Execution Agent each have in place procedures to mitigate conflicts of interest when executing the Trust’s orders, trading platforms or counterparties not used by the Prime Broker or Execution Agent may offer better prices and/or
lower costs than the platforms or counterparties used to execute the Trust’s orders.
The Execution Agent has adopted and implemented policies and procedures that are reasonably designed to ensure compliance with applicable law, including among others a Personal Trading Accounts
Policy, a
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Code of Ethics and Business Conduct, and a Global Policy on the Use of Confidential Information and the Prohibition of Insider Trading, which address certain conflicts of interest (together, the
“Policies”). Consistent with the requirements of the Policies, the Execution Agent will implement standard operating protocols under which personnel who have access to information about creation and redemption activity in Shares of the Trust (“Solana
Access Persons”) report and disclose personal trading activity and holdings in SOL. All of the Execution Agent’s employees will be required to preclear personal transactions in the Shares of the Trust. In addition, the Sponsor will adopt a Code of
Ethics that requires Solana Access Persons to report and pre-clear certain transactions in SOL, Shares of the Trust, and certain other digital assets. Finally, trading on behalf of clients in the shares of the Trust will be subject to controls
embedded in the Sponsor’s and the Execution Agent’s respective compliance programs and systems.
Resolution of Conflicts Procedures
The Trust Agreement provides that whenever a conflict of interest exists between the Sponsor or any of its affiliates, on the one hand, and the Trust or any Shareholders or any other person, on the
other hand, the Sponsor will resolve such conflict of interest considering the relative interest of each party (including its own interest) and the benefits and burdens relating to such interests, any customary or accepted industry practices, and any
applicable accepted accounting practices or principles.
DUTIES OF THE SPONSOR
The general fiduciary duties that would otherwise be imposed on the Sponsor (which would make its operation of the Trust as described herein impracticable due to the strict prohibition imposed by
such duties on, for example, conflicts of interest on behalf of a fiduciary in its dealings with its beneficiaries), will be replaced entirely by the terms of the Trust Agreement (to which terms all Shareholders, by subscribing to the Shares, are
deemed to consent). The Trust Agreement provides that the duty and authority to manage the affairs of the Trust is vested in the Sponsor, which duty and authority the Sponsor may further delegate.
Additionally, under the Trust Agreement, the Sponsor will have the power and authority as a sponsor of the Trust to cause the Trust, among other things:
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To own SOL, cash or IR Assets, to store SOL, cash or IR Assets with a Custodian, and to transfer SOL, cash or IR Assets;
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To litigate, compromise, arbitrate, settle or otherwise adjust claims in favor of or against the Trust or any matter in controversy, including claims for taxes;
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To operate as a trust with the purpose for which the Trust was established as described in the Trust Agreement, and exercise all the powers necessary or appropriate to the conduct of such operations;
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To issue, sell, repurchase, redeem, cancel, retire, acquire, hold, resell, reissue, transfer, dispose of and otherwise deal in Shares pursuant to applicable federal law; to establish terms and conditions including any fees or expenses
regarding the issuance, sale, repurchase, redemption, cancellation, retirement, acquisition, holding, resale, reissuance, disposition of or dealing in Shares; and to apply to any such repurchase, redemption, retirement, cancellation or
acquisition of Shares any funds or Trust property;
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In the event of an upcoming modification to the Solana network that could potentially result in a network fork or in the event of an upcoming airdrop, to cause the Solana Custodian, in consultation with the Sponsor, to either (i)
disclaim all rights to the IR Assets so created, (ii) sell the IR Assets as soon as reasonably practicable and thereafter distribute the cash proceeds to the Shareholders of record as of the date of the hard fork or airdrop that resulted in
the Trust’s acquisition of the IR Assets, or (iii) distribute the IR Assets in-kind as soon as reasonably practicable to the Shareholders of record as of the date of the hard
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fork or airdrop that resulted in the Trust’s acquisition of the IR Assets or to an agent acting on behalf of such Shareholders;
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To make such filings applications, statements, certificates, agreements and other instruments with the SEC, the Financial Industry Regulatory Authority or a national securities exchange as may be required by the federal securities laws or
other applicable regulations or as deemed necessary or desirable in the sole judgment of the Sponsor;
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To prepare and file and execute, in each case on behalf of the Trust, such applications, reports, surety bonds, irrevocable consents, appointments of attorney for service of process;
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To execute and deliver letters or documents to, or instruments for filing with, a depository relating to the Shares to be issued by the Trust and also any filing required to be made as determined by the Sponsor and any other filing or
application necessary or desirable as determined by the Sponsor in connection with the registration and/or offering of Shares by the Trust;
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To negotiate the terms of, and execute on behalf of the Trust, any agreement, including, but not limited to, any underwriting agreement or purchase agreement relating to the Shares to be issued by the Trust as determined by the Sponsor;
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To do all other acts which, in the Sponsor’s judgment, are reasonably necessary or desirable for the registration and/or offering of Shares by the Trust;
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To stake or delegate to a Custodian, an affiliate of the Custodian, an affiliate of the Execution Agent or another third-party to Stake SOL on the Solana network or other digital assets on another digital asset network, as applicable;
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Solely as consistent with the published IRS guidance, to borrow money, SOL or other digital assets and in this connection issue notes or other evidence of indebtedness; to secure such borrowings by mortgaging, pledging or otherwise
subjecting as security the Trust property; and to endorse, guarantee, or undertake the performance of an obligation or engagement of any other Person and to lend Trust property;
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To retain independent public accountants to audit the accounts of the Trust and employ attorneys to represent the Trust; and
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To enter into contracts and carry on any other activities in connection with or incidental to any of the foregoing powers or with the furtherance of the Trust’s purpose.
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The Sponsor will perform its duties in its subjective good faith belief as to what is in or not opposed to the best interests of the Trust, but only consistent with the terms of the Trust
Agreement.
LIABILITY AND INDEMNIFICATION
Trustee
The Trustee shall not be liable for any action reasonably taken, suffered or omitted by it in good faith and believed by it to be authorized or within the discretion or rights or powers
conferred upon it by the Trust Agreement. The Trustee shall not have any obligation or duty to supervise or monitor the performance of any other person, including the Trust or the Sponsor, and shall have no liability for the failure of any other
person to perform its obligations or duties under the agreements to which the Trust or the Trustee is a party or otherwise. The Trustee will not be personally liable under any circumstances, except for its own willful misconduct or gross
negligence. In particular, but not by way of limitation:
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(a) no implied covenants, duties (including fiduciary duties and duties existing at law or in equity) or obligations shall be read into the Trust
Agreement against the Trustee;
(b) in the absence of bad faith on the part of the Trustee, the Trustee may conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon any certificates or opinions furnished to the Trustee and conforming to the requirements of the Trust Agreement;
(c) the Trustee shall not be liable for an error of judgment made in good faith by an officer or employee of the Trustee;
(d) the Trustee shall not be liable with respect to any action taken, suffered or omitted to be taken by it in good faith in accordance with the
direction of the Sponsor;
(e) no provision of the Trust Agreement shall require the Trustee to expend or risk its personal funds or otherwise incur any financial liability in
the performance of its rights or duties under the Trust Agreement;
(f) under no circumstance shall the Trustee be personally liable for any representation, warranty, covenant, agreement or indebtedness of the Trust;
(g) the Trustee shall not be personally responsible for or in respect of the genuineness, form or value of the Trust property, the validity or
sufficiency of the Trust Agreement or for the due execution hereof by the Sponsor;
(h) the Trustee shall have no liability or responsibility for the validity or sufficiency of the Trust Agreement or for the form, character,
genuineness, sufficiency, enforceability, collectability, location, existence, value or validity of the Trust estate;
(i) the Trustee has not prepared or verified, and shall not be responsible or liable for, any information, disclosure or other statement or in any
document issued or delivered in connection with the sale or transfer of the Shares;
(j) the Trustee shall not have any liability for the acts or omissions of the Sponsor, the Custodian or their respective delegates;
(k) the Trustee shall have no duty or obligation to supervise the performance of any obligations of the Sponsor, the Custodian or their respective
delegates or any Authorized Participant; and
(l) in the event that the Trustee is unsure of the course of action to be taken by it hereunder, the Trustee may request instructions from the
Sponsor and to the extent the Trustee follows such instructions in good faith it shall not be liable to any person. In the event that no instructions are provided within the time requested by the Trustee, it shall have no duty or liability for its
failure to take any action or for any action it takes in good faith.
The Trustee will have no liability for the failure to respond to any instructions or directions that it has not actually received. The Trustee also will not be liable for any losses, costs or expenses arising directly
or indirectly from the Trustee's reliance upon and compliance with such instructions notwithstanding that such instructions conflict, or are inconsistent, with a subsequent written instruction.
The Trustee is under no obligation to exercise any of the duties or powers vested in it by the Trust Agreement; or to make any investigation of matters arising under the Trust Agreement; or to institute, conduct or
defend any litigation under the Trust Agreement or in relation thereto; or (except in certain limited circumstances) to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report,
notice, request, consent, order, approval, bond or other paper or document, unless requested in writing to do so by the Sponsor.
The Trustee may execute any of the trusts or powers vested in it by the Trust Agreement or perform any of its duties under the Trust Agreement either directly or by or through agents, nominees, or
attorney-in-fact appointed with due care and shall not be responsible for any willful misconduct or negligence on the part of any agent, custodian, nominee or attorney-in-fact so appointed, provided that the appointment of any
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agent, custodian, nominee or attorney-in-fact shall not relieve the Trustee of any of its obligations or liabilities under the Trust Agreement.
Except as otherwise provided in Section 2.2 of the Trust Agreement, in accepting the trust created by the Trust Agreement, the Trustee acts solely as a trustee under the Trust Agreement and not in
its individual capacity, and all persons having any claim against the Trustee by reason of the transactions contemplated by the Trust Agreement will look only to the Trust’s property for payment or satisfaction thereof.
The Trustee will not be liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if the Trustee has been
advised of the likelihood of such loss or damage and regardless of the form of action. In no event shall the Trustee hereto be liable for any failure or delay in the performance of its obligations under the Trust Agreement or any related documents
because of circumstances beyond its control.
Under the Trust Agreement, the Trust has agreed to be primary obligor and to indemnify, defend and hold harmless the Trustee, in its individual capacity and in its capacity as Trustee and any of
the officers, directors, employees, affiliates and agents of the Trustee (the “Indemnified Persons”) from and against any and all losses, damages, liabilities, claims, actions, suits, costs, expenses, disbursements (including reasonable legal fees
and expenses in connection with enforcement of its rights to indemnity under the Trust Agreement and including the reasonable fees and expenses of counsel), taxes and penalties of any kind and nature whatsoever (collectively, “Expenses”), to the
extent that such Expenses arise out of or are imposed upon or asserted at any time against such Indemnified Persons with respect to the performance of the Trust Agreement, the creation, operation or termination of the Trust or the transactions
contemplated by the Trust Agreement; provided, however, that the Trust shall not be required to indemnify any Indemnified Person for any Expenses which are a result of the willful misconduct or gross negligence of an Indemnified Person.
As security for any amounts owing to the Trustee under the indemnification provisions of the Trust Agreement described above, the Trustee shall have a lien against the Trust’s property, which lien
shall be prior to the rights of the Sponsor or any other Shareholder of the Trust. The obligations of the Sponsor and the Trust to indemnify the Indemnified Persons will survive the termination of the Trust Agreement.
Sponsor
The Trust Agreement provides that the Trust will indemnify, defend and hold harmless the Sponsor, in its capacity as Sponsor, and any of the officers, directors, employees, affiliates and agents of
the Sponsor (the “Sponsor Indemnified Persons”) from and against any and all Expenses, to the extent that such Expenses arise out of or are imposed upon or asserted at any time against such Sponsor Indemnified Persons with respect to the performance
of the Trust Agreement, the creation, operation or termination of the Trust or the transactions contemplated by the Trust Agreement; provided, however, that the Trust shall not be required to indemnify any Sponsor Indemnified Person for any Expenses
which are a result of the willful misconduct, bad faith or gross negligence of a Sponsor Indemnified Person. To the fullest extent permitted by law, Expenses to be incurred by a Sponsor Indemnified Person shall, from time to time, be advanced by, or
on behalf of, the Trust prior to the final disposition of any matter upon receipt by the Trust of an undertaking by, or on behalf of, such Sponsor Indemnified Person to repay such amount if it shall be determined that the Sponsor Indemnified Person
is not entitled to be indemnified under the Trust Agreement. The obligations of the Trust to indemnify the Sponsor Indemnified Parties will survive the termination of the Trust Agreement.
The Trust Agreement provides that (i) whenever a conflict of interest exists or arises between the Sponsor, on the one hand, and the Trust, on the other hand; or (ii) whenever the Trust Agreement
or any other
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agreement contemplated in the Trust Agreement provides that the Sponsor will act in a manner that is, or provides terms that are, fair and reasonable to the Trust, any Shareholder or any other
person, the Sponsor will use its good faith efforts to resolve such conflict of interest, take such action or provide such terms, considering in each case the relative interest of each party (including its own interest) to such conflict, agreement,
transaction or situation and the benefits and burdens relating to such interests, any customary or accepted industry practices, and any applicable generally accepted accounting practices or principles. In the absence of bad faith by the Sponsor, the
resolution, action or terms so made, taken or provided by the Sponsor will not constitute a breach of the Trust Agreement or any other agreement contemplated therein or of any duty or obligation of the Sponsor at law or in equity or otherwise.
VOTING BY SHAREHOLDERS; MANAGEMENT
The Shareholders of the Trust take no part in the management or control of, and have no voice in, the Trust’s operations or business. Shareholders will have no voting rights under the Trust
Agreement, except as authorized in the Sponsor's sole discretion. It is currently anticipated that Shareholders will possess no voting rights except as required by the listing rules of the Exchange or applicable law to which the Trust is subject.
The Sponsor, in its sole discretion, will generally have the right to amend the Trust Agreement without the consent of any Shareholders as it applies to the Trust provided that any amendment that
imposes or increases any fees or charges or prejudices a substantial existing right of the Shareholders will not become effective until thirty (30) days after notice of such amendment is given to the Shareholders. Any amendment shall be effective on
such date as designated by the Sponsor in its sole discretion. No amendment affecting the Trustee will be binding upon or effective against the Trustee unless consented to by the Trustee.
Liquidation and Voting Rights. The Sponsor will act to terminate the Trust upon the agreement of Shareholders owning at least seventy-five (75) percent of the outstanding Shares. Consistent with
the Trust Agreement, upon dissolution of the Trust, the Trustee will wind up the business and affairs of the Trust and direct the Execution Agent to sell all the SOL remaining in the Trust in an orderly manner. Following the liquidation of the
Trust’s SOL, any remaining outstanding Shares will be redeemed for cash and distributed to Shareholders in accordance with the provisions of the Trust Agreement.
The Trust does not have any directors, officers or employees. The creation and operation of the Trust has been arranged by the Sponsor. Under the Trust Agreement, all management functions of the
Trust will be delegated to and will be conducted by the Sponsor, its agents and its affiliates, including the Solana Custodian. The following persons, in their respective capacities as officers of the Sponsor perform certain functions with respect to
the Trust that, if the Trust had officers, would typically be performed by them.
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Name
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Capacity
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Brian Hartigan*
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Chief Executive Officer, Board of Managers
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Peter Hubbard
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Vice President and Director of Portfolio Management
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Jordan Krugman*
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Board of Managers
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Terry Gibson Vacheron
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Chief Financial Officer
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Kelli Gallegos*
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Principal Financial and Accounting Officer, Investment Pools
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Melanie Zimdars
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Chief Compliance Officer
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Melanie Ringold*
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Board of Managers
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* Executive officer of the Trust, within the meaning of Rule 3b-7 under the Exchange Act.
The Sponsor is managed by a Board of Managers. The Board of Managers is composed of Messrs. Hartigan and Krugman and Ms. Ringold.
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Brian Hartigan (45) has been Chief Executive Officer of the Sponsor since November 2023. In this role, he has general oversight responsibilities for all of
the Sponsor’s business. Mr. Hartigan has been a Member of the Board of Managers of the Sponsor since November 2023. Previously, Mr. Hartigan was Global Head of ETF Investments and Indexed Strategies at Invesco Ltd., a global investment management
company and affiliate of the Sponsor, since 2015. In that role, he was responsible for oversight of all portfolio management activities of exchange-traded funds (ETFs), as well as providing support to the US ETF Board, serving as a global ETF
expert/resource and providing day-to-day support. In addition, he was a team leader for Invesco’s unit investment trusts. Mr. Hartigan earned a BA degree from the University of St. Thomas in Minnesota and an MBA in finance from DePaul University. He
is a Chartered Financial Analyst® (CFA) charterholder and a member of the CFA Society of Chicago.
Peter Hubbard (43) joined the Sponsor in May 2005 as a portfolio manager and has been Vice President, Director of Portfolio Management since September 2012.
In his role, Mr. Hubbard manages a team of eight portfolio managers. His responsibilities include facilitating all portfolio management processes associated with more than 200 equity and fixed income Invesco Funds listed in the United States, Canada
and Europe. He is a graduate of Wheaton College with a B.A. degree in Business & Economics.
Jordan Krugman (46) is Chief Financial Officer of the Americas for Invesco Ltd., a global investment management company affiliated with the Sponsor. He was
appointed to this position in October 2020. In this capacity, Mr. Krugman is responsible for general management support, in addition to executing on various strategic initiatives and overseeing the financial framework for the business units operating
within the Americas division of Invesco Ltd. He has also served as a Member of the Board of Managers of the Sponsor since October 2020. From March 2019 to October 2020, Mr. Krugman served as the Global Head of Financial Planning and Analysis at
Invesco Ltd. In this role, he was responsible for overseeing Invesco’s forecasting, budgeting strategic planning and financial target setting processes, including analytics and decision support for Invesco Ltd.’s executive team. From March 2017 to
March 2019, Mr. Krugman served as Invesco Ltd.’s Head of Finance & Corporate Strategy, North America. In this role, Mr. Krugman was responsible for strategic and financial planning for Invesco Ltd.’s global investments organization including
global real estate, private equity and global fixed income. Prior to that, Mr. Krugman was Invesco Ltd.’s Treasurer and Head of Investor Relations from May 2011 to March 2017. In this role, he was responsible for management of Invesco Ltd.’s
liquidity and capital management programs. Additionally, Mr. Krugman managed the communication with Invesco Ltd.’s external stakeholders including equity shareholders, debt investors, rating agencies, and research analysts. Mr. Krugman earned a BA
degree in American civilizations, with a U.S. history concentration, from Middlebury College in Vermont in 1999, and earned an MBA from Santa Clara University in California in 2007. He is a Certified Treasury Professional (CTP).
Terry Vacheron CPA (59) is the Chief Accounting Officer (since April 2022)
and Head of Global Tax (since November 2020) at Invesco Ltd. In this role, she leads the company’s financial reporting, accounting, corporate tax, payroll, and SOX functions. Ms. Vacheron also serves as the Chief Financial Officer (since June 2022)
of the Sponsor and Invesco Advisers Inc. where she is responsible for overseeing all aspect of the companies’ financial operations, including financial reporting and accounting. Ms. Vacheron joined Invesco in November 2020 following a brief break
while between roles in October 2020. Prior to joining the firm, she was with SunTrust Bank (and later Truist Bank, which was formed in 2019 following the merger of BB&T and SunTrust) from October 2009 until September 2020, where she served as the
Chief Tax Officer. Ms. Vacheron directed the full spectrum of corporate tax matters and led the tax merger integration effort for the BBT and SunTrust merger. In an overlapping role as the Corporate Functions Risk Officer
at SunTrust Bank from March 2013 to December 2019, she built and led multiple corporate risk programs to identify and manage risk while maintaining her Chief Tax Officer responsibilities. During her tenure, she oversaw the implementation of stronger
guidelines and accountability for risk programs, including SOX, third-party risk management, and operational risk oversight. Ms. Vacheron earned a BS degree in accounting from the University of Tennessee. She is a Certified Public Accountant (CPA).
Ms.
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Vacheron served on the board of the United Way of Greater Atlanta from 2013 to 2020. She served as a member of the United Way’s Community Engagement Council and is currently on the United Way’s
Finance Committee.
Kelli Gallegos (53) has been Principal Financial and Accounting Officer—Investment Pools for the Sponsor since September 2018. Additionally, since September
2018, Ms. Gallegos has been Principal Financial and Accounting Officer – Investment Pools of Invesco Specialized Products, LLC (sponsor to a suite of currency exchange-traded funds, “ISP”), Head of North America Fund Reporting of Invesco, Ltd.
(“Invesco”, a global investment management company), and Vice President and Treasurer of Invesco Exchange Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded
Fund Trust, Invesco Actively Managed Exchange-Traded Commodity Fund Trust, and Invesco Exchange-Traded Self-Indexed Fund Trusts (each a registered investment company offering series of exchange-traded funds, the “Invesco ETFs”). She also serves as
Vice President (since March 2016), Principal Financial Officer (since March 2016) and Assistant Treasurer (since December 2008) for a suite of mutual funds advised by Invesco Advisers, Inc., a registered investment adviser (the “Invesco Funds”). In
her roles with the Sponsor, ISP, Invesco, the Invesco ETFs, and the Invesco Funds, Ms. Gallegos has financial and administrative oversight responsibilities for, and serves as Principal Financial Officer of the Invesco ETFs, the Trust and the
exchange-traded funds for which ISP serves as sponsor (the “CurrencyShares Trusts”). Previously, she was Director of Fund Financial Services from December 2008 to September 2018, Assistant Treasurer for the Sponsor from January 2013 to September
2018, Assistant Treasurer of ISP from April 2018 to September 2018, Assistant Treasurer for the Invesco ETFs from September 2014 to September 2018 and Assistant Vice President for the Invesco Funds from December 2008 to March 2016. In such roles, Ms.
Gallegos managed the group of personnel responsible for the preparation of fund financial statements and other information necessary for shareholder reports, fund prospectuses, regulatory filings, and for the coordination and oversight of third-party
service providers of the Trust, the Invesco ETFs, the Invesco Funds, and the CurrencyShares Trusts. Ms. Gallegos earned a BBA in accounting from Harding University in Searcy, AR.
Melanie H. Zimdars (47) has been Chief Compliance Officer of the Sponsor since November 2017. In this role she is responsible for all aspects of regulatory
compliance for the Sponsor. Ms. Zimdars has also served as Chief Compliance Officer of Invesco Exchange-Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Fund
Trust and Invesco Actively Managed Exchange-Traded Commodity Fund Trust since November 2017. From September 2009 to October 2017, she served as Vice President and Deputy Chief Compliance Officer at ALPS Holdings, Inc. where she was Chief Compliance
Officer for six different mutual fund complexes, including active and passive ETFs and open-end and closed-end funds. Through its subsidiary companies, ALPS Holdings, Inc. is a provider of investment products and customized servicing solutions to the
financial services industry. Ms. Zimdars received a BS degree from the University of Wisconsin-La Crosse.
Melanie Ringold (48) has been a Member of the Board of Managers of the Sponsor since July 2024. Ms. Ringold has also served as Head of Legal for the Americas
at Invesco Ltd., a global investment management company and affiliate of the Sponsor, since January 2023. In this role, she is responsible for overseeing legal support for all of Invesco’s Americas business. Prior to her current position, Ms. Ringold
served as Assistant General Counsel from March 2011 until January 2023, where she was responsible for overseeing legal support for the investments organization and co-chairing the firm’s US Regulatory Change Committee. Ms. Ringold earned a JD from
the University of Houston Law Center and a BA degree in political science from the University of Michigan.
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BOOKS AND RECORDS
The Trust keeps its books of record and account at the office of the Sponsor or at the offices of the Administrator, or such office, including of an administrative agent, as it may subsequently
designate upon notice. The books and records are open to inspection by any person who establishes to the Trust’s satisfaction that such person is a Shareholder upon reasonable advance notice at all reasonable times during usual business hours of the
Trust.
The Trust will keep a copy of the Trust Agreement on file in the Sponsor’s office, which will be available for inspection by any Shareholder at all times during its usual business hours upon
reasonable advance notice.
STATEMENTS, FILINGS, AND REPORTS TO SHAREHOLDERS
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 that the Sponsor determines shall be included. The annual report will be filed with the SEC and the Exchange and will be
distributed to such persons and in such manner, as is required by applicable laws, rules and regulations.
The Sponsor is responsible for the registration and qualification of the Shares under the federal securities laws. The Sponsor will also prepare, or cause to be prepared, and file any periodic
reports or updates required under the Exchange Act. The Administrator will assist and support the Sponsor in the preparation of such reports.
The Administrator 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.
FISCAL YEAR
The fiscal year of the Trust is the period ending December 31 of each year. The Sponsor may select an alternate fiscal year.
GOVERNING LAW; CONSENT TO DELAWARE JURISDICTION
The rights of the Sponsor, the Trust, DTC (as registered owner of the Trust’s global certificate for Shares) and the Shareholders are governed by the laws of the State of Delaware. The Sponsor, the
Trust, and, by accepting Shares, each DTC Participant and each Shareholder, consent to the exclusive jurisdiction of the Court of Chancery of the State of Delaware or, if such court does not have subject matter jurisdiction, any other courts located
in Delaware for any claims, suits, actions or proceedings, provided that (i) the forum selection provisions do not apply to suits brough to enforce a duty or liability created by the Exchange Act or any other claim for which the federal courts have
exclusive jurisdiction and (ii) the federal district courts of the United States of America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under any federal securities law. By purchasing Shares in
the Trust, Shareholders waive certain claims that the courts of the State of Delaware and any other courts located in Delaware is an inconvenient venue or is otherwise inappropriate.
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LEGAL MATTERS
Litigation and Claims
Within the past five years of the date of this Prospectus, there have been no material administrative, civil or criminal actions against the Sponsor, the Trust or any principal or affiliate of any
of them. This includes any actions pending, on appeal, concluded, threatened, or otherwise known to them.
Legal Opinions
The validity of the Shares will be passed upon for the Sponsor by Stradley Ronon Stevens & Young, LLP. Certain opinions of counsel have been filed with the SEC as exhibits to the Registration
Statement of which this Prospectus is a part.
EXPERTS
The financial statement as of October 16, 2025 included in this Prospectus has been so included in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting
firm, given on the authority of said firm as experts in auditing and accounting.
MATERIAL CONTRACTS
Trust Agreement
The following is a description of the material terms of the Trust Agreement.
Appointment and Duties of Trustee
The Trust Agreement provides that the Trustee is appointed to serve as the trustee of the Trust in the State of Delaware for the sole purpose of satisfying the requirement of Section 3807(a) of the
Delaware Act that the Trust have at least one trustee with a principal place of business in Delaware. The Sponsor shall have the exclusive authority to manage the affairs of the Trust as an agent of the Trust pursuant to Section 3806(b)(7) of the
Delaware Act.
Under the Trust Agreement, the Trustee has no obligation to supervise or monitor the Trust’s service providers or otherwise manage the Trust. The duties of the Trustee shall be limited to (i)
accepting legal process served on the Trust in the State of Delaware and (ii) the execution of any certificates required to be filed with the Secretary of State of the State of Delaware which the Trustee is required to execute under Section 3811 of
the Delaware Act.
The Trust Agreement provides that the Trustee shall serve for the duration of the Trust and until the effective date of the Trustee’s resignation or removal. The Trustee may resign upon sixty
(60) days’ prior notice to the Sponsor, which shall promptly appoint a successor. If no successor has been appointed by the Sponsor within such sixty (60) day period, the Trustee may, at the expense of the Trust, petition a court to appoint a
successor trustee.
Jurisdiction and Waiver of Jury Trial
The Trust Agreement provides that the Court of Chancery of the State of Delaware or, if such court does not have subject matter jurisdiction, any other courts located in Delaware will be the
exclusive jurisdiction for any claims, suits, actions or proceedings, provided that the federal district courts of the United States of
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America shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under any federal securities law. By purchasing Shares in the Trust, Shareholders waive
certain claims that the courts of the State of Delaware and any other courts located in Delaware is an inconvenient venue or is otherwise inappropriate. As such, Shareholder could be required to litigate a matter relating to the Trust in a Delaware
court, even if that court may otherwise be inconvenient for the Shareholder.
Matters Pertaining to Shares and Shareholders of the Trust
The Trust Agreement authorizes the Trust to issue an unlimited number of shares unless otherwise determined and subject to any conditions set forth by the Sponsor. The Trust will issue and redeem
the Shares in Creation Baskets only to certain Authorized Participants on an ongoing basis, or to such other purchaser or purchasers, including the Seed Capital Investor, as otherwise determined by the Sponsor in its sole discretion, and only in
exchange for SOL and/or cash. The creation and redemption mechanics are further described above under “Creation and Redemption of Shares.”
The Trust Agreement provides that all of the Shares are of the same class with equal rights and privileges. Each of the Shares is transferable, is fully paid and nonassessable 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. Shareholders have no voting rights, except as authorized in the Sponsor's sole discretion. It is currently anticipated that Shareholders will possess no voting rights except as required by the listing rules of the Exchange or
applicable law to which the Trust is subject. Shareholder voting rights are further described above under “Voting by Shareholders; Management—Liquidation and Voting Rights.”
Powers and Duties of the Sponsor
The Trust Agreement provides that the duty and authority to manage the affairs of the Trust is vested in the Sponsor, which duty and authority the Sponsor may further delegate, all pursuant to
Section 3806(b)(7) of the Delaware Act. The duties of the Sponsor under the Trust Agreement are further described above under “Duties of the Sponsor.”
Indemnification
Under the Trust Agreement, the Trustee and the Sponsor will have a right to be indemnified by the Trust for certain liabilities or expenses that each incurs without gross negligence, bad faith or
willful misconduct on its part.
Amendments
The Trust Agreement provides that it may be amended by the Sponsor in its sole discretion and without the Shareholders’ consent. Any such amendment to the Trust Agreement will be effective on such
date as designated by the Sponsor in its sole discretion, except that any amendment that imposes or increases any fees or charges or prejudices a substantial existing right of the Shareholders will not become effective until thirty (30) days after
notice of such amendment is given to the Shareholders. However, any amendment to the Trust Agreement that affects the rights or duties of the Trustee will require the Trustee’s prior written consent. Every Shareholder, at the time any amendment so
becomes effective, will 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.
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Tax Matters
The Trust Agreement provides that the Sponsor intends that the Trust shall be treated, for federal, state and local income tax purposes, as a grantor trust, and that, notwithstanding anything
contained in the Trust Agreement to the contrary, neither the Sponsor nor the Trustee, nor any other person acting for or on behalf of the Trust, shall take any action that is inconsistent with such treatment.
Governing Law
The validity and construction of the Trust Agreement and all amendments thereto shall be governed by the laws of the State of Delaware, and the rights of all parties hereto and the effect of every
provision thereof shall be subject to and construed according to the laws of the State of Delaware without regard to the conflicts of law provisions thereof; provided, however, that causes of action for violations of U.S. federal or state securities
laws are not governed by this limitation.
Derivative Actions
Under the Trust Agreement, no person who is not a Shareholder shall be entitled to bring any derivative action, suit or other proceeding on behalf of the Trust. The Trust Agreement provides that no
Shareholder may maintain a derivative action on behalf of the Trust unless holders of at least ten percent (10%) of the outstanding Shares join in the bringing of such action. In addition to the requirements set forth in Section 3816 of the Delaware
Act, a Shareholder may bring a derivative action on behalf of the Trust only if it meets additional conditions described in the Trust Agreement.
Merger and Consolidation
Under the Trust Agreement, the Sponsor may cause (i) the Trust to be merged into or consolidated with, converted to or to sell all or substantially all of its assets to, another trust or entity;
(ii) the Shares of the Trust to be converted into beneficial interests in another statutory trust (or series thereof); or (iii) the Shares of the Trust to be exchanged for units in another trust or company under or pursuant to any U.S. state or
federal statute to the extent permitted by law. Under the Trust Agreement, the Sponsor, with written notice to the Shareholders, may approve and effect any such transactions without any vote or other action of the Shareholders, but will not do so if
doing so would cause the Trust, its successor or other trust or company in which the Shareholders hold beneficial interests as a result of such transaction to fail or cease to qualify as a grantor trust for U.S. federal income tax purposes and any
purported approval or effecting of such a transaction shall be null and void ab initio and without legal effect.
Term and Termination
The Trust has no fixed termination date. The Trust may dissolve at the written direction of the Sponsor under the circumstances described in the section titled “Additional Information About the
Trust—Dissolution of the Trust,” above. On and after the date of dissolution of the Trust, the Sponsor shall wind up the Trust’s business and affairs in its sole discretion in accordance with the Delaware Act and upon completion of the winding up of
the Trust’s business and affairs by the Sponsor in accordance with the Delaware Act, including the payment of the expenses of liquidation and termination and any fee to the Transfer Agent in connection therewith and payment of any applicable taxes or
other governmental charges, Shareholders will be entitled to the distribution of the amount of trust property (paid in cash) represented by those Shares upon surrender or termination of the Shares then held. Upon completion of the winding up of the
Trust’s business and affairs by the Sponsor, the Trustee shall, at the written direction and expense of the Sponsor, file a certificate of cancellation in accordance with the Delaware Act and thereafter shall be
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released from any further duties or liabilities. Any remaining expenses of the Trust shall be paid by the Sponsor.
The Sponsor will act to terminate the Trust upon the agreement of Shareholders owning at least seventy-five (75) percent of the outstanding Shares.
Trust Administration and Accounting Agreement
Pursuant to the Trust Administration and Accounting Agreement, the Administrator is generally responsible for the day-to-day administration of the Trust. The responsibilities of the Administrator
include (i) establishing appropriate expense accruals and compute expense ratios, maintaining expense files and coordinating the payment of Trust approved invoices; (ii) calculating Trust approved income and per Share amounts required for periodic
distributions to be made by the Trust; (iii) calculating total return information; (iv) coordinating the Trust’s annual audit; (v) supplying various normal and customary portfolio and Trust statistical data as requested on an ongoing basis; and (vi)
preparing financial statements for the Trust.
The responsibilities of the Administrator also include providing various valuation and computation accounting services for the Trust, including (i) maintaining certain financial books and records
for the Trust, including creation and redemptions books and records, and Trust accounting records; (ii) computing the Trust’s NAV; (iii) obtaining quotes from pricing services as directed and approved by the Sponsor, or if such quotes are
unavailable, then obtaining such prices from the Sponsor, and in either case, calculating the market value of the Trust’s assets in accordance with the Trust’s valuation policies or guidelines; and (iv) transmitting or making available a copy of the
daily portfolio valuation to the Sponsor.
The Trust will indemnify the Administrator and any affiliate of the Administrator (“Administrator Indemnitees”), and the Administrator Indemnitees will incur no liability for its reliance upon (i)
any law, act, regulation or interpretation of the same even though the same may thereafter have been altered, changed, amended or repealed, (ii) the Trust’s offering materials or documents (excluding information provided by the Administrator), (iii)
any instructions or (iv) any written opinion of legal counsel for the Trust or the Administrator, or arising out of transactions or other activities of the Trust which occurred prior to the commencement of the Trust Administration and Accounting
Agreement; provided however, that the Trust shall not indemnify any Indemnitee for any losses arising out of the Administrator Indemnitees’ own bad faith, gross negligence or willful misconduct in the performance of the Trust Administration and
Accounting Agreement.
The Trust Administration and Accounting Agreement will have a three-year initial term and will automatically be renewed for successive one-year periods, unless terminated pursuant to the terms of
the agreement. The Trust may terminate the Trust Administration and Accounting Agreement at any time upon ninety days’ prior written notice in the event that the Sponsor determines to liquidate the Trust. The Administrator may terminate the Trust
Administration and Accounting Agreement at any time upon ninety days’ written notice for any reason and upon thirty (30) days’ written notice in the event of a breach of certain of the Trust’s representations contained in the Trust Administration and
Accounting Agreement.
Transfer Agency and Services Agreement
Pursuant to the Transfer Agency and Services Agreement, the Transfer Agent is generally responsible for the day-to-day administration of the Trust. The responsibilities of the Transfer Agent
include: (i) performing and facilitating the performance of purchases and redemption of Baskets in connection with creation and redemption transactions; (ii) preparing and transmitting by means of DTC’s book entry system payments for dividends and
distributions on or with respect to the Shares, if any, declared by the Trust; (iii) maintaining the record of the name and address of the Shareholder and the number of Shares issued by the
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Trust and held by the Shareholder; and (iv) recording the issuance of Shares of the Trust and maintain a record of the total number of Shares of the Trust which are outstanding and authorized,
based upon data provided to it by the Trust.
The Transfer Agency and Services Agreement will have a three-year initial term and will automatically be renewed for successive one-year periods, unless terminated pursuant to the terms of the
agreement. The Trust may terminate the Transfer Agency and Services Agreement at any time upon ninety days’ written notice in the event that the Trust’s sponsor determines to liquidate the Trust. The Transfer Agent may terminate the Transfer Agency
and Services Agreement at any time upon ninety days’ written notice for any reason.
Solana Custody Agreement
Pursuant to the Solana Custody Agreement, the Solana Custodian is responsible for providing the Trust with segregated cold wallet digital asset custody. The Trust’s assets with the Solana Custodian
are held in segregated wallets and are therefore not commingled with corporate or other customer assets. The Solana Custodian also segregates each of the accounts (comprising multiple wallets in some cases) that a client (such as the Trust) may hold
with the Solana Custodian, and each such account’s balance represents the account’s on-chain balance, which can be independently verified by the client or third-party auditors as needed. This approach applies to each asset supported by the Solana
Custodian.
Private key materials are generated and subsequently stored in a form whereby no private key is stored in a decrypted format. The private key materials are stored within the Solana Custodian’s
secure storage facilities within the U.S. and Europe. For security reasons, these exact locations are never disclosed.
Personnel supporting key operations are very limited and the Solana Custodian requires a background check prior to onboarding, and where required, annually thereafter. No single individual
associated with the Solana Custodian has access to full private keys. Private key use and subsequent transaction signing instead require access to multiple systems and human operators in order to access a key and perform an on-chain transaction. For
security purposes, the Solana Custodian does not disclose specifics around the roles and numbers of individuals involved in these processes.
The Solana Custodian maintains an annually renewed insurance policy with comprehensive coverage terms and conditions. This insurance policy covers the loss of client assets held in cold storage at
the Solana Custodian. This insurance program, which has continuously run since 2013, provides the Solana Custodian and its clients with some of the broadest and deepest insurance coverage in the digital asset industry, with coverage designed to be
comprehensive, including losses from employee collusion or fraud, physical loss (including theft), or damage of key material, security breach or hack, and fraudulent transfer. Furthermore, Coinbase also maintains a Cyber insurance program covering
security failures.
The Solana Custodian maintains an Internal Audit team that performs periodic internal audits over custody operations. SOC attestations are also performed on the Solana Custodian’s services. The SOC
1 Type 2 and SOC 2 Type 2 reports produced cover private key management controls as well as ensure controls are designed and operating effectively, providing reasonable assurance that customer digital asset positions held in custody and prime
brokerage accounts are authorized, executed and accurately and completely recorded. A SOC 1 Type 2 report addresses the controls at a service organization that are likely to be relevant to user entities’ internal control over financial reporting. A
SOC 2 Type 2 report addresses controls at a service organization relevant to security, availability, processing integrity, confidentiality, or privacy in order to support users’ evaluations of their own systems of internal control.
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The Solana Custodian will not be liable for any amount greater than the greater of (i) the aggregate amount of custodial fees paid in a 12-month period from the Trust to the Solana Custodian or
(ii) the value of the supported digital assets on deposit in the Trust’s custodial account(s) at the time of the event giving rise to the liability, subject further to the maximum liability limit of $100 million for each cold storage address.
Additionally, in respect of any incidental, indirect, special, punitive, consequential or similar losses, the Solana Custodian is not liable, even if the Solana Custodian has been advised of or knew or should have known of the possibility thereof.
The Solana Custodian is not liable for delays, suspension of operations, failure in performance, or interruption of service to the extent it is directly due to a cause or condition beyond the reasonable control of the Solana Custodian.
The Solana Custody Agreement became effective on October 10, 2025, and has no fixed termination date. Either party may terminate the Solana Custody Agreement in its entirety for any reason and
without cause by providing at least ninety days’ prior written notice to the other party.
Cash Custody Agreement
The Sponsor has entered into a Cash Custody Agreement with the Cash Custodian (the “Cash Custody Agreement”). Under the Cash Custody Agreement, the Cash Custodian will keep safely all cash and
other non-SOL assets of the Trust delivered to the Cash Custodian and, on behalf of the Trust, the Cash Custodian shall, from time to time, accept delivery of cash and other non-SOL assets for safekeeping.
In performing its duties under the Cash Custody Agreement, the Cash Custodian will exercise the standard of care and diligence that a professional custodian would observe in these affairs taking
into account the prevailing rules, practices, procedures and circumstances in the relevant market and shall perform its duties without negligence, fraud, bad faith or willful misconduct. The Cash Custodian’s liability arising out of or relating to
the Cash Custody Agreement will be limited solely to those direct damages that are caused by the Cash Custodian’s failure to perform its obligations under the Cash Custody Agreement in accordance with this standard of care.
The Cash Custody Agreement has no fixed termination date. Each party may terminate the Cash Custody Agreement by giving to the counterparty a notice in writing specifying the date of such
termination, which will be not less than ninety days after the date of such notice.
Marketing Agent Agreement
Pursuant to the Marketing Agent Agreement, the Marketing Agent is generally responsible for certain aspects of the day-to-day administration of the Trust. The responsibilities of the Marketing
Agent include (i) at the request of the Trust, assisting the Trust with facilitating Authorized Participant Agreements between and among Authorized Participants, the Trust, and the applicable Transfer Agent, for the creation and redemption of
Creation Baskets of the Trust; (ii) maintaining copies of confirmations of Creation Basket creation and redemption order acceptances and producing such copies upon reasonable request from the Trust or Sponsor; (iii) making available copies of the
Prospectus to Authorized Participants who have purchased Baskets in accordance with the Authorized Participant Agreements; (iv) maintaining telephonic, facsimile and/or access to direct computer communications links with the Transfer Agent; (v)
reviewing and approving, prior to use, certain Trust marketing materials submitted by the Trust for review (“Marketing Materials”) for compliance with applicable SEC and FINRA advertising rules, and filing all such Marketing Materials required to be
filed with FINRA; (vi) ensuring that all direct requests by Authorized Participants for Prospectuses are fulfilled; and (vii) working with the Transfer Agent to review and approve orders placed by Authorized Participants and transmitted to the
Transfer Agent.
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The Trust shall indemnify, defend and hold the Marketing Agent, its affiliates and each of their respective members, managers, directors, officers, employees, representatives and any person who
controls or previously controlled the Marketing Agent within the meaning of Section 15 of the Securities Act (collectively, the “Marketing Agent Indemnitees”), free and harmless from and against any and all losses, claims, demands, liabilities,
damages and expenses (including the costs of investigating or defending any alleged losses, claims, demands, liabilities, damages or expenses and any reasonable counsel fees incurred in connection therewith) (collectively, “Losses”) that any
Marketing Agent Indemnitee may incur arising out of or relating to (i) the Trust’s breach of any of its obligations, representations, warranties or covenants contained in the Marketing Agent Agreement; (ii) the Trust’s failure to comply in all
material respects with any applicable laws, rules or regulations; or (iii) any claim that the Prospectus, sales literature and advertising materials or other information filed or made public by the Trust (as from time to time amended) includes or
included an untrue statement of a material fact or omits or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading provided, however, that the Trust’s obligation to indemnify
any of the Marketing Agent Indemnitees shall not be deemed to cover any Losses arising out of any untrue statement or alleged untrue statement or omission or alleged omission made in the Prospectus or any such advertising materials or sales
literature or other information filed or made public by the Trust in reliance upon and in conformity with information provided by the Marketing Agent to the Trust, in writing, for use in such Prospectus or any such advertising materials or sales
literature.
The Marketing Agent Agreement will have a one-year initial term and will automatically be renewed for successive one-year periods, unless terminated on sixty days’ written notice by the Sponsor,
the Trust or the Marketing Agent.
Execution Agent Agreement
The Sponsor and the Execution Agent have entered into an agreement pursuant to which the Execution Agent will provide certain execution services on behalf of the Trust. Pursuant to the Execution
Agent Agreement, and subject to specific instructions from the Sponsor, the Execution Agent in its discretion is responsible for selecting the method of transacting, the price, the Solana Counterparty or Counterparties and the trading platform or
venue (if any) for the execution of each purchase and sale of SOL on behalf of the Trust. The Execution Agent has established policies and procedures for identifying, monitoring and performing due diligence on potential Solana Counterparties and
trading platforms or venues, with entities being added or removed from consideration on an ongoing basis. In addition, the Execution Agent evaluates Solana Counterparties and trading platforms or venues on a per-transaction basis. At the time it
selects a Solana Counterparty for any specific transaction, the Execution Agent may consider a number of factors in an effort to seek to achieve “best execution,” including price, transaction costs, speed, and likelihood of execution and settlement,
taking into account the size of the transaction and the experience and capabilities of the Solana Counterparty or any other consideration relevant to the execution of the relevant transaction, giving priority to transacting at a price that is the
same or similar to the Benchmark Price.
The Execution Agent shall designate, validate and maintain the Trust’s digital asset wallets in accordance with instructions received from the Sponsor. The Execution Agent shall cooperate with the
Trust’s administrator and custodian(s) as necessary and in accordance with agreed upon procedures.
In addition to the duty of care provisions contained in the Agreement, the Execution Agent is expressly prohibited from using any information that it has gained about the Trust’s trading activities
in SOL pursuant to instructions to inform (in whole or in part) any decision to purchase or sell SOL that it makes either for its own account or on behalf of any other person. The Execution Agent shall not aggregate any purchases or sales of SOL it
makes on behalf of the Trust with any purchases or sales of SOL it makes either for its
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own account or on behalf of any other person unless it does so in a manner that is not reasonably expected to operate to the disadvantage of the Trust.
The Execution Agent Agreement’s initial term will continue until December 22, 2025, and will automatically be renewed for successive two-year periods, unless terminated on one hundred eighty
days’ written notice by either party.
Master Services Agreement
The Sponsor has entered into a Master Services Agreement with the Benchmark Provider (the “Master Services Agreement”). Under the Master Services Agreement, the Benchmark Provider grants to Fund a
license to access and use the Benchmark in addition to other services of the Benchmark Provider. The Master Services Agreement limits the Benchmark Provider’s liability to exclude, among others, (i) loss of profits and any indirect damages arising
out of the Master Services Agreement and (ii) any breach of the Benchmark Provider’s servers or systems, including any hacking or unauthorized access to customer data. The Master Services Agreement also includes master terms that apply to other
agreements between the Trust and the Benchmark Provider, including the Benchmark Provider Agreement, discussed below.
The term of the Master Services Agreement commenced on February 1, 2022 and will continue until the termination of the Sponsor’s last outstanding subscription agreement with the Benchmark
Provider for services and proprietary data products. Each underlying subscription agreement automatically renews after its initial period for successive one-year periods until either party provides the other party with a written notice to terminate
that subscription agreement no less than ninety days prior to the close of the then-current subscription period, unless otherwise specified in such subscription agreement.
Calculation Services Subscription Agreement
The Sponsor has entered into a Calculation Services Subscription Agreement with the Benchmark Provider (the “Benchmark Provider Agreement”). Under the Benchmark Provider Agreement, the Benchmark
Provider agrees to provide and update the Sponsor and other identified parties with the value of SOL as calculated according to the methodology described in the “Description of Lukka Prime” section above, at agreed upon time frames, in exchange for a
fixed annual fee payable by the Sponsor.
The Calculation Services Subscription Agreement has an initial period of one year commencing on its effective date. The Calculation Services Subscription Agreement then automatically renews as
discussed above at “Material Contracts—Master Services Agreement.”
U.S. FEDERAL INCOME TAX CONSEQUENCES
The following is a discussion of certain material U.S. federal income tax consequences that generally will apply to the purchase, ownership and disposition of Shares by Shareholders and U.S.
federal income tax treatment of the Trust, and constitutes, insofar as it describes matters of U.S. federal income tax or legal conclusions relating thereto and subject to the limitations and qualifications described therein, the opinion of Stradley
Ronon Stevens & Young, LLP. The discussion below is based on the Code, Treasury Regulations promulgated thereunder and judicial and administrative interpretations of the Code, all as in effect on the date of this Prospectus and all of which are
subject to change either prospectively or retroactively. The tax treatment of Shareholders may vary depending upon their own particular circumstances. Certain Shareholders (including but not limited to banks, financial institutions, insurance
companies, regulated investment companies, real estate investment trusts, tax-exempt organizations, tax-exempt or tax-advantaged retirement plans or accounts, brokers or dealers, traders, partnerships for U.S. federal income tax purposes, persons
holding Shares as a position in a “hedging,” “straddle,” “conversion,”
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“constructive sale” or other integrated transaction for U.S. federal income tax purposes, persons whose “functional currency” is not the U.S. dollar, persons required for U.S. federal income tax
purposes to accelerate the recognition of any item of gross income with respect to the Shares as a result of such income being recognized on an applicable financial statement, or other investors with special circumstances) may be subject to special
rules not discussed below. In addition, the following discussion applies only to investors who will hold Shares as “capital assets” (generally, property held for investment). Moreover, the discussion below does not address the effect of any state,
local or foreign tax law consequences that may apply to an investment in Shares. Purchasers of Shares are urged to consult their own tax advisers with respect to all U.S. federal, state, local and foreign tax law considerations potentially applicable
to their investment in Shares.
For purposes of this discussion, a “U.S. Shareholder” is a Shareholder that is:
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an individual who is treated as a citizen or resident of the U.S. for U.S. federal income tax purposes;
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a corporation (or entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the U.S., any state thereof or the District of Columbia;
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an estate, the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or
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a trust, if a court within the U.S. is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust.
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For purposes of this discussion, a “U.S. Tax-Exempt Shareholder” is a U.S. Shareholder that is exempt from tax under Section 501(a) of the Code.
For purposes of this discussion, a “Non-U.S. Shareholder” is a Shareholder that is (or is treated as), for U.S. federal income tax purposes:
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a nonresident alien individual;
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a foreign corporation; or
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an estate or trust whose income is not subject to U.S. federal income tax on a net income basis.
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If a partnership or other entity or arrangement treated as a partnership for U.S. federal income tax purposes holds Shares, the tax treatment of a partner generally depends upon the status of the
partner and the activities of the partnership. If you are a partner of a partnership holding Shares, the discussion below may not be applicable, and the Trust urges you to consult your own tax adviser for the U.S. federal income tax implications of
the purchase, ownership and disposition of such Shares.
Taxation of the Trust
The Sponsor and the Trustee will treat the Trust as a “grantor trust” for U.S. federal income tax purposes. In the opinion of Stradley Ronon Stevens & Young, LLP, although not free from
doubt, if the Trust operates as expected, the Trust should be classified as a “grantor trust” for U.S. federal income tax purposes. As a result, the Trust itself should not be subject to U.S. federal income tax. Instead, the Trust’s income and
expenses should “flow through” to the Shareholders, and the Trustee intends to report the Trust’s income, gains, losses and deductions to the IRS on that basis. The opinion of Stradley Ronon Stevens & Young, LLP is not binding on the IRS or any
court. Accordingly, there can be no assurance that the IRS will agree with the conclusions of counsel’s opinion
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and it is possible that the IRS or another tax authority could assert a position contrary to one or all of those conclusions and that a court could sustain that contrary position.
In November of 2025, the U.S. Department of the Treasury and IRS issued a revenue procedure (the "Staking Revenue Procedure") setting forth a safe harbor under which the Trust will engage in
certain staking activities in reliance on the Staking Revenue Procedure. The Trust seeks to comply with the safe harbor and to maintain its status as an investment trust and as a grantor trust for U.S. federal income tax purposes. The requirements
under the safe harbor and under existing law are subject to interpretation and there can be no certainty that regulatory authorities will agree with the Trust's interpretation and application of the guidance or that the Trust will satisfy the
Staking Revenue Procedure's safe harbor conditions.
The treatment of staking in a grantor trust for U.S. federal income tax purposes is still developing.
As a grantor trust, the Trust can undertake only certain types of activities. For example, generally, the Trust cannot vary its investment portfolio to take advantage of market fluctuations. The
Trust may receive income from investment activities that do not require such decision-making. If staking is treated for U.S. federal income tax purposes as a passive ministerial and administrative activity, it should be permissible for the Trust. If
the Trust were viewed as undertaking the types of activities that would not be allowable for U.S. federal income tax purposes, then the Trust could lose its income tax status as a grantor trust, and the Trust could be reclassified as a partnership.
If the Trust were reclassified as a partnership, a more complex reporting regime would apply, and Shareholders would receive a Form K-1. If the Trust were reclassified as a partnership but did not satisfy a safe harbor or exception to the publicly
traded partnership rules, it could be reclassified as a corporation, which would subject the Trust to corporate level tax, and the Shareholder’s return on investment would likely be affected.
As discussed below in “Taxation of U.S. Shareholders,” if a hard fork, airdrop, staking or similar event occurs in the Solana blockchain, the Sponsor will instruct the Trust to immediately and
irrevocably disclaim all rights to the IR Assets so created. Although the Sponsor will instruct the Trust to immediately and irrevocably disclaim all rights to the IR Assets so created, it is possible that Shareholders may incur a federal income tax
liability if, for example, the IRS does not recognize such a disclaimer. The occurrence of a hard fork, airdrop, staking or the Trust’s or Sponsor’s actions with respect thereto or with respect to any alternative digital asset the Trust receives may
affect the Trust’s ability to qualify as a “grantor trust” for U.S. federal income tax purposes.
Neither the Sponsor nor the Trustee will request a ruling from the IRS with respect to the classification of the Trust for U.S. federal income tax purposes or with respect to any other matter.
If the IRS were to assert successfully that the Trust is not classified as a “grantor trust,” the Trust would likely be classified as a partnership for U.S. federal income tax purposes, which may affect the timing and other tax consequences to the
Shareholders, and might be classified as a publicly traded partnership that would be taxable as a corporation for U.S. federal income tax purposes, in which case the Trust would be taxed in the same manner as a corporation on its taxable income and
distributions to Shareholders out of the earnings and profits of the Trust would be taxed to Shareholders as ordinary dividend income (which may be eligible for preferential rates, in the case of non-corporate taxpayers, or a dividends received
deduction, in the case of corporate taxpayers). However, due to the uncertain treatment of digital currency for U.S. federal income tax purposes including with respect to the Staking Revenue Procedure (discussed above), there can be no assurance in
this regard. Except as otherwise indicated, the remainder of this discussion assumes that the Trust is classified as a grantor trust for U.S. federal income tax purposes.
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Taxation of U.S. Shareholders
A Shareholder will be treated, for U.S. federal income tax purposes, as if he or she directly owned a pro rata share of the underlying assets held in the
Trust. A Shareholder will also be treated as if he or she directly received their respective pro rata share of the Trust’s income, if any, (including staking income, as applicable) and as if they directly incurred their respective pro rata share of
the Trust’s expenses. For purposes of this discussion, and unless stated otherwise, it is assumed that all of a Shareholder’s Shares are acquired on the same date and at the same price per Share. A Shareholder that holds multiple lots of Shares, or
that is contemplating acquiring multiple lots of Shares, should consult his or her tax advisers as to the determination of the tax basis and holding period for the underlying SOL related to such Shares.
Current IRS guidance on the treatment of convertible virtual currencies classifies SOL as “property” that is not currency for U.S. federal income tax purposes and clarifies that SOL could be
held as a capital asset, but it does not address several other aspects of the U.S. federal income tax treatment of SOL. Because SOL is a new technological innovation, the U.S. federal income tax treatment of SOL or transactions relating to
investments in SOL may evolve and change from those discussed below, possibly with retroactive effect. In this regard, the IRS indicated that it has made it a priority to issue additional guidance related to the taxation of virtual currency
transactions, such as transactions involving SOL. Whether any future guidance will adversely affect the U.S. federal income tax treatment of an investment in SOL or in transactions relating to investments in SOL is unknown. Moreover, future
developments that may arise with respect to digital currencies may increase the uncertainty with respect to the treatment of digital currencies for U.S. federal income tax purposes. This discussion assumes that any SOL the Trust may hold is
properly treated for U.S. federal income tax purposes as property that may be held as a capital asset and is not currency for purposes of the provisions of the Code relating to foreign currency gain and loss.
The Trust may use SOL to pay the Sponsor Fee, which under current IRS guidance would be treated as a sale of such SOL. Although the Trust generally does not intend to sell SOL for other
purposes, it may do so in connection with cash redemption transactions, liquidating staking rewards for cash to pay quarterly distributions to Shareholders, or if necessary to pay certain expenses that must be paid in cash. As and when the Trust
sells SOL (for example to pay any such expenses) or is treated as selling SOL (for example, by using SOL to pay the Sponsor Fee), a Shareholder will generally recognize a gain or loss in an amount equal to the difference between (a) the
Shareholder’s pro rata share of the amount realized by the Trust upon the sale and (b) the Shareholder’s tax basis for its pro rata share of the SOL that was sold. A Shareholder’s tax basis for its share of any SOL sold by the Trust should
generally be determined by multiplying the Shareholder’s total basis for its share of all of the SOL held in the Trust immediately prior to the sale, by a fraction the numerator of which is the amount of SOL sold, and the denominator of which is
the total amount of the SOL 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 SOL remaining in the Trust should be equal to its tax basis for its share of the total amount
of the SOL held in the Trust immediately prior to the sale, less the portion of such basis allocable to its share of the SOL that was sold or treated as sold.
Upon a Shareholder’s sale of some or all of its Shares (other than a redemption), the Shareholder will be treated as having sold the portion or all, respectively, of its pro rata share of the SOL
held in the Trust at the time of the sale that is attributable to the Shares sold. Accordingly, the Shareholder generally will recognize a gain or loss on the sale in an amount equal to the difference between (a) the amount realized pursuant to the
sale of the Shares, and (b) the Shareholder’s tax basis for the portion of its pro rata share of the SOL held in the Trust at the time of sale that is attributable to the Shares sold, as determined in the manner described in the preceding paragraph.
Based on current IRS guidance, such gain or loss (as well as any gain or loss realized by a Shareholder on account of the Trust selling SOL) will generally be long-term
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or short-term capital gain or loss, depending upon whether the Shareholder has a holding period of greater than one year in its pro rata share of the SOL that was sold.
Gains or losses from the sale of SOL to fund cash redemptions are expected to be treated as incurred by the Shareholder that is being redeemed, and the amount of such gain or loss will generally
equal the difference between (a) the amount realized pursuant to the sale of the SOL , and (b) the Shareholder’s tax basis for the portion of its pro rata share of the SOL held in the Trust that is sold to fund the redemption, as determined in the
manner described in the paragraph that is two paragraphs above this one. A redemption of some or all of a Shareholder’s Shares in exchange for the cash received from such sale is not expected to be treated as a separate taxable event to the
Shareholder.
An in-kind redemption of some or all of a Shareholder’s Shares in exchange for the underlying SOL represented by the Shares redeemed generally will not be a taxable event to the Shareholder. The
Shareholder’s tax basis for the SOL 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 SOL held in the Trust immediately prior to the in-kind redemption that is
attributable to the Shares redeemed. The Shareholder’s holding period with respect to the SOL received generally should include the period during which the Shareholder held the Shares redeemed in-kind. A subsequent sale of the SOL received by the
Shareholder generally will be a taxable event, unless a nonrecognition provision of the Code or Treasury Regulations applies to such sale.
After any sale or redemption of less than all of a Shareholder’s Shares, the Shareholder’s tax basis for its pro rata share of the SOL 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 SOL held in the Trust immediately prior to the sale or redemption, less the portion of such basis that is taken into account in determining the amount of gain or loss
recognized by the Shareholder upon such sale or redemption for cash or, in the case of an in-kind redemption, that is treated as the basis of the SOL received by the Shareholder in the redemption.
If a hard fork, airdrop or similar event occurs in the Solana blockchain, the Sponsor will instruct the Trust to immediately and irrevocably disclaim all rights to the IR Assets, as discussed
above. Although the Sponsor will instruct the Trust to immediately and irrevocably disclaim all rights to the IR Assets so created, it is possible that Shareholders may still incur a federal income tax liability as a result of a hard fork, airdrop or
similar event if, for example, the IRS does not recognize such a disclaimer. Under current guidance, the IRS has held that a hard fork resulting in the receipt of new units of a digital asset is a taxable event giving rise to ordinary income. While
the IRS has not addressed all situations in which airdrops occur, it is clear from the reasoning of the IRS’s current guidance that it generally would treat an airdrop as a taxable event giving rise to ordinary income, and it is anticipated that any
gain or loss from disposition of any assets received in the airdrop would generally be treated as giving rise to capital gain or loss that generally would be short-term capital gain or loss, unless the holding period of those assets were treated as
being greater than one year as of the time they are sold.
If the Trust were to receive staking awards, likely in the form of new SOL tokens, any such staking rewards received by the Trust would be reportable to Shareholders as taxable income under current
IRS guidance. In 2023, the IRS released a revenue ruling that provided guidance on digital asset staking, including guidance to the effect that staking rewards will, under certain circumstances, be treated as giving rise to taxable income (the
“Staking Guidance”). Assuming that the Trust is treated as a grantor trust for U.S. federal income tax purposes, any staking income received will be a taxable event to beneficial owners of Shares. The Trust receiving staking rewards could result in
beneficial owners of Shares incurring tax liability without an associated distribution from the Trust.
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3.8% Tax on Net Investment Income
The Code generally imposes an additional 3.8% Medicare contribution tax on the net investment income of certain individuals, trusts, and estates to the extent their income exceeds certain threshold
amounts. Shareholders are advised to consult their tax advisors regarding the possible implications of this additional tax on their investment in the Shares.
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 the full amount of gain or loss upon a sale or deemed sale of SOL 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 as miscellaneous itemized deductions. An individual may not deduct miscellaneous itemized deductions. Similar rules apply to certain miscellaneous
itemized deductions of estates and trusts. In addition, such deductions may be subject to phase outs and other limitations under applicable provisions of the Code.
Investment by Certain Retirement Plans
Individual retirement accounts (“IRAs”) and participant-directed accounts under tax-qualified retirement plans are limited in the types of investments they may make under the Code. Potential
purchasers of Shares that are IRAs or participant-directed accounts under a Code section 401(a) plan should consult with their own tax advisors as to the potential tax consequences of a purchase of Shares.
U.S. Information Reporting and Backup Withholding
The Trustee will file certain information returns with the IRS, and provide certain tax-related information to Shareholders, in connection with the Trust. To the extent required by applicable
regulations, each Shareholder will be provided with information regarding its allocable portion of the Trust’s annual income, expenses, gains and losses (if any). A U.S. Shareholder may be subject to U.S. backup withholding tax in certain
circumstances unless it provides its taxpayer identification number and complies with certain certification procedures. Non-U.S. Shareholders may have to comply with certification procedures to establish that they are not a U.S. person, and some
Non-U.S. Shareholders may be required to meet certain information reporting or certification requirements imposed by the Foreign Account Tax Compliance Act, in order to avoid certain information reporting and withholding tax requirements.
The amount of any backup withholding will be allowed as a credit against a Shareholder’s U.S. federal income tax liability and may entitle the Shareholder to a refund, provided that the required
information is furnished to the IRS in a timely manner.
U.S. Federal Income Taxation of U.S. Tax-Exempt Shareholders
The Trust’s investments and activities relating thereto may cause a U.S. Tax-Exempt Shareholder to realize UBTI. In the absence of any guidance on the matter, a U.S. Tax-Exempt Shareholder’s share
of income
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from a hard fork, airdrop, or similar event with respect to digital currencies may be treated as UBTI. If the Trust were to incur liabilities, and thus, be treated as holding property constituting
debt-financed property (generally, assets purchased with borrowed funds), income attributable to such property generally would constitute UBTI.
Tax-Exempt Shareholders should consult their tax advisors with respect to the U.S. federal income tax consequences of an investment in the Shares.
U.S. Federal Income Taxation of Non-U.S. Shareholders
The Trust generally does not expect to generate taxable income except for gain (if any) upon the sale or transfer of SOL. A Non-U.S. Shareholder generally will not be subject to U.S. federal income
tax with respect to gain recognized upon the sale or other disposition of the Shares, or upon the sale or transfer of SOL by the Trust, unless (i) the Non-U.S. Shareholder is an individual and is present in the U.S. for one hundred and eighty-three
(183) days or more during the taxable year of the sale, transfer or other disposition, and the gain is treated as being from U.S. sources; or (ii) the gain is (or is treated as) effectively connected with the conduct by the Non-U.S. Shareholder of a
trade or business in the United States (“ECI”).
A Non-U.S. Shareholder’s allocable share of U.S. source dividend, interest, rental and other FDAP income that is not ECI generally will be subject to U.S. federal withholding tax at a rate of 30%
(unless reduced or eliminated by an applicable income tax treaty or statutory exemption). There is currently no guidance as to whether income recognized by the Trust as a result of a fork, airdrop or similar event would constitute U.S. source FDAP.
Non-U.S. Shareholders should consult their tax advisors with respect to the U.S. federal income tax consequences of an investment in the Shares.
Taxation in Jurisdictions Other Than the U.S.
Prospective purchasers of Shares that are based in or acting out of a jurisdiction other than the U.S. are advised to consult their own tax advisers as to the tax consequences under the laws of
such jurisdiction (or any other jurisdiction 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.
PROSPECTIVE SHAREHOLDERS ARE URGED TO CONSULT THEIR TAX ADVISERS BEFORE DECIDING WHETHER TO INVEST IN THE SHARES OF THE TRUST.
PURCHASES BY EMPLOYEE BENEFIT PLANS
The Employee Retirement Income Security Act of 1974 (“ERISA”) and/or Section 4975 of the Code impose certain requirements on: (i) employee benefit plans and certain other plans and arrangements,
including individual retirement accounts and annuities, Keogh plans and certain collective investment funds or insurance company general or separate accounts in which such plans or arrangements are invested, that are subject to Title I of ERISA
and/or Section 4975 of the Code (collectively, “Plans”); and (ii) persons who are fiduciaries with respect to the investment of assets treated as “plan assets” within the meaning of U.S. Department of Labor regulation 29 C.F.R. § 2510.3-101, as
modified by Section 3(42) of ERISA (the “Plan Assets Regulation”), of a Plan. Investments by Plans are subject to the fiduciary requirements and the applicability of prohibited transaction restrictions under ERISA and the Code.
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“Governmental plans” within the meaning of Section 3(32) of ERISA, certain “church plans” within the meaning of Section 3(33) of ERISA and “non-U.S. plans” described in Section 4(b)(4) of ERISA,
while not subject to the fiduciary responsibility and prohibited transaction provisions of Title I of ERISA or Section 4975 of the Code, may be subject to federal, state, local, non-U.S. or other law or regulation that are substantially similar to
the foregoing provisions of ERISA and the Code. Fiduciaries of any such plans are advised to consult with their counsel prior to an investment in the Shares.
In considering an investment of a portion of Plan assets in the Shares, the Plan fiduciary responsible for making such investment should carefully consider, taking into account the facts and
circumstances of the Plan, the “Risk Factors” discussed above and whether such investment is consistent with its fiduciary responsibilities. The Plan fiduciary should consider, among other issues, whether: (1) the fiduciary has the authority to make
the investment under the appropriate governing plan instrument; (2) the investment could constitute a direct or indirect non-exempt prohibited transaction with a “party in interest” or “disqualified person” within the meaning of ERISA and Section
4975 of the Code respectively; (3) the investment is in accordance with the Plan’s funding objectives; and (4) such investment is appropriate for the Plan under the fiduciary standards under ERISA including investment prudence and diversification,
taking into account the overall investment policy of the Plan, the composition of the Plan’s investment portfolio and the Plan’s need for sufficient liquidity to pay benefits when due.
By investing, each Plan shall be deemed to acknowledge and agree that: (a) none of the Sponsor, the Trustee, the Solana Custodian or any of their respective employees, representatives, agents or
affiliates (the “Transaction Parties”) has, through this report and related materials, provided any investment advice within the meaning of Section 3(21) of ERISA to the Plan in connection with the decision to purchase, acquire, hold or dispose of
such Shares; (b) no Transaction Party is intended to be treated as fiduciary to the Plan with respect to any decision by the Plan to purchase, acquire, hold or dispose of the Shares; and (c) no Transaction Party is expected to serve in a trusted
advisor role with respect to the Plan’s investment in the Shares.
INFORMATION YOU SHOULD KNOW
This Prospectus contains information you should consider when making an investment decision about the Shares. You should rely only on the information contained in this Prospectus. None of the Trust
or the Sponsor has authorized any person to provide you with different information and, if anyone provides you with different or inconsistent information, you should not rely on it. 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 information contained in this Prospectus was obtained from the Trust, the Sponsor, the Solana Custodian, the Execution Agent and other sources the Trust believes to be reliable.
You should disregard anything the Trust or the Sponsor said in an earlier document that is inconsistent with what is included in this Prospectus.
You should not assume that the information in this Prospectus is current as of any date other than the date on the front page of this Prospectus.
Cross references are included in this Prospectus to captions in these materials where you can find further related discussions. The table of contents tells you where to find these captions.
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WHERE YOU CAN FIND MORE INFORMATION
The Trust has filed 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 is available online at www.sec.gov.
Information about the Trust and the Shares can also be obtained from the Trust’s website, which is www.invesco.com/QSOL. The Trust’s website address is only provided here as a convenience to you
and the information contained on or connected to the 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 will file
certain reports and other information with the SEC under the Exchange Act.
The reports and other information are available online at www.sec.gov.
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INVESCO CAPITAL MANAGEMENT LLC PRIVACY NOTICE
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Rev. March 5, 2020
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FACTS
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WHAT DOES INVESCO DO WITH YOUR PERSONAL INFORMATION?*
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Why?
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Financial companies choose how they share your personal information. Federal law gives consumers the right to limit some but not all sharing. Federal law also requires us to tell you how we collect, share, and
protect your personal information. Please read this notice carefully to understand what we do.
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What?
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The types of personal information we collect and share depend on the product or service you have with us. This information can include:
• Social Security number and income
• Transaction history and investment experience
• Investment experience and assets
When you are no longer our customer, we continue to share information about you according to our policies.
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How?
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All financial companies need to share customers’ personal information to run their everyday business. In the section below, we list the reasons financial companies can share their customers’ personal
information; the reasons Invesco chooses to share; and whether you can limit this sharing.
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Reasons we can share your personal information
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Does Invesco share?
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Can you limit this sharing?
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For our everyday business purposes—
such as to process your transactions, maintain your account(s), respond to court orders and legal investigations, or report to credit bureaus
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Yes
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No
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For our marketing purposes—
to offer our products and services to you
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No
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We do not share
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For joint marketing with other financial companies
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No
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We do not share
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For our affiliates’ everyday business purposes—
information about your transactions and experiences
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No
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We do not share
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For our affiliates’ everyday business purposes—
information about your credit worthiness
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No
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We do not share
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For our affiliates to market to you
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No
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We do not share
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For non-affiliates to market to you
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No
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We do not share
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Questions?
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Call 1-800-959-4246 (toll free).
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*
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This privacy notice applies to individuals who obtain or have obtained a financial product or service from the Invesco family of companies. For a complete list of Invesco entities, please see the section titled
“Who is providing this notice” on page 2.
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Page 2
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Who we are
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Who is providing this notice?
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Invesco Advisers, Inc., Invesco Private Capital, Inc., Invesco Senior Secured Management, Inc., WL Ross & Co. LLC, Invesco Distributors, Inc., Invesco Managed Accounts, LLC, and the Invesco family of mutual
funds.
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What we do
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How does Invesco protect my personal information?
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To protect your personal information from unauthorized access and use, we use security measures that comply with federal law. These measures include computer safeguards and secured files and buildings.
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How does Invesco collect my personal information?
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We collect your personal information, for example, when you
• Open an account or give us your contact information
• Make deposits or withdrawals from your account or give us your income information
• Make a wire transfer
We also collect your personal information from others, such as credit bureaus, affiliates or other companies.
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Why can’t I limit all sharing?
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Federal law gives you the right to limit only
• Sharing for affiliates’ everyday business purposes—information about your creditworthiness
• Affiliates from using your information to market to you
• Sharing for nonaffiliates to market to you
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Definitions
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Affiliates
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Companies related by common ownership or control. They can be financial and nonfinancial companies.
Invesco does not share with our affiliates so that they can market to you.
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Nonaffiliates
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Companies not related by common ownership or control. They can be financial and nonfinancial companies.
Invesco does not share with non-affiliates so that they can market to you.
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Joint marketing
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A formal agreement between nonaffiliated financial companies that together market financial products or services to you.
Invesco doesn’t jointly market.
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Managers of Invesco Capital Management LLC (as Sponsor of Invesco Galaxy Solana ETF) and Shareholder of Invesco Galaxy Solana ETF
Opinion on the Financial Statement
We have audited the accompanying statement of assets and liabilities of Invesco Galaxy Solana ETF (the "Trust") as of October 16, 2025, including the related notes (collectively referred to as the “financial statement”). In our opinion, the
financial statement presents fairly, in all material respects, the financial position of the Trust as of October 16, 2025 in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
This financial statement is the responsibility of the Trust’s management. Our responsibility is to express an opinion on the Trust’s financial statement based on our audit. We are a public accounting firm registered with the Public Company
Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Trust in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and
the PCAOB.
We conducted our audit of this financial statement in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statement is free of material
misstatement, whether due to error or fraud.
Our audit included performing procedures to assess the risks of material misstatement of the financial statement, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test
basis, evidence regarding the amounts and disclosures in the financial statement. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the
financial statement. We believe that our audit provides a reasonable basis for our opinion.
/s/ PricewaterhouseCoopers LLP
Chicago, Illinois
October 31, 2025
We have served as the Trust’s auditor since 2025.
-146-
Invesco Galaxy Solana ETF
Statement of Assets and Liabilities
October 16, 2025
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Assets
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Cash held by custodian
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$100,000
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Total assets
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$100,000
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Liabilities
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Total liabilities
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$—
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Commitments and Contingencies (Note 6)
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Net Assets
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$100,000
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Shares outstanding
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4,000
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Net asset value per share
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$25.00
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See accompanying Notes to Financial Statement which are an integral part of the financial statement.
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Invesco Galaxy Solana ETF
Notes to Financial Statement
October 16, 2025
Note 1 – Organization
Invesco Galaxy Solana ETF (the “Trust”) is a Delaware statutory trust, formed on June 12, 2025, pursuant to the Delaware Statutory Trust Act (“DSTA”). The Trust
continuously issues common shares representing fractional undivided beneficial interest in and ownership of the Trust. The Trust operates pursuant to its Declaration of Trust and Trust Agreement, dated as of June 12, 2025 (the “Trust Agreement”). CSC
Delaware Trust Company, a Delaware trust company, is the Delaware trustee of the Trust (the “Trustee”). The Trust is managed and controlled by Invesco Capital Management LLC (the “Sponsor”).
On October 16, 2025, Invesco Ltd., the Seed Capital Investor, subject to certain conditions, purchased 4,000 Shares in exchange for $100,000, which comprise the
initial purchase of the Trust’s Shares. Delivery of the Shares was made on October 16, 2025. Through October 16, 2025, the Trust had no operations other than those related to its organization and registration and the sale of Shares to the Seed
Capital Investor. As of October 16, 2025, the Seed Capital Investor owns one hundred percent of the outstanding Shares. The Trust has an unlimited number of shares authorized for issuance.
The Trust’s investment objective is to reflect the performance of the spot price of Solana (“SOL”) as measured using Lukka Prime Solana Reference Rate (the
“Benchmark”), as adjusted to reflect the SOL staking rewards earned by the Trust and the Trust’s expenses and other liabilities. The Trust expects to outperform the Benchmark before taking its expenses and liabilities into account due to its plans to
receive SOL staking rewards. In seeking to achieve its investment objective, the Trust will hold SOL and will seek to stake substantially all of its SOL to earn staking rewards to the extent the Trust, in the Sponsor’s sole discretion, can engage in
staking without undue legal or regulatory risk, including jeopardizing its status as a grantor trust for U.S. federal income tax purposes (the “Staking Condition”). The Trust will value its Shares each day when the Exchange is open for regular
trading (a “Business Day”) as of 4:00 p.m. ET. Coinbase Custody Trust Company, LLC (the “Solana Custodian”) will hold all of the Trust’s SOL on the Trust’s behalf as Solana Custodian.
Note 2 – Summary of Significant Accounting Policies
| A. |
Basis of Presentation
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The financial statements of the Trust have been prepared using accounting principles generally accepted in the United States of America (“U.S. GAAP”). The Trust is
considered an
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investment company under U.S. GAAP for financial statement purposes and follows the accounting and reporting guidance applicable to investment companies in the Financial Accounting
Standards Board Accounting Standards Codification Topic 946, Financial Services— Investment Companies, but is not registered, and is not required to be registered,
under the Investment Company Act of 1940, as amended.
| B. |
Accounting Estimates
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The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statement. Actual results could differ from those estimates. In addition, the Trust monitors for material events or transactions that may occur or become known after the period-end date and before
the date the financial statements are issued.
| C. |
Segment Reporting
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The Trust represents a single operating segment. Subject to the oversight and, when applicable, approval of the Board of Managers, the Trust's Sponsor acts as the
Trust's chief operating decision maker (“CODM”), assessing performance and making decisions about resource allocation within the Trust. The CODM monitors the operating results of the Trust as a whole in view of the Trust’s operations in accordance
with the terms of its prospectus based on a single, defined investment strategy. The financial information provided to and reviewed by the CODM is consistent with that presented in the Trust's financial statements.
| D. |
Cash and Cash Equivalents
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The Trust defines cash as cash held by the Cash Custodian (as defined below). There were no cash equivalents held by the Trust as of October 16, 2025.
| E. |
Trust Expenses
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The Sponsor is responsible for all routine operational, administrative and other ordinary expenses of the Trust, including, but not limited to, the Trustee’s fees, the fees of
the Bank of New York Mellon (the “Administrator,” “Transfer Agent,” and “Cash Custodian”), the fees of the Solana Custodian, the fees of Galaxy Digital Funds LLC (the “Execution Agent”), fees associated with listing Shares on Cboe BZX (the
“Exchange”), Securities and Exchange Commission registration fees, printing and mailing costs, legal costs and audit fees.
The Trust will pay the Sponsor a unified fee of 0.25% per annum (the “Sponsor Fee”) as compensation for services performed under the Trust Agreement. The Trust’s only ordinary
recurring expense is the Sponsor Fee.
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The Sponsor Fee will be accrued daily and paid monthly in arrears in U.S dollars on the first Business Day of the month and will be calculated by the Administrator.
The Sponsor paid the costs of the Trust’s organization.
In certain cases, the Trust will pay for some expenses in addition to the Sponsor’s fee. These exceptions include expenses not assumed by the Sponsor (i.e.,
expenses other than those identified in the first paragraph of Section E of this Note 2), litigation and indemnification expenses, judgments, transactional expenses, taxes and other expenses not expected to be incurred in the ordinary course of the
Trust’s business.
| F. |
Federal Income Taxes
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The Sponsor intends to take the position that the Trust is properly treated as a grantor trust for U.S. federal income tax purposes. Assuming that the Trust is a
grantor trust, the Trust will not be subject to U.S. federal income tax and, therefore, no provision for federal income taxes is required. Rather, if the Trust is a grantor trust, each beneficial owner of Shares will be treated as directly owning its
pro rata share of the Trust’s assets and a pro rata portion of the Trust’s income, gain, losses and deductions will “flow through” to each beneficial owner of Shares.
Note 3 – Concentration Risk
Unlike other trusts that may invest in diversified assets, the Trust’s investment strategy is concentrated in a single asset: SOL. This concentration maximizes the degree of the
Trust’s exposure to a variety of market risks associated with SOL, including the rise or fall in its price, sometimes rapidly or unexpectedly. By concentrating its investment strategy solely in SOL, any losses suffered as a result of a decrease in
the value of SOL can be expected to reduce the value of an interest in the Trust and will not be offset by other gains if the Trust were to invest in underlying assets that were diversified. There is no assurance that SOL will maintain its long-term
value in terms of purchasing power in the future. In the event that the price of SOL declines, the Sponsor expects the value of an investment in the Shares to decline proportionately. Each of these events could have a material effect on the Trust’s
financial position and the results of its operations.
Note 4 – Service Providers and Related Party Agreements
The Trustee
CSC Delaware Trust Company, a Delaware trust company, acts as the Trustee of the Trust as required to create a Delaware statutory trust in accordance with the Trust Agreement and the
DSTA. Under the Trust Agreement, the duties of the Trustee are limited to (i) accepting legal process served on the Trust in the State of Delaware and (ii) at the direction of the Sponsor, the
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execution of any certificates required to be filed with the Secretary of State of the State of Delaware which the Trustee is required to execute under the DSTA.
The Sponsor
Invesco Capital Management LLC is the Sponsor of the Trust. The Sponsor arranged for the creation of the Trust and is responsible for the ongoing registration of the Shares for their
public offering, the listing of Shares on the Exchange and valuing the SOL held by the Trust. The Sponsor is a limited liability company formed in the state of Delaware on February 7, 2003, and is a wholly-owned subsidiary of Invesco Ltd. Invesco
Ltd. and its subsidiaries, including the Sponsor, are an independent global investment management group.
To cover the Sponsor Fee discussed in Section E of Note 2 above and any extraordinary expenses not assumed by the Sponsor, the Sponsor or its delegate will cause the Trust (or its
delegate) to instruct the Execution Agent to convert SOL held by the Trust into U.S. dollars. The Trust is not responsible for paying any costs associated with the transfer of SOL to or from the Trust in connection with paying the Sponsor Fee or in
connection with creation and redemption transactions.
The Administrator
The Bank of New York Mellon (“BNYM “) serves as the Trust’s Administrator. Under the trust administration and accounting agreement, the Administrator provides necessary
administrative, tax and accounting services and financial reporting for the maintenance and operations of the Trust, including calculating the NAV of the Trust, determining the net assets of the Trust, and calculating the size of the creation
baskets.
The Transfer Agent
BNYM also serves as the Transfer Agent for the Trust. The Transfer Agent is responsible for (1) issuing and redeeming Shares in connection with creation and redemption transactions,
(2) responding to correspondence by Shareholders and others relating to its duties, (3) maintaining Shareholder accounts and (4) making periodic reports to the Trust.
The Solana Custodian
Coinbase Custody Trust Company, LLC serves as the Trust’s Solana Custodian. Under the Solana Custody Agreement, the Solana Custodian is responsible for (1) safekeeping all of the SOL
owned by the Trust, (2) opening an account that holds the Trust’s SOL and (3) facilitating the transfer of SOL required for the operation of the Trust, as directed by the Sponsor. The Solana Custodian is chartered as a limited purpose trust company
by the New York State Department of Financial Services (“NYSDFS”) and is authorized by the NYSDFS to provide digital asset custody services. The Solana Custodian is a wholly-owned subsidiary of Coinbase Global, Inc.
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The Cash Custodian
BNYM serves as the Trust’s Cash Custodian. Under the Cash Custody Agreement, the Cash Custodian is responsible for holding the Trust’s cash in connection with creation and redemption
transactions effected in cash. The Cash Custodian is a New York state-chartered bank and a member of the Federal Reserve System.
The Marketing Agent
Invesco Distributors, Inc. (the “Marketing Agent”) is responsible for: (1) working with the Transfer Agent to review and approve, or reject, purchase and redemption orders of Shares
placed by Authorized Participants with the Transfer Agent; and (2) reviewing and approving the marketing materials prepared by the Trust for compliance with applicable SEC and Financial Industry Regulatory Authority advertising laws, rules, and
regulations.
The Execution Agent
The Sponsor has entered into an agreement with Galaxy Digital Funds LLC, a subsidiary of Galaxy Digital LP (“Galaxy”), to serve as Execution Agent. The Trust from time to time will be
required to sell SOL in such quantities as necessary to permit payment of the Sponsor Fee and any Trust expenses and liabilities not assumed by the Sponsor. The Sponsor has engaged the Execution Agent to sell SOL on the Trust’s behalf in such
circumstances. The Sponsor or its delegate will cause the Trust (or its delegate) to instruct the Execution Agent to sell SOL at approximately the price at which it is valued by the Trust and in the smallest amounts required to permit such payments
as they become due, with the intention of minimizing the Trust’s holdings of assets other than SOL. Accordingly, the amount of SOL to be sold may vary from time to time depending on the level of the Trust’s expenses and liabilities and the market
price of SOL. The Trust also may utilize the services of the Execution Agent to purchase or sell SOL in connection with cash creations and redemptions. In addition, as part of this agreement, the Execution Agent has agreed to co-brand and co-market
the Trust, and the Sponsor has licensed the use of certain Galaxy trademarks, service marks and trade names in connection with the Trust.
Galaxy is a subsidiary of Galaxy Digital Holdings LP (“Galaxy Holdings”). Galaxy Digital Holdings Ltd., which holds a limited partner interest in Galaxy Holdings, is listed on the
Toronto Stock Exchange under the symbol “GLXY.”
Note 5 – Organization and Offering Costs
The Sponsor has agreed to pay the organizational and initial offering costs of the Trust and the Trust will not be obligated to reimburse the Sponsor. The organizational and initial
offering costs include preparation and filing of incorporation documents, bylaws, declarations of trust, registration statements, state and federal registration of shares and audit fees. As a result, the Trust’s financial statements will not reflect
these organizational and initial offering costs.
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Note 6 – Commitments and Contingencies
The Trust’s organizational documents provide for the Trust to indemnify the Sponsor and any affiliate of the Sponsor that provides services to the Trust to the maximum extent
permitted by applicable law, subject to certain exceptions for disqualifying conduct by the Sponsor or such an affiliate. 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.
Note 7 – Subsequent Events
The Trust has evaluated the impact of all subsequent events through October 31, 2025, the date the financial statement was available for issuance and has determined that there were no subsequent
events requiring adjustment or additional disclosure in the financial statement.
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APPENDIX A
GLOSSARY OF DEFINED TERMS
GLOSSARY OF DEFINED TERMS
In this Prospectus, each of the following terms have the meanings set forth after such term:
“1940 Act”: Investment Company Act of 1940, as amended.
“Administrator”: The Bank of New York Mellon.
“Administrator Indemnitee”: The Administrator and any affiliate of the Administrator.
“Airdrop”: An event wherein the promoters of a new digital asset announce to holders of another digital asset that they will be entitled to claim a certain amount of the new digital asset for free
simply by virtue of having held the original digital asset at a certain point in time.
“ASC Topic 820”: The Financial Accounting Standards Board Accounting Standards Codification Topic 820, “Fair Value Measurements and Disclosures”.
“Alternative Benchmark”: An index or standard other than the Benchmark.
“AUL”: Authorized User List.
“Authorized Participant”: A financial firm that is authorized to purchase or redeem Creation Baskets from or to the Trust.
“Authorized Participant Agreement”: The authorized participant agreement by and among the Trust, the Sponsor and the Authorized Participant(s).
“Benchmark”: Lukka Prime Solana Reference Rate.
“Benchmark Pricing Source”: A SOL pricing source included in the Benchmark.
“Benchmark Provider”: Lukka, Inc.
“Benchmark Provider Agreement”: Calculation Services Subscription Agreement between the Sponsor and the Benchmark Provider.
“BES”: Base Exchange Score.
“BGP”: Border gateway protocol.
“BNYM”: The Bank of New York Mellon.
“BSA”: U.S. Bank Secrecy Act, as amended.
“Business Day”: Any day other than a Saturday, Sunday and any day when the Exchange is closed for regular trading.
“Cash Custodian”: The Bank of New York Mellon.
“Cash Custody Agreement”: Custody agreement by and between the Cash Custodian and the Trust.
A-1
“CBDCs”: Central bank digital currencies.
“Cboe”: Cboe BZX.
“CEA”: Commodity Exchange Act of 1936, as amended.
“CFIX”: Bloomberg Crypto Price Fixings.
“CFPB”: Consumer Financial Protection Bureau, an independent agency with the mandate to implement and enforce federal consumer financial law.
“CFTC”: Commodity Futures Trading Commission, an independent agency with the mandate to regulate commodity futures and options in the U.S.
“Code”: Internal Revenue Code of 1986, as amended.
“Coinbase”: Coinbase, Inc.
“Coinbase Global”: Coinbase Global, Inc.
“Connected Trading Venue”: Third-party trading platform or other trading platform where the Prime Broker routes orders to buy and sell SOL on behalf of the Trust if the Execution Agent opts to
utilize the Prime Broker to execute such orders.
“Creation Basket”: A block of 5,000 Shares used by the Trust to issue or redeem Shares.
“Creation Basket Deposit”: The total deposit required to create each Creation Basket.
“CTA”: Consolidated Tape Association
“CurrencyShares Trusts”: Exchange-traded funds for which ISP serves as sponsor.
“DAO”: Decentralized autonomous organization.
“DApp”: Decentralized applications.
“DCM”: Designated contract market.
“DeFi”: Decentralized financial services.
“DSTA”: Delaware Statutory Trust Act.
“DTC”: Depository Trust Company. DTC will act as the securities depository for the Shares.
“DTC Participant”: An entity that has an account with DTC.
“ECI”: Effectively Connected Income.
“ERISA”: The Employee Retirement Income Security Act of 1974.
“ETHW”: EthereumPoW network.
A-2
“ETP”: Exchange-traded product.
“Examinations”: The U.S. Securities and Exchange Commission’s Division of Examinations.
“Exchange”: Cboe BZX.
“Exchange Act”: The Securities Exchange Act of 1934, as amended.
“Execution Agent”: Galaxy Digital Funds LLC
“Expenses”: losses, damages, liabilities, claims, actions, suits, costs, expenses, disbursements (including the reasonable fees and expenses of counsel), taxes and penalties of any kind and nature
whatsoever.
“FASB”: Financial Accounting Standards Board.
“FDAP”: Fixed or determinable annual or periodical gains, profits and income.
“FDIC”: Federal Deposit Insurance Corporation.
“FinCEN”: The Financial Crimes Enforcement Network.
“FINRA”: Financial Industry Regulatory Authority, formerly the National Association of Securities Dealers.
“FMV”: Fair market value.
“FTX”: FTX Trading Ltd.
“Galaxy”: Galaxy Digital LP.
“Galaxy Holdings”: Galaxy Digital Holdings LP.
“Genesis”: Genesis Global Capital, LLC.
“ICO”: Initial coin offering.
“IFRS”: International Financial Reporting Standards Foundation
“IIV”: Intraday indicative value.
“Incidental Rights”: Rights to acquire, or otherwise establish dominion and control over, any virtual currency or other asset or right, which rights are incident to the Trust’s ownership of SOL and
arise without any action of the Trust or of the Sponsor on behalf of the Trust.
“Indemnified Person”: The Trustee as well as any officers, directors, employees and agents of the Trustee.
“Indirect Participants”: Banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a DTC Participant, either directly or indirectly.
“Initial Seed Shares”: 4,000 shares of the Trust sold to Invesco Ltd. in connection with the Trust’s launch.
“Invesco”: Invesco Capital Management LLC.
A-3
“Invesco ETFs”: Invesco Exchange Traded Fund Trust, Invesco Exchange-Traded Fund Trust II, Invesco India Exchange-Traded Fund Trust, Invesco Actively Managed Exchange-Traded Fund Trust, Invesco
Actively Managed Exchange-Traded Commodity Fund Trust, and Invesco Exchange-Traded Self-Indexed Fund Trusts.
“Invesco Funds”: Mutual funds advised by Invesco Advisers, Inc., a registered investment adviser.
“IR Assets”: Virtual currency tokens, or other asset or right, acquired by the Trust through the exercise (subject to the applicable provisions of the Trust Agreement) of any Incidental Right.
“IRAs”: Individual retirement accounts.
“IRS”: U.S. Internal Revenue Service.
“ISP”: Invesco Specialized Products, LLC.
“JOBS Act”: Jumpstart Our Business Startups Act.
“KYT”: Know-Your-Transaction.
“Losses”: Losses, claims, demands, liabilities, damages and expenses (including the costs of investigating or defending any alleged losses, claims, demands, liabilities, damages or expenses and any
reasonable counsel fees incurred in connection therewith).
“Marketing Agent”: Invesco Distributors, Inc.
“Marketing Agent Indemnitees”: The Marketing Agent, its affiliates and each of their respective members, managers, directors, officers, employees, representatives and any person who controls or
previously controlled the Marketing Agent within the meaning of Section 15 of the Securities Act.
“Marketing Materials”: Certain Trust marketing materials submitted by the Trust for review.
“Master Services Agreement”: Master Services Agreement between the Sponsor and the Benchmark Provider.
“Merge”: The 2022 fork that transitioned the Ethereum network from a proof-of-work consensus mechanism to a proof-of-stake consensus mechanism.
“NAV”: Net asset value per share of the Trust.
“NFA”: National Futures Association.
“NFT”: Non-fungible token.
“NYSDFS”: The New York State Department of Financial Services.
“OFAC”: The Office of Foreign Assets Control of the United States Department of the Treasury.
“OTC”: Over-the-counter markets.
“PCAOB”: Public Company Accounting Oversight Board.
A-4
“PIOB”: Benchmark Provider’s Price Integrity Oversight Board.
“Plans”: Employee benefit plans and certain other plans and arrangements, including individual retirement accounts and annuities, Keogh plans and certain collective investment funds or insurance
company general or separate accounts in which such plans or arrangements are invested, that are subject to Title I of ERISA and/or Section 4975 of the Code.
“PoS”: Proof-of-Stake.
“PoW”: Proof-of-Work.
“Prime Broker”: Coinbase, Inc.
“Prime Custody Vault”: “Cold storage” environment where the private keys associated with the Trust’s SOL are generated and secured.
“Redemption Order Date”: The date a redemption order is received in satisfactory form and approved by the Transfer Agent.
“Relevant Coinbase Entities”: Coinbase and Coinbase Global Inc.
“SEC”: The U.S. Securities and Exchange Commission.
“Securities Act”: Securities Act of 1933, as amended.
“Seed Capital Investor”: Invesco Ltd.
“Seed Creation Baskets:” 5 Creation Baskets anticipated to be purchased by the Seed Capital Investor.
“Selling Shareholder”: Invesco Ltd. (also referred to as the Seed Capital Investor) when it sells some or all of the Shares held by it pursuant to the registration statement for the Trust.
“Shareholders”: Holders of Shares.
“Shares”: Common shares representing fractional undivided beneficial interests in the Trust.
“SIPC”: Securities Investor Protection Corporation.
“SOC”: Systems and Organizational Control.
“SOL”: The digital asset within the Solana network.
“Solana Custody Agreement”: Prime brokerage and custody agreement between the Trust and Coinbase Custody Trust Company, LLC.
“Solana”: The system as a whole that is involved in maintaining the ledger of SOL ownership and facilitating the transfer of SOL among parties.
“Solana Access Persons”: Execution Agent personnel who have access to information about creation and redemption activity in Shares of the Trust.
A-5
“Solana Counterparty”: Digital asset trading platforms or counterparties with whom the Execution Agent transacts in acquiring or disposing of SOL on behalf of the Trust.
“Solana Custodian”: Coinbase Custody Trust Company, LLC.
“Solana Client”: A software application that implements the Solana network specification and communicates with the Solana network.
“Sponsor”: Invesco Capital Management LLC.
“Sponsor Fee”: The unified fee of 0.25% per annum paid by the Trust to the Sponsor.
“Sponsor Indemnified Person”: The Sponsor, in its capacity as Sponsor, and any of the officers, directors, employees, affiliates and agents of the Sponsor.
“Trading Balance”: Trading account that may be used to maintain the Trust’s SOL when it is being processed in connection with certain creation or redemption transactions or it is being sold.
“Transaction Parties”: The Sponsor, the Trustee, the Solana Custodian or any of their respective affiliates.
“Transfer Agent”: The Bank of New York Mellon.
“Trust”: Invesco Galaxy Solana ETF.
“Trust Agreement”: Amended and Restated Declaration of Trust and Trust Agreement dated as of November 28, 2025.
“Trustee”: CSC Delaware Trust Company, a Delaware trust company.
“U.S.”: United States of America.
“U.S. GAAP”: U.S. generally accepted accounting principles.
“U.S. Treasury Department”: United States Department of the Treasury.
“UBTI”: Unrelated Business Taxable Income.
“USDC”: U.S. Dollar Coin.
“WHO”: World Health Organization.
“You”: The current and prospective owner or holder of Shares.
A-6
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INVESCO GALAXY SOLANA ETF
COMMON SHARES
|
PROSPECTUS
|
December [ ], 2025
Until [ ], 2025 (25 calendar days after the date of the initial Prospectus) all dealers that effect transactions in these securities, whether or not participating in this
offering, may be required to deliver a Prospectus. This is in addition to the dealers’ obligation to deliver a Prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.
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II-1
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution.*
The Trust shall not bear any expenses incurred in connection with the issuance and distribution of the securities being registered. These expenses shall be paid by Invesco Capital Management LLC,
the sponsor of the Trust. Except for the Securities and Exchange Commission Registration Fee and Exchange Listing Fee, all such expenses are estimated:
|
Securities and Exchange Commission Registration Fee
|
**
|
|
Exchange Listing Fee
|
$12,000
|
|
Printing and engraving expenses
|
$150,000
|
|
Legal fees and expenses
|
$300,000
|
|
Accounting fees and expenses
|
$43,500
|
|
Total
|
$505,000
|
* Subject to revision upon completion of the offering.
** An indeterminate number of the securities is being registered as may from time to time be sold at indeterminate prices. In accordance with Rules 456(d) and 457(u), the Trust is deferring payment of all of the
registration fee and will pay the registration fee subsequently on an annual basis.
Item 14. Indemnification of Directors and Officers.
Under the Trust Agreement, the Trust has agreed to be primary obligor and to indemnify, defend and hold harmless the Trustee, in its individual capacity and in its capacity as Trustee and any of
the officers, directors, employees, affiliates and agents of the Trustee (the “Indemnified Persons”) from and against any and all losses, damages, liabilities, claims, actions, suits, costs, expenses, disbursements (including reasonable legal fees
and expenses in connection with enforcement of its rights to indemnity hereunder and including the reasonable fees and expenses of counsel), taxes and penalties of any kind and nature whatsoever (collectively, “Expenses”), to the extent that such
Expenses arise out of or are imposed upon or asserted at any time against such Indemnified Persons with respect to the performance of the Trust Agreement, the creation, operation or termination of the Trust or the transactions contemplated hereby;
provided, however, that the Trust shall not be required to indemnify any Indemnified Person for any Expenses which are a result of the willful misconduct, bad faith or gross negligence of an Indemnified Person. As security for any amounts owing to
the Trustee under the indemnification provisions of the Trust Agreement described above, the Trustee shall have a lien against the Trust’s property, which lien shall be prior to the rights of the Sponsor or any other Shareholder of the Trust. The
obligations of the Sponsor and the Trust to indemnify the Indemnified Persons will survive the termination of the Trust Agreement.
The Trust Agreement provides that the Trust shall indemnify, defend and hold harmless the Sponsor, in its capacity as Sponsor, the Sponsor Indemnified Persons from and against any and all Expenses,
to the extent that such Expenses arise out of or are imposed upon or asserted at any time against such Sponsor Indemnified Persons with respect to the performance of the Trust Agreement, the creation, operation or termination of the Trust or the
transactions contemplated by the Trust Agreement; provided, however, that the Trust shall not be required to indemnify any Sponsor Indemnified Person for any Expenses which are a result of the willful misconduct, bad faith or gross negligence of a
Sponsor Indemnified Person. To the fullest extent permitted by law, Expenses to be incurred by a Sponsor Indemnified Person shall, from time to time, be advanced by, or on behalf of, the Trust prior to the final disposition of any matter upon receipt
by the Trust of an undertaking by, or on behalf of, such Sponsor Indemnified Person to repay such amount if it shall be determined that the Sponsor Indemnified Person is not entitled to be indemnified under the
II-2
Trust Agreement. The obligations of the Trust to indemnify the Sponsor Indemnified Parties will survive the termination of the Trust Agreement.
Item 15. Recent Sales of Unregistered Securities.
In connection with the Trust’s launch, the Trust was seeded with $100,000 on October 16, 2025 through the sale of 4,000 Shares (“Initial Seed Shares”) at a per-Share price of $25.00 by the Trust to
Invesco Ltd. This transaction was effected pursuant to Section 4(a)(2) of the Securities Act.
Item 16. Exhibits and Financial Statement Schedules.
| (a) |
Exhibit.
|
The exhibits to this registration statement are listed in the Exhibit Index to this registration statement, which is incorporated herein by reference.
| (b) |
Financial Statement Schedules.
|
Not applicable.
Item 17. Undertakings.
| (a) |
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 SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more
than 20% change in the maximum aggregate offering price set forth in the “Calculation of 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;
|
Provided, however, That:
II-3
Paragraphs (1)(i), (ii), and (iii) of this section do not
apply if the registration statement is on Form S-1 or Form S-3 and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant
to section 13 or section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)) that are incorporated by reference in the registration statement, or, as to a registration statement on Form S-3, is contained in a form of prospectus
filed pursuant to Rule 424(b) that is part of the registration statement; and
| (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:
|
| (A) |
each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and
|
| (B) |
each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of
providing the information required by section 10(a) of the Securities Act shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the
date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a
new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering
thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or
prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was
part of the registration
|
II-4
statement or made in any such document immediately prior to such effective date; or
| (ii) |
If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed
in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that
is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of
contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of
first use.
|
| (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;
|
| (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) |
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 foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the SEC such indemnification is against public policy as expressed in the 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
|
II-5
being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
II-6
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 Downers Grove, and the State of Illinois, on November 28, 2025.
|
Invesco Galaxy Solana ETF
Invesco Capital Management LLC, as Sponsor of the Trust
|
||
|
By:
|
/s/ Brian Hartigan
|
|
|
Name: Brian Hartigan
Title: Chief Executive Officer and Manager
|
||
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities* and on the dates indicated.
|
Signature
|
Title
|
Date
|
|
/s/ Brian Hartigan
|
Chief Executive Officer, Manager
|
November 28, 2025
|
|
Name: Brian Hartigan
|
(principal executive officer)
|
|
|
/s/ Kelli Gallegos
|
Principal Financial and Accounting Officer, Investment Pools
|
November 28, 2025
|
|
Name: Kelli Gallegos
|
(principal financial officer and principal accounting officer)
|
|
|
/s/ Jordan Krugman
|
Manager
|
November 28, 2025
|
|
Name: Jordan Krugman
|
||
|
/s/ Melanie Ringold
|
Manager
|
November 28, 2025
|
|
Name: Melanie Ringold
|
| * |
The registrant is a trust and the persons are signing in their capacities as officers of Invesco Capital Management LLC, the Sponsor of the registrant.
|
EXHIBIT INDEX
|
Exhibit No.
|
Exhibit Description
|
|
3.1
|
|
|
3.2
|
|
|
5.1
|
|
|
8.1
|
|
|
10.1
|
[Reserved]
|
|
10.2
|
|
|
10.3
|
|
|
10.4
|
|
|
10.5
|
|
|
10.6
|
|
|
10.7
|
|
|
10.8
|
|
|
10.9
|
|
|
10.10
|
|
|
10.11
|
|
|
23.1
|
|
|
23.2
|
Consent of Stradley Ronon Stevens & Young, LLP (included in Exhibit 5.1 and Exhibit 8.1)*
|
|
107
|
* Filed herewith.
** To be filed by amendment.
| 1. |
Previously filed as an exhibit to the Registration Statement on Form S-1 filed June 25, 2025, and incorporated herein by reference.
|
| 2. |
Previously filed as an exhibit to the Registration Statement on Form S-1 filed October 31, 2025, and incorporated herein by reference.
|
Exhibit 3.1
INVESCO GALAXY SOLANA ETF
AMENDED AND RESTATED DECLARATION
OF TRUST AND TRUST AGREEMENT
AMENDED AND RESTATED DECLARATION
OF TRUST AND TRUST AGREEMENT
TABLE OF CONTENTS
|
ARTICLE I Formation of the Trust; Definitions; General Interpretive Matters
|
1
|
|
|
Section 1.1. Formation of Trust.
|
1
|
|
|
Section 1.2. Definitions.
|
2
|
|
|
Section 1.3. General Interpretive Principles.
|
5
|
|
|
Section 1.4. Appointment of Trustee and Authority of Sponsor.
|
6
|
|
|
ARTICLE II Representations and Warranties
|
6
|
|
|
Section 2.1. Representations and Warranties of the Sponsor.
|
6
|
|
|
ARTICLE III Matters Pertaining to Shares of the Trust
|
8
|
|
|
Section 3.1. Division of Beneficial Interest.
|
8
|
|
|
Section 3.2. Ownership of Shares.
|
8
|
|
|
Section 3.3. Transfer of Shares.
|
9
|
|
|
Section 3.4. Status of Shares, Limitation of Personal Liability and Shareholder Indemnification.
|
9
|
|
|
ARTICLE IV Powers and Obligations of the Trustee
|
10
|
|
|
Section 4.1. Eligibility Requirements for Trustee.
|
10
|
|
|
Section 4.2. Instructions or Directions Pursuant to E-mail.
|
11
|
|
|
Section 4.3. Powers.
|
11
|
|
|
Section 4.4. Duties of Trustee: Limitation of Liability.
|
12
|
|
|
Section 4.5. Trustee's Fees.
|
13
|
|
|
Section 4.6. State of Delaware.
|
14
|
|
|
Section 4.7. Certain Matters Affecting the Trustee.
|
14
|
|
|
Section 4.8. Virtual Currencies.
|
17
|
|
|
Section 4.9. Regarding the Sponsor.
|
17
|
|
|
Section 4.10. Payment of Expenses by the Trust.
|
19
|
|
|
Section 4.11. Service Contracts.
|
20
|
|
|
Section 4.12. Determinations by Sponsor.
|
21
|
|
|
Section 4.13. Sponsor's Duties.
|
21
|
|
|
ARTICLE V Matters Pertaining to Shareholders
|
23
|
|
|
Section 5.1. Shareholders' Rights, Voting, Transferability and Splits.
|
23
|
|
|
Section 5.2. Amendments.
|
24
|
|
i
|
ARTICLE VI NAV, Creations and Redemptions
|
24
|
|
|
Section 6.1. Determination of NAV, Net Income, and Distributions.
|
24
|
|
|
Section 6.2. Creations, Redemptions and Repurchases.
|
25
|
|
|
ARTICLE VII Tax Matters
|
27
|
|
|
Section 7.1. Tax Status of the Trust.
|
27
|
|
|
Section 7.2. Certain Costs.
|
27
|
|
|
ARTICLE VIII Compensation and Indemnification
|
27
|
|
|
Section 8.1. Indemnification of the Trustee.
|
27
|
|
|
Section 8.2. Indemnification of the Sponsor.
|
28
|
|
|
Section 8.3. Security Interest.
|
28
|
|
|
Section 8.4. Compensation of the Sponsor.
|
28
|
|
|
ARTICLE IX Resignation and Removal of the Trustee
|
28
|
|
|
Section 9.1. Resignation and Removal of the Trustee.
|
29
|
|
|
ARTICLE X Miscellaneous
|
30
|
|
|
Section 10.1. Entire Agreement.
|
30
|
|
|
Section 10.2. Governing Law.
|
30
|
|
|
Section 10.3. Counterparts.
|
30
|
|
|
Section 10.4. Merger and Consolidation.
|
31
|
|
|
Section 10.5. Dissolution of the Trust.
|
31
|
|
|
Section 10.6. Notices.
|
32
|
|
|
Section 10.7. Jurisdiction and Waiver of Jury Trial.
|
32
|
|
|
Section 10.8. Derivative Actions.
|
34
|
|
|
Section 10.9. Action Without a Meeting.
|
35
|
|
|
Section 10.10. Statutory Trust Only.
|
35
|
|
|
Section 10.11. Corporate Transparency Act.
|
35
|
|
|
Section 10.12. Legal Title to the Trust Estate.
|
35
|
|
ii
THIS FORM OF AMENDED AND RESTATED DECLARATION OF TRUST AND TRUST AGREEMENT (this "Amended and Restated
Declaration of Trust"), dated as of [___________], 2025, amends and restates the Trust Agreement dated as of June 12, 2025 (the "Prior Trust Agreement") , among Invesco Capital Management
LLC, a Delaware limited liability company, as sponsor (the "Sponsor"), and CSC Delaware Trust Company, a Delaware corporation ("CSC Delaware Trust Company"),
as trustee (the "Trustee").
WHEREAS, the Trust was formed under the Delaware Act (as defined herein) on June 12, 2025, by the filing of the Certificate of Trust in the
Office of the Secretary of State of the State of Delaware and the execution and delivery of the Prior Trust Agreement and
WHEREAS, the Prior Trust Agreement is superseded by this Amended and Restated Declaration of Trust.
NOW, THEREFORE, the Trustee and Sponsor do hereby amend and restate the Prior Trust Agreement in its entirety Accordingly, the Sponsor and
the Trustee hereby agree as follows:
ARTICLE I
Formation of the Trust; Definitions; General Interpretive Matters
Formation of the Trust; Definitions; General Interpretive Matters
Section 1.1. Formation of Trust.
| a. |
The trust is known as "Invesco Galaxy Solana ETF" (the "Trust") in which name the Sponsor, the Administrator, the Custodian or other duly authorized
parties may conduct the activities of the Trust to the extent provided herein, make and execute contracts, and sue and be sued. Any name change of the Trust shall become effective upon the effectiveness of the filing of a certificate of
amendment under the Delaware Act reflecting such change. Any such action shall have the status of an amendment to this Amended and Restated Declaration of Trust. In the event of any name change, the Sponsor shall provide written notice to the
affected Shareholders within a reasonable time after the implementation of such change, which notice will be deemed given if the changed name is reflected in any Registration Statement. The principal executive office of the Trust shall be
3500 Lacey Road, Suite 700, Downers Grove, IL 60515.
|
| b. |
It is the intention of the parties hereto that the Trust continued hereby constitute a statutory trust under Chapter 38 of Title 12 of the Delaware Code, 12 Del. C. § 3801 et seq. (the "Delaware Act") and that this Amended and Restated Declaration of Trust constitute the governing instrument of the Trust. Pursuant to authorization granted to it under the Prior Trust Agreement, the
Trustee executed and filed the Certificate of Trust with the Delaware Secretary of State. Without limiting the provisions hereof, the Trust may exercise all powers that are ordinarily exercised by such a
|
1
statutory trust under Delaware law. The Trust specifically reserves the right to exercise any of the powers or privileges afforded to statutory
trusts and the absence of a specific reference herein to any such power, privilege or action shall not imply that the Trust may not exercise such power or privilege or take such actions.
| c. |
The purpose of the Trust is to invest in and hold SOL for the benefit of the Shareholders and to engage in only those other activities necessary, advisable or incidental thereto, which may include
seeking to stake some or all of the Trust's SOL to earn staking rewards.
|
Section 1.2. Definitions.
Whenever used herein, unless otherwise required by the context or specifically provided:
| a. |
"Administrator" shall mean The Bank of New York Mellon, or any successor thereto, or any other entity who acts as administrator to the Trust pursuant
to a written agreement with the Trust;
|
| b. |
"Amended and Restated Declaration of Trust" shall have the meaning assigned to such term in the preamble hereto;
|
| c. |
"Authorized Participant" shall mean a market participant 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, (ii) is a direct participant in DTC, and (iii) has entered into an Authorized Participant Agreement with the Sponsor and
the Trust, subject to acceptance by the Transfer Agent. To facilitate the creation and redemption of Creation Baskets, Authorized Participants may, but are not required to, establish an SOL custody account with the Custodian. Only Authorized
Participants may place orders to create or redeem Creation Baskets;
|
| d. |
"Authorized Participant Agreement" shall mean an agreement entered into by an Authorized Participant, the Trust and the Sponsor on behalf of the Trust
which provides the procedures for the creation and redemption of Creation Baskets and for the delivery of the SOL and distribution of the Shares required for such creations and redemptions.
|
| e. |
"Blockchain" shall have the meaning assigned to such term in Section 1.2(t) hereof;
|
| f. |
"Business Day" shall mean any day other than a Saturday, Sunday and any day that the national securities
exchange on which the Trust is listed as open for business;
|
2
| g. |
"Certificate of Trust" shall mean the certificate of trust of the Trust, as amended or restated from time to time, filed in the Office of the Secretary
of State of the State of Delaware in accordance with the Delaware Act;
|
| h. |
"Creation Basket" shall mean a block of 5,000 Shares (or such other number of Shares that the Sponsor shall determine from time to time in its sole
discretion);
|
| i. |
"Commission" shall mean the U.S. Securities and Exchange Commission;
|
| j. |
"CTA" shall have the meaning assigned to such term in Section 10.11 hereof;
|
| k. |
"Custodian" shall mean Coinbase Custody Trust Company, LLC with respect to the Trust's SOL and The Bank of New York Mellon with respect to the Trust's
cash, as applicable, or such other custodian(s) appointed by the Sponsor to serve as custodian of the Trust Property pursuant to a custody agreement between and among the Sponsor, the Trust and a Custodian (each a "Custody Agreement"), or any other entity who acts as custodian to the Trust pursuant to a written agreement with the Trust;
|
| l. |
"Custody Agreement" shall have the meaning assigned to such term in Section 1.2(k) hereof;
|
| m. |
"Delaware Act" shall have the meaning assigned to such term in Section 1.1 (b) hereof;
|
| n. |
"Digital Asset Network Fork" shall mean a substantial software modification to the Blockchain where the Trust's Property is reflected that results in
two or more competing and incompatible Blockchain implementations;
|
| o. |
"DTC" shall mean the Depository Trust Company. DTC is a limited purpose trust company organized under New York law, a member of the U.S. Federal
Reserve System and a clearing agency registered with the Commission. DTC will act as the securities depository for the Shares;
|
| p. |
"Expenses" shall have the meaning assigned to such term in Section 8.1 hereof;
|
| q. |
"IR Asset" shall have the meaning assigned to such term in Section 4.9 hereof;
|
| r. |
"NAV" shall mean net asset value;
|
| s. |
"SOL" shall mean a type of a digital asset based on an open source protocol existing on the Solana Network and utilizing cryptographic security. SOL
constitutes the assets underlying the Trust's Shares;
|
3
| t. |
"Solana" or "Solana Network" shall mean the online, end-user-to-end-user network hosting the public
transaction ledger, known as the blockchain (the "Blockchain"), and the source code comprising the basis for the protocols and cryptographic security governing the Solana Network;
|
| u. |
"Sponsor Indemnified Persons" shall have the meaning assigned to such term in Section 8.2 hereof;
|
| v. |
"Staking" shall mean a process by which SOL or other digital assets are locked up or "staked" with a validator on the applicable blockchain, with the
goal of being rewarded with new SOL tokens or other digital assets when the staked SOL or other digital assets becomes part of the process of validating data for the applicable blockchain;
|
| w. |
"Person" shall mean and include individuals, corporations, limited liability companies, partnerships, trusts, associations, joint ventures, estates and
other entities, whether or not legal entities, governments and agencies and political subdivisions thereof, whether domestic or foreign, and any other "person" within the meaning of Section 3801 (f) of the Delaware Act;
|
| x. |
"Prior Trust Agreement" shall have the meaning assigned to such term in the preamble hereto;
|
| y. |
"Registration Statement" shall mean the Trust's registration statement or statements as filed with the Commission, as in effect and as may be amended
from time to time and shall include any prospectus or statement of additional information forming a part thereof;
|
| z. |
"Seed Investor" shall mean the purchaser of the initial Creation Baskets acting solely in its capacity as purchaser of such initial Creation Baskets;
|
| aa. |
"Shareholder" shall mean a record owner of outstanding Shares;
|
| bb. |
"Shares" shall mean units of fractional undivided beneficial interest in and ownership of the Trust which are issued by the Trust;
|
| cc. |
"Sponsor" shall have the meaning assigned to such term in the preamble hereto;
|
| dd. |
"Sponsor's Fee" shall mean the fee paid by the Trust to the Sponsor in consideration for the
Sponsor's duties and its assumption of the ordinary administrative and marketing expenses that the Trust is expected to incur. The Sponsor's Fee will accrue daily and will be payable in cash as provided pursuant to the Trust's Registration
Statement monthly in arrears;
|
| ee. |
"Transaction Fee" shall have the meaning assigned to such term in Section 6.2 hereof;
|
4
| ff. |
"Transfer Agent" shall mean The Bank of New York Mellon, or any successor thereto, or any other entity who acts as transfer agent to the Trust pursuant
to a written agreement with the Trust;
|
| gg. |
"Trust" shall have the meaning assigned to such term in Section 1.1 (a) hereof;
|
| hh. |
"Trust Documents" shall have the meaning assigned to such term in Section 6.1 hereof;
|
| ii. |
"Trust Property" shall mean the SOL and any other property that is from time to time owned or held by or for the account of the Trust under this
Amended and Restated Declaration of Trust;
|
| jj. |
"Trustee" shall mean CSC Delaware Trust Company, not in its individual capacity but solely in its capacity as trustee of the Trust hereunder, and its
permitted successors and assigns in such capacity; and
|
| kk. |
"Trustee Indemnified Peron" shall have the meaning assigned to such term in Section 8.1 hereof;
|
Section 1.3. General Interpretive Principles.
For purposes of this Amended and Restated Declaration of Trust, except as otherwise expressly provided or unless the context otherwise requires:
| a. |
the terms defined in this Amended and Restated Declaration of Trust have the meanings assigned to them in this Amended and Restated Declaration of Trust and include the plural as well as the
singular, and the use of any gender herein shall be deemed to include the other gender, and capitalized terms not defined in this Amended and Restated Declaration of Trust have the meanings assigned to them in the Registration Statement;
|
| b. |
accounting terms not otherwise defined herein have the meanings assigned to them in accordance with United States generally accepted accounting principles as in effect from time to time;
|
| c. |
references herein to "Articles", "Sections", "Subsections", "Paragraphs" and other subdivisions without reference to a document are to designated Articles, Sections, Subsections, Paragraphs and
other subdivisions of this Amended and Restated Declaration of Trust;
|
| d. |
a reference to a Subsection without further reference to a Section is a reference to such Subsection as contained in the same Section in which the reference appears, and this rule shall also apply
to Paragraphs and other subdivisions;
|
5
| e. |
the words "herein", "hereof", "hereunder", "hereto", "hereby" and other words of similar import refer to this Amended and Restated Declaration of Trust as a whole and not to any particular provision
unless the context requires otherwise;
|
| f. |
the terms "include," "includes" and "including" and any comparable term shall be deemed to be followed by the phrase "without limitation";
|
| g. |
any definition referencing any agreement, instrument or other document shall be construed as referencing to such agreement, instrument or other document as from time to time amended, supplemented or
otherwise modified.
|
Section 1.4. Appointment of Trustee and Authority of Sponsor.
CSC Delaware Trust Company has been appointed and hereby agrees to serve as the Trustee of the Trust. The Trustee is appointed to serve as the trustee of the
Trust in the State of Delaware for the sole purpose of satisfying the requirement of Section 3807(a) of the Delaware Act that the Trust have at least one trustee with a principal place of business in Delaware. The Sponsor shall have the exclusive
authority to manage the affairs of the Trust as an agent of the Trust pursuant to Section 3806(b)(7) of the Delaware Act. It is understood and agreed by the parties hereto that the Trustee shall have none of the duties or liabilities of the Sponsor,
Administrator, Custodian or any other Person and shall have no obligation to supervise or monitor the Sponsor, Administrator, Custodian or any other Person or otherwise manage the Trust. The duties of the Trustee shall be limited to (i) accepting
legal process served on the Trust in the State of Delaware and (ii) the execution of any certificates required to be filed with the Secretary of State of the State of Delaware which the Trustee is required to execute under Section 3811 of the
Delaware Act. The Trustee shall provide notice to the Sponsor of its performance of any of the foregoing. The Sponsor shall reasonably keep the Trustee informed of any actions taken by the Sponsor with respect to the Trust that would reasonably be
expected to affect the rights, obligations or liabilities of the Trustee hereunder or under the Delaware Act.
ARTICLE II
Representations and Warranties
Representations and Warranties
Section 2.1. Representations and Warranties of the Sponsor.
| a. |
The Sponsor hereby represents and warrants to the Trust as of the date hereof, that:
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| i. |
The Sponsor is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization.
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| ii. |
The Sponsor has the full limited liability company power and authority to enter into and consummate all transactions contemplated by this Amended and Restated Declaration of Trust, has duly
authorized the
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6
execution, delivery and performance of this Amended and Restated Declaration of Trust, and has duly executed and delivered this Amended and
Restated Declaration of Trust.
| iii. |
This Amended and Restated Declaration of Trust, assuming due authorization, execution and delivery by the Trustee, constitutes a valid, legal and binding obligation of the Sponsor, enforceable
against the Sponsor in accordance with the terms hereof, subject to (A) applicable bankruptcy, insolvency, reorganization, moratorium and other laws affecting the enforcement of creditors' rights generally, and (B) general principles of
equity, regardless of whether such enforcement is considered in a proceeding in equity or at law.
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| iv. |
The execution, delivery and performance of the Sponsor of this Amended and Restated Declaration of Trust will not violate, conflict with, result in a breach of, or constitute a default under (a) the
organizational documents of the Sponsor, (b) any agreement or instrument to which the Sponsor is a party or by which it may be bound, (c) any law, any order or decree of any court or arbiter, or any order, regulation or demand of any federal,
state or local governmental or regulatory authority, and (d) any order, decision, judgment or decree that may be applicable to the Sponsor or any of its affiliates or any of their properties.
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| v. |
No consent, approval, authorization or order of any state or federal court or governmental agency or body is required for the consummation by the Sponsor of the transactions contemplated herein,
except for those consents, approvals, authorizations or orders that previously have been obtained.
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| b. |
The representations and warranties of the Sponsor set forth in this Section 2.1 shall survive the execution and delivery of this Amended and Restated Declaration of Trust and shall inure to the
benefit of the Trustee for so long as the Trust remains in existence. Upon discovery by any party hereto of any breach of any of the foregoing representations and warranties, the party discovering such breach shall give prompt written notice
thereof to the other parties hereto. The Sponsor will be deemed to have made the representation and warranties of the Sponsor set forth in this Section 2.1 with respect to any future contributions of funds upon the effectiveness of such
contribution.
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Except as otherwise provided in Section 1.4 in accepting the trust hereby created, CSC Delaware Trust Company is acting solely as Trustee hereunder and not in
its individual capacity, and all Persons having any claim against the Trustee by reason of the transactions contemplated by this Amended and Restated Declaration of Trust shall look only to the Trust Property for payment or satisfaction thereof.
7
ARTICLE III
Matters Pertaining to Shares of the Trust
Matters Pertaining to Shares of the Trust
Section 3.1. Division of Beneficial Interest.
The beneficial interest in the Trust shall be divided into Shares, which shall all be of a single class, and which may be issued or redeemed from time to time
only in one or more whole Creation Baskets in accordance with Article VI. Notwithstanding anything to the contrary in this Amended and Restated Declaration of Trust, the Trust will issue and redeem the Shares in Creation Baskets only to certain
Authorized Participants on an ongoing basis, or to such other purchaser or purchasers, including the Seed Investor, as otherwise determined by the Sponsor in its sole discretion, and only in exchange for SOL and/or cash. The number of Shares
authorized hereunder is unlimited. The Trust is authorized to issue an unlimited number of Shares unless otherwise determined and subject to any conditions set forth by the Sponsor. Subject to the further provisions of this ARTICLE Ill and ARTICLE
VI, the Sponsor shall have full power and authority, in its sole discretion, (i) to authorize and cause the Trust to issue Creation Baskets of Shares without limitation as to number to such Authorized Participants, or to such other purchaser or
purchasers, including the Seed Investor, as otherwise determined by the Sponsor in its sole discretion, and for such amount of SOL or cash, at such time or times and on such terms as the Sponsor may deem appropriate, (ii) to divide or combine the
Shares of the Trust into a greater or lesser number without thereby materially changing the proportionate beneficial interest of the Shares of the Trust in the assets held with respect to the Trust, and (iii) to take such other action with respect to
the Shares of the Trust as the Sponsor may deem necessary or desirable to further the purpose of the Trust; provided in each case that the Sponsor shall not have any power or authority to take any action that would constitute a power to vary the
investment of (within the meaning of Treasury Regulation section 301.7701-4(c)) of the Trust or the Shareholders. The Trust shall not issue securities or other evidences of beneficial ownership of, or beneficial interest in, the Trust other than
Shares issued in accordance with this ARTICLE Ill and ARTICLE VI.
Each Creation Basket of Shares shall initially consist of 5,000 Shares or such other number of Shares as the Sponsor may determine from time to time in its sole
discretion. Each Share of the Trust shall represent units of fractional undivided beneficial interest in and ownership of the Trust, and shall have no par value.
Notwithstanding any other provision of this Amended and Restated Declaration of Trust, all Shares issued hereunder, including Shares issued in connection with a
split or reverse split of Shares, when issued on the terms contemplated by this Amended and Restated Declaration of Trust, shall be duly authorized, validly issued, fully paid and non-assessable. Shares held in the Trust's treasury shall not confer
any voting rights and shall not be entitled to any dividends or other distributions declared with respect to the Shares.
Section 3.2. Ownership of Shares.
8
The ownership of Shares shall be recorded on the books of the Trust or the Transfer Agent or similar agent for the Trust, which books shall contain the names and
addresses of the Shareholders and the Shares held by each Shareholder. No certificates certifying the ownership of Shares shall be issued except as the Transfer Agent or the Sponsor may otherwise determine from time to time. The Sponsor (or the
Transfer Agent, in consultation with the Sponsor), may make such rules as it considers appropriate for the issuance of Share certificates, the transfer of Shares and similar matters. The record books of the Trust as kept by the Trust or the Transfer
Agent or similar agent, as the case may be, shall be conclusive as to the identity of the Shareholders and as to the number of Shares of the Trust held from time to time by each Shareholder. No Shareholder shall be entitled to receive payment of any
distribution or to have notice given to such Shareholder of any meeting or other action in respect of the Trust until such Shareholder has given its address and such other information as shall be required to such Transfer Agent, officer or agent of
the Trust as shall keep the record books of the Trust for entry thereof.
Section 3.3. Transfer of Shares.
Except as otherwise provided in the Registration Statement, Shares shall be transferable on the books of the Trust only by the record holder thereof or by his
duly authorized agent upon delivery to the Sponsor or the Trust's Transfer Agent or similar agent of a duly executed instrument of transfer, together with a Share certificate if one is outstanding, and such evidence of the genuineness of each such
execution and authorization and of such other matters as may be required by the Sponsor. Upon such delivery, and subject to any further requirements specified by the Sponsor, the transfer shall be recorded on the books of the Trust. Until a transfer
is so recorded, the Shareholder of record of Shares shall be deemed to be the Shareholder with respect to such Shares for all purposes hereunder and neither the Sponsor nor the Trust, nor the Transfer Agent or any similar agent or registrar or any
officer, employee or agent of the Trust, shall be affected by any notice of a proposed transfer.
Section 3.4. Status of Shares, Limitation of Personal Liability and Shareholder Indemnification.
| a. |
Shares shall be deemed to be personal property giving only the rights provided in this Amended and Restated Declaration of Trust. Every Shareholder by virtue of having become a Shareholder shall be
held to have expressly assented and agreed to the terms hereof. The death, incapacity, dissolution, termination or bankruptcy of a Shareholder during the existence of the Trust shall not operate to terminate the Trust, nor entitle the
representative of any such Shareholder to an accounting or to take any action in court or elsewhere against the Trust, but entitles such representative only to the rights of such Shareholder under this Trust. Ownership of Shares shall not
entitle the Shareholder to any title in or to the whole or any part of the Trust Property or right to call for a partition or division of the same or for an accounting, nor shall the ownership of Shares constitute the Shareholders as
partners. Neither the Trust, nor any officer, employee or agent of the Trust shall have any power to bind personally any
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9
Shareholder, nor to call upon any Shareholder for the payment of any sum of money whatsoever other than such as the Shareholder may at any time
personally agree to pay. Ownership of Shares shall not make any Shareholder a third-party beneficiary of any contract entered into by the Trust.
| b. |
Except as otherwise provided under Delaware law, the Shareholders shall be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized
under the general corporation law of Delaware and no Shareholder shall be liable for claims against, or debts of the Trust in excess of his capital contribution and his share of the Trust property and undistributed profits, except in the
event that the liability is founded upon misstatements or omissions contained in such Shareholder's Authorized Participant Agreement delivered in connection with his purchase of Shares. In addition, and subject to the exceptions set forth in
the immediately preceding sentence, the Trust shall not make a claim against a Shareholder with respect to amounts distributed to such Shareholder or amounts received by such Shareholder upon redemption unless, under Delaware law, such
Shareholder is liable to repay such amount.
|
| c. |
The Trust shall indemnify to the full extent permitted by law and the other provisions of this Amended and Restated Declaration of Trust, and to the extent of the Trust property, each Shareholder
against any claims of liability asserted against such Shareholder solely because he is a beneficial owner of one or more Shares (other than for taxes for which such Shareholder is liable by reason of such Shareholder's ownership of any
Shares).
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| d. |
Every written note, bond, contract, instrument, certificate or undertaking made or issued by the Sponsor shall give notice to the effect that the same was executed or made by or on behalf of the
Trust and that the obligations of such instrument are not binding upon any Shareholder individually but are binding only upon the assets and property of the Trust, and no resort shall be had to the Shareholders' personal property for
satisfaction of any obligation or claim thereunder, and appropriate references may be made to this Trust Agreement and may contain any further recital which the Sponsor deems appropriate, but the omission thereof shall not operate to bind any
Shareholder individually or otherwise invalidate any such note, bond, contract, instrument, certificate or undertaking.
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ARTICLE IV
Powers and Obligations of the Trustee
Powers and Obligations of the Trustee
Section 4.1. Eligibility Requirements for Trustee.
10
The Trustee hereunder shall at all times satisfy the requirements of Section 3807 of the Delaware Act and be authorized to exercise corporate trust powers under
the laws of the jurisdiction of its organization, having a combined capital, surplus and undivided profits of at least $50,000,000 and subject to supervision or examination by federal or state authorities. If the Trustee publishes reports of
condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purposes of this ARTICLE IV the combined capital, surplus and undivided profits of the Trustee shall be deemed to be
its combined capital and surplus as set forth in its most recent report of condition so published. In case at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section 4.1, the Trustee shall resign promptly in
the manner and with the effect specified in ARTICLE IX. The institution serving as Trustee may have normal banking and trust relationships with the Sponsor and their respective affiliates; provided that none of (i) the Sponsor, (ii) any Person
involved in the organization or operation of the Sponsor or the Trust, or (iii) any affiliate of any of them, may be the Trustee hereunder. The Trust shall have at least one trustee with a principal place of business in Delaware.
Section 4.2. Instructions or Directions Pursuant to E-mail.
Facsimile or Other Similar Unsecured Electronic Methods. Written instructions or directions pursuant to this Amended and Restated Declaration of Trust sent by the
Sponsor, as the case may be, may be sent by unsecured or secured e-mail, facsimile transmission or other similar unsecured or secured electronic methods, provided that the Sponsor shall provide to the Trustee an incumbency certificate listing
designated persons with the authority to provide such instructions, which incumbency certificate shall be amended whenever a person is to be added or deleted from the listing. The Sponsor shall confirm the receipt of any such instructions by the
Trustee, and the Trustee shall have no liability for the failure to respond to any instructions or directions that it has not actually received. The Trustee shall not be liable for any losses, costs or expenses arising directly or indirectly from the
Trustee's reliance upon and compliance with such instructions notwithstanding that such instructions conflict, or are inconsistent, with a subsequent written instruction (provided that the Trustee shall notify the sender of any such conflict or
inconsistency before acting thereon). The Sponsor agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee, including without limitation the risk of the Trustee acting on
unauthorized instructions, and the risk of interception and misuse by third parties.
Section 4.3. Powers.
The duty and authority to manage the affairs of the Trust is vested in the Sponsor, which duty and authority the Sponsor may further delegate, all pursuant to
Section 3806(b)(7) of the Delaware Act. In furtherance of the foregoing, it is understood and agreed that all obligations, duties and responsibilities of the Trust under all documents to which the Trust is a party or otherwise has obligations shall
be effected and undertaken by or at the discretion of the Sponsor, Administrator, Transfer Agent, or the Custodian, as applicable. To the extent that, at law or at equity, the Trustee has duties (including fiduciary duties) and liabilities relating
thereto to the Trust, the Sponsor, the Shareholders or any other Person, it is understood and agreed by the other parties, the Shareholders,
11
and the Sponsor that such duties and liabilities are eliminated and replaced by the duties and liabilities of the Trustee expressly set forth in this Amended and Restated
Declaration of Trust. The Sponsor (or any service provider authorized by the Sponsor or the Trust) is hereby authorized to execute and deliver each and every document on behalf of the Trust or any of them to which the Trust, is a party, and is
authorized and empowered to execute and deliver, on behalf of the Trust, any and all other documents, to receive on behalf of the Trust, all notices, statements, reports, invoices, communications and other information to be delivered to the Trust
under all such documents, and to make or cause to be made deposits and withdrawals from accounts of the Trust in accordance with the terms of this Amended and Restated Declaration of Trust, provided that Trustee shall not be liable for any action of
the Sponsor (or any such service provider to the Trust).
Section 4.4. Duties of Trustee: Limitation of Liability.
| a. |
The Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Amended and Restated Declaration of Trust. The Trustee shall not have any duty or liability
with respect to the administration of the Trust, the investment of the Trust's property or the payment of dividends or other distributions of income or principal to the Trust's beneficiaries, and no implied obligations shall be inferred from
this Amended and Restated Declaration of Trust on the part of the Trustee. Any permissive right of the Trustee contained in this Amended and Restated Declaration of Trust shall not be construed as a duty.
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| b. |
The Trustee accepts the trusts hereby created and agrees to perform its express duties hereunder with respect to the same but only upon the express terms of this Amended and Restated Declaration of
Trust. No provision of this Amended and Restated Declaration of Trust shall be construed to relieve the Trustee from liability for its own gross negligence or willful misconduct. In particular, but not by way of limitation:
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| i. |
no implied covenants, duties (including fiduciary duties and duties existing at law or in equity) or obligations shall be read into this Amended and Restated Declaration of Trust against the
Trustee, all such duties which are hereby eliminated; and, in the absence of bad faith on the part of the Trustee, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Trustee and conforming to the requirements of this Amended and Restated Declaration of Trust;
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| ii. |
the Trustee shall not be liable for an error of judgment made in good faith by an officer or employee of the Trustee;
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| iii. |
the Trustee shall not be liable with respect to any action taken, suffered or omitted to be taken by it in good faith in accordance with the direction of the Sponsor;
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12
| iv. |
no provision of this Amended and Restated Declaration of Trust shall require the Trustee to expend or risk its personal funds or otherwise incur any financial liability in the performance of its
rights or duties hereunder;
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| v. |
under no circumstance shall the Trustee be personally liable for any representation, warranty, covenant, agreement or indebtedness of the Trust;
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| vi. |
the Trustee shall not be personally responsible for or in respect of the genuineness, form or value of the Trust Property, the validity or sufficiency of this Amended and Restated Declaration of
Trust or for the due execution hereof by the Sponsor;
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| vii. |
The Trustee shall have no liability or responsibility for the validity or sufficiency of this Trust Agreement or for the form, character, genuineness, sufficiency, enforceability, collectability,
location, existence, value or validity of the Trust estate;
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| viii. |
The Trustee has not prepared or verified, and shall not be responsible or liable for, any information, disclosure or other statement or in any document issued or delivered in connection with the
sale or transfer of the Shares;
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| ix. |
The Trustee shall not have any liability for the acts or omissions of the Sponsor, the Custodian or their respective delegates;
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| x. |
The Trustee shall have no duty or obligation to supervise the performance of any obligations of the Sponsor, the Custodian or their respective delegates or any Authorized Participant; and
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| xi. |
in the event that the Trustee is unsure of the course of action to be taken by it hereunder, the Trustee may request instructions from the Sponsor and to the extent the Trustee follows such
instructions in good faith it shall not be liable to any person. In the event that no instructions are provided within the time requested by the Trustee, it shall have no duty or liability for its failure to take any action or for any action
it takes in good faith.
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Section 4.5. Trustee's Fees.
The Trust hereby agrees to be primary obligor and shall (i) compensate the Trustee in accordance with a separate fee agreement with the Trustee, (ii) reimburse
the Trustee for all reasonable expenses (including reasonable fees and expenses of counsel (subject to the limitation below) and other experts) and (iii) indemnify the Trustee, in its capacity as such and in its individual capacity, in accordance
with Section 8.1 hereof. Notwithstanding any other provisions of this Amended and Restated Declaration of Trust, all payments to the Trustee, including fees, expenses and any amounts paid in connection
13
with indemnification of the Trustee in accordance with the terms of this Amended and Restated Declaration of Trust, will be payable only in United States Dollars.
Section 4.6. State of Delaware.
Notwithstanding anything contained herein to the contrary, the Trustee shall not be required to take any action in any jurisdiction other than in the State of
Delaware if the taking of such action will (i) require the registration with, licensing by or the taking of any other similar action in respect of, any State or other governmental authority or agency of any jurisdiction other than the State of
Delaware by or with respect to the Trustee (as such or in its individual capacity); (ii) result in any fee, tax or other governmental charge under the laws of any jurisdiction or any political subdivisions thereof in existence on the date hereof
other than the State of Delaware becoming payable by the Trustee (as such or in its individual capacity); or (iii) subject the Trustee (as such or in its individual capacity) to personal jurisdiction in any jurisdiction other than the State of
Delaware for causes of action arising from acts unrelated to the consummation of the transactions by the Trustee contemplated hereby.
Section 4.7. Certain Matters Affecting the Trustee.
| a. |
The Trustee shall be under no obligation to exercise any of the duties or powers vested in it by this Amended and Restated Declaration of Trust; or to make any investigation of matters arising
hereunder; or to institute, conduct or defend any litigation hereunder or in relation hereto; or to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond or other paper or document, unless requested in writing to do so by the Sponsor; in each case, at the request, order or direction of the Sponsor, unless the Sponsor shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities which may be incurred therein or thereby; and the Trustee shall not be required to expend or risk its own funds or otherwise incur any liability financial or
otherwise in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or indemnity reasonably satisfactory to it against
such risk or liability is not reasonably assured to it.
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| b. |
The Trustee shall not be liable for any action reasonably taken, suffered or omitted by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred
upon it by this Amended and Restated Declaration of Trust.
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| c. |
The Trustee shall not be required to give any bond or surety in respect of the execution of the trusts created hereby or the powers granted hereunder.
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| d. |
The Trustee may execute any of the trusts or powers vested in it by this Amended and Restated Declaration of Trust or perform any of its duties hereunder either directly or by or through agents,
nominees, or attorney-in-
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14
fact appointed with due care and shall not be responsible for any willful misconduct or negligence on the part of any agent, custodian, nominee
or attorney-in-fact so appointed, and the Trustee shall provide notice to the Sponsor upon the appointment of any such agent, custodian, nominee or attorney-in- fact, provided that the appointment of any agent, custodian, nominee or attorney-in-fact
shall not relieve the Trustee of any of its obligations or liabilities under this Amended and Restated Declaration of Trust.
| e. |
Whenever in the administration of the provisions of this Amended and Restated Declaration of Trust, the Trustee shall deem it necessary or desirable that a matter be proved or established prior to
taking or suffering any action to be taken hereunder, such matter (unless other evidence in respect thereof be herein specifically prescribed) may, in the absence of gross negligence or willful misconduct on the part of the Trustee, be deemed
to be conclusively proved and established by a certificate signed by the Sponsor and delivered to the Trustee, and such certificate, in the absence of gross negligence or willful misconduct on the part of the Trustee, shall be full warrant to
the Trustee for any action taken, suffered or omitted by it under the provisions of this Amended and Restated Declaration of Trust upon the faith thereof.
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| f. |
Anything in this Amended and Restated Declaration of Trust to the contrary notwithstanding, in no event shall the Trustee be liable for special, indirect, punitive or consequential loss or damage of
any kind whatsoever (including but not limited to lost profits), even if the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.
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| g. |
In no event shall the Trustee hereto be liable for any failure or delay in the performance of its obligations under this Amended and Restated Declaration of Trust or any related documents because of
circumstances beyond its control, including, but not limited to, a failure, termination, or suspension of, or limitations or restrictions in respect of post- payable adjustments through, a clearing house, securities depositary, settlement
system or central payment system in any applicable part of the world or acts of God, flood, war (whether declared or undeclared), civil or military disturbances or hostilities, nuclear or natural catastrophes, political unrest, explosion,
severe weather or accident, earthquake, terrorism, fire, riot, epidemics, pandemics, labor disturbances, strikes or work stoppages for any reason, embargo, government action, including any laws, ordinances, regulations or the like (whether
domestic, federal, state, county or municipal or foreign) which delay, restrict or prohibit the providing of the services contemplated by this Amended and Restated Declaration of Trust or any related documents, or the unavailability of
communications or computer facilities, the failure of equipment or interruption of communications or computer facilities, or the unavailability of the Federal Reserve Bank wire or
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15
telex or other wire or communication facility, or any other causes beyond its control whether or not of the same class or kind as specified
above.
| h. |
The Trustee shall take such action or refrain from taking such action under this Amended and Restated Declaration of Trust as it may be directed in writing by the Sponsor from time to time;
provided, however, that the Trustee shall not be required to take or refrain from taking any such action if it shall have reasonably determined or shall have been advised by counsel, that such performance may involve the Trustee in personal
liability or is contrary to the terms of this Amended and Restated Declaration of Trust or of any document contemplated hereby to which the Trust is a party or is otherwise contrary to law. In the absence of bad faith, the Trustee shall have
no liability for following any such instructions.
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| i. |
The Trustee shall not have any obligation or duty to supervise or monitor the performance of any other Person and shall have no liability for the failure of any other Person to perform its
obligations or duties under the agreements to which the Trust is a party or otherwise.
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| j. |
The Trustee shall have no obligation or duty to monitor the Trust's obligations and duties under the agreements to which the Trust or the Trustee is a party or to ensure its compliance with the
terms thereof. In addition, the Trustee shall not have any duty or obligation to manage, make any payment in respect of, register, record, sell, dispose of or otherwise deal with the Trust Property, or to otherwise take or refrain from taking
any action under, or in connection with, any document contemplated hereby to which the Trust is a party.
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| k. |
It shall be the Sponsor's duty and responsibility, and not the Trustee's duty or responsibility, to cause the Trust to respond to, defend, participate in or otherwise act in connection with any
regulatory, administrative, governmental, investigative or other proceeding or inquiry relating in any way to the Trust, its assets or the conduct of its business.
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| l. |
Each of the parties hereto hereby agrees and, as evidenced by its acceptance of any benefits hereunder, any Shareholder agrees that the Trustee in any capacity (i) has not provided and will not
provide in the future, any advice, counsel or opinion regarding the tax, financial, investment, securities law or insurance implications and consequences of the formation, funding and ongoing administration of the Trust, including, but not
limited to, income, gift and estate tax issues, insurable interest issues, doing business or other licensing matters and the initial and ongoing selection and monitoring of financing arrangements, (ii) has not made any investigation as to the
accuracy of any representations, warranties or other obligations of the Trust under any of the documents to which the Trust is a party and shall have no liability in connection therewith and (iii) the Trustee has not prepared or verified, and
shall not be responsible or liable for, any
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16
information, disclosure or other statement in any disclosure or offering document or in any other document issued or delivered in connection with
the sale or transfer of Shares.
Section 4.8. Virtual Currencies.
It is the intent of the parties that the execution, delivery and performance of the transactions contemplated by this Amended and Restated Declaration of Trust
will not result in the Trustee being required to obtain a license or make a registration under any federal or state law including rules pertaining to virtual currencies under Title 23, Part 200 of New York Codes, Rules and Regulations, the
Commodities Act or any federal or state law regulating, money transmitters, money services business, providers of prepaid or stored value or similar entities, or virtual currency business.
Section 4.9. Regarding the Sponsor.
The Sponsor (or any service provider authorized by the Sponsor of the Trust) is authorized and empowered to pay or cause such other Persons to pay out of the
Trust Property any amounts that are required to be paid by the Trust, including for the payment of fees, the reimbursement of expenses and the making of indemnity payments not otherwise payable by the Sponsor pursuant to this Amended and Restated
Declaration of Trust or as described in the Registration Statement.
Any determination as to what is in the interests of the Trust made by the Sponsor in good faith shall be conclusive. In construing the provisions of this Amended
and Restated Declaration of Trust, the presumption shall be in favor of a grant of power to the Sponsor except as limited, restricted or prohibited by the express provisions of this Amended and Restated Declaration of Trust (e.g., see Section 7.1).
The enumeration of any specific power in this Amended and Restated Declaration of Trust shall not be construed as limiting the aforesaid or any other power.
Whenever any distribution will be made, or whenever the Trust receives notice of any solicitation of proxies or consents from Shareholders, or whenever for any
reason there is a split, reverse split or other change in the outstanding Shares, or whenever the Sponsor shall find it necessary or convenient in respect of any matter, the Sponsor shall fix a record date for the determination of the Shareholders
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, (iii) entitled to receive Shares of the Trust as a result of any such
split, reverse split or other change and (iv) entitled to act in respect of any other matter for which the record date was set. Subject to applicable law and this Trust Agreement, Sponsor shall have sole discretion to fix such record date.
Without limiting the foregoing, the Sponsor shall have the power and authority to cause the Trust (or to act on behalf of the Trust);
| a. |
To own SOL, cash or any asset received as a result of a Digital Asset Network Fork or airdrop in respect of SOL (an "IR Asset"), to store SOL, cash or
IR Assets with the Custodian subject to the conditions set forth in
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17
the Trust Custody Agreement and to transfer SOL, cash or IR Assets in accordance with the Registration Statement;
| b. |
To litigate, compromise, arbitrate, settle or otherwise adjust claims in favor of or against the Trust or any matter in controversy, including claims for taxes;
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| c. |
To operate as a trust with the purpose for which the Trust was established as described herein, and exercise all the powers necessary or appropriate to the conduct of such operations;
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| d. |
Subject in each case to ARTICLE Ill and ARTICLE VI, to issue, sell, repurchase, redeem, cancel, retire, acquire, hold, resell, reissue, transfer, dispose of and otherwise deal in Shares pursuant to
applicable federal law; to establish terms and conditions including any fees or expenses regarding the issuance, sale, repurchase, redemption, cancellation, retirement, acquisition, holding, resale, reissuance, disposition of or dealing in
Shares; and to apply to any such repurchase, redemption, retirement, cancellation or acquisition of Shares any funds or Trust Property;
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| e. |
Subject to the terms of the Trust Custody Agreement and the Registration Statement, in the event of an upcoming modification to the Solana Network that could potentially result in a Digital Asset
Network Fork or in the event of an upcoming airdrop, to cause the Custodian, in consultation with the Sponsor, to either (i) disclaim all rights to the IR Assets so created, (ii) sell the IR Assets as soon as reasonably practicable and
thereafter distribute the cash proceeds to the Shareholders of record as of the date of the Digital Asset Network Fork or airdrop that resulted in the Trust's acquisition of the IR Assets, or (iii) distribute the IR Assets in-kind as soon as
reasonably practicable to the Shareholders of record as of the date of the Digital Asset Network Fork or airdrop that resulted in the Trust's acquisition of the IR Assets or to an agent acting on behalf of such Shareholders;
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| f. |
(i) To make such filings applications, statements, certificates, agreements and other instruments with the Commission, the Financial Industry Regulatory Authority or a national securities exchange
as may be required by the federal securities laws or other applicable regulations or as deemed necessary or desirable in the sole judgment of the Sponsor; (ii) to prepare and file and execute, in each case on behalf of the Trust, such
applications, reports, surety bonds, irrevocable consents, appointments of attorney for service of process; (iii) to execute and deliver letters or documents to, or instruments for filing with, a depository relating to the Shares to be issued
by the Trust and also any filing required to be made as determined by the Sponsor and any other filing or application necessary or desirable as determined by the Sponsor in connection with the registration and/or offering of Shares by the
Trust; (iv) to negotiate the terms of, and execute on behalf of the Trust, any agreement, including, but not limited to, any
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18
underwriting agreement or purchase agreement relating to the Shares to be issued by the Trust as determined by the Sponsor; and (v) to do all
other acts which, in the Sponsor's judgment, are reasonably necessary or desirable for the registration and/or offering of Shares by the Trust.;
| g. |
To Stake or delegate to a Custodian, an affiliate of the Custodian, or another third-party to Stake SOL on the Solana Network or other digital assets on another digital asset network, as applicable;
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| h. |
Solely as consistent with published IRS guidance: (i) to borrow money, SOL or other digital assets and in this connection issue notes or other evidence of indebtedness; (ii) to secure such
borrowings by mortgaging, pledging or otherwise subjecting as security the Trust Property; and (iii) to endorse, guarantee, or undertake the performance of an obligation or engagement of any other Person and to lend Trust Property;
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| i. |
To retain independent public accountants to audit the accounts of the Trust and employ attorneys to represent the Trust;
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| j. |
To enter into contracts and carry on any other activities in connection with or incidental to any of the foregoing powers or with the furtherance of the Trust's purpose; and
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| k. |
To the fullest extent permitted by law, the Trust shall not in any way be bound or limited by any present or future law or custom in regard to investment by fiduciaries. The Trust shall not be
required to obtain any court order to deal with any assets of the Trust or take any other action hereunder. Notwithstanding anything contained in this Amended and Restated Declaration of Trust to the contrary, the Trust and the Sponsor shall
not, and any other Person acting for or on behalf of the Trust shall cause the Trust not to: (i) acquire any asset other than SOL and, subject to the further restrictions herein, cash and IR Assets; (ii) acquire IR Assets other than as a
result of a Digital Asset Network Fork or airdrop in respect of SOL; (iii) sell or otherwise dispose of Trust Property other than in order to pay expenses of the Trust, to facilitate the termination of the Trust, to facilitate a redemption in
accordance with Article VI or to dispose of any IR Asset; (iv) have any power to, or consent to any action that would, vary the investment (within the meaning of Treasury Regulation section 301.7701-4(c)) of the Trust or the Shareholders or
(v) take any action or fail to take any action that it believes could cause the Trust to fail or cease to qualify as a grantor trust for U.S. federal income tax purposes.
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Section 4.10. Payment of Expenses by the Trust.
The Trust shall pay the Sponsor's Fee as calculated by the Administrator. The Sponsor is authorized to pay or cause to be paid out of the Trust, all
extraordinary, nonrecurring expenses, fees, charges, taxes and liabilities incurred or arising in
19
connection with the Trust, including expenses and charges for the services of agents or independent contractors and such other expenses and charges as the Sponsor may, in its sole
discretion, deem necessary or proper to incur.
Section 4.11. Service Contracts.
| a. |
The Trust may enter into contracts with one or more Persons, to act as administrator, sub-administrator, transfer agent, or other agent, and as such to perform such functions as the Sponsor may deem
reasonable and proper to further the purpose of the Trust, including, without limitation, valuation of assets, clerical and administrative functions, under such terms and conditions, and for such compensation, as the Sponsor may deem
advisable. Without limiting the foregoing, the Sponsor may also authorize any administrator to employ one or more sub-administrators from time to time, any custodian to employ one or more sub-custodians from time to time, and any transfer
agent to employ one or more sub-transfer agents upon such terms and conditions as shall be approved by the Sponsor.
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| b. |
The Trust may enter into a contract or contracts with one or more Persons to act as underwriters, distributors or placement agents whereby the Trust may either agree to sell Shares of the Trust to
the other party or parties or appoint such other party or parties its sales agent or agents for such Shares and with such other provisions as the Sponsor may deem reasonable and proper, and the Trust may from time to time enter into transfer
agency, sub-transfer agency and or shareholder servicing contract(s), in each case with such terms and conditions, and providing for such compensation, as the Sponsor may deem advisable.
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| c. |
Any contract of the character described in this Section 4.11 may be entered into with any Person, although one or more of the Trustee, officers, or Shareholders of the Trust may be an officer,
director, trustee, shareholder, or member of such other party to the contract, or otherwise interested in such contract, and no such contract shall be invalidated or rendered voidable by reason of the existence of any such relationship, nor
shall any Person holding such relationship be liable merely by reason of such relationship for any loss or expense to the Trust under or by reason of said contract or accountable for any profit realized directly or indirectly therefrom. The
same Person may be a party to more than one contract entered into pursuant to this Section 4.11 and any individual may be financially interested or otherwise affiliated with Persons who are parties to any or all of the contracts mentioned in
this Section 4.11.
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| d. |
The authority of the Sponsor hereunder to authorize the Trust to enter into contracts or other agreements or arrangements shall include the authority of the Sponsor to modify, amend, waive any
provision of, or supplement, assign all or a portion of, novate, or terminate such contracts, agreements or arrangements. The enumeration of any specific contracts in this Section
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20
4.11 shall in no way be deemed to limit the power and authority of the Sponsor as otherwise set forth in this Amended and Restated Declaration of
Trust to authorize the Trust to employ, contract with or make payments to such Persons as the Sponsor may deem desirable for the transaction of the business of the Trust.
| e. |
The Sponsor is further empowered, at any time and from time to time, to contract with any Person to provide such other services to the Trust as the Sponsor determines to be in the best interests of
the Trust and in furtherance of the purpose of the Trust.
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Section 4.12. Determinations by Sponsor.
The Sponsor may make any determinations it deems necessary with respect to the provisions of this Amended and Restated Declaration of Trust, including the
following matters: the amount of the assets, obligations, liabilities and expenses of the Trust; the amount of the net income of the Trust from capital gains or other sources for any period and the amount of assets at any time legally available for
the payment of dividends or distributions; which items are to be treated as income and which as capital; the amount, purpose, time of creation, increase or decrease, alteration or cancellation of any reserves or charges and the propriety thereof
(whether or not any obligation or liability for which such reserves or charges were created shall have been paid or discharged); the market value, or any other price to be applied in determining the market value, or the fair value, of any SOL owned
or held by the Trust; the number of Shares of the Trust issued or issuable; and the NAV per Share.
Section 4.13. Sponsor's Duties.
| a. |
The Sponsor agrees to perform its duties under this Amended and Restated Declaration of Trust in its subjective good faith belief as to what is in or not opposed to the best interests of the Trust,
but only upon the express terms of this Amended and Restated Declaration of Trust. To the fullest extent permitted by law, the Sponsor shall not have any implied duties (including fiduciary duties) or liabilities otherwise existing at law or
in equity with respect to the Trust, the Shareholders or any other Person, all of which duties are hereby eliminated. To the fullest extent permitted by law, the provisions of this Amended and Restated Declaration of Trust, to the extent that
they restrict or eliminate the duties (including fiduciary duties) and liabilities of the Sponsor otherwise existing at law or in equity are agreed by the parties hereto to replace such other duties and liabilities of the Sponsor. Unless
otherwise determined by the Sponsor, each officer of the Trust shall owe to the Trust and the Shareholders the same fiduciary duties (and only such fiduciary duties) as owed by officers of private corporations for profit to such corporations
and their stockholders under the Delaware General Corporation Law.
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| b. |
Unless otherwise expressly provided herein:
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21
| i. |
whenever a conflict of interest exists or arises between the Sponsor or any of its affiliates, on the one hand, and the Trust or any Shareholder or any other Person, on the other hand; or
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| ii. |
whenever this Amended and Restated Declaration of Trust or any other agreement contemplated herein provides that the Sponsor shall act in a manner that is, or provides terms that are, fair and
reasonable to the Trust, any Shareholder or any other Person, the Sponsor shall use its good faith efforts to resolve such conflict of interest, take such action or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or situation and the benefits and burdens relating to such interests, any customary or accepted industry practices, and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Sponsor, the resolution, action or terms so made, taken or provided by the Sponsor shall not constitute a breach of this Amended and Restated Declaration of Trust or any other
agreement contemplated herein or of any duty or obligation of the Sponsor at law or in equity or otherwise.
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| c. |
The Sponsor and any affiliate of the Sponsor may engage in or possess an interest in other profit-seeking or business ventures of any nature or description, independently or with others, whether or
not such ventures are competitive with the Trust and the doctrine of corporate opportunity, or any analogous doctrine, shall not apply to the Sponsor. If the Sponsor acquires knowledge of a potential transaction, agreement, arrangement or
other matter that may be an opportunity for the Trust, it shall have no duty to communicate or offer such opportunity to the Trust, and the Sponsor shall not be liable to the Trust or to the Shareholders for breach of any fiduciary or other
duty by reason of the fact that the Sponsor pursues or acquires for, or directs such opportunity to another Person or does not communicate such opportunity or information to the Trust. Neither the Trust nor any Shareholders shall have any
rights or obligations by virtue of this Amended and Restated Declaration of Trust or the trust relationship created hereby in or to such independent ventures or the income or profits or losses derived therefrom, and the pursuit of such
ventures, even if competitive with the activities of the Trust, shall not be deemed wrongful or improper. Except to the extent expressly provided herein, the Sponsor may engage or be interested in any financial or other transaction with the
Trust, the Shareholders or any affiliate of the Trust or the Shareholders.
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| d. |
To the fullest extent permitted by law and notwithstanding any other provision of this Amended and Restated Declaration of Trust or in any agreement contemplated herein or applicable provisions of
law or equity or otherwise, whenever in this Amended and Restated Declaration of Trust a Person is permitted or required to make a decision (a) in its "sole discretion"
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22
or "discretion" or under a grant of similar authority or latitude, the Person shall be entitled to consider only such interests and factors as it
desires, including its own interests, and shall have no duty or obligation to give any consideration to any interest of or factors affecting the Trust, the Shareholders or any other Person, or (b) in its "good faith" or under another express
standard, the Person shall act under such express standard and shall not be subject to any other or different standard. The term "good faith" as used in this Amended and Restated Declaration of Trust shall mean subjective good faith as such term is
understood and interpreted under Delaware law.
ARTICLE V
Matters Pertaining to Shareholders
Matters Pertaining to Shareholders
Section 5.1. Shareholders' Rights, Voting, Transferability and Splits.
All of the Shares are of the same class with equal rights and privileges. Each of the Shares is transferable, is fully paid and nonassessable and entitles the
holder to vote on the limited matters upon which Shareholders may vote under this Amended and Restated Declaration of Trust. 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. Except as required under applicable federal law or under the rules or regulations of a national securities exchange, Shareholders shall have no voting rights hereunder (including with respect to mergers,
consolidations or conversions of the Trust or transfers to or domestication in any jurisdiction by the Trust or any other matters that under the Delaware Act default voting rights are provided to holders of beneficial interests.) The Shareholders
shall have the right to vote on other matters only as the Sponsor may consider desirable and so authorize in its sole discretion. To the extent that federal or Delaware law is amended, modified or interpreted by rule, regulation, order, or no-action
letter to (on a mandatory basis) expand, eliminate or limit Shareholders' right to vote on any specific matter, the Shareholders' right to vote shall be deemed to be amended, modified or interpreted in accordance therewith without further approval by
the Sponsor or the Shareholders. Nothing set forth in this Amended and Restated Declaration of Trust shall be construed so as to constitute the Shareholders from time to time as partners or members of an association; nor shall any Shareholder ever
be liable to any third person by reason of any action taken by the parties to this Trust Agreement, or for any other cause whatsoever.
The Sponsor will act to terminate the Trust upon the agreement of Shareholders owning at least seventy-five (75) percent of the outstanding Shares. If the
Sponsor believes that the Share price in the secondary market for the Shares has risen or fallen outside a desirable trading price range, the Sponsor may direct the Transfer Agent 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 Creation Basket.
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Section 5.2. Amendments.
| a. |
The Sponsor, in its sole discretion, may amend any provision of this Amended and Restated Declaration of Trust without the consent of any Shareholder. Except as otherwise provided herein, any
amendment shall be effective on such date as designated by the Sponsor in its sole discretion. Any amendment that imposes or increases any fees or charges or prejudices a substantial existing right of the Shareholders will not become
effective until thirty (30) days after notice of such amendment is given to the Shareholders as provided herein or by means of an amendment to the Registration Statement or other filing with the Commission. Every Shareholder, at the time any
such amendment becomes effective, shall be deemed, by continuing to hold any Shares or an interest therein, to consent and agree to such amendment and to be bound by this Amended and Restated Declaration of Trust as amended thereby.
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| b. |
Upon amendment of this Amended and Restated Declaration of Trust, the Certificate of Trust shall also be amended, if required by the Delaware Act, to reflect such change. At the expense and written
direction of the Sponsor, the Trustee shall execute and file any amendment to the Certificate of.
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| c. |
No amendment affecting the rights or duties of the Trustee shall be binding upon or effective against the Trustee unless consented to by the Trustee in writing. The Trustee shall be under no
obligation to execute any amendment to this Amended and Restated Declaration of Trust until it has received an instruction letter from the Sponsor, in form and substance reasonably satisfactory to the Trustee (i) directing the Trustee to
execute such amendment, (ii) representing and warranting to the Trustee that such execution is authorized and permitted by the terms of this Amended and Restated Declaration of Trust and does not conflict with or violate any other agreement
to which the Trust is a party and (iii) confirming that such execution and acts related thereto are covered by the indemnity provisions of this Amended and Restated Declaration of Trust in favor of the Trustee and do not adversely affect the
Trustee.
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| d. |
To the fullest extent permitted by law, no provision of this Amended and Restated Declaration of Trust may be amended, waived or otherwise modified orally but only by a written instrument adopted in
accordance with this Section.
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ARTICLE VI
NAV, Creations and Redemptions
NAV, Creations and Redemptions
Section 6.1. Determination of NAV, Net Income, and Distributions.
24
The Administrator will calculate the NAV per share of the Trust in accordance with the Registration Statement and the relevant provisions of this Amended and
Restated Declaration of Trust, Fund Administration and Accounting Agreement, Transfer Agency and Service Agreement and Trust Custody Agreements (collectively, the "Trust Documents").
The Sponsor will publish the Trust's NAV on the Trust's website as soon as practicable after its calculation by the Administrator based on the rate set forth in
the Registration Statement (or such other similar rate as determined by the Sponsor in its sole discretion from time to time). To the extent that the NAV has been calculated using a price per SOL other than the rate set forth in the Registration
Statement for such Business Day, the publication on the Trust's website will note the valuation methodology and the price per SOL resulting from such calculation.
The Administrator'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 Administration Agreement will be required by reason of any difference in amounts estimated from those actually paid.
Section 6.2. Creations, Redemptions and Repurchases.
The Trust will issue and redeem Shares from time to time, in accordance with the Registration Statement and the relevant provisions of the Trust Documents and
Authorized Participant Agreements as they may be amended from time to time. The Trust is expected to issue or redeem Shares from time to time only in one or more whole Creation Baskets. The Trust will issue and redeem the Shares in Creation Baskets
only to certain Authorized Participants on an ongoing basis, or as otherwise determined by the Sponsor in its sole discretion, including the issuance of the initial Creation Baskets to the Seed Investor (if any). On a creation, Creation Baskets will
be distributed to the creating Authorized Participant by the Trust in exchange for the delivery to the Trust of the appropriate number of SOL (i.e., SOL equal in value to the NAV multiplied by the number of Shares in the Creation Basket) or an
equivalent amount of cash. On a redemption, the Trust will distribute SOL equal in value to the NAV multiplied by the number of Shares in the Creation Basket to the redeeming Authorized Participant in exchange for the delivery to the Trust of one or
more Creation Baskets or an equivalent amount of cash. On each Business Day, the value of each Creation Basket accepted by the Transfer Agent in a creation or redemption transaction will be the same (i.e., each Creation Basket will initially consist
of 5,000 Shares and the value of the Creation Basket will be equal to the value of 5,000 Shares (or such other amount as determined by the Sponsor from time to time in its sole discretion) at their NAV per Share on that day). The Trust will not issue
or redeem fractions of a Creation Basket. Except as may be otherwise permitted by the Sponsor pursuant to Article III, or as otherwise determined by the Sponsor in its sole discretion, including the issuance of the initial Creation Baskets to the
Seed Investor (if any), only Authorized Participants will be able to place orders to create or redeem Creation Baskets. Authorized Participants must be (i) 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 (ii) DTC Participants. To become an Authorized Participant, a person must enter into an Authorized Participant
25
Agreement with the Sponsor on behalf of the Trust, subject to acceptance by the Transfer Agent. Authorized Participant Agreements provide the procedures for the creation and
redemption of Creation Baskets as well as the quantity of SOL required for delivery or distribution for such creations and redemptions. An Authorized Participant Agreement and the related procedures attached thereto may be amended by the Trust and
the Sponsor without the consent of any Shareholder or Authorized Participant. A transaction fee ("Transaction Fee") may be imposed to offset the transfer and other transaction costs associated with
creation or redemption, and such Transaction Fee will be used by the Transfer Agent and/or the Trust to promptly pay such transfer and other transaction costs. Authorized Participants will not receive a fee, or any other form of compensation or
inducement from either the Sponsor or the Trust, and no Authorized Participant has any obligation or responsibility to the Sponsor or the Trust to effect any sale or resale of the Shares.
The number of SOL required for deposit with the Trust to create one or more Creation Baskets initially is the equivalent of the NAV of 5,000 shares per Creation
Basket (or an equivalent amount of cash). The number of SOL required to create a Creation Basket, or to be delivered upon the redemption of a Creation Basket, will gradually decrease over time, due to the accrual of the Trust's expenses, the transfer
of the Trust's SOL to pay the Sponsor's Fee and the transfer of the Trust's SOL to pay any Trust expenses not assumed by the Sponsor.
Authorized Participants may sell to other investors all or part of the Shares included in the Creation Baskets they purchase from the Trust. The Seed Investor (if
any) will not be subject to a Transaction Fee for the purchase of the initial Creation Baskets issued to it in its capacity as the purchaser of such initial Creation Baskets.
Subject to this Section 6.2, Shares may be redeemed or repurchased at their NAV which may be reduced by any Transaction Fee or other form of charge authorized by
the Sponsor. NAV shall be determined as set forth in Section 6.1 hereof. Payment for Shares redeemed or repurchased shall be made in SOL out of the Trust Property.
The Sponsor may require any Authorized Participant or group of Authorized Participants to redeem Shares for any reason as determined by the Sponsor, in its sole
discretion. Any such redemption shall be effected at the redemption price and in the manner provided in this Article VI.
The Authorized Participants shall upon demand disclose to the Sponsor in writing such information with respect to direct and indirect ownership of Shares as the
Sponsor deems necessary to comply with the provisions of the Internal Revenue Code of 1986, as amended (or any successor statute thereto), or to comply with the requirements of any other taxing authority.
Notwithstanding the foregoing, the Trust may issue and redeem Creation Baskets of Shares in exchange for cash rather than SOL. The Trust will use any cash
received in connection with any such issuance of Shares to purchase SOL, such purchase to take place as soon as reasonably practicable after receipt of such cash but in any event prior to the first calculation of the Trust's NAV following the receipt
of such cash.
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ARTICLE VII
Tax Matters
Tax Matters
Section 7.1. Tax Status of the Trust.
The Sponsor intends that the Trust shall be treated, for federal, state and local income tax purposes, as a grantor trust, and, notwithstanding anything contained
in this Amended and Restated Declaration of Trust to the contrary, neither the Sponsor, nor any other Person acting for or on behalf of the Trust, shall take any action that it believes is inconsistent with such treatment.
Section 7.2. Certain Costs.
The Sponsor shall pay out of its own funds any and all routine tax administration expenses incurred with respect to the Trust, but not including any professional
fees or expenses related to audits or any administrative or judicial proceedings with respect to the Trust that involve the IRS or state, local or other taxing authorities, which extraordinary expenses shall be payable or reimbursable pursuant to
Section 4.10.
ARTICLE VIII
Compensation and Indemnification
Compensation and Indemnification
Section 8.1. Indemnification of the Trustee.
The Trust hereby agrees to be primary obligor and shall indemnify, defend and hold harmless CSC Delaware Trust Company, in its individual capacity and in its
capacity as Trustee and any of the officers, directors, employees, affiliates and agents of the Trustee (the "Trustee Indemnified Persons") from and against any and all losses, damages, liabilities,
claims, actions, suits, costs, expenses, disbursements (including reasonable legal fees and expenses in connection with enforcement of its rights to indemnity hereunder and including the reasonable fees and expenses of counsel), taxes and penalties
of any kind and nature whatsoever (collectively, "Expenses"), to the extent that such Expenses arise out of or are imposed upon or asserted at any time against such Trustee Indemnified Persons with
respect to the performance of this Amended and Restated Declaration of Trust, the creation, operation or termination of the Trust or the transactions contemplated hereby; provided, however, that the Trust shall not be required to indemnify any
Trustee Indemnified Person for any Expenses which are a result of the willful misconduct or gross negligence of a Trustee Indemnified Person. If the Trust shall have insufficient assets or improperly refuses to pay a Trustee Indemnified Person within
sixty (60) days of a request for payment owed hereunder, the Sponsor shall, as secondary obligor, compensate or reimburse the Trustee or indemnify, defend and hold harmless a Trustee Indemnified Person as if it were the primary obligor hereunder;
provided, however, that the Sponsor shall not be required to indemnify any Trustee Indemnified Person for any Expenses which are a result of the willful misconduct or gross negligence of a Trustee Indemnified Person. To the fullest extent permitted
by law, Expenses to be incurred by a Trustee Indemnified Person shall, from time to time, be advanced by, or on
27
behalf of, the Sponsor prior to the final disposition of any matter upon receipt by the Sponsor of an undertaking by, or on behalf of, such Trustee Indemnified Person to repay such
amount if it shall be determined that the Trustee Indemnified Person is not entitled to be indemnified under this Amended and Restated Declaration of Trust.
Section 8.2. Indemnification of the Sponsor.
The Trust shall indemnify, defend and hold harmless the Sponsor, in its capacity as Sponsor, and any of the officers, directors, employees, affiliates and agents
of the Sponsor (the "Sponsor Indemnified Persons") from and against any and all Expenses, to the extent that such Expenses arise out of or are imposed upon or asserted at any time against such Sponsor
Indemnified Persons with respect to the performance of this Amended and Restated Declaration of Trust, the creation, operation or termination of the Trust or the transactions contemplated hereby; provided, however, that the Trust shall not be
required to indemnify any Sponsor Indemnified Person for any Expenses which are a result of the willful misconduct, bad faith or gross negligence of a Sponsor Indemnified Person. To the fullest extent permitted by law, Expenses to be incurred by a
Sponsor Indemnified Person shall, from time to time, be advanced by, or on behalf of, the Trust prior to the final disposition of any matter upon receipt by the Trust of an undertaking by, or on behalf of, such Sponsor Indemnified Person to repay
such amount if it shall be determined that the Sponsor Indemnified Person is not entitled to be indemnified under this Amended and Restated Declaration of Trust.
Section 8.3. Security Interest.
As security for any amounts owing to the Trustee or Sponsor hereunder, the Trustee or Sponsor, as applicable, shall have a lien against the Trust Property, which
lien shall be prior to the rights of the Sponsor (in the case of a lien held by the Trustee) or any other Shareholder of the Trust. The obligations of the Sponsor and the Trust, as applicable, to indemnify the Trustee Indemnified Persons and the
Sponsor Indemnified Persons under this Section 8.3 shall survive the termination of this Declaration of Trust and the resignation or removal of the Trustee.
Section 8.4. Compensation of the Sponsor.
The Sponsor shall be entitled to compensation for its services as Sponsor of the Trust as set forth in the Sponsor Agreement. The Trustee shall have no liability
or responsibility for amounts paid to the Sponsor pursuant to this Section 8.4. The Sponsor may, at its sole discretion and from time to time, waive all or a portion of its fee payable under this Section 8.4. The Sponsor is under no obligation to
waive 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 the Sponsor's obligations hereunder.
ARTICLE IX
Resignation and Removal of the Trustee
Resignation and Removal of the Trustee
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Section 9.1. Resignation and Removal of the Trustee.
The Trustee shall serve for the duration of the Trust and until the effective date of the Trustee's resignation or removal. The Trustee may resign upon sixty
(60) days' prior notice to the Sponsor, which shall promptly appoint a successor. If no successor has been appointed by the Sponsor within such sixty (60) day period, the Trustee may, at the expense of the Trust, petition a court to appoint a
successor trustee. Any Person into which the Trustee may be merged or with which it may be consolidated, or any Person resulting from any merger or consolidation to which the Trustee shall be a party, or any Person which succeeds to all or
substantially all of the corporate trust business of the Trustee, shall be the successor Trustee under this Amended and Restated Declaration of Trust without the execution, delivery or filing of any paper or instrument or further act to be done on
the part of the parties hereto, except as may be required by applicable law. Any successor Trustee shall file any necessary amendments to the Certificate of Trust with the Secretary of State. Any successor trustee appointed pursuant to this ARTICLE
IX shall be eligible to act in such capacity in accordance with this Amended and Restated Declaration of Trust and, following compliance with this ARTICLE IX, shall become fully vested with the rights, powers, duties and obligations of its
predecessor under this Amended and Restated Declaration of Trust, with like effect as if it was originally named as trustee. Any such successor trustee shall notify the Trustee of its appointment by providing a written instrument to the Trustee. At
such time the Trustee shall be discharged of its duties herein.
| a. |
If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Amended and Restated Declaration of Trust, or if at any time the Trustee shall become incapable of
acting, or shall be adjudged bankrupt or insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then the Sponsor may remove the Trustee and appoint a successor trustee by written instrument, in duplicate, which instrument shall be delivered to the Trustee so removed and the successor trustee.
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| b. |
The Sponsor may at any time, upon sixty (60) days' prior notice to the Trustee, remove the Trustee with or without cause and appoint a successor trustee by written instrument or instruments, in
triplicate, signed by the Sponsor or its attorney-in-fact duly authorized, one complete set of which instruments shall be delivered to the Trustee so removed and one complete set to the successor so appointed.
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| c. |
Notwithstanding anything to the contrary contained herein, any resignation or removal of the Trustee and appointment of a successor trustee pursuant to any of the provisions of this ARTICLE IX shall
become effective only upon acceptance of appointment by the successor trustee as provided herein.
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ARTICLE X
Miscellaneous
Miscellaneous
Section 10.1. Entire Agreement.
This Amended and Restated Declaration of Trust represents the entire agreement between the parties hereto with respect to the subject matter hereof, and
supersedes all prior agreements and understandings between the parties, whether written or oral.
Section 10.2. Governing Law.
The validity and construction of this Amended and Restated Declaration of Trust and all amendments hereto shall be governed by the laws of the State of Delaware,
and the rights of all parties hereto and the effect of every provision hereof shall be subject to and construed according to the laws of the State of Delaware without regard to the conflicts of law provisions thereof; provided, however, that causes
of action for violations of U.S. federal or state securities laws shall not be governed by this Section 10.2 and provided further that the parties hereto and the Shareholders intend that the provisions hereof shall control over any contrary or
limiting statutory or common law of the State of Delaware (other than the Delaware Act) and that, to the maximum extent permitted by applicable law, there shall not be applicable to the Trust, the Sponsor, the Trustee, the Shareholders or this
Amended and Restated Declaration of Trust any provision of the laws (statutory or common) of the State of Delaware (other than the Delaware Act) pertaining to trusts which relate to or regulate in a manner inconsistent with the terms hereof: (a) the
filing with any court or governmental body or agency of trustee accounts or schedules of trustee fees and charges, (b) affirmative requirements to post bonds for trustees, officers, agents, or employees of a trust, (c) the necessity for obtaining
court or other governmental approval concerning the acquisition, holding or disposition of real or personal property, (d) fees or other sums payable to trustees, officers, agents or employees of a trust, (e) the allocation of receipts and
expenditures to income or principal, (f) restrictions or limitations on the permissible nature, amount or concentration of trust investments or requirements relating to the titling, storage or other manner of holding of trust assets, (g) the
existence of rights or interests (beneficial or otherwise) in trust assets, (h) the ability of beneficial owners or other persons to terminate or dissolve a trust, or (i) the establishment of fiduciary or other standards or responsibilities or
limitations on the acts or powers of trustees or beneficial owners that are inconsistent with the limitations on liability or authorities and powers of the Trustee or the Shareholders set forth or referenced in this Amended and Restated Declaration
of Trust. Sections 3540, 3542 and 3561 of Title 12 of the Delaware Code shall not apply to the Trust.
Section 10.3. Counterparts.
This Amended and Restated Declaration of Trust may be executed in two or more counterparts, each of which shall be an original, but all such counterparts shall
together constitute one and the same agreement.
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Section 10.4. Merger and Consolidation.
The Sponsor may cause (i) the Trust to be merged into or consolidated with, converted to or to sell all or substantially all of its assets to, another trust or
entity; (ii) the Shares of the Trust to be converted into beneficial interests in another statutory trust (or series thereof); or (iii) the Shares of the Trust to be exchanged for units in another trust or company under or pursuant to any U.S. state
or federal statute to the extent permitted by law. For the avoidance of doubt, the Sponsor, with written notice to the Shareholders, may approve and effect any of the transactions contemplated under (i) - (iii) above without any vote or other action
of the Shareholders.
Section 10.5. Dissolution of the Trust.
The Trust may dissolve at the written direction of the Sponsor if any of the following dissolution events occur: Shares are delisted from the Trust's listing
exchange and are not approved for listing on another national securities exchange within five business days of their delisting; 180 days have elapsed since the Trustee notified the Sponsor of the Trustee’s election to resign or since the Sponsor
removed the Trustee, and a successor trustee has not been appointed and accepted its appointment; the U.S. Securities and Exchange Commission determines that the Trust is an investment company under the Investment Company Act of 1940, as amended, and
the Sponsor has made the determination that dissolution of the Trust is advisable; the Commodity Futures Trading Commission determines that the Trust is a commodity pool under the Commodity Exchange Act, and the Sponsor has made the determination
that dissolution of the Trust is advisable; the Trust is determined to be a “money service business” under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act, as amended (the “BSA”) and is required to comply with
certain FinCEN regulations thereunder or is determined to be a “money transmitter” (or equivalent designation) under the laws of any state in which the Trust operates and is required to seek licensing or otherwise comply with state licensing
requirements, and the Sponsor has made the determination that dissolution of the Trust is advisable; a U.S. regulator requires the Trust to shut down or forces the Trust to liquidate its SOL; SOL is determined to be a “security” and is subject to
regulation under U.S. federal securities laws; any ongoing event exists that either prevents the Trust from making or makes impractical the Trust’s reasonable efforts to make a fair determination of the price of SOL for purposes of determining the
NAV of the Trust; the Sponsor determines that the aggregate net assets of the Trust in relation to the operating expenses of the Trust make it unreasonable or imprudent to continue the business of the Trust; the Trust fails to qualify for treatment,
or ceases to be treated, as a “grantor trust” under the Internal Revenue Code of 1986, as amended (the “Code”) or any comparable provision of the laws of any State or other jurisdiction where that treatment is sought, and the Sponsor determines that,
because of that tax treatment or change in tax treatment, dissolution of the Trust is advisable; 60 days have elapsed since Depository Trust Company (“DTC”) or another depository has ceased to act as depository with respect to the Shares, and the
Sponsor has not identified another depository that is willing to act in such capacity; the Trustee elects to dissolve the Trust after the Sponsor is conclusively deemed to have resigned effective immediately as a result of the Sponsor being adjudged
bankrupt or insolvent, or a receiver of the Sponsor
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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 and a successor sponsor has not been appointed; or the Sponsor elects to dissolve the Trust after the Trustee, Execution Agent, Administrator or the Solana Custodian (or any successor trustee, administrator
or custodian) resigns or otherwise ceases to be the trustee, administrator or custodian of the Trust, as applicable, and no replacement trustee, administrator and/or custodian acceptable to the Sponsor is engaged. In addition, the Trust may be
dissolved at any time for any reason by the Sponsor in its sole discretion. On and after the date of dissolution of the Trust, the Sponsor shall wind up the Trust's business and affairs in its sole discretion in accordance with Section 3808(e) of the
Delaware Act and upon completion of the winding up of the Trust's business and affairs by the Sponsor in accordance with the Delaware Act, including the payment of the expenses of liquidation and termination and any fee to the Transfer Agent in
connection therewith and payment of any applicable taxes or other governmental charges, Shareholders will be entitled to the distribution of the amount of Trust Property (paid in cash) represented by those Shares upon surrender or termination of the
Shares then held. Upon completion of the winding up of the Trust's business and affairs by the Sponsor, the Trustee shall, at the written direction and expense of the Sponsor, file a certificate of cancellation in accordance with the Delaware Act and
thereafter shall be released from any further duties or liabilities. Any remaining expenses of the Trust shall be paid by the Sponsor.
Section 10.6. Notices.
Any communications provided for or permitted hereunder shall be in writing and, unless otherwise expressly provided herein, shall be deemed to have been duly
given when delivered to: (i) in the case of the Sponsor, Invesco Capital Management LLC c/o Adam Henkel, 3500 Lacey Road, Suite 700, Downers Grove, Illinois 60515; (ii) in the case of the Trustee, CSC Delaware Trust Company, 251 Little Falls Drive,
Wilmington, DE 19808, Attention: Invesco Galaxy Solana ETF; or (iii) as to each such Person (including, without limitation, a Shareholder) such other address, facsimile number and/or telecopy number as may hereafter be furnished by such Person to the
other party hereto in writing. Unless expressly set forth herein to the contrary, any communication required or permitted to be delivered to the Sponsor shall be deemed to have been duly given when mailed first class, postage prepaid, to the address
of the Sponsor. Unless expressly set forth herein to the contrary, any communication required or permitted to be delivered to a Shareholder shall be deemed to have been duly given upon personal delivery, when mailed first class, postage prepaid, or
if sent by facsimile or telecopy. In addition, to the fullest extent permitted by federal law, any document, consent, instrument or notice referenced in or contemplated by this Amended and Restated Declaration of Trust that is to be delivered by the
Sponsor may be delivered by electronic means (including e-mail).
Section 10.7. Jurisdiction and Waiver of Jury Trial.
This Amended and Restated Declaration of Trust and the rights of the Sponsor, Trustee, DTC (as registered owner of the Trust's global certificates for Shares)
and Shareholders under this Amended and Restated Declaration of Trust are governed by the
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laws of the State of Delaware. Each of the Sponsor, Trustee, each DTC Participant, each Shareholder and each Person beneficially owning an interest in a Share of the Trust (whether
through a broker, dealer, bank, trust company or clearing corporation or an agent of any of the foregoing or otherwise), to the fullest extent permitted by law, including Section 3804(e) of the Delaware Act, (i) irrevocably agrees that any claims,
suits, actions or proceedings arising out of or relating in any way to the Trust or its business and affairs, the Delaware Act, this Amended and Restated Declaration of Trust or asserting a claim governed by the internal affairs (or similar)
doctrine (including, without limitation, any claims, suits, actions or proceedings to interpret, apply or enforce (A) the provisions of this Amended and Restated Declaration of Trust, or (B) the duties, obligations or liabilities of the Trust to the
Shareholders or the Trustees, or of officers or the Trustee to the Trust, to the Shareholders or each other, or (C) the rights or powers of, or restrictions on, the Trust, the officers, the Trustee or the Shareholders, or (D) any provision of the
Delaware Act or other laws of the State of Delaware pertaining to trusts made applicable to the Trust pursuant to Section 3809 of the Delaware Act, or (E) any other instrument, document, agreement or certificate contemplated by any provision of the
Delaware Act, this Amended and Restated Declaration of Trust relating in any way to the Trust or (F) the federal securities laws of the United States and the securities or antifraud laws of any international, national, state, provincial, territorial,
local or other governmental or regulatory authority, including, in each case, the applicable rules and regulations promulgated thereunder (regardless, in every case, of whether such claims, suits, actions or proceedings (x) sound in contract, tort,
fraud or otherwise, (y) are based on common law, statutory, equitable, legal or other grounds, or (z) are derivative or direct claims)), shall be exclusively brought, unless the Trust, in its sole discretion, consents in writing to an alternative
forum, in the Court of Chancery of the State of Delaware or, if such court does not have subject matter jurisdiction thereof, any other court in the State of Delaware with subject matter jurisdiction; provided, however, that unless the Trust consents
in writing to the selection of an alternative forum, the Federal District Courts of the United States of America shall be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under any federal
securities law, (ii) irrevocably submits to the exclusive jurisdiction of such courts in connection with any such claim, suit, action or proceeding, (iii) irrevocably agrees not to, and waives any right to, assert in any such claim, suit, action or
proceeding that (A) it is not personally subject to the jurisdiction of such courts or any other court to which proceedings in such courts may be appealed, (B) such claim, suit, action or proceeding is brought in an inconvenient forum, or (C) the
venue of such claim, suit, action or proceeding is improper, (iv) consents to process being served in any such claim, suit, action or proceeding by mailing, certified mail, return receipt requested, a copy thereof to such party at the address in
effect for notices hereunder, and agrees that such service shall constitute good and sufficient service of process and notice thereof; provided, nothing in clause (iv) hereof shall affect or limit any right to serve process in any other manner
permitted by law, and (v) irrevocably waives any and all right to trial by jury in any such claim, suit, action or proceeding. Each of the Sponsor, Trustee, each DTC Participant, each Shareholder and each Person beneficially owning an interest in a
Share of the Trust (whether through a broker, dealer, bank, trust company or clearing corporation or an agent of any of the foregoing or otherwise) further agrees that, in the event that any dispute arising from or relating to this Amended and
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Restated Declaration of Trust becomes subject to any judicial proceeding, such party waives any right that it may otherwise have to seek punitive or consequential damages.
Section 10.8. Derivative Actions.
| a. |
No person who is not a Shareholder shall be entitled to bring any derivative action, suit or other proceeding on behalf of the Trust. No Shareholder may maintain a derivative action on behalf of the
Trust unless holders of at least ten percent (10%) of the outstanding Shares join in the bringing of such action.
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| b. |
In addition to the requirements set forth in Section 3816 of the Delaware Act, a Shareholder may bring a derivative action on behalf of the Trust only if the following conditions are met:
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| i. |
the Shareholder or Shareholders must make a pre-suit demand upon the Sponsor to bring the subject action unless an effort to cause the Sponsor to bring such an action is not likely to succeed; and a
demand on the Sponsor shall only be deemed not likely to succeed and therefore excused if the Sponsor has a personal financial interest in the transaction at issue, and the Sponsor shall not be deemed interested in a transaction or otherwise
disqualified from ruling on the merits of a Shareholder demand by virtue of the fact that the Sponsor receives remuneration for his service as the Sponsor of the Trust or an employee or officer of the Sponsor receives remuneration for his or
her service as a trustee or director of one or more investment companies that are under common management with or otherwise affiliated with the Trust; and
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| ii. |
unless a demand is not required under clause (i) of this paragraph, the Sponsor must be afforded a reasonable amount of time to consider such Shareholder request and to investigate the basis of such
claim; and the Sponsor shall be entitled to retain counsel or other advisors in considering the merits of the request and shall require an undertaking by the Shareholders making such request to reimburse the Trust for the expense of any such
advisors in the event that the Sponsor determines not to bring such action.
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| c. |
In addition to all suits, claims or other actions (collectively, "claims") that under applicable law must be brought as derivative claims, each
Shareholder agrees that any claim that affects all Shareholders of the Trust equally, that is, proportionately based on their number of Shares in the Trust, must be brought as a derivative claim subject to this Section 10.8 irrespective of
whether such claim involves a violation of the Shareholder's rights under this Amended and Restated Declaration of Trust or any other alleged violation of contractual or individual rights that might otherwise give rise to a direct claim (and
regardless, in each case, of whether such claims
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sound in tort, fraud or otherwise, or are based on common law, statutory, equitable, legal or other grounds).
| d. |
Notwithstanding the foregoing, however, if a provision of this Section 10.8 is found to violate the U.S. federal securities laws, then such provision shall not apply to any claims asserted under
such U.S. federal securities law.
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Section 10.9. Action Without a Meeting.
Any action required or permitted to be taken by Shareholders by vote may be taken without a meeting by written consent setting forth the actions so taken. Such
written consents shall be treated for all purposes as votes at a meeting. If the vote or consent of any Shareholder to any action of the Trust or any Shareholder, as contemplated by this Amended and Restated Declaration of Trust, is solicited by the
Sponsor, the solicitation shall be effected by notice to each Shareholder given in the manner provided in Section 10.6. The vote or consent of each Shareholder so solicited shall be deemed conclusively to have been cast or granted as requested in the
notice of solicitation, whether or not the notice of solicitation is actually received by that Shareholder, unless the Shareholder expresses written objection to the vote or consent by notice given in the manner provided in Section 10.6 above and
actually received by the Trust within twenty (20) days after the notice of solicitation is effected. The Sponsor and all persons dealing with the Trust shall be entitled to act in reliance on any vote or consent which is deemed cast or granted
pursuant to this Section and shall be fully indemnified by the Trust in so doing. Any action taken or omitted in reliance on any such deemed vote or consent of one or more Shareholders shall not be void or voidable by reason of timely communication
made by or on behalf of all or any of such Shareholders in any manner other than as expressly provided in Section 10.6.
Section 10.10. Statutory Trust Only.
It is the intention of the parties hereto to create a statutory trust pursuant to the Delaware Act. It is not the intention of the parties hereto to create a
general partnership, limited partnership, joint stock association, corporation, bailment, or any form of legal relationship other than a statutory trust pursuant to the Delaware Act. Nothing in this Amended and Restated Declaration of Trust shall be
construed to make the Shareholders, either by themselves or with the Sponsor, partners or members of a joint stock association.
Section 10.11. Corporate Transparency Act.
The Corporate Transparency Act (31 U.S.C. § 5336) and its implementing regulations (collectively, the "CTA"), may
require the Trust to file reports with Financial Crimes Enforcement Network. It shall be Sponsor's duty and not the Trustee's duty to prepare such filings, cause the Trust to make such filings, and to cause the Trust to comply with its obligations
under the CTA, if any.
Section 10.12 Legal Title to the Trust Estate.
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Legal title to all of the Trust estate shall be vested in the Trust as a separate legal entity; provided, however, that if applicable law in any jurisdiction requires legal title to any portion of the Trust estate to be vested otherwise, the Sponsor may cause legal title to such portion of the Trust estate to be held
by or in the name of the Sponsor or any other Person (other than a Shareholder) as nominee.
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IN WITNESS WHEREOF, the parties hereto have caused this Amended and Restated Declaration of Trust to be duly executed by their respective
officers or representatives hereunto duly authorized, as of the day and year first above written.
Invesco Capital Management LLC, as Sponsor:
By:
Name:
Title:
CSC Delaware Trust Company, as Trustee:
By:
Name:
Title:
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Exhibit 5.1
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Stradley Ronon Stevens & Young, LLP
Suite 2600
2005 Market Street
Philadelphia, PA 19103-7018
215.564.8000
www.stradley.com
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November 28, 2025
Invesco Galaxy Solana ETF
Invesco Capital Management LLC
3500 Lacey Road, Suite 700
Downers Grove, IL 60515
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Re:
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Invesco Galaxy Solana ETF
Registration Statement on Form S-1 (Registration No. 333-288318)
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Ladies and Gentlemen:
We have acted as counsel for Invesco Galaxy Solana ETF, a Delaware statutory trust (the “Trust”), and Invesco Capital Management LLC (the “Sponsor”), in its capacity as the sponsor of the Trust, in
connection with the Trust’s filing on November 28, 2025 with the Securities and Exchange Commission of its registration statement on Form S-1, as amended, (the “Registration Statement”), including the prospectus included in Part I of the Registration
Statement (the “Prospectus”), under the Securities Act of 1933, as amended (the “1933 Act”) (No. 333-288318). The Registration Statement relates to the proposed registration, issuance and sale by the Trust, of an indeterminate number of shares of
fractional undivided beneficial interest in and ownership of the Trust (the “Shares”) in accordance with Rule 456(d) under the 1933 Act to be continuously offered.
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 Form of Amended and Restated Agreement and Declaration of Trust between the Sponsor, as sponsor, and CSC Delaware Trust Company, as
trustee (the “Trust Agreement”), (c) the pertinent provisions of the constitution and laws of the State of Delaware, 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 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.
We have, when relevant facts material to our opinion were not independently established by us, relied, to the extent we deemed such reliance proper, upon written or oral statements of officers or
other representatives of the Sponsor. We have not made or undertaken to make any independent investigation to establish or verify the accuracy or completeness of such factual representations, certifications and other information. The opinions set
forth below are also based on the assumption that the Registration Statement has been declared effective under the 1933 Act.
Based upon the foregoing and subject to the qualifications set forth in this letter, we are of the opinion that the Shares of the Trust, when issued in accordance with the Trust Agreement and the Registration
Statement, including receipt by the Trust of the consideration required for the issuance of the Trust’s Shares, will be duly and legally issued and will be fully paid and non-assessable.
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 Delaware statutory trust
laws governing matters such as the authorization, issuance and non-assessability of the Shares and the applicable provisions of the Delaware constitution, 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 and to the use of our name where it may appear in the Registration Statement and the Prospectus. 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.
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Very truly yours,
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|
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/s/ Stradley Ronon Stevens & Young, LLP
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Exhibit 8.1
November 28, 2025
Invesco Galaxy Solana ETF
Invesco Capital Management LLC
3500 Lacey Road, Suite 700
Downers Grove, IL 60515
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Re:
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Discussion of Federal Income Tax Consequences
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Ladies and Gentlemen:
We have acted as counsel for Invesco Galaxy Solana ETF, a Delaware statutory trust (the “Trust”), and Invesco Capital Management LLC (the “Sponsor”), in its capacity as the sponsor of the Trust,
in connection with the Trust’s filing on November 28, 2025 with the Securities and Exchange Commission (the “Commission”) of its registration statement on
Form S-1, as amended (the “Registration Statement”), including the prospectus included in Part I of the Registration Statement (the “Prospectus”), under the Securities Act of 1933, as amended (the “1933 Act”)
(No. 333-288318). The Registration Statement relates to the proposed registration, issuance and sale by the Trust of an indeterminate number of shares of fractional undivided beneficial interest in and ownership of the Trust (the “Shares”) for continuous offering.
You have requested our opinion in our capacity as special federal income tax counsel to the Sponsor, regarding the discussion relating to
federal income tax matters under the heading “U.S. Federal Income Tax Consequences” in the Prospectus. 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 but not limited to (a) the Prospectus and the exhibits thereto, (b) the Trust’s Amended and Restated Declaration of
Trust and Trust Agreement dated as of November 28, 2025, between the Sponsor, as sponsor, and CSC Delaware Trust Company (the “Trustee”), as trustee (the “Declaration of Trust”), and and (c) such other instruments, documents, statements and records of the Trust and others as we have deemed relevant and necessary
to examine and rely upon for the purpose of this opinion (collectively, the “Documents”).
In our examination of the foregoing Documents, we have assumed with your consent that: (i) all Documents reviewed by us are original
documents, or true and accurate copies of original documents and have not been subsequently amended, (ii) the signatures of each original Document are genuine, (iii) each party who executed the Document had proper authority and capacity, (iv) all
representations and statements set forth in such Documents are true and correct, (v) all obligations imposed by any such Documents on the parties thereto have been performed or satisfied in accordance with their terms, (vi) the Documents present
all the material and relevant facts relating to the subject matter hereof, (vii) the Trust will operate in accordance with the Documents (viii) the Sponsor, the Trustee, and the Trust will not make or cause any amendments to the Documents, in
particular the Declaration of Trust or any other Document after the date of this opinion that is material to the Trust’s federal income tax classification, and (ix) no action will be taken by the Sponsor, Trustee, or the Trust after the date hereof
that would have the effect of altering the facts upon which the opinion set forth below is based.
As to various matters of fact material to this opinion, we have relied, exclusively and without independent verification (with your
permission) upon written or oral statements of officers and other representatives of the Sponsor and any other information supplied to us by the Sponsor; we have no reason to believe that any of that information is inaccurate, untrue, or
incomplete, but, as noted, we have not attempted to independently verify any of it.
Based upon the foregoing and subject to the qualifications set forth in this letter, we advise you that the discussion in the Prospectus
as set forth in the section “U.S. Federal Income Tax Consequences”, to the extent that it constitutes matters of federal income tax law or legal conclusions relating thereto, is correct and complete in all material respects.
The opinion set forth above represents our conclusion based upon the Documents, facts, representations and assumptions referred to above.
Any material amendments to such documents, changes in any significant facts or inaccuracy of such representations or assumptions could affect the opinions referred to herein.
The opinion set forth in this letter is based on relevant provisions of the Internal Revenue Code of 1986, as amended, the Treasury
Regulations promulgated thereunder, interpretations of the foregoing as expressed in court decisions, legislative history, and existing administrative rulings and practices of the IRS (including its practices and policies in issuing private letter
rulings, which are not binding on the IRS except with respect to a taxpayer that receives such a ruling), all as of the date hereof. These provisions and interpretations are subject to change, which may or may not be retroactive in effect, and
which may result in modifications of our opinion. Our opinion does not foreclose the possibility of a contrary determination by the IRS or a court of competent jurisdiction or of a contrary determination by the IRS or the Treasury Department in
regulations or rulings issued in the future. In this regard, an opinion of counsel with respect to an issue represents counsel’s best professional judgment with respect to the outcome on the merits with respect to such issue, if such issue were to
be litigated, but an opinion is not binding on the IRS or the courts and is not a guarantee that the IRS will not assert a contrary position with respect to such issue or that a court will not sustain such a position asserted by the IRS.
This letter is limited to those matters expressly covered and no opinion is expressed in respect of any other matter. This letter is
being rendered to the Sponsor of the Trust and may be relied upon only by the Sponsor, the Trust and the Trust’s shareholders, and may not be relied upon for any other purpose, or furnished to, quoted in whole or in part or relied upon by any other
person, firm or corporation, for any purpose, without our prior written consent.
The opinion set forth in this letter is rendered only to you and is solely for your use in connection with the submission to the
Commission as an exhibit to the Prospectus. We hereby consent to the filing of this letter as an exhibit to the Prospectus and to the use of the name of our firm under the caption “U.S. Federal Income Tax Consequences” of the Prospectus. In giving
this consent, we do not hereby admit that we come within the category of persons whose consent is required under Section 7 of the 1933 Act or the rules and regulations of the Commission thereunder.
Very truly yours,
/s/ Stradley Ronon Stevens & Young, LLP
Exhibit 10.3
MARKETING AGENT AGREEMENT
MARKETING AGENT AGREEMENT dated and effective as of November 28, 2025 (this “Agreement”) among Invesco Galaxy Solana ETF, a Delaware statutory trust
(the “Trust”), Invesco Distributors, Inc., a Delaware corporation (the “Marketing Agent”), and Invesco Capital Management LLC, a Delaware limited liability company (the “Sponsor”). Capitalized terms used but not defined in this
Agreement shall have the meaning ascribed thereto in the Trust’s Prospectus (as defined herein) included in its Registration Statement (as defined herein).
WHEREAS, the Sponsor has filed the Registration Statement on Form S-1 (Registration No. 333-288318 with the U.S. Securities and Exchange Commission (the “SEC”)
under the Securities Act of 1933, as amended (the “1933 Act”);
WHEREAS, the Trust intends to create and redeem shares of beneficial interest in the Trust (the “Shares”) only in large aggregations (“Creation Baskets”) on a
continuous basis, and list the Shares on one or more national securities exchanges;
WHEREAS, the Sponsor desires to retain the Marketing Agent to provide certain services in connection with the offering of the Shares (as amended from time to
time);
WHEREAS, the Marketing Agent is registered as a broker-dealer under the Securities Exchange Act of 1934, as amended (the “1934 Act”), and is a member of the
Financial Industry Regulatory Authority, Inc. (“FINRA”);
WHEREAS, the Trust and the Sponsor wish to employ Marketing Agent in connection with the performance of the services listed in Schedule A and additional
services as may be agreed to from time-to-time; and
WHEREAS, the Marketing Agent is willing to provide such services on the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual promises and undertakings herein contained, the parties agree as follows:
1. Documents — The Trust has furnished or will furnish, upon request, the Marketing Agent with copies of the Trust’s Amended and Restated Declaration of Trust, custodian agreements, transfer agency agreement,
fund administration agreement, execution agent agreement, current Prospectus and Registration Statement, and all forms relating to any plan, program or service offered by the Trust. The Trust 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, the Trust 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” and “prospectus” shall mean any registration statement, prospectus and statement of additional information filed by the Trust with the Securities and Exchange Commission (“SEC”) and any
amendments and supplements thereto that are filed with the SEC. “Prospectus” means the Prospectus constituting part of the Registration Statement of the Trust under the 1933 Act as such Prospectus may be amended or supplemented and filed with
the SEC from time to time. “Registration Statement” means the registration statement most recently filed from time to time by the Trust with the SEC and effective under the 1933 Act, as such registration statement is amended by any amendments
thereto at the time in effect.
2. Authorized Representations — The Marketing Agent is not authorized by the Trust to give any information or to make any representations other than those contained in the Registration Statement or Prospectus,
or contained in shareholder reports or other material that may be prepared by or on behalf of the Trust for the Marketing Agent’s use. Consistent with the foregoing, the Marketing Agent may prepare and distribute sales literature or other material as
it may deem appropriate in consultation with the Trust and the Sponsor, provided such sales literature is approved in accordance with this agreement and complies with applicable law and regulations.
-1-
3. Registration of Shares — The Trust agrees that it will take all action necessary to register the Shares of the Trust under the 1933 Act. The Trust shall make available to the Marketing Agent, at the Marketing
Agent’s expense, such number of copies of its Prospectus as the Marketing Agent may reasonably request. The Trust shall furnish to the Marketing Agent copies of all information, financial statements and other papers related to the Funds, which the
Marketing Agent may reasonably request for use in connection with the marketing Shares of the Trust.
4. Fees and Fund Expenses — (a) In consideration of the services to be performed for the Trust by the Marketing Agent hereunder as set forth on Schedule A attached hereto and as it may be amended from time-to-time, the Sponsor
(and not the Trust) will pay the Marketing Agent a fee in an amount set forth in Schedule B hereto, subject to any limitation imposed by any law, rule or regulation applicable to any of the parties hereto.
(b) The Sponsor 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 with the prior written consent of the Sponsor.
5. Use of the Marketing Agent’s Name — The Trust shall not 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 and in all other materials which merely refer to accurate terms to their appointment hereunder or which are required by the SEC, FINRA, OCC, CFTC, NFA 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 the Trust (which shall not be unreasonably withheld); provided, however, that the Trust hereby approves all lawful uses of their respective 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, OCC, CFTC, NFA or any state securities authority.
7. Indemnification — (a) Subject to the limitations set forth in Paragraph 12 below, the Sponsor agrees to indemnify and hold harmless the Marketing Agent and each of its directors and officers and each person,
if any, who controls the Marketing Agent within the meaning of Section 15 of the Securities Act, against any loss, liability, claim, damage or expense (including the reasonable cost of investigating or defending any alleged loss, liability, claim,
damage or expense and reasonable counsel fees incurred in connection therewith) by reason of any person acquiring any Shares, based upon the ground that the Registration Statement, Prospectus, shareholder reports or other information filed or made
public by the Trust (as from time-to-time amended) included an untrue statement of a material fact or omitted to state a material fact required to be stated or necessary in order to make the statements not misleading under the Securities Act or any
other statute or the common law. However, the Trust does not agree to indemnify the Marketing Agent or hold it harmless to the extent that the statement or omission was made in reliance upon, and in conformity with, information furnished to it by or
on behalf of the Marketing Agent. In no case (i) is the indemnity of the Trust in favor of the Marketing Agent or any person indemnified to be deemed to protect the Marketing Agent or any person against any liability to a Trust or its security
holders to which the Marketing Agent or such person would otherwise be subject by reason of willful misfeasance, bad faith or negligence in the performance of its duties or by reason of its reckless disregard of its obligations and duties under this
Agreement, or (ii) is a Trust to be liable under its indemnity agreement contained in this paragraph with respect to any claim made against the Marketing Agent or any person indemnified unless the Marketing Agent or person, as the case may be, shall
have notified the Trust in writing of the claim promptly after the summons or other first written notification giving information of the nature of the claims shall have been served upon the Marketing Agent or any such person (or after the Marketing
Agent or such person shall have received notice of service on any designated agent). However, failure to notify a Trust of any claim shall not relieve that Trust from any liability which it may have to any person against whom such action is brought
otherwise than on account of its indemnity agreement contained in this paragraph. The Trust 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, and
if a Trust elects to assume the defense, the defense shall be conducted by counsel chosen by such Trust. In the event a Trust elects to assume the defense of any suit and retain counsel, the Marketing Agent, officers or directors or controlling
person(s) or defendant(s) in the suit, shall
-2-
bear the fees and expenses of any additional counsel retained by them. If a Trust does not elect to assume the defense of any suit, it will reimburse the Marketing Agent, officers or directors or controlling person(s) or
defendant(s) in the suit for the reasonable fees and expenses of any counsel retained by them. The Trust agrees to notify the Marketing Agent promptly of the commencement of any litigation or proceeding against it or any of its officers in connection
with the issuance or sale of any of the Shares.
(b) The Marketing Agent also covenants and agrees to indemnify and hold harmless the Trust, the Sponsor, and each of their respective officers, representatives or agents and each person, if any, who controls the Trust or
the Sponsor within the meaning of Section 15 of the Securities Act (each, an “Indemnified Party”), against any loss, liability, claim, damage or expense (including the reasonable cost of investigating or defending any alleged loss, liability,
claim, damage or expense and reasonable counsel fees incurred in connection therewith) arising by reason of any person acquiring any Shares, based upon the Securities Act or any other statute or common law, alleging (a) any wrongful act of the
Marketing Agent or any of its employees or (b) that any sales literature, advertisements, information, statements or representations used or made by the Marketing Agent or any of its affiliates or employees or that the Registration Statement or
Prospectus (as from time-to-time amended) included an untrue statement of a material fact or omitted to state a material fact required to be stated or necessary in order to make the statements not misleading, insofar as the statement or omission was
made in reliance upon, and in conformity with, information furnished to such Trust or Sponsor by or on behalf of the Marketing Agent. In no case (i) is the indemnity of the Marketing Agent in favor of any Indemnified Party to be deemed to protect any
such party against any liability to which the Indemnified Party would otherwise be subject by reason of willful misfeasance, bad faith or negligence in the performance of its duties or by reason of its reckless disregard of its obligations and duties
under this Agreement, or (ii) is the Marketing Agent to be liable under its indemnity agreement contained in this paragraph with respect to any claim made against any Indemnified Party unless such Indemnified Party shall have notified the Marketing
Agent in writing of the claim promptly after the summons or other first written notification giving information of the nature of the claim shall have been served upon such Indemnified Party (or after such Indemnified Party shall have received notice
of service on any designated agent). However, failure to notify the Marketing Agent of any claim shall not relieve the Marketing Agent from any liability which it may have to the Indemnified Party against whom the action is brought otherwise than on
account of its indemnity agreement contained in this paragraph. In the case of any notice to the Marketing Agent it 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, and if the Marketing Agent elects to assume the defense, the defense shall be conducted by counsel chosen by it and satisfactory to the Indemnified Party, to its officers and to any controlling person(s), or defendant(s) in the
suit. In the event that the Marketing Agent elects to assume the defense of any suit and retain counsel, the Indemnified Party or controlling person(s), defendant(s) in the suit, shall bear the fees and expenses of any additional counsel retained by
them. If the Marketing Agent does not elect to assume the defense of any suit, it will reimburse the Indemnified Party, officers or controlling person(s) or defendant(s) in the suit for the reasonable fees and expenses of any counsel retained by
them. The Marketing Agent agrees to notify the Indemnified Party promptly of the commencement of any litigation or proceeding against it in connection with the Indemnified Party and sale of any of the Shares.
8. Supplemental Information — The Marketing Agent and the Sponsor, on behalf of the Trust, shall regularly consult with each other regarding the Marketing Agent’s performance of its obligations under this
Agreement. In connection therewith, the Sponsor shall submit to the Marketing Agent at a reasonable time in advance of filing with the SEC reasonably final copies of any amended or supplemented registration statement (including exhibits) under the
Securities Act; provided, however, that nothing contained in this Agreement shall in any way limit the Trust’s right to file at any time such amendments to any Registration Statement and/or supplements to any Prospectus, of whatever
character, as the Trust may deem advisable, such right being in all respects absolute and unconditional.
The Marketing Agent acknowledges that the only information provided to it by the Trust or the Sponsor is that contained in the Registration Statement, the Prospectus and reports and financial information referred to
herein. Neither the Marketing Agent nor any other person is authorized by the Trust to give any information or to make any representations, other than those contained in such documents.
9. Term — This Agreement shall become effective as of the date first written above, and shall continue until one year from such date and thereafter shall continue automatically for successive annual periods.
This Agreement is terminable, with respect to the Trust, without penalty on sixty (60) days’ written notice by the Sponsor, the Trust or by the Marketing Agent. This Agreement shall automatically terminate in the event of its assignment.
-3-
Upon the termination of this Agreement by the Trust, at the expense and direction of the Trust, the Marketing Agent shall transfer to such successor, as the Trust shall specify all relevant books, records and other data
established or maintained by the Marketing Agent for the Trust under this Agreement.
10. Notice — Any notice required or permitted to be given by any party to another party shall be deemed sufficient if sent by (i) email 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 the Sponsor, at:
Invesco Capital Management LLC
3500 Lacey Road, Suite 700
Downers Grove, IL 60515
Attn: Head of Legal
if to the Marketing Agent at:
Invesco Distributors, Inc.
11 Greenway Plaza, Suite 1000
Houston, TX 77046
Attn: General Counsel
or such other email 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 and to prior or present shareholders or to those persons or entities who respond to the Marketing Agent’s inquiries concerning investment in a particular Trust, and will not use such records and information for any purposes other than
performance of its responsibilities and duties hereunder. 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 the Trust with prompt written notice of any such request or requirement so
that particular Trust 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. Limitation of Liability —The Marketing Agent agrees that, pursuant to Section 3804(a) of the Delaware Statutory Trust Act, the liabilities of the Trust shall be limited such that the debts, liabilities,
obligations and expenses incurred, contracted for or otherwise existing and relating to this Agreement with respect to the Trust shall be enforceable against the assets of the Trust. The Marketing Agent further agrees that it shall not seek
satisfaction of any such obligation from the Trustee, shareholders, any individual shareholder, officer, representative or agent of the Trust, nor shall the Marketing Agent seek satisfaction of any such obligation from the Sponsor, its members,
managers, directors or officers.
Any obligations of the Trust entered into in the name or on behalf thereof by the Sponsor, members managers, officers, representatives or agents are made not individually, but in such capacities, and are not binding upon
any of the Sponsor, the Trustee, members, managers, or officers, representatives or agents personally, but bind only the property of the Trust party to said obligation, and all persons dealing with such Trust must look solely to that Trust’s property
for the enforcement of any claims.
It is expressly understood and agreed by the Marketing Agent that:
-4-
(a) this Agreement is executed and delivered on behalf of the Trust by the Sponsor, not individually or personally, but solely as Sponsor of the Trust in the exercise of the powers and authority
conferred and vested in it;
(b) the representations, covenants, undertakings and agreements herein made on the part of the Trust are made and intended not as personal representations, undertakings and agreements by the Sponsor but
are made and intended for the purpose of binding only the Trust;
(c) nothing herein contained shall be construed as creating any liability on the Sponsor, individually or personally, to perform any covenant of the Trust either expressed or implied contained herein,
all such liability, if any, being expressly waived by the parties hereto and by any person claiming by, through or under the parties hereto; and
(d) under no circumstances shall the Sponsor be personally liable for the payment of any indebtedness or expenses of the Trust or be liable for the breach or failure of any obligation, duty,
representation, warranty or covenant made or undertaken by the Trust under this Agreement or any other related document.
13. Miscellaneous — Each party agrees to perform such further acts and execute such further documents as are necessary to effectuate the purposes hereof. Except with respect to Paragraph 12 above, which shall be
construed, interpreted, and enforced in accordance with and governed by the laws of the State of Delaware, this Agreement shall be construed, interpreted, and enforced in accordance with and governed by the laws of the State of Illinois. 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.
All activities by the Marketing Agent and its agents and employees as Marketing Agent of the Shares shall comply with all applicable laws, rules and regulations including, without limitation, all rules and regulations
made or adopted by the SEC, FINRA or any securities association registered under the Exchange Act or futures association registered under the Commodity Exchange Act, as amended. Should the Marketing Agent, or any of its agents and employees,
materially fail to maintain compliance with all applicable laws, rules and regulations to which it is subject, or otherwise lose its status as a registered broker-dealer in good standing with FINRA, the Marketing Agent agrees to promptly notify the
Sponsor.
All activities by the Sponsor and its agents and employees as Marketing Agent of the Shares shall comply with all applicable laws, rules and regulations including, without limitation, all rules and regulations made or
adopted by the SEC, CFTC or any securities association registered under the Exchange Act or futures association registered under the Commodity Exchange Act, as amended. Should the Sponsor, or any of its agents and employees, materially fail to
maintain compliance with all applicable laws, rules and regulations to which it is subject, or otherwise lose its status as a commodity pool operator in good standing with the CFTC, the Sponsor agrees to promptly notify the Marketing Agent.
14. Anti-Money Laundering. The Marketing Agent and Sponsor both represent and warrant to the other that it has, and shall maintain, an anti-money laundering program (“AML Program”) that, at a minimum, (i)
designates a compliance officer to administer and oversee the AML Program, (ii) provides ongoing employee training, (iii) includes an independent audit function to test the effectiveness of the AML Program, (iv) establishes internal policies,
procedures, and controls that are tailored to its particular business, (v) provides for the filing of all necessary anti-money laundering reports including, but not limited to, currency transaction reports and suspicious activity reports, and (vi)
allows for appropriate regulators to examine its anti-money laundering books and records.
Remainder of page intentionally left blank. Signature page follows.
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IN WITNESS WHEREOF, each of the undersigned have executed this instrument in its name and behalf, and the Marketing Agent has executed this instrument in its name and behalf, as
of the date and year first above written.
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INVESCO GALAXY SOLANA ETF
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By:
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INVESCO CAPITAL MANAGEMENT LLC,
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as Sponsor of Invesco Galaxy Solana ETF
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By:
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Name:
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Title:
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INVESCO DISTRIBUTORS, INC.
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By:
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Name:
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Title:
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INVESCO CAPITAL MANAGEMENT LLC
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By:
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Name:
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Title:
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Schedule A
List of Services for the Trust
1. Duties of the Marketing Agent
The Marketing Agent shall use commercially reasonable efforts to provide, or cause an affiliate to provide, the following services to the Trust:
|
•
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At the request of the Trust, the Marketing Agent shall assist the Trust with facilitating Authorized Participant Agreements between and among
Authorized Participants, the Trust, and the applicable Transfer Agent, for the creation and redemption of Creation Baskets of the Trust.
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•
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Make available copies of the Prospectus to Authorized Participants who have purchased Creation Baskets in accordance with the Authorized
Participant Agreements.
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•
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Maintain telephonic, facsimile and/or access to direct computer communications links with the Transfer Agent.
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•
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Review and approve, prior to use, all Trust marketing materials submitted to the Marketing Agent for review by the Sponsor (“Marketing Materials”)
for compliance with applicable SEC and FINRA advertising rules, and file all such Marketing Materials required to be filed with FINRA. The Marketing Agent agrees to furnish to the Trust or the Sponsor any comments provided by FINRA with
respect to such materials.
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•
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Ensure that all direct requests by Authorized Participants for Prospectuses are fulfilled.
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•
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Work with the Transfer Agent to review and approve orders placed by Authorized Participants and transmitted to the Transfer Agent. The Trust
acknowledges that the Marketing Agent shall not be obligated to approve any certain number of orders for Creation Baskets.
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•
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Review distribution related legal documents and contracts.
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•
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Consult with sponsor’s marketing staff on development of FINRA compliant marketing campaigns.
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|
•
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Consult with sponsor on marketing/sales strategy.
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•
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Maintain books and records in respect of the Trust that relate to the services provided pursuant to this Agreement.
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•
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Perform such additional marketing and distribution related services as may be agreed among the parties from time-to-time.
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2. Duties of the Sponsor
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•
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The Trust agrees to create, issue, and redeem Creation Baskets of the Trust in accordance with the procedures described in the
Prospectus. Upon reasonable notice to the Marketing Agent, and in accordance with the procedures described in the Prospectus, the Trust reserves the right to reject any order for Creation Baskets or to stop all receipts of such orders at
any time.
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|
•
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The Sponsor shall deliver to the Marketing Agent copies of the following documents:
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(i)
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the then current Prospectus for the Trust;
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(ii)
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any relevant policies and procedures adopted by the Sponsor or the Trust or its service providers that are applicable to the services provided by
the Marketing Agent; and
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(iii)
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any other documents, materials or information that [the Marketing Agent shall reasonably request to enable it to perform its duties pursuant to
this Agreement.
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A-1
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•
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The Sponsor shall thereafter deliver to the Marketing Agent as soon as is reasonably practical any and all amendments to the documents required to
be delivered under this Section.
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•
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The Trust shall arrange to provide the listing exchanges with copies of Prospectuses and product descriptions that are required to be provided by
the Trust to purchasers in the secondary market.
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•
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The Trust will make it known that Prospectuses and product descriptions are available by making sure such disclosures are in all marketing and
advertising materials prepared by the Trust.
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A-2
Schedule B
Pursuant to Section 4(a)
In consideration of the services to be provided by the Marketing Agent under and pursuant to this Agreement, Sponsor shall pay to the
Marketing Agent as reimbursement for actual costs associated with the Marketing Agent performing the services provided herein, with such compensation to be capped at $[ ] annually. Marketing Agent’s compensation will be paid quarterly in arrears on
the last business day of each calendar quarter and prorated for partial quarters in the event the Marketing Agent Agreement becomes effective on a date that is not the first day of a calendar quarter or is terminated on a date that is not the last
day of a calendar quarter.
B-1
Exhibit 10.11
STAKING & DELEGATION SERVICES AGREEMENT
This Staking & Delegation Services Agreement (the “Agreement”) dated November [__], 2025 (the “Effective Date”) is between Galaxy
Blockchain Infrastructure LLC, a Cayman Islands limited liability company having its registered address at Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands (“Galaxy”)
and Invesco Galaxy Solana ETF, a Delaware statutory trust located at 3500 Lacey Road, Suite 700, Downers Grove, IL 60515 (“Delegator”).
WHEREAS, some blockchain
protocols achieve consensus among distributed nodes through a system known as “proof-of-stake” in which holders of tokens native to the protocol may stake and/or delegate their tokens with a validator node to participate in the consensus validation
process;
WHEREAS, to incentivize staking and validation, proof-of-stake systems programmatically allocate
tokens as rewards for performing validation processes;
WHEREAS, Galaxy offers non-custodial validation-as-a-service to qualified token holders through
Galaxy’s proprietary hardware and computational systems that facilitate validation and staking processes on certain blockchain protocols;
WHEREAS, Delegator wishes to delegate the staking of its tokens to Galaxy
on the terms of this Agreement.
NOW, THEREFORE, in consideration of the mutual promises contained herein and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:
| 1. |
DEFINITIONS
|
The definitions for some defined terms used in this Agreement are set forth below. Other terms may be defined elsewhere in this Agreement.
1.1 “Agreement” means this Staking & Delegation Services Agreement and includes the Supported Blockchain Terms and all the schedules attached hereto, as any of the same may be updated,
supplemented, and amended from time to time.
1.2 “Affiliate” means, with respect to any entity, any other entity that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control
with, such entity. The term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of an entity, whether through the ownership of
voting securities, by contract, or otherwise.
1.3 “Blockchain Protocols” means any protocols or operations of the Supported Blockchain, including the rules governing the validation and inclusion of transactions in the Supported Blockchain.
1.4 “Confidential Information” means: (i) with respect to Galaxy, the Platform, the Website, and any and all
source code relating thereto and any other non-public information or material regarding its legal or business affairs, financing, customers, properties, pricing, or data; and (ii) with respect to Delegator, any non-public information or material
regarding Delegator's legal or business affairs, financing, customers, properties, or data. Notwithstanding any of the foregoing, Confidential Information does not include information which: (a) is or becomes public knowledge without any action by,
or involvement of, the Party to which the Confidential Information is disclosed (the “Receiving Party”); (b) is known to the Receiving Party prior to its
disclosure by the other Party (the “Disclosing Party”); (c) is independently developed by the Receiving Party without reference or access to the
Confidential Information of the Disclosing Party; or (d) is obtained by the Receiving Party without restrictions on use or disclosure from a third party not known to the Receiving Party to be subject to or to owe a legal, contractual or other duty
of confidentiality to the Disclosing Party.
1.5 “Delegator Wallet” mean the digital asset wallet associated with the relevant Tokens to be delegated by Delegator.
1.6 “Law” means any national, provincial, international, federal, state, county, and local statute, law, ordinance, regulation, rule, code, and order applicable to a Party.
1.7 “Missed Rewards” means Delegator’s Rewards that would have been received but for the failure of Galaxy to sign blocks for a Supported Blockchain when performing Services in its role as a validator,
unless such failure was due to a Force Majeure Event.
1.8 “Net Rewards” means the sum of the Rewards minus the Service Fee, as such term is defined in Section 5.1 below.
1.9 “Party” means Galaxy or Delegator, as applicable; and “Parties” means, together, Galaxy and Delegator.
1.10 “Person” means any individual, organization, business, partnership, trust, entity, corporation, or government.
1.11 “Platform” means Galaxy's proprietary computational infrastructure or platform that it uses to perform the
Services.
1.12 “Prohibited Content” means content that: (i) is illegal under Law; (ii) violates any third party's intellectual property rights, including copyrights, trademarks, patents, and trade
secrets; (iii) contains indecent or obscene material; (iv) contains libelous, slanderous, or defamatory material, or material constituting an invasion of privacy or misappropriation of publicity rights; (v) promotes unlawful or illegal goods,
services, or activities; (vi) contains false, misleading, or deceptive statements, depictions, or sales practices; or (vii) contains viruses, Trojan horses, worms, or any other harmful, malicious, or hidden procedures, routines, mechanisms, or
code.
1.13 “Public Rate” means the standard, publicly-available rate programmatically transferred to Galaxy for providing the technological infrastructure and support services in providing
validation Services to each Supported Blockchain to earn Rewards
1.14 “Rewards” or “Staking Rewards” means with respect to any Tokens staked by Galaxy in accordance with this Agreement on behalf of Delegator, any
rewards allocated by the Supported Blockchain in respect of such staked Tokens, including block rewards, endorser rewards, and transaction fees (including, for the avoidance of doubt, fees received from maximal extractable value), in each case as
actually allocated to Delegator by the Supported Blockchain and received in connection with the performance of the Services.
1.15 “Representatives” means, in respect of a Person, such Person’s Affiliates and its and their officers, directors and employees, as applicable.
1.15 “Slashing Penalties” means any penalty imposed by the Supported Blockchain..
1.17 “Slashing Reimbursements” means the payment by Galaxy to Delegator of an amount equal to any
Slashing Penalties, subject to Section 5.6.
1.18 “Sponsor” means Invesco Capital Management LLC.
2
1.19 “Supported Blockchain” means the distributed ledger maintained by any proof-of-stake based blockchain network on which Galaxy
may exercise Token Rights delegated to it by Delegator. Each Supported Blockchain has its own protocols and terms. Supported Blockchains and some applicable terms are identified in the Supported Blockchain Terms.
1.20 “Supported Blockchain Terms” means certain terms in respect of the delegation of Tokens of each Supported Blockchain. The Supported
Blockchain Terms are subject to the Blockchain Protocols and changes of such protocols imposed by the respective Supported Blockchain. Supported Blockchain Terms are set forth in Schedule A.
1.21 “Token” means any token (whole or fractional) that Delegator has delegated to Galaxy in
accordance with the protocol of the applicable Supported Blockchain.
1.22 “Token Rights” means, together, Validation Rights and Voting Rights.
1.23 “Validation Rights” means rights of a Token owner to validate and sign the next definitive serial transaction record on a Supported Blockchain.
1.24 “Voting Rights” means rights of a Token owner to vote upon proposals related to the operation and governance of the respective Supported Blockchain.
1.25 “Website” means www.galaxy.com .
| 2. |
DELEGATION
|
2.1 Subject to the protocols of the Supported Blockchains and unless otherwise provided in the Supported Blockchain Terms, by interacting directly with the protocols of a Supported Blockchain:
| (a) |
Delegator may delegate any number of the relevant Tokens to Galaxy at any time during the Term; and
|
| (b) |
Delegator may initiate the process of withdrawing such Tokens at any time.
|
2.2 Galaxy may add additional Supported Blockchains to this Agreement. Any additional Supported Blockchains shall be indicated in Schedule A, including applicable terms for such Supported Blockchain(s).
2.3 Galaxy may choose to discontinue support of any existing Supported Blockchain by providing no less than sixty (60) calendar days’ written notice to Delegator, which may be provided via email, that such support shall be discontinued.
2.4 Delegator shall not delegate any Tokens to Galaxy hereunder if Delegator reasonably expects that any condition described in Section 6.1(b) to and including (e) is not satisfied, and, in
the event that any such condition ceases to be satisfied, then Delegator shall reasonably promptly deliver written notice of the same to Galaxy.
| 3. |
SERVICES
|
3.1 Services. Subject to the terms of this Agreement, Galaxy will provide the following services (together, the “Services”):
3
| (a) |
stake the relevant Tokens by exercising the Validation Rights in a manner intended to generate Rewards;
|
| (b) |
Delegator will rely on Galaxy to perform the Services, subject to the duty to perform the Services in a commercially reasonable manner intended to maximize the amount of Net Rewards receivable by Delegator, to the
extent legally permissible and subject to Galaxy’s internal regulatory and legal compliance policies, in accordance with this Agreement in a safe and sound manner; provided that, at all times, Delegator shall have the discretion whether to
delegate its Tokens to Galaxy for Galaxy to perform the Services in respect of the relevant Supported Blockchain; and
|
| (c) |
provide the Services in a manner that meets or exceeds the service levels set forth in Schedule B attached
hereto; provided that Galaxy shall perform all Services not otherwise subject to a service level requirement in accordance with leading industry standards.
|
3.2 Restriction. Galaxy will not, directly or indirectly, lend, pledge, encumber, hypothecate or rehypothecate any Tokens staked or delegated under this
Agreement.
| 4. |
WITHDRAWAL & UNBONDING
|
4.1 Tokens withdrawn by Delegator may be subject to unbonding periods imposed by the protocols of the relevant Supported Blockchain.
4.2 Pursuant to the protocols of certain Supported Blockchains, Tokens and Net Rewards may be unavailable to Delegator during the unbonding periods and subject to other restrictions imposed by the Supported Blockchain.
| 5. |
REWARDS
|
| 5.1 |
Determination of Service Fees.
|
| (a) |
The Parties understand and acknowledge that each Supported Blockchain will programmatically determine the quantum of Rewards that will be allocated to Galaxy for staking and transaction validation Services based on the relevant Public
Rate.
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| (b) |
The Parties understand and agree that a portion of the Rewards will be used to compensate Galaxy for providing the technological infrastructure and support services in providing such validation Services to
each relevant Supported Blockchain to earn Rewards, which may differ from the Public Rate (the “Service Fee”).
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| (c) |
The Service Fee in respect of each Supported Blockchain shall be mutually agreed upon by Galaxy and Delegator, as indicated in the Supported Blockchain Terms.
|
| 5.2 |
Transfer of Net Rewards.
|
| (a) |
The Parties acknowledge that the performance of the Services by Galaxy with respect to each relevant Supported Blockchain is intended to result in the transfer of:
|
| (i) |
the Service Fee to Galaxy; and
|
| (ii) |
Net Rewards to Delegator,
|
in each case in accordance with the relevant Supported Blockchain Terms.
4
| (b) |
Galaxy and Delegator will transfer the applicable Net Rewards on a monthly basis, as agreed upon by the Parties.
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| (c) |
The Net Rewards will be in the same denomination as the Tokens that Delegator delegated to Galaxy under this Agreement, unless otherwise agreed between the Parties in
writing, or as otherwise set forth in the protocols of the relevant Supported Blockchain.
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| (d) |
This Section 5.2 shall be subject to the applicable Blockchain Protocol and any variations to Section 5.2 under the Supported Blockchain Terms.
|
5.3 Rewards Not Guaranteed. Delegator acknowledges that the transfer of Rewards by the relevant Supported Blockchain is not guaranteed (even if Galaxy performs the Services properly and in accordance with this Agreement), and that Galaxy is not responsible for any failure by the relevant Supported Blockchain to transfer Rewards to
Galaxy or Delegator, or for any loss or destruction of Rewards or transfer by the relevant Supported Blockchain of Rewards to the incorrect Delegator Wallet or other wallet address of Delegator (unless such loss, destruction or incorrect transfer
was caused by the gross negligence, fraud, or willful misconduct of Galaxy). For the avoidance of doubt, nothing in this Section limits Galaxy’s obligations or liability
with respect to Missed Rewards as set forth in Section 14.3.
5.4 Slashing. Galaxy will take all commercially reasonable steps to avoid the slashing of any Token delegated to it by Delegator hereunder. The slashing risk of any
Supported Blockchain, as made known by that Supported Blockchain, will be identified in the Supported Blockchain Terms.
5.5 Slashing Reimbursement. Galaxy will make payment, directly to the applicable Delegator Wallet, a Slashing Reimbursement for
any Slashing Penalty (except for a Slashing Penalty that is solely the result of a protocol-wide malfunction of a relevant Supported Blockchain) assessed against a Delegator Wallet in connection with Galaxy’s
Services, subject to Section 14.2 and the Supported Blockchain Terms.
| 5.6 |
Protocol Changes, Airdrops & Forks; Governance and Voting Rights
|
| (a) |
The Parties acknowledge and agree that Supported Blockchain protocols may change, and airdrops or forks may arise, in each case outside of the control of Galaxy and that,
therefore, except as may be otherwise provided in this Agreement:
|
| (i) |
Galaxy may respond to protocol changes, airdrops or forks in any way that Galaxy determines appropriate in its commercially reasonable discretion acting in good faith
(provided that, to the extent reasonably practical, Galaxy will advise Delegator of its anticipated response to a protocol change or fork with respect to a Supported Blockchain in advance thereof);
|
| (ii) |
the reasonable exercise by Galaxy, acting in good faith, of any right or power that is available to it in its capacity as a validating node on the Supported Blockchain
shall not constitute a breach or violation of any obligation owed by Galaxy to Delegator under this Agreement; and
|
| (iii) |
Galaxy is not responsible for any losses or reductions in value in respect of the Tokens or otherwise suffered by Delegator in connection with protocol changes, airdrops or forks unless caused by Galaxy’s gross negligence, fraud or willful misconduct.
|
5
| (b) |
In the event that the Supported Blockchain Terms describe a protocol of a Supported Blockchain that undergoes a change imposed by the protocol that affects the Public Rate, Rewards, Slashing Penalties, or Validation
Rights of the Supported Blockchain, such protocol change shall be deemed to be incorporated into and supersede any conflicting Supported Blockchain Terms.
|
5.7 Governance. Certain Supported Blockchains may offer the ability for staking parties to participate in governance voting relating to the related Blockchain Protocol. To the extent set forth
in this Section 5.7, Galaxy may, solely for the benefit and on behalf of Delegator, facilitate the casting of votes associated with Delegator’s Tokens for governance matters relating to the relevant Blockchain Protocol. Any such action
shall be taken solely upon Delegator’s written direction, which must be received by Galaxy no less than forty-eight (48) hours prior to the applicable governance matter’s voting deadline, as set forth in the applicable governance proposal (the “Notice of Intent to Vote”).
Delegator shall be solely responsible for monitoring all governance matters, proposals, and voting opportunities relating to any Supported
Blockchain. Galaxy shall have no obligation to monitor, identify, track, or notify Delegator of any such governance matters. Galaxy’s obligation to act is limited solely to timely receiving the Notice of Intent to Vote and only with respect to
governance proposals that materially affect Delegator in relation to the applicable Supported Blockchain, as mutually determined by the Parties acting in a commercially reasonable manner; provided that, Galaxy reserves the right to decline to act
on any voting instruction if Galaxy determines, in its sole but reasonable discretion, that (i) doing so is necessary or advisable to address a material risk to Galaxy (including to its reputation), its affiliates or business partners, or
Galaxy’s technical, operational, or commercial systems; (ii) it would be technically or commercially unsafe; or (iii) the action would violate applicable Law.
To the maximum extent permitted by applicable Law and notwithstanding anything contrary in this Agreement, Galaxy shall not be liable for any loss, damage, or
claim arising out of or related to Galaxy’s good-faith actions or omissions in following Delegator’s written directions in connection with participation in governance voting relating to any Blockchain Protocol, including any failure to act due to
late, unclear, incomplete, or conflicting instructions. Delegator shall be solely responsible for any tax liabilities arising in connection with governance voting, including any new tokens or rewards that may be created, distributed, or credited as a
result of such voting activity.
Delegator acknowledges and agrees that the governance support described in this Section 5.7 does not create, and shall not be construed as creating, any fiduciary
duty, advisory duty, or other heightened standard of care on the part of Galaxy, and that Galaxy’s obligations with respect to governance matters related to a Blockchain Protocol are strictly limited to those expressly set forth in this Section 5.7.
| 6. |
Conditions
|
6.1 The obligation of Galaxy to perform the Services is conditional on the satisfaction of the following conditions precedent as of the Effective Date and the time of performance of the Services:
| (a) |
Galaxy is authorized to operate a validator node on the Supported Blockchain;
|
| (b) |
the covenants and obligations of Delegator under this Agreement are performed and satisfied;
|
| (c) |
the representations and warranties of Delegator set forth herein are true, accurate and complete in all material respects as of all times on and after the date of this Agreement during the Term;
|
6
| (d) |
neither the delegation of the Token Rights by Delegator to Galaxy, nor Galaxy’s performance of Services, constitute, or would be
reasonably expected to result in (with or without notice, lapse of time, or both) a breach, default, contravention or violation of any Law, or agreement to which Delegator or Galaxy is a party or by
which Delegator or Galaxy is bound, including this Agreement and the protocols of each relevant Supported Blockchain; and
|
| (e) |
without limiting the generality of the foregoing, under Law:
|
| (i) |
neither Galaxy nor Delegator, to the best of its knowledge, is deemed to be a “money service business,” “money transmitter” or a similar classification in accordance with applicable anti-money laundering,
know-your-customer or similar rules, regulations or other Laws; and
|
| (ii) |
the performance of this Agreement, including the Services, by each of Galaxy and Delegator, to the best of its knowledge, does not require any licenses, permits, or
registrations (in respect of securities Law or otherwise) not possessed by Galaxy or Delegator.
|
| 7. |
Taxes
|
7.1 Delegator shall be solely responsible for the payment to applicable governmental authorities of any and all taxes or associated penalties, duties, and interest (together, “Taxes”) (i)
applicable to the Delegator's Net Rewards, Slashing Reimbursements and other amounts receivable or received by Delegator in connection with or resulting from this Agreement, and (ii) all other Taxes of Delegator or which may apply to Delegator
resulting from or related to the transactions contemplated under this Agreement or otherwise.
7.2 Galaxy shall be solely responsible for the payment to applicable governmental authorities of any and all Taxes (i) applicable to Galaxy’s Service Fee and other amounts receivable or received by
Galaxy in connection with or resulting from this Agreement, and (ii) all other Taxes of Galaxy or which may apply to Galaxy resulting
from or related to the transactions contemplated under this Agreement or otherwise.
7.3 Neither Galaxy nor any of its agents have provided or will provide advice or guidance with respect to any Law, applicable Tax or other obligations of Delegator. Delegator is strongly
encouraged to seek advice from Delegator's legal and tax advisors with respect to any Law, applicable Tax and other obligations of Delegator related to the entering into and performance of this Agreement.
7.4 Delegator shall indemnify and hold harmless Galaxy and its Representatives in respect of all Taxes levied by any governmental authority on any Net Rewards, Slashing Reimbursements and
other amounts receivable or received by Delegator in connection with this Agreement.
| 8. |
TERM, TERMINATION, AND SURVIVAL
|
8.1 Term. The term of this Agreement (the “Term”) commences on the Effective Date and shall continue in effect until terminated in accordance with Section
8.2.
8.2 Termination. A Party or the Parties (as applicable) may terminate this Agreement in accordance with items (a) through (f) below (each, a “Termination
Event”). In addition, upon any Termination Event, for the avoidance of doubt, existing staking arrangements will be unwound and there will be no requirement for either Party to undertake the staking of new tokens. A Party or the Parties
(as applicable) may terminate this Agreement as follows:
7
| (a) |
for material uncured breach of this Agreement that continues for thirty (30) calendar days following written notice to the breaching Party;
|
| (b) |
immediately upon (i) the filing of a petition in bankruptcy for relief under the U.S Bankruptcy Code or the institution of any other bankruptcy or insolvency proceedings by, against, or on behalf of the other Party,
(ii) the appointment of a receiver for the other Party, (iii) the dissolution or liquidation of the other Party, or (iv) any act of insolvency by the other Party;
|
| (c) |
immediately, for reasons of material violation of any Law by the other Party;
|
| (d) |
immediately, upon a change in Law which does or will render any material portion of the Services illegal or otherwise materially and adversely impacts the Services;
|
| (e) |
immediately, in the event that the terminating Party is directed in writing by a regulatory authority with valid jurisdiction over it to cease or materially limit performance of such Party’s obligations under this
Agreement;
|
| (f) |
for convenience by the Delegator, upon ninety (90) days written notice to Galaxy after the initial twelve (12) months of the Agreement (the “Initial Term”); or
|
| (g) |
upon the mutual written agreement of the Parties to terminate this Agreement.
|
| 8.3 |
Effect of Termination. Upon the termination of this Agreement:
|
| (a) |
Delegator will cease delegating Tokens to Galaxy;
|
| (b) |
Delegator will be required to initiate withdrawal and unbonding of Tokens;
|
| (c) |
Galaxy will transfer to Delegator all amounts owed by Galaxy to Delegator in accordance with the terms of this Agreement, if not yet transferred to Delegator;
|
| (d) |
Delegator will transfer to Galaxy all amounts owed by Delegator to Galaxy in accordance with the terms of this Agreement, including
Service Fees, if not yet transferred to Galaxy;
|
| (e) |
Upon reasonable written request, each Party shall either return to the other Party (or, at such other Party’s instruction, and subject to reasonable technical limitations, destroy and provide such other Party with
written certification of the destruction of) all documents, computer files, and other materials containing any of the other Party’s Confidential Information that are in its possession or control, unless such Party is required by applicable
Law or by its internal compliance or document retention policies to retain such Confidential Information solely for archival purposes (in which case such retained Confidential Information will remain subject to the undertakings in Section 9);
and
|
| (f) |
No Service Fee shall accrue after termination (inclusive of any applicable protocol unbonding period that is solely initiated in relation to such termination) other than amounts attributable to Rewards generated
prior to the termination effective date.
|
8.4 Survival. The following provisions will survive any expiration or termination of this Agreement: 1, 5, 7, 8.3, 8.4, 9, 11, 12, 14-16; provided that, with respect to Sections 8.3(e) and 9,
each Party’s
8
obligations hereunder with respect to Confidential Information of the other Party as Disclosing Party shall terminate and expire on that date that is two (2)
years following the date of termination of this Agreement.
| 9. |
CONFIDENTIALITY
|
The Receiving Party will: (i) protect the confidentiality of the Disclosing Party’s Confidential Information using the same degree of care that it uses with its
own confidential information of similar nature, but with no less than reasonable care; (ii) not use any of the Disclosing Party's Confidential Information for any purpose other than as may be necessary or desirable in connection with the performance
of this Agreement; and (iii) not disclose the Disclosing Party's Confidential Information to any party other than its Representatives and its and their advisors, as reasonably required to perform this Agreement, provided they are advised of the
obligations of confidentiality and restrictions on use hereunder. If the Receiving Party is legally compelled to disclose any of the Disclosing Party's Confidential Information, the Receiving Party will, if legally permitted to do so, provide the
Disclosing Party prompt prior written notice of such requirement so that the Disclosing Party may seek a protective order or other appropriate remedy and/or waive compliance with the terms of this Section. If such protective order or other remedy is
not obtained or the Disclosing Party waives compliance with the terms of this Section, the Receiving Party may furnish only that portion of the Confidential Information which it is legally required to disclose in the opinion of its counsel.
| 10. |
SECURITY AND CONFLICT CLEARANCE OBLIGATIONS
|
10.1 Galaxy
will: (i) maintain appropriate administrative, technical and physical safeguards to protect the security, confidentiality and integrity of its staking service and any of Delegator’s data received or processed or
transmitted by Galaxy, and such safeguards shall include encryption of Delegator’s data in transmission and at rest; and (ii) maintain, and will require all third party data processors that Galaxy engages to maintain, appropriate physical, technical and organizational measures to protect Delegator’s Confidential Information against accidental, unauthorized or unlawful destruction, loss, alteration, disclosure or
access. Galaxy’s obligations for security, data protection and operational resiliency are set forth in Schedule C hereto.
| 11. |
INTELLECTUAL PROPERTY AND INFRINGEMENT INDEMNITY
|
All right, title, and interest in and to the Platform and the Website, including all modifications, improvements, adaptations, and
enhancements made thereto, are and shall remain the sole and exclusive property of Galaxy. Galaxy shall defend, indemnify, and hold Delegator harmless from any third-party claim alleging that Delegator’s authorized use of the unmodified Platform or
Website, as provided to Delegator, infringes an intellectual property right, but only to the extent caused by the Platform or Website; provided, however, that Galaxy shall have no obligation to the extent such claim arises from (i) use not in
accordance with this Agreement, (ii) modifications not made by Galaxy, or (iii) combinations with items not provided by Galaxy. Galaxy shall control the defense of any such indemnified claim. Galaxy may settle any indemnified claim that involves only
the payment of money without Delegator’s consent. For any other settlement, Galaxy will seek Delegator’s consent, which shall not be unreasonably withheld, conditioned, or delayed.
| 12. |
LIMITATIONS OF USE
|
Delegator shall not and will not authorize, permit, or encourage any third party to: (i) reverse engineer, decompile, disassemble, or
otherwise attempt to discern the source code or interface protocols of the Platform or the Website; (ii) modify, adapt, or translate the Platform or the Website; (iii) make any copies of the Platform or the Website; (iv) resell, distribute, or
sublicense the Platform or the Website; (v) remove or modify any proprietary marking or restrictive legends placed on the Platform or the Website; (vi) use the
9
Platform or Website (A) in violation of any Law or regulation, (B) to build a competitive product or service, or (C) for any purpose other
than to perform this Agreement; or (vii) introduce, post, upload, transmit, or otherwise make available to or from the Platform or the Website any Prohibited Content.
| 13. |
REPRESENTATIONS AND WARRANTIES; DISCLAIMER
|
13.1 Mutual Representations and Warranties. Each Party represents and warrants to the other Party, as of the Effective Date and each date on which Delegator
delegates Token Rights to Galaxy, that:
| (a) |
The Party is duly organized and existing in good standing under the laws of its jurisdiction of organization or formation, has all corporate or trust powers required to carry on its business as now conducted, and is
duly qualified to do business and is in good standing in each jurisdiction where such qualification is necessary;
|
| (b) |
The Party has all required capacity, authority, and power to enter into and perform its obligations under this Agreement, and this Agreement constitutes a legal, valid and binding obligation of the Party enforceable
against the Party in accordance with its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to or affecting the enforcement of creditors' rights generally and principles of equity;
|
| (c) |
The Party is, to the best of its knowledge, in material compliance with all applicable Laws including licensing requirements governing its operations and activities;
|
| (d) |
The execution, delivery, and performance of this Agreement by the Party (i) will not, to the best of such Party’s knowledge, conflict with or violate in any material manner any Law, and (ii) will not constitute or
result in a violation or breach of, and will not conflict with or constitute a default under, any contract, agreement, or commitment binding upon it;
|
| (e) |
Neither the delegation of Token Rights by Delegator to Galaxy, nor Galaxy’s performance of this Agreement (i) represents or
constitutes a loan or a contribution of capital to, or other investment in, Galaxy; (ii) provides Delegator with any ownership interest, equity, security, or right to or interest in the assets, rights,
properties, revenues or profits of, or voting rights whatsoever in, Galaxy; or (iii) creates or implies any fiduciary or other agency relationship between Galaxy (or
any of its Representatives) and Delegator or entitles Delegator to any fiduciary duty or similar duty on the part any of the foregoing Persons; and
|
| (f) |
Neither Party hereto, nor such Party’s Representatives, is, or is a Person that is owned in part or in whole or controlled by any Person that is, or is conducting any activities on behalf of any Person that is
(i) the subject of any economic or trade sanctions administered or enforced by any governmental authority or otherwise designated on any list of prohibited or restricted parties (including but not limited to the United Nations Security
Council, the European Union, His Majesty’s Treasury of the United Kingdom of Great Britain and Northern Ireland (the “UK Treasury”), and the U.S.
Department of Treasury), or (ii) located, organized or resident in a jurisdiction or territory that is the subject of comprehensive country-wide, territory-wide, or regional economic sanctions by the United Nations, European Union, any EU
country, the UK Treasury, or the United States, including without limitation Cuba, the Crimea, Donetsk, and Luhansk regions of Ukraine, Iran, North Korea, Russia, Syria, or Yemen (a “Restricted
Territory”).
|
| 13.2 |
Representations and Warranties of Delegator. In addition to the representations and warranties
|
10
set forth in Section 13.1, Delegator represents and warrants to Galaxy, as of the Effective Date and each
date on which Delegator delegates Token Rights to Galaxy, that:
| (a) |
Delegator has all right, title and interest in and to the Tokens;
|
| (b) |
Delegator has sufficient authority to delegate the staking of Tokens;
|
| (c) |
Delegator is not entering into this Agreement for the purpose of making an investment with respect to Galaxy or its securities, but instead, and only, to receive the
Services from Galaxy;
|
| (d) |
Delegator and its Representatives, as applicable, are in compliance with the Foreign Corrupt Practices Act of 1977 (United States), and where applicable, similar Laws of
other jurisdictions;
|
| (e) |
Delegator and its Representatives, where applicable, are in compliance with anti-money laundering obligations, and anti-terrorist financing obligations under the Law of the United States, and if applicable to
Delegator, similar Laws of other jurisdictions;
|
| (f) |
Neither Delegator nor, to the best of its knowledge, its Representatives have been convicted of, nor have agreed to enter into a pretrial diversion or similar program in connection with the prosecution of, a
criminal offense involving theft, dishonesty, breach of trust, money laundering, the illegal manufacture, sale, distribution of or trafficking in controlled substances, or substantially equivalent activity in a domestic, military, or foreign
court;
|
| (f) |
Delegator is not (i) a Sanctioned Person, (ii) located, organized or resident in a Restricted Territory, or (iii) engaged in any dealings or transactions with any such Person described in (i) or (ii) above; without
limiting the generality of the foregoing, none of Delegator and its Representatives is owned or controlled by, or acting on behalf of, any Person who is, a Sanctioned Person or located, organized or resident in any Restricted Territory;
|
| (g) |
Delegator is sophisticated and experienced in using and evaluating the relevant Supported Blockchains and applicable protocols and related technologies. Delegator has conducted and will conduct its own due
diligence and analysis of the relevant Supported Blockchains and the matters provided under this Agreement in order to determine whether Delegator wishes to enter into this Agreement to have Galaxy
perform the Services;
|
| (h) |
Delegator is capable of evaluating the merits and risks of the Services provided hereunder and protecting its own interests in the transactions contemplated hereunder; Delegator
has not relied upon any information, statement, omission, representation or warranty, express or implied, written or oral, made by or on behalf of Galaxy in connection with the entering into and
performance of this Agreement by the Parties except those matters that are explicitly set forth herein; and
|
| (i) |
to the best of its knowledge, Delegator’s Tokens are not derived from, and do not otherwise represent the proceeds of, any activities done in violation or contravention of any applicable Law.
|
| 13.3 |
Artificial Intelligence (AI). Galaxy shall not (a) provide or otherwise make available any AI Tools to Delegator under this Agreement (whether provided as a service or
deliverable or sourced from a third party), (b) materially use any AI Tools to provide services or materially process any data of Delegator, or (c) otherwise materially connect any AI Tools with the Delegator’s information
|
11
technology environment. “AI Tools” means any software, systems, algorithms, and technologies that can be used to perform
intelligent functions or to substitute, augment, or replace the activities, roles, responsibilities, or functions performed by human beings, but excluding any software, systems, algorithms, and technologies that merely use rules directly defined
solely by natural persons to automatically execute operations.
| 13.4 |
Disclaimer. Except as expressly set forth herein, the Services, the Platform, the Website, their components, and any other materials provided
hereunder are provided “as is” and “as available”, and Galaxy does not make any warranties with respect to the same or otherwise in connection with this Agreement (except as explicitly provided in this
Agreement) and hereby disclaims any and all express, implied, or statutory warranties, including any warranties of non-infringement, merchantability, fitness for a particular purpose, availability, error-free or uninterrupted operation, and
any warranties arising from a course of dealing, course of performance, or usage of trade. To the extent that Galaxy may not as a matter of Law disclaim any implied warranty, the scope and duration of
such warranty will be the minimum permitted under such Law. Without limiting the foregoing, Galaxy makes no representations or warranties with regard to the potential market for the Services or the
amount of Rewards that may be generated under this Agreement.
|
| 14. |
LIMITATION OF LIABILITY
|
14.1 In no event will Galaxy or Delegator be liable to the other Party or any other Person for any incidental, indirect, consequential, special, exemplary or punitive damages or losses of
any kind arising from or relating to this Agreement, regardless of whether the relevant party was advised, had other reason to know, or in fact knew of the possibility thereof. Each Party’s aggregate liability
for direct damages under this Agreement will not exceed the amount equal to the sum of the Service Fee and Slashing Reimbursements paid to Delegator under this Agreement during the period twenty four (24)
months prior to the event giving rise to the liability.
14.2 In no event will Galaxy be liable to Delegator or any other Person for any Missed Reward, Slashing Penalties or any other damages or losses caused
solely by protocol-wide malfunction of a Supported Blockchain.
14.3 For Missed Rewards: where Rewards were missed due to Galaxy’s failure to perform the Services as required by the terms of this Agreement, Galaxy’s
total liability shall be limited to the total amount of Missed Rewards, unless such Missed Rewards were due to a protocol-wide malfunction of a relevant Supported Blockchain in which case Galaxy shall not be
liable.
| 15. |
INDEMNIFICATION
|
15.1 Delegator (in such capacity, the “Delegator Indemnifying Party”) shall defend, indemnify, and hold harmless Galaxy and its Representatives (together, the “Galaxy Indemnified Parties”), from all liabilities, damages, costs, and reasonable expenses (including reasonable attorneys' fees) incurred by such Galaxy Indemnified Parties in connection with any unaffiliated third-party action,
claim, proceeding, or other damage, cost or liability (each, a “Galaxy Claim”) arising from the Delegator Indemnifying Party's breach of its covenants and
representations and warranties under this Agreement, in each case, except to the extent caused by the gross negligence, fraud, or willful misconduct of any Galaxy Indemnified Parties; provided that the foregoing obligations shall be subject to the
relevant Galaxy Indemnified Party: (i) promptly notifying the Delegator Indemnifying Party in writing of the Galaxy Claim; (ii) providing the Delegator Indemnifying Party, at the expense of the Delegator Indemnifying Party, with reasonable
cooperation in the defense of the Galaxy Claim; and (iii) providing the Delegator Indemnifying Party with control over the defense and negotiations of the Galaxy Claim for a settlement or other resolution, subject
12
to reasonable ongoing notice to the relevant Galaxy Indemnified Parties with respect to strategy and direction of the defense and negotiations of
the Galaxy Claim.
15.2 Galaxy (in such capacity, the “Galaxy Indemnifying Party”) shall defend, indemnify, and hold harmless Delegator and its Representatives (together, the “Delegator
Indemnified Parties”), from all liabilities, damages, costs, and reasonable expenses (including reasonable attorneys' fees) incurred by such Delegator Indemnified Parties in connection with any unaffiliated third-party action, claim,
proceeding, or other damage, cost or liability (each, a “Delegator Claim”) arising from the Galaxy Indemnifying Party's breach of its covenants and representations and warranties under this Agreement, in each
case, except to the extent caused by the gross negligence, fraud, or willful misconduct of any Delegator Indemnified Party; provided that the foregoing obligations shall be subject to the relevant Delegator Indemnified Parties: (i) promptly
notifying the Galaxy Indemnifying Party in writing of the Delegator Claim; (ii) providing the Galaxy Indemnifying Party, at the expense of the Galaxy Indemnifying Party, with reasonable cooperation in the defense of the Delegator Claim; and (iii)
providing the Galaxy Indemnifying Party with control over the defense and negotiations of the Delegator Claim for a settlement or other resolution, subject to reasonable ongoing notice to the relevant Delegator Indemnified Parties with respect to
strategy and direction of the defense and negotiations of the Delegator Claim.
| 16. |
GENERAL PROVISIONS
|
| 16.1 |
Interpretation
|
| (a) |
Headings. The headings in this Agreement are for reference only and will not affect the interpretation of this Agreement.
|
| (b) |
References to Agreements. The term “Agreement” and any reference to this Agreement or any other agreement or document includes, and is a reference to, this Agreement or such other agreement or document as it
may have been, or may from time to time be, amended, restated, replaced, supplemented or novated.
|
| (c) |
Non-Strict Construction. The language used in this Agreement is the language chosen by the Parties to express their mutual intent, and no rule of strict construction will be applied against a Party.
|
| (d) |
Other Terms.
|
| (i) |
The words “including”, “includes”, and “include” mean “including (or includes or include) without limitation”.
|
| (ii) |
Any reference in this Agreement to a Person includes his, her, or its heirs, administrators, executors, legal representatives, successors, and permitted assigns, as applicable.
|
| (iii) |
Any reference in this Agreement to gender includes all genders, and words importing the singular number only include the plural and vice-versa.
|
16.2 Assignment. Neither Party shall assign or otherwise transfer any of its rights or obligations under this Agreement without the prior written consent of the other Party;
provided that Galaxy may assign or otherwise transfer this Agreement: (i) to any of its Affiliates with at least thirty (30) calendar days’ prior
13
written notice to Delegator; or (ii) in connection with a change of control transaction (whether by merger, consolidation, sale of equity
interests, sale of all or substantially all assets, or otherwise), provided further that in all cases, the assignee is, upon the assignment or transfer, bound by the terms and conditions of this Agreement. Any assignment or other transfer in
violation of this Section will be null and void. Subject to the foregoing, this Agreement will be binding upon and inure to the benefit of the Parties and their successors and permitted assigns.
16.3 Waiver. No failure or delay by either Party in exercising any right or remedy under this Agreement shall operate or be deemed as a waiver of any such right or
remedy. Without limiting the generality of the foregoing, Galaxy shall not be deemed to have waived any of the conditions described in Section 6.1(b) to and including (e), or waived or released any claim,
right, power, privilege or remedy related thereto, by virtue of providing Services to Delegator while having no specific knowledge that such condition is not satisfied with respect to Delegator.
16.4 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard for the internal choice of law provisions
thereof.
16.5 Exclusive Forum; Jury Trial Waiver. The Parties hereby irrevocably and unconditionally consent to the exclusive jurisdiction of the courts of the State of New York and the
United States District Court for the Southern District of New York, in each case located in the Borough of Manhattan, for any action, suit or proceeding arising out of or relating to this Agreement, and agree not to commence any action, suit or
proceeding related thereto except in such courts. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW THAT CANNOT BE WAIVED, THE PARTIES HEREBY WAIVE, AND AGREE THAT THEY WILL NOT ASSERT (WHETHER AS PLAINTIFF,
DEFENDANT OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING DESCRIBED HEREIN. THE PARTIES AGREE THAT EITHER OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND
BARGAINED-FOR AGREEMENT BETWEEN THE PARTIES IRREVOCABLY TO WAIVE THEIR RIGHT TO TRIAL BY JURY IN ANY SUCH ACTION, SUIT OR PROCEEDING AND THAT ANY SUCH ACTION, SUIT OR PROCEEDING WILL INSTEAD BE TRIED BY A JUDGE SITTING WITHOUT A JURY.
16.6 No Class Action. Without limiting the foregoing, each Party may only make a claim or proceeding against the other Party in the first Party’s individual capacity and shall not as
a plaintiff or class member in any purported class or representative action or proceeding.
16.7 Notices. All notices required under this Agreement (other than routine operational communications) must be in writing and delivered to the personnel designated below. Such
notices shall be effective upon actual delivery to the other Party, if delivered in person or by e-mail.
To Galaxy:
Galaxy Blockchain Infrastructure LLC
c/o Legal Department
300 Vesey Street, 13th Floor
New York, N.Y. 10282
Email: StratOps@galaxydigital.io ; with a mandatory copy to: legal-compliance@galaxydigital.io
To Delegator:
Invesco Galaxy Solana ETF
14
3500 Lacey Road, Suite 700
Downers Grove, IL 60515
rudolf.reitmann@invesco.com
16.8 Independent Contractors. The Parties are independent contractors. Neither Party shall be deemed to be an employee, agent, partner, joint venturer, or legal representative of
the other for any purpose, and neither shall have any right, power, or authority to create any obligation or responsibility on behalf of the other.
16.9 Severability. If any provision of this Agreement is found invalid or unenforceable by a court of competent jurisdiction, that provision shall be amended to
achieve as nearly as possible the same economic effect as the original provision, and the remainder of this Agreement shall remain in full force and effect. Any provision of this Agreement, which is unenforceable in any jurisdiction, shall be
ineffective only as to that jurisdiction, and only to the extent of such unenforceability, without invalidating the remaining provisions hereof.
16.10 Force Majeure. Neither Party shall be deemed to be in breach of this Agreement for any default or delay in the performance of its obligations under this
Agreement, if and to the extent such default or delay is caused directly or indirectly by an event of force majeure, such as war, terrorist attacks, cyber-attacks, riots, forces of nature or fire, sabotage, epidemics, quarantine, government
sanctions, blockades, collective actions, strike, disruption of provision of services in the supply chain, failure of telecommunications carriers, electric power disruptions, utility company failures or any other similar causes beyond the reasonable
control of a Party (each, a “Force Majeure Event”).
16.11 Non-Exclusivity. This Agreement is non-exclusive. Galaxy may perform staking services for other delegators and Delegator
may engage with other staking providers.
16.12 Third-Party Beneficiaries. Except as set forth in Section 15, there are no other third-party beneficiaries under this Agreement.
16.13 Entire Agreement. This Agreement constitutes the final and complete agreement between the Parties regarding the subject matter hereof, and supersedes any prior or contemporaneous
communications, representations, or agreements between the Parties, whether oral or written. No term included in any confirmation, acceptance, or any other similar document from Delegator in connection with this Agreement will apply to this
Agreement or have any force or effect.
16.14 Modifications. Any modification or amendment to this Agreement must be in writing signed by both Parties or is null and void.
16.15 Paramountcy. Without limiting the foregoing, if there would otherwise be any legally binding agreement involving Delegator and Galaxy that is implied by or embodied in the protocols of any Supported Blockchain that conflicts or is inconsistent with this Agreement, this Agreement shall prevail over such other agreement to the extent of the inconsistency.
16.16 Currency. All dollar ($) amounts identified in this Agreement are denominated in United States dollars.
16.17 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which shall constitute the same agreement. One or more
counterparts of this Agreement may be delivered by facsimile or pdf electronic transmission, with the intention that they shall have the same effect as an original counterpart hereof.
15
16.18 Limitations of Liability of the Shareholders. It is expressly acknowledged and agreed that the obligations of the Delegator hereunder shall not be binding upon any shareholder,
sponsor, officer, employee or agent of the Delegator, personally, but shall bind only the trust property of the Delegator, as provided in its Amended and Restated Declaration of Trust and By-Laws.
16.19 Liability of Sponsor. It is expressly understood and agreed by the Parties that the to the extent that the Agreement has been executed by Invesco Capital Management LLC, as
sponsor (“Sponsor”) of the Delegator that (a) this Agreement is executed and delivered on behalf of the Delegator by the Sponsor, not individually or personally, but solely as the Delegator’s Sponsor in the
exercise of the powers and authority conferred and vested in it; (b) the representations, covenants, undertakings and agreements herein made by the Delegator are made and intended not as personal representations, covenants, undertakings and
agreements by the Sponsor but are made and intended for the purpose of binding only the Delegator; (c) nothing herein contained shall be construed as creating any liability on the Sponsor, individually or personally, to perform any covenant of the
Delegator either expressed or implied herein, all such liability, if any, being expressly waived by the Parties hereto and by any person claiming by, through or under the Parties hereto; and (d) except for those obligations expressly assumed by the
Sponsor, under no circumstances shall the Sponsor be personally liable for the payment of any the Delegator’s indebtedness or expenses or be liable for the breach or failure of any obligation, duty, representation, warranty or covenant made or
undertaken by the Delegator under this Agreement or any other related document.
[The remainder of this page is intentionally left blank].
16
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed and delivered as of the Effective Date:
INVESCO GALAXY SOLANA ETF
BY INVESCO CAPITAL MANAGEMENT LLC, NOT IN ITS INDIVIDUAL CAPACITY BUT SOLELY AS SPONSOR
By: _____________________________
Print Name: ______________________
Title: ____________________________
GALAXY BLOCKCHAIN INFRASTRUCTURE LLC
By: _____________________________
Print Name: ______________________
Title: ____________________________
17
SCHEDULE A
SUPPORTED BLOCKCHAIN TERMS
[attached]
SCHEDULE B
SERVICE LEVEL AGREEMENT
| • |
Quality assurance and testing of all included subsystems (monitoring, logging, balancing)
|
| • |
Full hardware / software maintenance and servicing upgrades and deployments within twenty-four (24) hours
|
| • |
Individual Node uptime of 99.9%
|
| • |
On-call support - 24/7 direct access to Galaxy via several channels
|
| • |
Log Collection & display - standard UI component, available for full review and audit
|
Nodes. Galaxy shall ensure that its Nodes have an Actual Uptime of at least 99.9% during each rolling thirty (30) calendar day period.
Definitions. For the purposes of this SLA:
“Actual Uptime” shall mean Total Scheduled Availability minus Downtime.
“Critical Defect” means any demonstrable Defect in the Node that: (a) causes the Node to have a significant loss of utility of intended function; (b) causes
or is likely to cause data to be lost or destroyed; or (c) prevents the Node from being accessed by the Delegator.
“Defect” means a failure of the Node to perform substantially in accordance with the relevant Blockchain Protocol.
“Downtime” shall mean time (in minutes) that an individual Node is not accessible to Delegator or is not functioning materially as expected for reasons other
than Maintenance or Force Majeure.
“Low Defect” means any demonstrable Defect that: (a) causes a function to not execute as documented without a significant loss of utility of intended
functionality; or (b) disables one or more nonessential functions.
“Maintenance” shall mean time (in minutes) that an individual Node is not accessible to Delegator or is not functioning materially as expected due to
maintenance of the Node or Platform, including for maintenance and upgrading of the software and hardware used by Galaxy to provide the Node or emergency maintenance to prevent an anticipated outage or reduction in performance. Scheduled maintenance
shall only be performed on no less than three calendar days’ prior notice.
“Medium Defect” means any demonstrable Defect in the Node that causes the Node to operate improperly, but which error does not rise to the level of a
Critical Defect.
“Total Scheduled Availability” shall mean 24 hours a day, 7 days a week, 365/6 days a year,
excluding Maintenance and Force Majeure.
In the event that the Actual Uptime for any Node is less than 99.9% of Total Scheduled Availability in any calendar month, Galaxy shall provide a credit to Delegator against Service Fees payable to
Galaxy hereunder for the following invoicing cycle based on the Actual Uptime achieved for any such month (each, a “Service Credit).
Defects shall be reported by the Delegator and categorized by Galaxy as Critical Defects, Medium Defects or Low Defects. If the Delegator disagrees with Galaxy’s classification, the Delegator shall
advise Galaxy of such disagreement and the parties shall use commercially reasonable efforts to resolve the conflict.
Galaxy shall use commercially reasonable efforts to adhere to the following response and restoration time frames:
|
Defect Type
|
Response
|
Interim Resolution
|
Permanent Solution
|
Update Frequency
|
|
Critical
|
30 Minutes
|
12 Hours
|
2 Days
|
Hourly for the first 12 Hours
|
|
Medium
|
1 Day
|
2 Days
|
1 Week
|
N/A
|
|
Low
|
3 Days
|
30 Days
|
Next Release
|
N/A
|
SCHEDULE C
Security and Resiliency Requirements
[Any reference herein to “Supplier” shall mean “Galaxy” and any reference to “Company” shall mean “Delegator”]
Definitions
Availability means the ability of an authorized person to use or access objects, resources, data, or information when needed, without undue delay.
Company Data means the data pertaining to Company that is stored, processed, transferred, or accessed by the Supplier on behalf of Company.
Confidentiality means and includes the property that data or information is not made available or disclosed to unauthorized people or processes.
Disaster means an unplanned event which results in a material and sustained loss of access to and use of the Third-Party products or services resulting in
the observed and material disruption or degradation in the processes of one or more Third Party Companies, excluding force majeure events. To avoid doubt, fire, flood, earthquake, wind, power, outage, network outages (other than collapse of the
Internet backbone), and catastrophic failure of Third Party’s infrastructure are not force majeure events.
Encryption means to modify or code data so that it is illegible without a specific key to decode it.
Force Majeure is an unforeseen circumstance that prevents the fulfillment of contract.
Integrity means the property that data or information has not been altered or destroyed in an unauthorized manner.
Important Business Service refers to a service provided by an organization that, if disrupted, could cause significant harm to the organization itself, its
customers, or the broader market.
Impact Tolerance is the maximum tolerable level of disruption to an important business service before intolerable harm occurs to the organization, its
stakeholders, or its customers.
Malicious Software means software that is intentionally distributed with the intent to cause damage, disrupt, or gain unauthorized access to networks,
systems, devices, servers and/or data.
Personal Data is any information that relates to an identified or identifiable individual where they can be identified directly or indirectly from such
information
Recovery Point Objective (“RPO”) means the maximum targeted period in which data might be lost from a Service due to a major incident.
Recovery Time Objective (“RTO”) means the targeted duration of time and a service level within which a business process must be restored after a disaster (or
disruption) to avoid unacceptable consequences associated with a break in business continuity.
Risk means the possibility of suffering harm or loss.
Security Incident is one or more cyber events that actually or potentially jeopardize confidentiality, integrity, authenticity, or availability of
information. Security incidents usually involve attempts to gain unauthorized access to, disrupt, misuse, or steal Company data, systems, or assets.
Subcontractors are any third-party entities or individuals engaged by the supplier to perform services, deliver goods, or otherwise fulfill any
portion of the Supplier’s obligation under this agreement. This includes but is not limited to sub-contractors, agents, consultants, or service providers contracted directly or indirectly by the supplier.
Supplier Relationship Owner (SRO) is the Company employee primarily responsible and accountable for managing Company’s relationship with a supplier.
| 1. |
General
|
| 1.1. |
Acceptable Use
|
Suppliers must protect the Confidentiality, Integrity, authenticity, and Availability of Company systems and data entrusted to them and restrict their activities to legitimate
business purposes only. Under no circumstances is a Supplier authorized to use Company’s applications, systems, networks, and/or electronic data for activities that are illegal under applicable local, state, federal or international law.
| 1.2. |
Data Classification
|
Supplier shall implement data classification to classify data based on its sensitivity, value, and criticality to the organization. Security mechanisms for storage,
transmission, handling, resiliency, and destruction must be implemented in correlation with the Supplier’s classification of the data. Suppliers shall provide their classification of any Company Data accessed, processed, or stored by the Supplier.
| 1.3. |
Cooperation and Ready Availability of Company Information
|
Suppliers will ensure that Company Data is always readily available to the Company upon request, at no additional cost. Additionally, Supplier agrees to cooperate with Company
in preserving, accessing, searching, or producing Company Data as needed, including undertaking commercially reasonable efforts to develop and implement a joint litigation response plan, all at no additional cost to Company.
| 2. |
Security Program and Management
|
2.1 Information Security Program
Supplier agrees to maintain documented and management approved information security policies consistent with best practice (i.e., ISO 27001) and all applicable regulations that
include administrative, physical, and technical safeguards to protect the Company. Supplier warrants that it has an established risk management process to identify and manage security risks and exceptions to the information security policies.
Supplier shall have an established Information Security program governed by a senior member of security leadership (i.e., Chief Information Security Officer) with clearly established accountability and ownership of the program. This shall include
assigned specific roles and responsibilities for management along with proper staffing and financial resources.
2.2 Background Checks
Supplier will ensure that reasonable and appropriate background checks are conducted on all personnel in accordance with applicable laws and regulations and include identity proofing. Personnel must pass Supplier’s background check requirements prior to being assigned to positions in which they will, or Supplier expects them to, have access to Company Data.
2.3 Subcontractors
Supplier will implement a third-party risk management program to ensure that any third parties or subcontractors utilized to provide services will maintain adequate physical, technical, organizational,
and administrative controls in accordance with this best practices (i.e., ISO 27001) and applicable regulations. Supplier will appropriately maintain an inventory of their subcontractors and manage risks associated
with subcontractors in accordance with their risk management program. Supplier will appropriately disclose any third parties or subcontractors that are utilized to provide services to Company or have access to Company
data. Supplier will implement an offboarding or exit process for sub-contractors that includes the decommissioning, disposal, or return of Company data as appropriate.
2.4 Security Awareness and Training
Supplier will implement and maintain a comprehensive security awareness and training program to ensure that all personnel understand their individual responsibilities in
safeguarding against security incidents and preventing unauthorized access to or use of Company Data. This program will include, at a minimum, mandatory annual security awareness training for all personnel and subcontractors, as appropriate. The
training will cover the Supplier’s Information Security Program, employee responsibilities, phishing awareness, and consequences of non-compliance. The Supplier will also provide periodic updates and refresher training to address emerging threats,
changes in policy, and lessons learned from security events. Participation in this training will be documented and monitored to ensure compliance and continuous improvement.
| 3. |
Logical and Technical Safeguards
|
3.1 Access Controls
Suppliers will maintain a formal access control policy and employ a centralized access management system to control personnel and machine identity access to
environments where Company data is accessed, processed or stored. Supplier will utilize role-based access controls and authorize access with the principle of least privilege. Supplier will ensure that individual user accounts are created for
accountability and non-repudiation. Multi-factor authentication (MFA) must be globally implemented for access to the network and associated applications. Privileged users are required to authenticate through MFA prior to accessing production
environments. Supplier will ensure periodic access reviews are performed for end users at least annually and for privileged accounts at least quarterly. Supplier will ensure that access to systems is timely removed upon user termination or when no
longer required per their role. Identity verification procedures must be established prior to user account changes and granting access. Suppliers will implement a password policy that aligns to industry’s best practices, requires complexity, and
periodic password changes.
3.2 Secure Software Development and Code Reviews
Supplier shall maintain a formal Software Development Lifecycle (SDLC) that incorporates secure coding practices aligned with OWASP and other recognized industry standards. Supplier shall implement
consistent, documented software delivery processes to reduce risk, ensure integrity of deliverables, and utilize trusted components. These processes shall include measures to harden software during build and deployment by removing unnecessary tools
and software. Supplier shall perform regular manual and automated code reviews using both static and dynamic application security testing (SAST and DAST). Production changes must be reviewed to confirm appropriate use of deployment pipelines and
completion of code reviews. Significant issues identified during review shall be tracked and resolved prior to release into production. Development and test environments must be logically segregated from production, and Company data shall not be used
in non-production environments without prior written authorization. Supplier shall maintain and follow a documented change control process, including back-out procedures for all production releases. Application Programming Interfaces (APIs) shall be
tested for security vulnerabilities prior to release. Supplier shall implement and maintain
a Software Bill of Materials (SBOM) or equivalent process to inventory software components, libraries, and dependencies.
3.3 Antivirus and Malicious Software Protection
Suppliers will ensure that systems are appropriately protected against malicious software (including code) through implementation and configuration of anti-virus
software and regular assessment of software. Processes must be in place to initiate cyber response plans in case potentially harmful code is identified. Antivirus software must be updated regularly to identify newfound threats and known exploited
vulnerabilities. Open-Source or third-party libraries used within applications must be inventoried and regularly assessed for malicious code, disclosed vulnerabilities, or unwanted functionality.
3.4 Network Security Protection
Supplier will maintain a defense-in-depth approach to hardening the Production Environment against exposure and external attacks. Supplier will maintain an
isolated Production Environment that includes network management controls such as load balancers, firewalls, intrusion detection systems distributed across production networks, and malware protections. Supplier will implement 24/7/365 security
monitoring to identify anomalies of network behavior and traffic. Prevention and detection technologies shall monitor all activity generated and send risk-based alerts to the relevant security groups. Suppliers shall implement data loss and leakage
prevention techniques, and policy driven controls designed to guard against accidental or unauthorized disclosure of Confidential Information.
3.5 Audit and Logging Procedures
Supplier will use and maintain an auditing and logging mechanism that captures and records successful and failed events (with a date and time stamp, user ID,
application name, and pass/fail indicator). User access activities will be logged and audited periodically to identify unauthorized access and to investigate root causes. All application components that have logging capabilities (such as operating
systems, databases, web servers, and applications) will be configured to produce a security audit log. Audit logs will be configured for sufficient log storage capacity, and Access to security log files will be limited to authorized Personnel.
3.6 Vulnerability Scans and Patch Management
Supplier shall establish, document, approve, communicate, apply, evaluate, and maintain policies and procedures to identify, report, and prioritize the
remediation of vulnerabilities to protect systems against exploitation. These policies and procedures shall include technical and procedural measures to support both scheduled and emergency responses to vulnerability identification. Supplier shall
regularly scan (at least weekly) information systems using industry-standard vulnerability scanning tools and practices to remediate applicable critical, high, and medium risk vulnerabilities identified in provided technologies. Remediation shall
follow a defined schedule based on the risk and severity classification of the vulnerability, such as:
| a. |
Critical / High - Within thirty (30) days of discovery of the vulnerability
|
| b. |
Medium - Within sixty to Ninety (60-90) days of discovery of the vulnerability
|
| c. |
Low - Within one hundred and eighty days (180) days of discovery of vulnerability
|
Additionally, Supplier shall provide, status and trends of open and patched high risk vulnerabilities upon request to Company.
| 4. |
Information Protection and Disposal
|
4.1 Encryption Protocols
Supplier shall implement and maintain strong cryptographic safeguards to protect Company Data across all environments. This includes the use of industry best-practice encryption
protocols—such as AES-256 or equivalent—for securing data at rest within production systems, backup repositories, portable devices, laptops, removable media, and backup tapes. Company Data in transit must be protected using at least Transport Layer
Security (TLS) version 1.3 or higher to ensure confidentiality and integrity during transmission. All electronic data exchanges between Supplier systems, networks, or applications must be conducted over secure, authenticated channels that align with
current industry standards.
4.2 Data Disposal and Destruction
Supplier storing Company Data must have a data destruction process in place which includes paper shredding and secure disposal of all electronic hardware. Prior
to disposal or redeployment of electronic device or media that contain Company Data, the Supplier must ensure that such data cannot be recreated or recovered. Supplier will implement industry recognized processes and procedures for data disposal and
secure media disposal in accordance with the guidelines identified in the National Institute of Standards’ Guidelines for Media Sanitization, SP800-88. Final disposition of electronic and/or devices must be documented and validated through
certification. All assets (including internal and external storage, data, etc.) belonging to the Company must be returned upon termination of the contract between the Supplier and the Company. With regards to Personal Data, Supplier is subject to the
disposal provisions outlined in the Data Protection Schedule.
4.3 Information Backup
Suppliers hosting Company Data must establish and implement procedures to create, maintain, and verify exact copies of Company Data, Company impact, government regulation,
business operations and security best practices. Supplier must ensure backup is stored in a secure manner and must be available in the event of a system failure or other Disaster.
| 5. |
Business Continuity and Resilience
|
5.1 Business Continuity and Disaster Recovery Plan
Supplier shall maintain written business continuity and disaster recovery plans (“plans”) with clear roles and responsibilities to ensure the ongoing availability of
Services during and after significant business disruptions. These plans shall address crisis management, plan activation, communication protocols, business recovery strategies, infrastructure, and system recovery. Supplier shall review their plans
periodically and update them as needed, provided such changes do not diminish its ability to safeguard Company Confidential Information or deliver Services under this Agreement. Supplier agrees to maintain a log of all business continuity
events and report material business continuity events to the Company upon Supplier becoming aware of any such event, as well as steps proposed to minimize any interruption to its Services here under. In the event of a
material disruption, the Supplier will cooperate with the Company in response to recovery efforts. The occurrence of a Force Majeure event does not relieve Supplier of its obligation to implement its plans and maintain necessary disaster recovery
services.
In the event of a failure of critical services or significant disruption, Supplier will promptly invoke its resiliency plans and restore critical service capability and the
production capability of critical information technology infrastructure of the Supplier services (including, but not limited to, data centers, hardware, software, power systems, and critical voice, data, and e-commerce communications links). Except
as otherwise provided in the applicable plan, Supplier will notify Company’s Supplier Relationship Owner or their delegate of disruptions in accordance with incident handling protocols outlined in this Exhibit. It is Supplier’s responsibility to
ensure any Subcontractors performing activities that could impact critical processes of Supplier services have plans in place that meet the same standards
and resiliency requirements.
Supplier agrees to provide Services with a stated Recovery Time Objective (RTO) and a Recovery Point Objective (RPO) to be mutually agreed upon between the parties and
incorporated within this Agreement. Supplier recovery capabilities will align with the Company’s relevant Important Business Service’s Impact Tolerances. Upon written request of Company, Supplier agrees to provide relevant details to Company on their
business continuity and disaster recovery plans.
5.2 Business Continuity and Disaster Recovery Testing
Suppliers shall implement testing procedures to ensure the design and effectiveness of Business Continuity and Disaster Recovery plans. Plans for critical business operations
shall be tested no less than annually with the ability of the Company to participate in the testing as deemed feasible. The Supplier shall provide the Company with the results of Business Continuity and Disaster Recovery testing on an annual basis
and, where unsuccessful tests or significant issues arise, provide sufficient evidence of remediation or resolution. In the event of a material business disruption associated with the Services outlined in this Agreement, Supplier agrees to cooperate
with Company in responding to, resolving, and/or recovering from the disruption. The occurrence of a Force Majeure event will not relieve Supplier of its obligation to implement the Disaster Recovery Plan and to provide the disaster recovery
services contained therein. Supplier shall participate in Company operational resilience tests, as necessary. Evidence of plan testing and any resulting remedial actions will be documented in the audit reports
referenced in Section 8.1 (Independent Assurances).
| 6. |
Physical Safeguards
|
6.1 Physical Security Program
Suppliers must implement appropriate physical security measures designed to protect the physical copies or assets where Company Data is processed and to ensure continuous
monitoring of access to facilities. Physical security measures are aligned to industry’s best practices (e.g. ISO 27001) and periodically reviewed to align to industry’s best practices.
6.2 Office and Facility Access
Supplier will ensure that physical locations are restricted to only authorized users and access is reviewed regularly. Visitors to supplier facilities shall be escorted by
Supplier personnel with appropriate staff on site to monitor access. Physical access to facilities must be revoked upon termination of Supplier personnel's employment.
6.3 Data Center Safeguards
Supplier will use data center service providers and will ensure that all data centers conform to ISO 27001 or equivalent certification. At minimum, all data
centers must implement:
(a) Multi-factor physical security measures, including auditable entry/exit mechanisms that record physical access to the facility, must be
maintained.
(b) Access must be limited to authorized personnel and visitors must be escorted at all times by authorized personnel while in the data center.
(c) Environmental security measures that include temperature and humidity controls, fire suppression systems, and periodic inspections by a
safety official.
| 7. |
Incident Handling, Tracking, and Response
|
7.1 Incident Response Program
Supplier will maintain an incident response program, which will be managed and run by a dedicated incident response team. The Supplier’s incident response program must follow documented incident
management policies and procedures to ensure timely detection, investigation, evidence preservation, notification, and remediation of any Security Incidents. Supplier’s incident response program will include, at a minimum: initial detection; initial
tactical response; initial briefing; incident briefing; refined response; communication and message; formal containment, eradication, and recovery; formal incident report; and postmortem/trend analysis.
7.2 Security Incident Notification
Supplier will comply with all applicable security incident notification laws and regulations in its provision of Supplier services. Supplier will notify Company without undue delay
(and in any event, within 48 hours) upon becoming aware of any (potential, suspected, or actual) incident leading to accidental or unlawful destruction, loss, alteration, unauthorized disclosure of, or access to Company Data. If Supplier is aware a
security incident has impact to Company Data, the notification period is within 24 hours. Notification must be made via a phone call or email to the designated Supplier Relationship Owner (SRO) and a secure email to infosecurity@invesco.com.
The initial notification must include:
(a) a problem statement or description,
(b) the expected resolution time (if known),
(c) notification of Invesco impact (if known),
(d) the name and phone number of the Supplier representative responsible for providing updates.
7.3 Ongoing Communication, Mitigation, and Cooperation
The Supplier must take reasonable measures to mitigate the root cause of any incident and implement corrective actions to prevent recurrence. The Supplier is also required to provide
timely updates, respond to Company inquiries, and cooperate fully in any related investigations or legal proceedings. As additional information becomes available—and unless prohibited by law—the Supplier must share relevant details about the nature
and impact of the incident to support the Company’s obligations to notify affected individuals, regulatory bodies, or credit bureaus.
| 8. |
Independent Audits and Assurances
|
8.1 Independent Audits
Supplier is responsible for conducting annual independent audits, in accordance with industry best practices, of their information security controls relevant to the access,
storage, or processing of Company information within the Supplier’s environment. The independent audits shall include testing of the design and operating effectiveness of the information technology and security controls. Supplier is to provide
Company with copies of any relevant independent SSAE 18/SOC 1 and SOC 2 audits.
8.2 Independent Penetration Testing
Supplier is responsible for conducting penetration testing after major changes or at least annually by an independent party against their external facing network and applications.
Penetration testing shall be conducted utilizing both manual and automated techniques in alignment with industry best practices to ensure the security against external threats of the Supplier network and external facing applications. Critical or
high-risk findings identified from penetration testing shall be remediated within 30 days.
Supplier shall perform appropriate testing to verify remediation effectiveness and report status of remediation to Company if there are critical or high-risk findings are open
beyond 30 days of discovery. At minimum, Supplier must provide an attestation or executive summary that includes the scope, methodology, date, and summary of the testing results. If requested, Supplier shall provide Rules of Engagements or equivalent
that outlines the parameters for Customer penetration testing based on the responsibility model of the Supplier service.
8.3 Remediation and Response Timeline
In the event Supplier’s administrative, physical or technical safeguards do not satisfy Supplier’s obligations under this Agreement, non-compliance shall be remediated by Supplier
within a commercially reasonable time this includes but is not limited to responding to assessments, providing responses to findings and implementing necessary preventative and/detect controls. If any audit reveals material non-compliance, Supplier
shall promptly develop and implement a remediation plan, at its own expense, to address the deficiencies within a mutually agreed-upon timeframe.
8.4 Company Right to Audit
Company, at no added expense and with reasonable notice, may inspect Supplier’s information security practices and safeguards relevant to the Services provided upon reasonable
request from Company.
Any audits conducted by Company pursuant to this Exhibit must:
(i) conducted during reasonable times and be of reasonable duration.
(ii) not unreasonably interfere with Supplier’s day-to-day operations; and
(iii) be conducted under mutually agreed upon terms and in accordance with Supplier’s security policies and procedures.
Supplier reserves the right to limit an audit of configuration settings, sensors, monitors, network devices and equipment, files, or other items if Supplier, in its reasonable
discretion, determines that such an audit may compromise the security of Supplier Services or the data of other Supplier clients.
In the event Company conducts an audit through an independent auditor, such auditors must enter into a non-disclosure agreement containing confidentiality provisions substantially
similar to those set forth in the Agreement to protect Supplier’s confidential information. Company must promptly provide Awareness with any audit, security assessment, compliance assessment reports, and associated findings prepared by it or its
independent auditors for comment and input prior to formalization and/or sharing such information with a third party.
| 9. |
Operational Resilience
|
Supplier shall maintain a documented operational resilience program, with defined roles and responsibilities, that is approved by leadership and reviewed on a periodic basis. The
program shall identify the Supplier’s Important Business Service’s Impact Tolerances relevant for the services provided to Company and meet Company’s Impact Tolerance of 24-48 hours. Supplier shall identify critical systems supporting the services
provided to Company that ensure redundancy and failover mechanisms, vulnerability management, and performance monitoring. Supplier is responsible for service continuity and appropriate regulatory compliance. Supplier recovery capabilities will align
with the Company’s relevant Important Business Service’s Impact Tolerances. Appropriate incident management response and notification procedures shall be in place for incidents impacting Important Business Services in accordance with section 7.2 of
this Exhibit. Subcontractors supporting the provided services are subject to the resiliency program requirements. If requested by Company, Supplier shall provide an annual attestation of operational resilience program effectiveness and testing
summary or attestation.
| 10. |
Termination of Agreement
|
Any failure to perform or breach of this Schedule by Supplier will be deemed a material breach of the Agreement and the Company may terminate (in whole or in part) the Agreement as set forth in
Section 8.3(a) of the Agreement.
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the use in this Registration Statement on Form S-1 of Invesco Galaxy Solana ETF of our report
dated October 31, 2025, relating to the financial statement of Invesco Galaxy Solana ETF, which appears in this Registration Statement. We also consent to the reference to us under the heading “Experts” in such Registration Statement.
/s/ PricewaterhouseCoopers LLP
Chicago, Illinois
November 28, 2025