AUTHORIZED PARTICIPANT AGREEMENT



                               VANGUARD ETF SHARES

                        AUTHORIZED PARTICIPANT AGREEMENT

                           JPMORGAN CHASE BANK VERSION



This Authorized  Participant  Agreement (the "Agreement") is entered into by and

between    Vanguard    Marketing    Corporation    (the    "Distributor")    and

---------------- ------------------ (the "Participant") and is subject to

acceptance  by JPMorgan  Chase Bank, an index receipt agent for the Vanguard ETF

Shares of the registered investment companies listed in Annex I to the Agreement

(the "Index Receipt Agent.").



     The Distributor, acting on an agency basis, is the principal underwriter of

the class of shares  known as  "Vanguard  ETF Shares"  (or simply "ETF  Shares")

issued by the registered investment companies listed on Annex I to the Agreement

(each, a "Trust").  The Index Receipt Agent serves as the sub-transfer agent and

custodian  for each Trust and is an index  receipt agent as that term is defined

in the rules of the  National  Securities  Clearing  Corporation  ("NSCC").  The

Distributor,  the Index Receipt Agent, and the Participant acknowledge and agree

that each Trust and its  constituent  funds  listed in Annex I to the  Agreement

(each, a "Fund") shall be third party beneficiaries of this Agreement, and shall

receive the benefits contemplated by this Agreement.



         The process by which an investor purchases and redeems Vanguard ETF

Shares from a Fund is described in detail in each Trust's ETF Shares Prospectus

and the Statement of Additional Information incorporated therein (the

"Prospectus") that comprise part of the Trust's registration statement, as

amended, on Form N-1A. The discussion of the purchase and redemption process in

this Agreement is modified as necessary by reference to the more complete

discussion in the Prospectus. References to the Prospectus are to the

then-current Prospectus as it may be supplemented or amended from time to time.

Capitalized terms not otherwise defined herein are used herein as defined in the

Prospectus.



         The ETF Shares of a Fund may be purchased or redeemed directly from the

Fund only in aggregations of a specified number, known as a "Creation Unit." The

number of ETF Shares presently constituting a Creation Unit of each Fund is set

forth in Annex I. Creation Units of ETF Shares may be purchased only by or

through an "Authorized Participant," i.e., an entity that is a participant in

the Depository Trust Company ("DTC") and that has entered into an Authorized

Participant Agreement with the Distributor.



         To purchase a Creation Unit, an investor generally must deliver to the

Fund a designated basket of specified securities (the "Deposit Securities") and

an amount of cash computed as described in the Prospectus (the "Balancing

Amount"), plus a purchase transaction fee as described in the Prospectus (the

"Transaction Fee"). The Balancing Amount and the Transaction Fee are referred to

collectively as the "Cash Component." The Deposit Securities and the Cash

Component together constitute the "Fund Deposit." Typically, the Cash Component

is paid by the investor to the Fund. However, if the Balancing Amount is

negative and is larger than the Transaction Fee, then the Cash Component will be

paid by the Fund to the investor.

{PAGE}

                        Authorized Participant Agreement

                                  Page 2 of 10



         To redeem a Creation Unit, an investor generally must tender to the

Fund the number of Vanguard ETF Shares specified in Annex I. In return, the

investor will receive a designated basket of securities (the "Redemption

Securities"). The Cash Component of a redemption consists of the Balancing

Amount minus the Transaction Fee. Depending on the amount of the Balancing

Amount, the Cash Component may be paid by the investor to the Fund or

vice-versa.



         This Agreement is intended to set forth the procedures by which the

Participant may purchase and/or redeem Creation Units of Vanguard ETF Shares (i)

through the Continuous Net Settlement ("CNS") clearing processes of NSCC as such

processes have been enhanced to effect purchases and redemptions of Creation

Units, such processes being referred to herein as the "NSCC Clearing Process,"

or (ii) outside the NSCC Clearing Process. The procedures for processing an

order to purchase Vanguard ETF Shares (a "Purchase Order") and an order to

redeem Vanguard ETF Shares (a "Redemption Order") are described in the Fund's

Prospectus and in Annex II to this Agreement.



         The parties hereto, in consideration of the premises and of the mutual

agreements contained herein, agree as follows:



     1. Status of Participant

       ----------------------

     (a) The Participant hereby represents, covenants, and warrants that it is a

participant in DTC ("DTC Participant") and that, with respect to Purchase Orders

or Redemption Orders of Creation Units of Vanguard ETF Shares of any Fund placed

through the NSCC Clearing Process, it is a member of NSCC and a participant in

the CNS System of NSCC. With respect to Vanguard's stock ETFs, Purchase Orders

and Redemption Orders for Creation Units will settle either through the NSCC

Clearing Process or outside the NSCC Clearing Process. With respect to

Vanguard's bond ETFs, Purchase Orders and Redemption Orders will settle through

the DTC and the Federal Reserve's Fedwire System. If a Participant loses its

status as a DTC Participant or NSCC member, or its eligibility to participate in

the CNS System, it shall promptly notify the Distributor in writing of the

change in status or eligibility, and the Distributor may terminate this

Agreement.



     (b) The Participant hereby represents and warrants that it is registered as

a broker-dealer under the Securities Exchange Act of 1934, as amended, is

qualified to act as a broker or dealer in the states or other jurisdictions

where it transacts business, and is a member in good standing of the National

Association of Securities Dealers, Inc. (the "NASD"). The Participant agrees

that it will maintain such registrations, qualifications, and membership in good

standing and in full force and effect throughout the term of this Agreement. The

Participant agrees to comply with all applicable federal laws, the laws of the

states or other jurisdictions concerned, and the rules and regulations

promulgated thereunder, and with the Constitution, By-Laws and Conduct Rules of

the NASD, and that it will not offer or sell Vanguard ETF Shares of any Fund in

any state or jurisdiction where such shares may not lawfully be offered and/or

sold.

{PAGE}

                        Authorized Participant Agreement

                                  Page 3 of 10



     (c) If the Participant is offering and selling Vanguard ETF Shares of any

Fund in jurisdictions outside the several states, territories and possessions of

the United States and is not otherwise required to be registered or qualified as

a broker or dealer, or to be a member of the NASD, as set forth above, the

Participant nevertheless agrees to observe the applicable laws of the

jurisdiction in which such offer and/or sale is made, to comply with the full

disclosure requirements of the Securities Act of 1933 as amended (the "1933

Act") and the regulations promulgated thereunder, and to conduct its business in

accordance with the spirit of the NASD Conduct Rules.



     (d) The Participant understands and acknowledges that the proposed method

by which Creation Units of Vanguard ETF Shares will be created and traded may

raise certain issues under applicable securities laws. For example, because new

Creation Units of ETF Shares may be issued and sold by the Fund on an ongoing

basis, at any point a "distribution," as such term is used in the 1933 Act, may

occur. The Participant understands and acknowledges that some activities on its

Home        Intelligence        Services        Subscriptions        News        About Us

Contact Us       Terms of Use       Resend Documents       Shopping Cart

Copyright © 2008 The Consus Group LLC