Common use of Authorized Participant Status Clause in Contracts

Authorized Participant Status. (a) The Authorized Participant understands and acknowledges that the method by which Baskets will be created and Shares will be traded may raise certain issues under applicable securities laws. For example, because new Baskets may be issued and sold by a Fund on an ongoing basis, at any point a “distribution,” as such term is used in the 1933 Act, may occur. The Authorized Participant understands and acknowledges that some activities on its part, depending on the circumstances, may result in its being deemed a participant in a distribution in a manner which could render it an “underwriter” as such term is defined in Section 2(a)(11) of the 1933 Act and subject it to the prospectus delivery and liability provisions of the 1933 Act. Each Authorized Participant should review the “Plan of Distribution” portion of the applicable Fund’s Prospectus and consult with its own counsel in connection with entering into one or more Authorized Participant Agreements and placing Purchase Orders or Redemption Orders. (b) The Sponsor shall ensure that the Prospectus for each Fund contains an accurate and current listing of such Fund’s Authorized Participants.