Common use of Partnership Classification Clause in Contracts

Partnership Classification. The Trust is intended to be classified as a partnership for U.S. federal tax purposes; provided, however, that the Trustee may cause the Trust to file with the U.S. Internal Revenue Service an election to be classified as an association taxable as a corporation if it deems such classification to be in the best interest of the Shareholders. Until any such election is made, the Trustee shall not permit transfers or redemptions of Shares if the Trustee believes that such transfer or redemption could cause the Trust to be treated as a publicly traded partnership under Section 7704 of the Code that is taxed as a corporation.