# EDGAR Filing Document

**Accession Number:** 0001683471
**File Stem:** 0000894189-25-011422
**Filing Date:** 2025-10
**Character Count:** 604021
**Document Hash:** 05db2349ce957f70a2d4fb04e383b213
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0000894189-25-011422.hdr.sgml**: 20251017

**ACCESSION NUMBER**: 0000894189-25-011422

**CONFORMED SUBMISSION TYPE**: 485BPOS

**PUBLIC DOCUMENT COUNT**: 40

**FILED AS OF DATE**: 20251017

**DATE AS OF CHANGE**: 20251017

**EFFECTIVENESS DATE**: 20251022

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Listed Funds Trust
- **CENTRAL INDEX KEY:** 0001683471

**ORGANIZATION NAME:**
- **EIN:** 826272597
- **FISCAL YEAR END:** 0831

**FILING VALUES:**
- **FORM TYPE:** 485BPOS
- **SEC ACT:** 1940 Act
- **SEC FILE NUMBER:** 811-23226
- **FILM NUMBER:** 251400829

**BUSINESS ADDRESS:**
- **STREET 1:** 615 E. MICHIGAN STREET
- **CITY:** MILWAUKEE
- **STATE:** WI
- **ZIP:** 53202
- **BUSINESS PHONE:** 414-765-5144

**MAIL ADDRESS:**
- **STREET 1:** 615 E. MICHIGAN STREET
- **CITY:** MILWAUKEE
- **STATE:** WI
- **ZIP:** 53202

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Active Weighting Funds ETF Trust
- **DATE OF NAME CHANGE:** 20160830
**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Listed Funds Trust
- **CENTRAL INDEX KEY:** 0001683471

**ORGANIZATION NAME:**
- **EIN:** 826272597
- **FISCAL YEAR END:** 0831

**FILING VALUES:**
- **FORM TYPE:** 485BPOS
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 333-215588
- **FILM NUMBER:** 251400828

**BUSINESS ADDRESS:**
- **STREET 1:** 615 E. MICHIGAN STREET
- **CITY:** MILWAUKEE
- **STATE:** WI
- **ZIP:** 53202
- **BUSINESS PHONE:** 414-765-5144

**MAIL ADDRESS:**
- **STREET 1:** 615 E. MICHIGAN STREET
- **CITY:** MILWAUKEE
- **STATE:** WI
- **ZIP:** 53202

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Active Weighting Funds ETF Trust
- **DATE OF NAME CHANGE:** 20160830

## Series and Classes Contracts Data

### Optimized Equity Income ETF (Series ID: S000096088)

| Class ID   | Class Name                  | Ticker Symbol   |
|:---|:---|:---|
| C000264875 | Optimized Equity Income ETF | OEI             |

?xml version='1.0' encoding='ASCII'? ck0001683471-20251017

Filed with the U.S. Securities and Exchange Commission on October 17, 2025

Securities Act Registration No. 333-215588

Investment Company Act Reg. No. 811-23226

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

**FORM N-1A**

---

| | |
|:---|:---|
| REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 | [X] |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pre-Effective Amendment No.  | [ ] |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Post-Effective Amendment No. <u>393</u>  | [X] |
| and |  |
| REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 | [X] |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amendment No. <u>395</u>  | [X] |

---

(Check appropriate box or boxes.)

**<u>LISTED FUNDS TRUST</u>**

**<u>(Exact Name of Registrant as Specified in Charter)</u>**

615 East Michigan Street, Milwaukee, Wisconsin 53202

(Address of Principal Executive Offices)

(Registrant's Telephone Number, including Area Code): (608) 716-8890

---

| | |
|:---|:---|
| Kacie Briody, President | Copy to: |
| Listed Funds Trust | Laura E. Flores |
| c/o U.S. Bancorp Fund Services, LLC | Morgan, Lewis & Bockius LLP |
| 615 East Michigan Street | 1111 Pennsylvania Avenue, NW |
| Milwaukee, Wisconsin 53202 | Washington, DC 20004-2541 |
| (Name and Address of Agent for Service) | |

---

As soon as practical after the effective date of this Registration Statement

(Approximate Date of Proposed Public Offering)

It is proposed that this filing will become effective

[ ] immediately upon filing pursuant to paragraph (b)

[X] on <u>October 22, 2025</u> pursuant to paragraph (b)

[ ] 60 days after filing pursuant to paragraph (a)(1)

[ ] on ______________ pursuant to paragraph (a)(1)

[ ] 75 days after filing pursuant to paragraph (a)(2)

[ ] on pursuant to paragraph (a)(2) of Rule 485.

If appropriate, check the following box

&nbsp;&nbsp;&nbsp;&nbsp;[ ] &nbsp;&nbsp;&nbsp;&nbsp;this post-effective amendment designates a new effective date for a previously filed post-effective amendment.

------

PROSPECTUS

**Optimized Equity Income ETF (OEI)**

**Listed on NYSE Arca, Inc.**

**October 22, 2025**

The U.S. Securities and Exchange Commission (the "SEC") has not approved or disapproved of these securities or passed upon the accuracy or adequacy of this Prospectus. Any representation to the contrary is a criminal offense.

------

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
| &nbsp;&nbsp;OPTIMIZED EQUITY INCOME ETF[- FUND SUMMARY](#ide069103c9f14c2ab04a7dec94c3cdd2_13) | [3](#ide069103c9f14c2ab04a7dec94c3cdd2_13) |
| &nbsp;&nbsp;[Investment Objective](#ide069103c9f14c2ab04a7dec94c3cdd2_16) | [3](#ide069103c9f14c2ab04a7dec94c3cdd2_16) |
| &nbsp;&nbsp;[Fees and Expenses of the Fund](#ide069103c9f14c2ab04a7dec94c3cdd2_19) | [3](#ide069103c9f14c2ab04a7dec94c3cdd2_19) |
| &nbsp;&nbsp;[Portfolio Turnover](#ide069103c9f14c2ab04a7dec94c3cdd2_25) | [3](#ide069103c9f14c2ab04a7dec94c3cdd2_25) |
| &nbsp;&nbsp;[Principal Investment Strategies](#ide069103c9f14c2ab04a7dec94c3cdd2_28) | [3](#ide069103c9f14c2ab04a7dec94c3cdd2_28) |
| &nbsp;&nbsp;[Principal Investment Risks](#ide069103c9f14c2ab04a7dec94c3cdd2_31) | [4](#ide069103c9f14c2ab04a7dec94c3cdd2_31) |
| &nbsp;&nbsp;[Performance](#ide069103c9f14c2ab04a7dec94c3cdd2_34) | [7](#ide069103c9f14c2ab04a7dec94c3cdd2_34) |
| &nbsp;&nbsp;[Portfolio Management](#ide069103c9f14c2ab04a7dec94c3cdd2_43) | [7](#ide069103c9f14c2ab04a7dec94c3cdd2_43) |
| &nbsp;&nbsp;[Purchase and Sale of Shares](#ide069103c9f14c2ab04a7dec94c3cdd2_46) | [7](#ide069103c9f14c2ab04a7dec94c3cdd2_46) |
| &nbsp;&nbsp;[Tax Information](#ide069103c9f14c2ab04a7dec94c3cdd2_49) | [7](#ide069103c9f14c2ab04a7dec94c3cdd2_49) |
| &nbsp;&nbsp;[Financial Intermediary Compensation](#ide069103c9f14c2ab04a7dec94c3cdd2_52) | [7](#ide069103c9f14c2ab04a7dec94c3cdd2_52) |
| [ADDITIONAL INFORMATION ABOUT THE FUND](#ide069103c9f14c2ab04a7dec94c3cdd2_55) | [8](#ide069103c9f14c2ab04a7dec94c3cdd2_55) |
| &nbsp;&nbsp;[Investment Objective](#ide069103c9f14c2ab04a7dec94c3cdd2_58) | [8](#ide069103c9f14c2ab04a7dec94c3cdd2_58) |
| &nbsp;&nbsp;[Principal Investment Strategy](#ide069103c9f14c2ab04a7dec94c3cdd2_61) | [8](#ide069103c9f14c2ab04a7dec94c3cdd2_61) |
| &nbsp;&nbsp;[Principal Investment Risks](#ide069103c9f14c2ab04a7dec94c3cdd2_64) | [8](#ide069103c9f14c2ab04a7dec94c3cdd2_64) |
| [PORTFOLIO HOLDINGS INFORMATION](#ide069103c9f14c2ab04a7dec94c3cdd2_67) | [12](#ide069103c9f14c2ab04a7dec94c3cdd2_67) |
| [MANAGEMENT](#ide069103c9f14c2ab04a7dec94c3cdd2_70) | [12](#ide069103c9f14c2ab04a7dec94c3cdd2_70) |
| &nbsp;&nbsp;[Investment Adviser](#ide069103c9f14c2ab04a7dec94c3cdd2_73) | [12](#ide069103c9f14c2ab04a7dec94c3cdd2_73) |
| &nbsp;&nbsp;[Portfolio Managers](#ide069103c9f14c2ab04a7dec94c3cdd2_76) | [13](#ide069103c9f14c2ab04a7dec94c3cdd2_76) |
| &nbsp;&nbsp;[Other Service Providers](#ide069103c9f14c2ab04a7dec94c3cdd2_79) | [13](#ide069103c9f14c2ab04a7dec94c3cdd2_79) |
| [HOW TO BUY AND SELL SHARES](#ide069103c9f14c2ab04a7dec94c3cdd2_82) | [13](#ide069103c9f14c2ab04a7dec94c3cdd2_82) |
| &nbsp;&nbsp;[Book Entry](#ide069103c9f14c2ab04a7dec94c3cdd2_85) | [14](#ide069103c9f14c2ab04a7dec94c3cdd2_85) |
| &nbsp;&nbsp;[Frequent Purchases and Redemptions of Shares](#ide069103c9f14c2ab04a7dec94c3cdd2_88) | [14](#ide069103c9f14c2ab04a7dec94c3cdd2_88) |
| &nbsp;&nbsp;[Determination of Net Asset Value](#ide069103c9f14c2ab04a7dec94c3cdd2_91) | [14](#ide069103c9f14c2ab04a7dec94c3cdd2_91) |
| &nbsp;&nbsp;[Fair Value Pricing](#ide069103c9f14c2ab04a7dec94c3cdd2_94) | [14](#ide069103c9f14c2ab04a7dec94c3cdd2_94) |
| &nbsp;&nbsp;[Investments by Registered Investment Companies](#ide069103c9f14c2ab04a7dec94c3cdd2_97) | [14](#ide069103c9f14c2ab04a7dec94c3cdd2_97) |
| [DIVIDENDS, DISTRIBUTIONS, AND TAXES](#ide069103c9f14c2ab04a7dec94c3cdd2_100) | [14](#ide069103c9f14c2ab04a7dec94c3cdd2_100) |
| &nbsp;&nbsp;[Dividends and Distributions](#ide069103c9f14c2ab04a7dec94c3cdd2_103) | [14](#ide069103c9f14c2ab04a7dec94c3cdd2_103) |
| &nbsp;&nbsp;[Taxes](#ide069103c9f14c2ab04a7dec94c3cdd2_106) | [15](#ide069103c9f14c2ab04a7dec94c3cdd2_106) |
| &nbsp;&nbsp;[Taxes on Distributions](#ide069103c9f14c2ab04a7dec94c3cdd2_109) | [15](#ide069103c9f14c2ab04a7dec94c3cdd2_109) |
| &nbsp;&nbsp;[Taxes When Shares Are Sold on the Exchange](#ide069103c9f14c2ab04a7dec94c3cdd2_112) | [16](#ide069103c9f14c2ab04a7dec94c3cdd2_112) |
| &nbsp;&nbsp;[Taxes on Purchases and Redemptions of Creation Units](#ide069103c9f14c2ab04a7dec94c3cdd2_115) | [16](#ide069103c9f14c2ab04a7dec94c3cdd2_115) |
| &nbsp;&nbsp;[Foreign Taxes](#ide069103c9f14c2ab04a7dec94c3cdd2_118) | [16](#ide069103c9f14c2ab04a7dec94c3cdd2_118) |
| &nbsp;&nbsp;[Net Investment Income Tax](#ide069103c9f14c2ab04a7dec94c3cdd2_121) | [16](#ide069103c9f14c2ab04a7dec94c3cdd2_121) |
| [DISTRIBUTION PLAN](#ide069103c9f14c2ab04a7dec94c3cdd2_124) | [16](#ide069103c9f14c2ab04a7dec94c3cdd2_124) |
| [PREMIUM/DISCOUNT INFORMATION](#ide069103c9f14c2ab04a7dec94c3cdd2_127) | [16](#ide069103c9f14c2ab04a7dec94c3cdd2_127) |
| [ADDITIONAL NOTICES](#ide069103c9f14c2ab04a7dec94c3cdd2_130) | [16](#ide069103c9f14c2ab04a7dec94c3cdd2_130) |
| [FINANCIAL HIGHLIGHTS](#ide069103c9f14c2ab04a7dec94c3cdd2_133) | [17](#ide069103c9f14c2ab04a7dec94c3cdd2_133) |

---

------

**OPTIMIZED EQUITY INCOME ETF – FUND SUMMARY**

**Investment Objective** 

The Optimized Equity Income ETF (the "Fund") seeks long-term capital appreciation with current income as a secondary consideration.

**Fees and Expenses of the Fund**

This table describes the fees and expenses that you may pay if you buy, hold, and sell shares of the Fund ("Shares"). **You may pay other fees, such as brokerage commissions and other fees to financial intermediaries, which are not reflected in the table and Example below.** 

---

| | |
|:---|:---|
| **Shareholder Fees** *(fees paid directly from your investment)* |  |
| **Annual Fund Operating Expenses** *(expenses that you pay each year as a percentage of the value of your investment)* | **Annual Fund Operating Expenses** *(expenses that you pay each year as a percentage of the value of your investment)* |
| Management Fee | 0.75% |
| Distribution and/or Service (12b-1) Fees |  |
| Other Expenses\* | 0.00% |
| **Total Annual Fund Operating Expenses** | **0.75%** |

---

\* Estimated for the current fiscal year.

**Example** 

This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other funds. The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your Shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Fund's operating expenses remain the same. The Example does not take into account brokerage commissions that you may pay on your purchases and sales of Shares. Although your actual costs may be higher or lower, based on these assumptions your costs would be:

---

| | | | |
|:---|:---|:---|:---|
| **1 Year:** | $77 | **3 Years:** | $240 |

---

**Portfolio Turnover** 

The Fund pays transaction costs, such as commissions, when it buys and sells securities (or "turns over" its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Shares are held in a taxable account. These costs, which are not reflected in the Total Annual Fund Operating Expenses or in the Example, affect the Fund's performance. Because the Fund is newly organized, portfolio turnover information is not yet available.

**Principal Investment Strategies**

The Fund seeks to achieve its investment objective by investing, under normal circumstances, at least 80% of its net assets, plus any borrowings for investment purposes, in equity securities. Equity securities include common stocks and other instruments that represent an ownership interest or right to acquire an ownership interest in a company. The Fund generally expects to invest closer to 90% of its assets in such securities. The Fund primarily invests in U.S.-listed equity securities of large-capitalization companies, which Core Alternative Capital, LLC (the "Adviser") defines as companies with a market capitalization in excess of $10 billion at the time of purchase. From time to time, the Fund may also obtain equity exposure by investing up to 10% of its assets in exchange-traded funds ("ETFs") that seek to track broad market indexes.

The Fund employs an actively managed investment strategy in both the selection of individual securities and the sizing of positions. The Adviser selects investments for the Fund using both "top-down" and "bottom-up" analyses. The Adviser examines the current overall market conditions using a variety of quantitative measures (such as value, size, quality, and volatility) to determine attractive investments and size of positions, generally disfavoring securities with too much volatility (and consequently higher risk) over time. Within categories of securities determined to be attractive, the Adviser may utilize a "bottom-up approach" through the use of various quantitative measures (*e.g.*, various statistical and mathematical pricing models), and, at times, qualitative measures (*e.g.*, assessments of company fundamentals, managements, etc. based on internal research) to assess the attractiveness of securities for long term appreciation and current income (*i.e.*, dividend payment attractiveness and generation of income under its options strategy (as discussed below)). Overall the Adviser emphasizes the potential for capital appreciation and the evaluation of volatility characteristics relevant to the Fund's options strategy.

A key aspect of the Fund's strategy is the generation of monthly income through a combination of dividend payments from equity holdings and premiums from the Fund's options strategy, which involves writing (selling) call options with an attractive strike price (*e.g.,* close to the current price of the underlying asset). Such options contracts may be either European-style or American-style standardized options, and generally will be listed on a national securities exchange and cash-settled. The Fund may write call options

------

on individual securities held in the portfolio, as well as on equity market indexes *(primarily broad market indexes such as the S&P 500*<sup>®</sup>*)* or ETFs that seek to track such indexes. The Fund may write covered call options on the individual securities held in the portfolio, but does not anticipate doing so to a significant extent. The Fund typically targets selling call options with a notional value of 25% to 75% of the value of its equity holdings. Notional value refers to the number of option contracts owned by the Fund, multiplied by the size of the contract (*i.e.*, the number of shares a contract controls), multiplied by the strike price (*i.e.*, the predetermined price at which the owner of an options contract can buy or sell the underlying asset). Options contracts are generally written with expiration terms ranging from one to six months from the trade date. The Adviser seeks to optimize the trade-off between income generation and the potential limitation on capital appreciation from the options strategy. In addition, the Fund does not guarantee that distributions will always be paid or will be at a relatively stable level. Collateral for the Fund's options strategy will consist of long positions on its equity holdings and cash held by the Fund.

The Fund may also seek to purchase out-of-the-money (*i.e.*, the strike price is set above the then-current share price of the security) put options and call options with expiration terms ranging from three to twelve months. The Fund will typically target purchasing put and call options with a notional value of 25% to 75% of the value of its equity holdings. The Fund expects the total notional value of the written call options and the total value of the purchased call and put options to each not exceed 100% of the Fund's net assets at the time of entering the positions. The Adviser seeks to mitigate downside risk exposure with the put options and to potentially capture upside equity exposure with the call options.

The Fund is considered to be non-diversified, which means that it may invest more of its assets in the securities of a single issuer or a smaller number of issuers than if it were a diversified fund. Additionally, the Fund's investment strategies may involve active and frequent trading resulting in high portfolio turnover.

While the Fund's exposure to certain sectors may change over time, the Fund expects to have significant exposure to companies in the Information Technology Sector.

**Principal Investment Risks** 

The principal risks of investing in the Fund are summarized below. The principal risks are presented in alphabetical order to facilitate finding particular risks and comparing them with the risks of other funds. Each risk summarized below is considered a "principal risk" of investing in the Fund, regardless of the order in which it appears. As with any investment, there is a risk that you could lose all or a portion of your investment in the Fund. Some or all of these risks may adversely affect the Fund's net asset value ("NAV"), trading price, yield, total return and/or ability to meet its investment objective. The following risks could affect the value of your investment in the Fund:

**• Call Writing (Selling) Strategy Risk.** When the Fund sells call options, it receives cash but limits its opportunity to profit from an increase in the market value of the underlying instrument to the exercise price (plus the premium received). The maximum potential gain on the underlying benchmark, ETF or individual stock (each, an "underlying instrument") will be equal to the difference between the exercise price and the purchase price of the underlying instrument at the time the option is written, plus the premium received. In a rising market, the option may require an underlying instrument to be sold at an exercise price that is lower than would be received if the instrument was sold at the market price. If a call expires, the Fund realizes a gain in the amount of the premium received, but because there may have been a decline (unrealized loss) in the market value of the underlying instrument during the option period, the loss realized may exceed such gain. If the underlying instrument declines by more than the option premium the Fund receives, there will be a loss on the overall position.

**• Cybersecurity Risk.** Cybersecurity incidents may allow an unauthorized party to gain access to Fund assets or proprietary information, or cause the Fund, the Adviser, and/or other service providers (including custodians and financial intermediaries) to suffer data breaches or data corruption. Additionally, cybersecurity failures or breaches of the electronic systems of the Fund, the Adviser, the Fund's other service providers, market makers, Authorized Participants ("APs"), the Fund's primary listing exchange, or the issuers of securities in which the Fund invests have the ability to disrupt and negatively affect the Fund's business operations, including the ability to purchase and sell Shares, potentially resulting in financial losses to the Fund and its shareholders.

**• Derivatives Risk.** Put and call options are referred to as "derivative" instruments since their values are based on, or derived from, an underlying reference asset, such as an index. Derivatives can be volatile, and a small investment in a derivative can have a large impact on the performance of the Fund as derivatives can result in losses in excess of the amount invested. The return on a derivative instrument may not correlate with the return of its underlying reference asset. Derivative instruments may be difficult to value and may be subject to wide swings in valuations caused by changes in the value of the underlying instrument. Other risks of investments in derivatives include risks that the transactions may result in losses that partially or completely offset gains in portfolio positions, risks associated with leverage, and risks that the derivative transaction may not be liquid. Derivative instruments may create economic leverage in the Fund, which magnifies the Fund's exposure to the underlying instrument.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;◦ **Options Risk.** The prices of options may change rapidly over time and do not necessarily move in tandem with the price of the underlying securities. The profitability of selling options is dependent on a variety of unpredictable factors, such as whether an options contract is out-of-the-money or in-the-money, as well as general market conditions such as volatility.

------

Because of the unpredictability of these and other factors, outcomes may or may not be profitable. Writing call options reduces the Fund's ability to profit from increases in the value of the Fund's equity portfolio, and purchasing put options may result in the Fund's loss of premiums paid in the event that the put options expire unexercised. To the extent that the Fund reduces its put option holdings relative to the number of call options sold by the Fund, the Fund's ability to mitigate losses in the event of a market decline will be reduced. When the Fund sells an option, it gains the amount of the premium it receives, but also incurs a liability representing the value of the option it has sold until the option is either exercised and finishes "in the money," meaning it has value and can be sold, or the option expires worthless, or the expiration of the option is "rolled," or extended forward. The value of the options in which the Fund invests is based partly on the volatility used by market participants to price such options (*i.e.*, implied volatility). Accordingly, increases in the implied volatility of such options will cause the value of such options to increase (even if the prices of the options' underlying stocks do not change), which will result in a corresponding increase in the liabilities of the Fund under such options and thus decrease the Fund's NAV. Additionally, if the Fund transacts in non-cash settled options, the Fund may be obligated to receive or deliver shares of the underlying stock.

• **Distribution Policy Risk.** The Fund's distributions in respect of any period may exceed the amount of the Fund's income and gains for that period. In that case, some or all of the Fund's distributions may constitute a return of capital to shareholders. It is possible for the Fund to suffer substantial investment losses and simultaneously experience additional asset reductions as a result of its distributions to shareholders. A return of capital distribution generally will not be taxable but will decrease the shareholder's cost basis in the Shares and will result in a higher capital gain or lower capital loss when those shares on which the distribution was received are sold. Once a shareholder's cost basis is reduced to zero, further distributions will be treated as capital gain, if the shareholder holds Shares as capital assets. A distribution constituting a return of capital is not a distribution of income or capital gains earned by the Fund and should not be confused with the Fund's "yield" or "income." In addition, the Fund does not guarantee that distributions will always be paid at a relatively stable level.

**• Dividend Paying Security Risk.** Securities that pay high dividends as a group can fall out of favor with the market, causing these companies to underperform companies that do not pay high dividends. Also, companies owned by the Fund that have historically paid a dividend may reduce or discontinue their dividends, thus reducing the yield of the Fund.

**• Equity Investing Risk.** The values of equity securities could decline generally or could underperform other investments due to factors affecting a specific issuer, market or securities markets generally.

**• ETF Risks.** The Fund is an ETF and may invest in other ETFs, and, as a result of its structure, it is exposed to the following risks:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*◦ Authorized Participants, Market Makers, and Liquidity Providers Concentration Risk.* The Fund has a limited number of financial institutions that may act as APs. In addition, there may be a limited number of market makers and/or liquidity providers in the marketplace. Shares may trade at a material discount to NAV and possibly face delisting if either: (i) APs exit the business or otherwise become unable to process creation and/or redemption orders and no other APs step forward to perform these services, or (ii) market makers and/or liquidity providers exit the business or significantly reduce their business activities and no other entities step forward to perform their functions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*◦ Costs of Buying or Selling Shares Risk.* Due to the costs of buying or selling Shares, including brokerage commissions imposed by brokers and bid/ask spreads, frequent trading of Shares may significantly reduce investment results and an investment in Shares may not be advisable for investors who anticipate regularly making small investments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*◦ Shares May Trade at Prices Other Than NAV Risk.* As with all ETFs, Shares may be bought and sold in the secondary market at market prices. Although it is expected that the market price of Shares will approximate the Fund's NAV, there may be times when the market price of Shares is more than the NAV intra-day (premium) or less than the NAV intra-day (discount) due to supply and demand of Shares or during periods of market volatility. This risk is heightened in times of market volatility, periods of steep market declines, and periods when there is limited trading activity for Shares in the secondary market, in which case such premiums or discounts may be significant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*◦ Trading Risk.* Although Shares are listed for trading on the NYSE Arca, Inc. (the "Exchange") and may be traded on U.S. exchanges other than the Exchange, there can be no assurance that Shares will trade with any volume, or at all, on any stock exchange. In stressed market conditions, the liquidity of Shares may begin to mirror the liquidity of the Fund's underlying portfolio holdings, which can be significantly less liquid than the Shares.

**• Large-Capitalization Risk.** The Fund's investments in large-capitalization companies may underperform other segments of the market because large-capitalization companies may be unable to respond quickly to new competitive challenges, such as changes in technology and consumer tastes, and may not be able to attain the high growth rate of successful smaller companies, especially during extended periods of economic expansion.

**• Management Risk.** The Fund is actively managed using proprietary investment strategies and processes. There can be no guarantee that the investment adviser's judgments about the attractiveness, value and potential appreciation of particular investments and strategies for the Fund will be correct or produce the desired results or that the Fund will achieve its investment

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objective. If the investment adviser fails to accurately evaluate market risk or appropriately react to current and developing market conditions, the Fund's Share price may be adversely affected.

**• Market Risk.** The trading prices of securities and other instruments fluctuate in response to a variety of factors. These factors include events impacting the entire market or specific market segments, such as political, market and economic developments, as well as events that impact specific issuers. The Fund's NAV and market price, like security and commodity prices generally, may fluctuate significantly in response to these and other factors. As a result, an investor could lose money over short or long periods of time. U.S. and international markets have experienced significant periods of volatility in recent years due to a number of these factors, including the impact of the COVID-19 pandemic and related public health issues, growth concerns in the U.S. and overseas, uncertainties regarding interest rates, trade tensions and the threat of and/or actual imposition of tariffs by the U.S. and other countries. In addition, local, regional or global events such as war, including Russia's invasion of Ukraine, acts of terrorism, recessions, rising inflation, or other events could have a significant negative impact on the Fund and its investments. These developments as well as other events could result in further market volatility and negatively affect financial asset prices, the liquidity of certain securities and the normal operations of securities exchanges and other markets.

**• New Fund Risk.** The Fund is a recently organized investment company with no operating history. As a result, prospective investors have no track record or history on which to base their investment decision.

**• Non-Diversification Risk.** The Fund is considered to be non-diversified, which means that it may invest a greater percentage of its assets in the securities of a single issuer or a lesser number of issuers than if it was a diversified fund. As a result, the Fund may be more exposed to the risks associated with and developments affecting an individual issuer or a lesser number of issuers than a fund that invests more widely. This may increase the Fund's volatility and cause the performance of a relatively small number of issuers to have a greater impact on the Fund's performance.

***•* Portfolio Turnover Risk.** Because the Fund is expected to "turn over" some or all of its portfolio frequently, the Fund may incur high levels of transaction costs from commissions or mark-ups in the bid/offer spread. Higher portfolio turnover (*e.g.*, in excess of 100% per year) may result in the Fund paying higher levels of transaction costs and generating greater tax liabilities for shareholders.

• **Sector Risk.** To the extent the Fund invests more heavily in particular sectors of the economy, its performance will be especially sensitive to developments that significantly affect those sectors. The Fund may invest a significant portion of its assets in the following sector and, therefore, the performance of the Fund could be negatively impacted by events affecting this sector.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;◦ *Information Technology Sector Risk.* Market or economic factors impacting technology companies and companies that rely heavily on technological advances could have a major affect on the value of any Fund that is invested in this sector. The value of stocks of technology companies and companies that rely heavily on technology is particularly vulnerable to rapid changes in technology product cycles, rapid product obsolescence, government regulation and competition, both domestically and internationally, including competition from foreign competitors with lower production costs. Technology companies may have limited product lines, markets, financial resources or personnel. Stocks of technology companies and companies that rely heavily on technology, especially those of smaller, less-seasoned companies, tend to be more volatile than the overall market. Technology companies are heavily dependent on patent and intellectual property rights, the loss or impairment of which may adversely affect profitability. Additionally, companies in the technology sector may face dramatic and often unpredictable changes in growth rates and competition for the services of qualified personnel.

• **Tax Risk.** The writing of call options by the Fund may significantly reduce or eliminate its ability to make distributions eligible to be treated as qualified dividend income. Covered call options may also be subject to the federal tax rules applicable to straddles under the Internal Revenue Code of 1986, as amended (the "Code"). If positions held by the Fund were treated as "straddles" for federal income tax purposes, or the Fund's risk of loss with respect to a position was otherwise diminished as set forth in Treasury regulations, dividends on stocks that are a part of such positions would not constitute qualified dividend income subject to such favorable income tax treatment in the hands of non-corporate shareholders or eligible for the dividends received deduction for corporate shareholders. In addition, generally, straddles are subject to certain rules that may affect the amount, character and timing of the Fund's recognition of gains and losses with respect to straddle positions by requiring, among other things, that: (1) any loss realized on disposition of one position of a straddle may not be recognized to the extent that the Fund has unrealized gains with respect to the other position in such straddle; (2) the Fund's holding period in straddle positions be suspended while the straddle exists (possibly resulting in a gain being treated as short-term capital gain rather than long-term capital gain); (3) the losses recognized with respect to certain straddle positions that are part of a mixed straddle and that are not subject to Section 1256 of the Code be treated as 60% long-term and 40% short-term capital loss; (4) losses recognized with respect to certain straddle positions that would otherwise constitute short-term capital losses be treated as long-term capital losses; and (5) the deduction of interest and carrying charges attributable to certain straddle positions may be deferred.

The use of derivatives strategies, such as writing (selling) and purchasing options, involves complex rules that will determine for income tax purposes the amount, character and timing of recognition of the gains and losses the Fund realizes in connection therewith. To the extent such options are governed by section 1256 of Code, gains and losses resulting from the expiration, exercise, or closing of the non-equity options are treated as 60% long-term capital gain or loss and 40% short-term capital gain or

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loss (hereinafter, "blended gain or loss"). In addition, such options governed by section 1256 of the Code issued by the Fund will be treated as sold for market value on the last day of the Fund's fiscal year, and gain or loss recognized as a result of such deemed sale will be blended gain or loss. These rules may operate to accelerate the amount that the Fund must distribute to satisfy its distribution requirement (*i.e.*, with respect to the portion treated as short-term capital gain, which will be includible in investment company taxable income and thus taxable to its shareholders as ordinary income when distributed to them), and to increase the net capital gain the Fund recognizes, even though the Fund may not have closed the transactions and received cash to pay the distributions. To the extent the Fund writes options that are not subject to the rules of section 1256 of the Code, the amount of the premium received by the Fund for writing such options will be entirely short-term capital gain to the Fund. In addition, if such an option is closed by the Fund, any gain or loss realized by the Fund as a result of the closing the transaction will also be short-term capital gain or loss. If the holder of a put option exercises the holder's right under the option, any gain or loss realized by the Fund upon the sale of the underlying security pursuant to such exercise will be short-term or long-term capital gain or loss to the Fund depending on the Fund's holding period for the underlying security. In addition, equity securities that are hedged with put options may not be eligible for long-term capital gains tax treatment.

**Performance**

The Fund is new and therefore does not have a performance history for a full calendar year. In the future, performance information for the Fund will be presented in this section. Updated performance information is available on the Fund's website at www.corealtfunds.com.

**Portfolio Management** 

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| | |
|:---|:---|
| *Adviser* | Core Alternative Capital, LLC |
| *Portfolio Managers* | David Pursell, Managing Partner of the Adviser, and Peter Simasek, Portfolio Manager with the Adviser, have been portfolio managers of the Fund since its inception in October 2025. |

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**Purchase and Sale of Shares** 

The Fund issues and redeems Shares at NAV only in large blocks known as "Creation Units," which only APs (typically, broker-dealers) may purchase or redeem. The Fund generally issues and redeems Creation Units in exchange for a portfolio of securities and/or a designated amount of U.S. cash.

Shares are listed on the Exchange, and individual Shares may only be bought and sold in the secondary market through a broker or dealer at market prices, rather than NAV. Because Shares trade at market prices rather than NAV, Shares may trade at a price greater than NAV (premium) or less than NAV (discount).

An investor may incur costs attributable to the difference between the highest price a buyer is willing to pay to purchase Shares (the "bid" price) and the lowest price a seller is willing to accept for Shares (the "ask" price) when buying or selling Shares in the secondary market. The difference in the bid and ask prices is referred to as the "bid-ask spread."

Recent information regarding the Fund's NAV, market price, how often Shares traded on the Exchange at a premium or discount, and bid-ask spreads can be found on the Fund's website at www.corealtfunds.com.

**Tax Information** 

The Fund's distributions are generally taxable as ordinary income, qualified dividend income, or capital gains (or a combination), unless your investment is held in an individual retirement account ("IRA") or other tax-advantaged account. Distributions on investments made through tax-deferred arrangements may be taxed later upon withdrawal of assets from those accounts.

**Financial Intermediary Compensation** 

If you purchase Shares through a broker-dealer or other financial intermediary (such as a bank) (an "Intermediary"), the Adviser or its affiliates may pay Intermediaries for certain activities related to the Fund, including participation in activities that are designed to make Intermediaries more knowledgeable about exchange-traded products, including the Fund, or for other activities, such as marketing, educational training or other initiatives related to the sale or promotion of Shares. These payments may create a conflict of interest by influencing the Intermediary and your salesperson to recommend the Fund over another investment. Any such arrangements do not result in increased Fund expenses. Ask your salesperson or visit the Intermediary's website for more information.

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**ADDITIONAL INFORMATION ABOUT THE FUND**

**Investment Objective**

The Fund's investment objective may be changed by the Board of Trustees (the "Board") of Listed Funds Trust (the "Trust") without shareholder approval upon written notice to shareholders.

**Principal Investment Strategy**

The Fund will provide shareholders with sixty (60) days' prior notice of any change to its 80% policy.

*Temporary Defensive Positions*

To respond to adverse market, economic, political, or other conditions, the Fund may invest up to 100% of its assets in a temporary defensive manner by holding all or a substantial portion of its assets in cash, cash equivalents, or other high quality short-term investments. Temporary defensive investments generally may include short-term U.S. government securities, commercial paper, bank obligations, repurchase agreements, money market fund shares, and other money market instruments. The Adviser also may invest in these types of securities or hold cash while looking for suitable investment opportunities or to maintain liquidity. In these circumstances, the Fund may be unable to achieve its investment objective.

**Principal Investment Risks**

An investment in the Fund entails risks. The Fund could lose money, or its performance could trail that of other investment alternatives. The following provides additional information about the Fund's principal risks. It is important that investors closely review and understand these risks before making an investment in the Fund. Just as in the Fund's summary section, the principal risks below are presented in alphabetical order to facilitate finding particular risks and comparing them with those of other funds. Each risk summarized below is considered a "principal risk" of investing in the Fund, regardless of the order in which it appears.

**• Call Writing (Selling) Strategy Risk.** To the extent that the Fund sells call options, it receives cash but limits its opportunity to profit from an increase in the market value of the underlying instrument to the exercise price (plus the premium received). The maximum potential gain on the underlying instrument will be equal to the difference between the exercise price and the purchase price of the underlying instrument at the time the option is written, plus the premium received. In a rising market, the option may require an underlying instrument to be sold at an exercise price that is lower than would be received if the instrument was sold at the market price. If a call expires, the Fund realizes a gain in the amount of the premium received, but because there may have been a decline (unrealized loss) in the market value of the underlying instrument during the option period, the loss realized may exceed such gain. If the underlying instrument declines by more than the option premium the Fund receives, there will be a loss on the overall position.

**• Cybersecurity Risk.** With the increased use of technologies such as the Internet and the dependence on computer systems to perform business and operational functions, funds (such as the Fund) and their service providers may be prone to operational and information security risks resulting from cyber-attacks and/or technological malfunctions. In general, cyber-attacks are deliberate, but unintentional events may have similar effects. Cyber-attacks include, among others, stealing or corrupting data maintained online or digitally, preventing legitimate users from accessing information or services on a website, releasing confidential information without authorization, and causing operational disruption. Cybersecurity incidents may allow an unauthorized party to gain access to Fund assets or proprietary information, or cause the Fund, the Adviser, and/or other service providers (including custodians and financial intermediaries) to suffer data breaches or data corruption. Additionally, cybersecurity failures or breaches of the electronic systems of the Fund, the Adviser, or the Fund's other service providers, market makers, APs, the Fund's primary listing exchange, or the issuers of securities in which the Fund invests have the ability to disrupt and negatively affect the Fund's business operations, including the ability to purchase and sell Shares, potentially resulting in financial losses to the Fund and its shareholders. For instance, cyber-attacks or technical malfunctions may interfere with the processing of shareholder or other transactions, affect the Fund's ability to calculate its NAV, cause the release of private shareholder information or confidential Fund information, impede trading, cause reputational damage, and subject the Fund to regulatory fines, penalties or financial losses, reimbursement or other compensation costs, and additional compliance costs. Cyber-attacks or technical malfunctions may render records of Fund assets and transactions, shareholder ownership of Shares, and other data integral to the functioning of the Fund inaccessible or inaccurate or incomplete. The Fund also may incur substantial costs for cybersecurity risk management to prevent cyber incidents in the future. The Fund and its shareholders could be negatively impacted as a result.

**• Derivatives Risk.** The Fund may invest in derivatives, including in particular options contracts, to pursue its investment objective. The use of derivatives may expose the Fund to risks in addition to and greater than those associated with investing directly in the instruments underlying those derivatives, including risks relating to leverage, correlation (imperfect correlations with underlying instruments or the Fund's other portfolio holdings), high price volatility, lack of availability, counterparty credit, liquidity, valuation and legal restrictions. The use of derivatives also may expose the Fund to the performance of securities that the Fund does not own. To the extent the Fund engages in derivatives in an attempt to hedge certain exposures or risks, there can be no assurance that the Fund's hedging investments or transactions will be effective. In addition, hedging investments or transactions involve costs and may reduce gains or result in losses, which may adversely affect the Fund. The skills necessary to

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successfully execute derivatives strategies may be different from those for more traditional portfolio management techniques, and if the Adviser is incorrect about its expectations of market conditions, the use of derivatives also could result in a loss, which in some cases may be unlimited. Use of derivatives also may cause the Fund to be subject to additional regulations, which may generate additional Fund expenses. These practices also entail transactional expenses and may cause the Fund to realize higher amounts of short-term capital gains than if the Fund had not engaged in such transactions. Certain of the derivatives in which the Fund invests may trade (and privately negotiated) in the over-the-counter ("OTC") market. OTC derivatives are complex and often valued subjectively, which exposes the Fund to heightened liquidity, mispricing and valuation risks. Improper valuations can result in increased cash payment requirements to counterparties or a loss of value to the Fund. In addition, OTC derivative instruments are often highly customized and tailored to meet the needs of the Fund and its trading counterparties. If a derivative transaction is particularly large or if the relevant market is illiquid, it may not be possible to initiate a transaction or liquidate a position at an advantageous time or price. As a result and similar to other privately negotiated contracts, the Fund is subject to counterparty credit risk with respect to such derivative contracts. Certain derivatives are subject to mandatory exchange trading and/or clearing, which exposes the Fund to the credit risk of the clearing broker or clearinghouse. While exchange trading and central clearing are intended to reduce counterparty credit risk and to increase liquidity, they do not make derivatives transactions risk-free.

The Fund is subject to the risk that a change in U.S. law and related regulations will impact the way the Fund operates, increase the particular costs of the Fund's operation and/or change the competitive landscape. In October 2020, the SEC adopted a rule governing a fund's use of derivatives. The rule, among other things, generally requires a fund to adopt a derivatives risk management program, appoint a derivatives risk manager to oversee the program and comply with an outer limit on fund leverage risk based on value at risk, or "VaR." The rule significantly changed the regulatory framework applicable to a fund's use of derivatives, including by replacing the existing asset segregation regulatory framework in its entirety. The rule may influence the extent to which the Fund will use derivatives, adversely affect the Fund's performance, and increase costs related to the Fund's use of derivatives.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;◦ **Options Risk.** The prices of options may change rapidly over time and do not necessarily move in tandem with the price of the underlying securities. The profitability of selling options is dependent on a variety of unpredictable factors, such as whether an options contract is out-of-the-money or in-the-money, as well as general market conditions such as volatility. Because of the unpredictability of these and other factors, outcomes may or may not be profitable. Writing call options reduces the Fund's ability to profit from increases in the value of the Fund's equity portfolio, and purchasing put options may result in the Fund's loss of premiums paid in the event that the put options expire unexercised. To the extent that the Fund reduces its put option holdings relative to the number of call options sold by the Fund, the Fund's ability to mitigate losses in the event of a market decline will be reduced. When the Fund sells an option, it gains the amount of the premium it receives, but also incurs a liability representing the value of the option it has sold until the option is either exercised and finishes "in the money," meaning it has value and can be sold, or the option expires worthless, or the expiration of the option is "rolled," or extended forward. The value of the options in which the Fund invests is based partly on the volatility used by market participants to price such options (*i.e.*, implied volatility). Accordingly, increases in the implied volatility of such options will cause the value of such options to increase (even if the prices of the options' underlying stocks do not change), which will result in a corresponding increase in the liabilities of the Fund under such options and thus decrease the Fund's NAV. Additionally, if the Fund transacts in non-cash settled options, the Fund may be obligated to receive or deliver shares of the underlying stock.

**• Distribution Policy Risk.** The Fund's distributions in respect of any period may exceed the amount of the Fund's income and gains for that period. In that case, some or all of the Fund's distributions may constitute a return of capital to shareholders. It is possible for the Fund to suffer substantial investment losses and simultaneously experience additional asset reductions as a result of its distributions to shareholders. A return of capital distribution generally will not be taxable but will decrease the shareholder's cost basis in the Shares and will result in a higher capital gain or lower capital loss when those shares on which the distribution was received are sold. Once a shareholder's cost basis is reduced to zero, further distributions will be treated as capital gain, if the shareholder holds Shares as capital assets. A distribution constituting a return of capital is not a distribution of income or capital gains earned by the Fund and should not be confused with the Fund's "yield" or "income." In addition, the Fund does not guarantee that distributions will always be paid at a relatively stable level.

**• Dividend Paying Security Risk.** Securities that pay high dividends as a group can fall out of favor with the market, causing these companies to underperform companies that do not pay high dividends. Also, changes in the dividend policies of and capital resources available to companies owned by the Fund that have historically paid a dividend may adversely impact the Fund's yield if these companies reduce or discontinue their dividends. Lower priced securities in the Fund may be more susceptible to these risks. Past dividend payments are not a guarantee of future dividend payments.

**• Equity Investing Risk.** An investment in the Fund involves risks similar to those of investing in any fund holding equity securities, such as market fluctuations, changes in interest rates and perceived trends in stock prices. The values of equity securities could decline generally or could underperform other investments. Different types of equity securities tend to go through cycles of outperformance and underperformance in comparison to the general securities markets. In addition, securities may

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decline in value due to factors affecting a specific issuer, market or securities markets generally. Recent unprecedented turbulence in financial markets, reduced liquidity in credit and fixed income markets, or rising interest rates may negatively affect many issuers worldwide, which may have an adverse effect on the Fund.

**• ETF Risks.** The Fund is an ETF and may invest in other ETFs, as a result of its structure, is exposed to the following risks:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*◦ Authorized Participants, Market Makers, and Liquidity Providers Concentration Risk.* The Fund has a limited number of financial institutions that may act as APs. In addition, there may be a limited number of market makers and/or liquidity providers in the marketplace. Shares may trade at a material discount to NAV and possibly face delisting if either: (i) APs exit the business or otherwise become unable to process creation and/or redemption orders and no other APs step forward to perform these services, or (ii) market makers and/or liquidity providers exit the business or significantly reduce their business activities and no other entities step forward to perform their functions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*◦ Costs of Buying or Selling Shares Risk.* Investors buying or selling Shares in the secondary market will pay brokerage commissions or other charges imposed by brokers, as determined by that broker. Brokerage commissions are often a fixed amount and may be a significant proportional cost for investors seeking to buy or sell relatively small amounts of Shares. In addition, secondary market investors also will incur the cost of the difference between the price at which an investor is willing to buy Shares (the "bid" price) and the price at which an investor is willing to sell Shares (the "ask" price). This difference in bid and ask prices is often referred to as the "spread" or "bid/ask spread." The bid/ask spread varies over time for Shares based on trading volume and market liquidity and is generally lower if Shares have more trading volume and market liquidity and higher if Shares have little trading volume and market liquidity. Further, a relatively small investor base in the Fund, asset swings in the Fund and/or increased market volatility may cause increased bid/ask spreads. Due to the costs of buying or selling Shares, including bid/ask spreads, frequent trading of Shares may significantly reduce investment results and an investment in Shares may not be advisable for investors who anticipate regularly making small investments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;◦ *Shares May Trade at Prices Other Than NAV Risk.* As with all ETFs, Shares may be bought and sold in the secondary market at market prices. Although it is expected that the market price of Shares will approximate the Fund's NAV, there may be times when the market price of Shares is more than the NAV intra-day (premium) or less than the NAV intra-day (discount) due to supply and demand of Shares or during periods of market volatility. This risk is heightened in times of market volatility or periods of steep market declines and periods when there is limited trading activity for Shares in the secondary market, in which case such premiums or discounts may be significant. The market price of Shares during the trading day, like the price of any exchange-traded security, includes a "bid/ask" spread charged by the exchange specialist, market makers or other participants that trade Shares. In times of severe market disruption, the bid/ask spread can increase significantly. At those times, Shares are most likely to be traded at a discount to NAV, and the discount is likely to be greatest when the price of Shares is falling fastest, which may be the time that you most want to sell your Shares. The Adviser believes that, under normal market conditions, large market price discounts or premiums to NAV will not be sustained because of arbitrage opportunities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*◦ Trading Risk.* Although Shares are listed for trading on the Exchange and may be listed or traded on U.S. and non-U.S. stock exchanges other than the Exchange, there can be no assurance that an active trading market for such Shares will develop or be maintained. Trading in Shares may be halted due to market conditions or for reasons that, in the view of the Exchange, make trading in Shares inadvisable. In addition, trading in Shares on the Exchange is subject to trading halts caused by extraordinary market volatility pursuant to Exchange "circuit breaker" rules, which temporarily halt trading on the Exchange when a decline in the S&P 500<sup>®</sup> Index during a single day reaches certain thresholds (*e.g.*, 7%, 13%, and 20%). Additional rules applicable to the Exchange may halt trading in Shares when extraordinary volatility causes sudden, significant swings in the market price of Shares. There can be no assurance that Shares will trade with any volume, or at all, on any stock exchange. In stressed market conditions, the liquidity of Shares may begin to mirror the liquidity of the Fund's underlying portfolio holdings, which can be significantly less liquid than Shares.

**• Large-Capitalization Risk.** Investments in large-capitalization companies may go in and out of favor based on market and economic conditions and may underperform other market segments. Some large-capitalization companies may be unable to respond quickly to new competitive challenges, such as changes in technology and consumer tastes, and may not be able to attain the high growth rate of successful smaller companies, especially during extended periods of economic expansion. As such, returns on investments in stocks of large-capitalization companies could trail the returns on investments in stocks of small and mid-capitalization companies.

**• Management Risk.** The Fund is actively managed and uses proprietary investment strategies and processes. There can be no guarantee that the Adviser's judgments about the attractiveness, value and potential appreciation of particular investments and strategies for the Fund will be correct or produce the desired results and no guarantee that the Fund will achieve its investment objective or outperform other investment strategies over the short- or long-term market cycles. If the Adviser fails to accurately evaluate market risk or appropriately react to current and developing market conditions, the Fund's Share price may be adversely affected. Securities selected by the Adviser may not perform as expected. This could result in the Fund's underperformance compared to other funds with similar investment objectives.

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• **Market Risk.** Market risks, including political, regulatory, market, and economic or other developments, and developments that impact specific economic sectors, industries or segments of the market, can affect the value of the Fund's Shares. The Fund is subject to the risk that the prices of, and the income generated by, securities held by the Fund may decline significantly and/or rapidly in response to adverse conditions or other developments, such as interest rate fluctuations, and events directly involving specific issuers that may cause broad changes in market value, public perceptions concerning these developments, and adverse investor sentiment. Such events may cause the value of securities owned by the Fund to go up or down, sometimes rapidly or unpredictably. There also is a risk that policy and legislative changes by the U.S. Government and/or Federal Reserve, or certain foreign governments and central banks, could cause increased volatility in financial markets and higher levels of Fund redemptions, which could have a negative impact on the Fund. These events may lead to periods of volatility and increased redemptions, which could cause the Fund to experience a loss when selling securities to meet redemption requests by shareholders. The risk of loss increases if the redemption requests are unusually large or frequent. Markets also tend to move in cycles, with periods of rising and falling prices. If there is a general decline in the securities and other markets, your investment in the Fund may lose value, regardless of the individual results of the securities and other instruments in which the Fund invests.

Local, regional, or global events, such as war, acts of terrorism, natural disasters, public health issues, recessions, or other events could have a significant impact on the market generally and on specific securities. The COVID-19 pandemic, Russia's invasion of Ukraine, the Israel-Hamas conflict, and higher inflation have resulted in extreme volatility in the financial markets, economic downturns around the world, and severe losses, particularly to some sectors of the economy and individual issuers, and reduced liquidity of certain instruments. These events have caused significant disruptions to business operations, strained healthcare systems, disruptions to supply chains, large expansion of government deficits and debt as a result of government actions to mitigate the effects of such events, and widespread uncertainty regarding the long-term effects of such events. These or similar events could be prolonged and could adversely affect the value and liquidity of the Fund's investments, impair the Fund's ability to satisfy redemption requests, and negatively impact the Fund's performance. Furthermore, economies and financial markets throughout the world are becoming increasingly interconnected. As a result, whether or not the Fund invests in securities of issuers located in or with significant exposure to countries experiencing economic and financial difficulties, the value and liquidity of the Fund's investments may be negatively affected.

• **New Fund Risk.** The Fund is a recently organized investment company with no operating history. As a result, prospective investors have no track record or history on which to base their investment decision. Moreover, investors will not be able to evaluate the Fund against one or more comparable funds on the basis of relative performance until the Fund has established a track record.

**• Non-Diversification Risk.** The Fund is considered to be non-diversified, which means it may invest a greater percentage of its assets in the securities of a single issuer or a lesser number of issuers than if it was a diversified fund. As a result, the Fund may be more exposed to the risks associated with and developments affecting an individual issuer or a lesser number of issuers than a fund that invests more widely. This may increase the Fund's volatility and cause the performance of a relatively small number of issuers to have a greater impact on the Fund's performance.

***•* Portfolio Turnover Risk.** Because the Fund is expected to "turn over" some or all of its options as frequently as monthly, the Fund may incur high levels of transaction costs from commissions or mark-ups in the bid/offer spread. Higher portfolio turnover may result in the Fund paying higher levels of transaction costs and generating greater tax liabilities for shareholders. Portfolio turnover risk may cause the Fund's performance to be less than you expect. While the turnover of the warrants is not deemed "portfolio turnover" for accounting purposes, the economic impact to the Fund is similar to what could occur if the Fund experienced high portfolio turnover (*e.g.*, in excess of 100% per year).

**• Sector Risk.** The Fund's investing approach may result in an emphasis on certain sectors or sub-sectors of the market at any given time. To the extent the Fund invests more heavily in one sector or sub-sector of the market, it thereby presents a more concentrated risk and its performance will be especially sensitive to developments that significantly affect those sectors or sub-sectors. In addition, the value of Shares may change at different rates compared to the value of shares of a fund with investments in a more diversified mix of sectors and industries. An individual sector or sub-sector of the market may have above-average performance during particular periods, but may also move up and down more than the broader market. The several industries that constitute a sector may all react in the same way to economic, political or regulatory events. The Fund's performance could also be affected if the sectors or sub-sectors do not perform as expected. Alternatively, the lack of exposure to one or more sectors or sub-sectors may adversely affect performance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;◦ *Information Technology Sector Risk.* Market or economic factors impacting technology companies and companies that rely heavily on technological advances could have a major affect on the value of any Fund that is invested in this sector. The value of stocks of technology companies and companies that rely heavily on technology is particularly vulnerable to rapid changes in technology product cycles, rapid product obsolescence, government regulation and competition, both domestically and internationally, including competition from foreign competitors with lower production costs. Technology companies may have limited product lines, markets, financial resources or personnel. Stocks of technology companies and companies that rely heavily on technology, especially those of smaller, less-seasoned companies, tend to be more volatile than the overall market. Technology companies are heavily dependent on patent and intellectual property rights, the loss or impairment of

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which may adversely affect profitability. Additionally, companies in the technology sector may face dramatic and often unpredictable changes in growth rates and competition for the services of qualified personnel.

**• Tax Risk.** The writing of call options by the Fund may significantly reduce or eliminate its ability to make distributions eligible to be treated as qualified dividend income. Covered call options may also be subject to the federal tax rules applicable to straddles under the Code. If positions held by the Fund were treated as "straddles" for federal income tax purposes, or the Fund's risk of loss with respect to a position was otherwise diminished as set forth in Treasury regulations, dividends on stocks that are a part of such positions would not constitute qualified dividend income subject to such favorable income tax treatment in the hands of non-corporate shareholders or eligible for the dividends received deduction for corporate shareholders. In addition, generally, straddles are subject to certain rules that may affect the amount, character and timing of the Fund's recognition of gains and losses with respect to straddle positions by requiring, among other things, that: (1) any loss realized on disposition of one position of a straddle may not be recognized to the extent that the Fund has unrealized gains with respect to the other position in such straddle; (2) the Fund's holding period in straddle positions be suspended while the straddle exists (possibly resulting in a gain being treated as short-term capital gain rather than long-term capital gain); (3) the losses recognized with respect to certain straddle positions that are part of a mixed straddle and that are not subject to Section 1256 of the Code be treated as 60% long-term and 40% short-term capital loss; (4) losses recognized with respect to certain straddle positions that would otherwise constitute short-term capital losses be treated as long-term capital losses; and (5) the deduction of interest and carrying charges attributable to certain straddle positions may be deferred.

The use of derivatives strategies, such as writing (selling) and purchasing options, involves complex rules that will determine for income tax purposes the amount, character and timing of recognition of the gains and losses the Fund realizes in connection therewith. To the extent such options are governed by section 1256 of Code, gains and losses resulting from the expiration, exercise, or closing of the non-equity options are treated as 60% long-term capital gain or loss and 40% short-term capital gain or loss (hereinafter, "blended gain or loss"). In addition, such options governed by section 1256 of the Code issued by the Fund will be treated as sold for market value on the last day of the Fund's fiscal year, and gain or loss recognized as a result of such deemed sale will be blended gain or loss. These rules may operate to accelerate the amount that the Fund must distribute to satisfy its distribution requirement (*i.e.*, with respect to the portion treated as short-term capital gain, which will be includible in investment company taxable income and thus taxable to its shareholders as ordinary income when distributed to them), and to increase the net capital gain the Fund recognizes, even though the Fund may not have closed the transactions and received cash to pay the distributions. To the extent the Fund writes options that are not subject to the rules of section 1256 of the Code, the amount of the premium received by the Fund for writing such options will be entirely short-term capital gain to the Fund. In addition, if such an option is closed by the Fund, any gain or loss realized by the Fund as a result of the closing the transaction will also be short-term capital gain or loss. If the holder of a put option exercises the holder's right under the option, any gain or loss realized by the Fund upon the sale of the underlying security pursuant to such exercise will be short-term or long-term capital gain or loss to the Fund depending on the Fund's holding period for the underlying security. In addition, equity securities that are hedged with put options may not be eligible for long-term capital gains tax treatment.

**PORTFOLIO HOLDINGS INFORMATION**

Information about the Fund's daily portfolio holdings is available at www.corealtfunds.com. A complete description of the Fund's policies and procedures with respect to the disclosure of the Fund's portfolio holdings is available in the Fund's Statement of Additional Information (the "SAI").

**MANAGEMENT**

**Investment Adviser**

Core Alternative Capital, LLC, located at 3930 East Jones Bridge Road, Suite 380, Peachtree Corners, Georgia 30092, serves as the investment adviser for the Fund. The Adviser, subject to the oversight of the Board, provides an investment program for the Fund and manages the day-to-day investment of the Fund's assets. The Adviser also arranges for transfer agency, custody, fund administration, distribution and all other services necessary for the Fund to operate. The Adviser is an SEC-registered investment adviser that provides investment advisory services to separately managed accounts and sub-advisory services to institutional clients, in addition to providing investment advisory services to the Fund.

For the services it provides to the Fund, the Adviser is entitled to a unified management fee, which is calculated daily and paid monthly, at an annual rate of 0.75% of the Fund's average daily net assets.

Pursuant to an investment advisory agreement between the Trust, on behalf of the Fund, and the Adviser (the "Advisory Agreement"), the Adviser has agreed to pay all expenses of the Fund except the fee paid to the Adviser under the Advisory Agreement, interest charges on any borrowings, dividends, and other expenses on securities sold short, taxes, brokerage commissions and other expenses incurred in placing orders for the purchase and sale of securities and other investment instruments, acquired fund fees and expenses, accrued deferred tax liability, extraordinary expenses, and distribution fees and expenses (paid by the Trust under any distribution plan adopted pursuant to Rule 12b-1 under the 1940 Act.

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A discussion of the basis for the Board's approval of the Fund's Investment Advisory Agreement will be available in the Fund's first Form N-CSR filing with the SEC.

**Portfolio Managers**

The individuals identified below are jointly and primarily responsible for the day-to-day management of the Fund's portfolio.

Mr. Pursell is a Managing Partner of the Adviser, which he founded in May 2019. He previously was a Senior Portfolio Manager with Cambria Investment Management, L.P. ("Cambria") since March 2017. Mr. Pursell also managed Cambria's corresponding separate account business. Prior to joining Cambria, Mr. Pursell worked for IFAM Capital as a Director and member of the investment committee. While at IFAM his responsibilities included asset management and the firm's overall asset allocation strategy. Previous to this, Mr. Pursell worked at Stadion Money Management where he was a Senior Portfolio Manager of two of the firm's mutual fund strategies. Prior to joining Stadion, Mr. Pursell was part of Morgan Stanley's Investment Bank, within their Private Wealth Division. His background also includes roles at Merrill Lynch's Private Banking and Investment Group. Mr. Pursell received a B.B.A in Finance and an M.B.A. from Emory University's Goizueta Business School.

Mr. Simasek is a Portfolio Manager with the Adviser. His responsibilities are focused on the macroeconomic and equity market strategies for the firm. Prior to joining the Adviser in 2021, Mr. Simasek served in an asset management role with PIMCO where he worked with multi-billion dollar corporate clients to design custom investment solutions and asset allocation strategies, and held prior roles in capital markets with Bank of America Merrill Lynch. He received his undergraduate education at the University of Virginia's McIntire School of Commerce concentrating in finance/accounting. Mr. Simasek completed his doctoral studies in finance at Georgia Tech with a research agenda spanning various areas of fixed income and equity markets. He is a Chartered Financial Analyst charterholder.

The SAI provides additional information about the Portfolio Managers' compensation structure, other accounts managed by the Portfolio Managers, and the Portfolio Managers' ownership of Shares.

**Other Service Providers**

Quasar Distributors, LLC, a wholly-owned subsidiary of Foreside Financial Group, LLC (doing business as ACA Group) (the "Distributor"), serves as the principal underwriter and distributor of the Fund's Shares. The Distributor's principal address is 190 Middle Street, Suite 301, Portland, Maine 04101. The Distributor will not distribute Shares in less than whole Creation Units, and it does not maintain a secondary market in the Shares. The Distributor is a broker-dealer registered under the Securities Exchange Act of 1934 and a member of the Financial Industry Regulatory Authority, Inc. ("FINRA"). The Distributor has no role in determining the policies of the Fund or the securities that are purchased or sold by the Fund and is not affiliated with the Adviser or any of its affiliates.

U.S. Bancorp Fund Services, LLC, doing business as U.S. Bank Global Fund Services, located at 615 East Michigan Street, Milwaukee, Wisconsin 53202, serves as the administrator and transfer agent for the Fund.

U.S. Bank National Association, located at 1555 North Rivercenter Drive, Suite 302, Milwaukee, Wisconsin 53212, serves as the custodian for the Fund.

Morgan, Lewis & Bockius LLP, located at 1111 Pennsylvania Avenue, N.W., Washington, D.C. 20004, serves as legal counsel to the Trust.

Cohen & Company, Ltd., located at 1835 Market Street, Suite 310, Philadelphia, Pennsylvania 19103, serves as the Fund's independent registered public accounting firm. The independent registered public accounting firm is responsible for auditing the annual financial statements of the Fund.

**HOW TO BUY AND SELL SHARES**

The Fund issues and redeems Shares only in Creation Units at the NAV per share next determined after receipt of an order from an AP. Only APs may acquire Shares directly from the Fund, and only APs may tender their Shares for redemption directly to the Fund, at NAV. APs must be a member or participant of a clearing agency registered with the SEC and must execute a Participant Agreement that has been agreed to by the Distributor, and that has been accepted by the Fund's transfer agent, with respect to purchases and redemptions of Creation Units. Once created, Shares trade in the secondary market in quantities less than a Creation Unit.

Most investors buy and sell Shares in secondary market transactions through brokers. Individual Shares are listed for trading on the secondary market on the Exchange and can be bought and sold throughout the trading day like other publicly traded securities.

When buying or selling Shares through a broker, you will incur customary brokerage commissions and charges, and you may pay some or all of the spread between the bid and the offer price in the secondary market on each leg of a round trip (purchase and sale) transaction. In addition, because secondary market transactions occur at market prices, you may pay more than NAV when you buy Shares and receive less than NAV when you sell those Shares.

------

**Book Entry**

Shares are held in book-entry form, which means that no stock certificates are issued. The Depository Trust Company (the "DTC") or its nominee is the record owner of all outstanding Shares.

Investors owning Shares are beneficial owners as shown on the records of DTC or its participants. DTC serves as the securities depository for all Shares. DTC's participants include securities brokers and dealers, banks, trust companies, clearing corporations and other institutions that directly or indirectly maintain a custodial relationship with DTC. As a beneficial owner of Shares, you are not entitled to receive physical delivery of stock certificates or to have Shares registered in your name, and you are not considered a registered owner of Shares. Therefore, to exercise any right as an owner of Shares, you must rely upon the procedures of DTC and its participants. These procedures are the same as those that apply to any other securities that you hold in book entry or "street name" through your brokerage account.

**Frequent Purchases and Redemptions of Shares**

The Fund imposes no restrictions on the frequency of purchases and redemptions of Shares. In determining not to approve a written, established policy, the Board evaluated the risks of market timing activities by Fund shareholders. Purchases and redemptions by APs, who are the only parties that may purchase or redeem Shares directly from the Fund, are an essential part of the ETF process and help keep Share trading prices in line with NAV. As such, the Fund accommodates frequent purchases and redemptions by APs. However, frequent purchases and redemptions for cash may increase tracking error and portfolio transaction costs and lead to the realization of capital gains. The Fund's fair valuation of its holdings consistent with the 1940 Act and Rule 2a-5 thereunder and its ability to impose transaction fees on purchases and redemptions of Creation Units to cover the custodial and other costs incurred by the Fund in effecting trades help to minimize the potential adverse consequences of frequent purchases and redemptions.

**Determination of Net Asset Value**

The Fund's NAV is calculated as of the scheduled close of regular trading on the New York Stock Exchange (the "NYSE"), generally 4:00 p.m. Eastern Time, each day the NYSE is open for business. The NAV is calculated by dividing the Fund's net assets by its Shares outstanding.

In calculating its NAV, the Fund generally values its assets on the basis of market quotations, last sale prices, or estimates of value furnished by a pricing service or brokers who make markets in such instruments. For example, the Fund generally values equity securities at their readily available market quotations. If such information is not available for an investment held by the Fund or is determined to be unreliable, the investment will be valued by the Adviser at fair value pursuant to procedures established by the Adviser and approved by the Board (as described below).

**Fair Value Pricing**

The Adviser has been designated by the Board as the valuation designee for the Fund pursuant to Rule 2a-5 under the 1940 Act. In its capacity as valuation designee, the Adviser has adopted procedures and methodologies to fair value Fund investments whose market prices are not "readily available" or are deemed to be unreliable. For example, such circumstances may arise when: (i) an investment has been de-listed or has had its trading halted or suspended; (ii) an investment's primary pricing source is unable or unwilling to provide a price; (iii) an investment's primary trading market is closed during regular market hours; or (iv) an investment's value is materially affected by events occurring after the close of the investment's primary trading market. Generally, when fair valuing an investment held by the Fund, the Adviser will take into account all reasonably available information that may be relevant to a particular valuation including, but not limited to, fundamental analytical data regarding the issuer, information relating to the issuer's business, recent trades or offers of the investment, general and/or specific market conditions and the specific facts giving rise to the need to fair value the investment. Fair value determinations are made in good faith and in accordance with the fair value methodologies established by the Adviser. Due to the subjective and variable nature of determining the fair value of a security or other investment, there can be no assurance that the Adviser's determined fair value will match or closely correlate to any market quotation that subsequently becomes available or the price quoted or published by other sources. In addition, the Fund may not be able to obtain the fair value assigned to an investment if the Fund were to sell such investment at or near the time its fair value is determined.

**Investments by Registered Investment Companies**

Section 12(d)(1) of the 1940 Act and the rules thereunder limit investments by registered investment companies in the securities of other investment companies. Registered investment companies are permitted to invest in the Fund beyond the limits set forth in section 12(d)(1), subject to certain terms and conditions, including that such investment companies enter into an agreement with the Fund.

**DIVIDENDS, DISTRIBUTIONS, AND TAXES**

**Dividends and Distributions**

The Fund intends to pay out dividends and income generated from selling call options in cash, if any, and distribute any net realized capital gains to its shareholders at least annually. The Fund will declare and pay capital gain distributions in cash, if any. Distributions in cash may be reinvested automatically in additional whole Shares only if the broker through whom you purchased Shares makes such option available. Your broker is responsible for distributing the income and capital gain distributions to you.

------

**Taxes**

The following discussion is a summary of certain important U.S. federal income tax considerations generally applicable to investments in the Fund. Your investment in the Fund may have other tax implications. Please consult your tax advisor about the tax consequences of an investment in Shares, including the possible application of foreign, state, and local tax laws. This summary does not apply to Shares held in an IRA or other tax-qualified plans, which are generally not subject to current tax. Transactions relating to Shares held in such accounts may, however, be taxable at some time in the future. This summary is based on current tax laws, which may change.

The Fund intends to qualify each year for treatment as a regulated investment company (a "RIC") within the meaning of Subchapter M of the Code. If it meets certain minimum distribution requirements, a RIC is not subject to tax at the fund level on income and gains from investments that are timely distributed to shareholders. However, the Fund's failure to qualify as a RIC or to meet minimum distribution requirements would result (if certain relief provisions were not available) in fund-level taxation and, consequently, a reduction in income available for distribution to shareholders.

Unless your investment in Shares is made through a tax-exempt entity or tax-advantaged account, such as an IRA, you need to be aware of the possible tax consequences when the Fund makes distributions, when you sell your Shares listed on the Exchange, and when you purchase or redeem Creation Units (APs only).

**Taxes on Distributions**

The Fund intends to distribute, at least annually, substantially all of its net investment income and net capital gains. For federal income tax purposes, distributions of investment income are generally taxable as ordinary income or qualified dividend income. Taxes on distributions of capital gains (if any) are determined by how long the Fund owned the investments that generated them, rather than how long a shareholder has owned his or her Shares. Sales of assets held by the Fund for more than one year generally result in long-term capital gains and losses, and sales of assets held by the Fund for one year or less generally result in short-term capital gains and losses. Distributions of the Fund's net capital gain (the excess of net long-term capital gains over net short-term capital losses) that are reported by the Fund as capital gain dividends ("Capital Gain Dividends") will be taxable as long-term capital gains, which for non-corporate shareholders are subject to tax at reduced rates of up to 20% (lower rates apply to individuals in lower tax brackets). Distributions of short-term capital gain will generally be taxable as ordinary income. Dividends and distributions are generally taxable to you whether you receive them in cash or reinvest them in additional Shares.

Distributions reported by the Fund as "qualified dividend income" are generally taxed to non-corporate shareholders at rates applicable to long-term capital gains, provided certain holding period and other requirements are met. Qualified dividend income generally is income derived from dividends paid by U.S. corporations or certain foreign corporations that are either incorporated in a U.S. possession or eligible for tax benefits under certain U.S. income tax treaties. In addition, dividends that the Fund receives in respect of stock of certain foreign corporations may be qualified dividend income if that stock is readily tradable on an established U.S. securities market. Corporate shareholders may be entitled to a dividends received deduction for the portion of dividends they receive from the Fund that are attributable to dividends received by the Fund from U.S. corporations, subject to certain limitations. For such dividends to be taxed as qualified dividend income to a non-corporate shareholder, the Fund must satisfy certain holding period requirements with respect to the underlying stock and the non-corporate shareholder must satisfy holding period requirements with respect to his or her ownership of the Fund's Shares. Holding periods may be suspended for these purposes for stock that is hedged. The Fund's investment strategies may significantly limit its ability to make distributions eligible to be treated as qualified dividend income.

Shortly after the close of each calendar year, you will be informed of the amount and character of any distributions received from the Fund.

In general, your distributions are subject to federal income tax for the year in which they are paid. Certain distributions paid in January, however, may be treated as paid on December 31 of the prior year. Distributions are generally taxable even if they are paid from income or gains earned by the Fund before your investment (and thus were included in the Shares' NAV when you purchased your Shares).

You may wish to avoid investing in the Fund shortly before a dividend or other distribution, because such a distribution will generally be taxable even though it may economically represent a return of a portion of your investment.

If you are neither a resident nor a citizen of the United States or if you are a foreign entity, distributions (other than Capital Gain Dividends) paid to you by the Fund will generally be subject to a U.S. withholding tax at the rate of 30%, unless a lower treaty rate applies. Gains from the sale or other disposition of your Shares from non-U.S. shareholders generally are not subject to U.S. taxation, unless you are a nonresident alien individual who is physically present in the U.S. for 183 days or more per year. The Fund may, under certain circumstances, report all or a portion of a dividend as an "interest-related dividend" or a "short-term capital gain dividend," which would generally be exempt from this 30% U.S. withholding tax, provided certain other requirements are met. Different tax consequences may result if you are a foreign shareholder engaged in a trade or business within the United States or if a tax treaty applies.

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The Fund (or a financial intermediary, such as a broker, through which a shareholder owns Shares) generally is required to withhold and remit to the U.S. Treasury a percentage of the taxable distributions and sale proceeds paid to any shareholder who fails to properly furnish a correct taxpayer identification number, who has underreported dividend or interest income, or who fails to certify that the shareholder is not subject to such withholding.

**Taxes When Shares Are Sold on the Exchange**

Provided that a shareholder holds Shares as capital assets, any capital gain or loss realized upon a sale or exchange of Shares generally is treated as a long-term capital gain or loss if Shares have been held for more than one year and as a short-term capital gain or loss if Shares have been held for one year or less. However, any capital loss on a sale of Shares held for six months or less is treated as long-term capital loss to the extent of Capital Gain Dividends paid with respect to such Shares. Any loss realized on a sale will be disallowed to the extent Shares are acquired, including through reinvestment of dividends, within a 61-day period beginning 30 days before and ending 30 days after the disposition of Shares. The ability to deduct capital losses may be limited.

The cost basis of Shares acquired by purchase will generally be based on the amount paid for the Shares and then may be subsequently adjusted for other applicable transactions as required by the Code. The difference between the selling price and the cost basis of Shares generally determines the amount of the capital gain or loss realized on the sale or exchange of Shares. Contact the broker through whom you purchased your Shares to obtain information with respect to the available cost basis reporting methods and elections for your account.

**Taxes on Purchases and Redemptions of Creation Units**

An AP having the U.S. dollar as its functional currency for U.S. federal income tax purposes who exchanges securities for Creation Units generally recognizes a gain or a loss. The gain or loss will be equal to the difference between the value of the Creation Units at the time of the exchange and the exchanging AP's aggregate basis in the securities delivered, plus the amount of any cash paid for the Creation Units. An AP who exchanges Creation Units for securities will generally recognize a gain or loss equal to the difference between the exchanging AP's basis in the Creation Units and the aggregate U.S. dollar market value of the securities received, plus any cash received for such Creation Units. The Internal Revenue Service ("IRS") may assert, however, that a loss that is realized upon an exchange of securities for Creation Units may not be currently deducted under the rules governing "wash sales" (for an AP who does not mark-to-market its holdings) or on the basis that there has been no significant change in economic position. APs exchanging securities should consult their own tax advisor with respect to whether wash sale rules apply and when a loss might be deductible.

The Fund may include a payment of cash in addition to, or in place of, the delivery of a basket of securities upon the redemption of Creation Units. The Fund may sell portfolio securities to obtain the cash needed to distribute redemption proceeds. This may cause the Fund to recognize investment income and/or capital gains or losses that it might not have recognized if it had completely satisfied the redemption in kind. As a result, the Fund may be less tax efficient if it includes such a cash payment in the proceeds paid upon the redemption of Creation Units.

**Foreign Taxes**

Dividends and interest received by the Fund from sources within foreign countries may be subject to withholding and other taxes imposed by such countries. Tax treaties between certain countries and the United States may reduce or eliminate such taxes.

**Net Investment Income Tax**

U.S. individuals with income exceeding specified thresholds are subject to a 3.8% tax on all or a portion of their "net investment income," which includes interest, dividends, and certain capital gains (generally including capital gains distributions and capital gains realized on the sale of Shares). This 3.8% tax also applies to all or a portion of the undistributed net investment income of certain shareholders that are estates and trusts.

*The foregoing discussion summarizes some of the possible consequences under current federal tax law of an investment in the Fund. It is not a substitute for personal tax advice. You also may be subject to state and local tax on Fund distributions and sales of Shares. Consult your personal tax advisor about the potential tax consequences of an investment in Shares under all applicable tax laws. For more information, please see the section entitled "Federal Income Taxes" in the SAI.* 

**DISTRIBUTION PLAN**

The Board has adopted a Distribution and Service Plan (the "Plan") pursuant to Rule 12b-1 under the 1940 Act. In accordance with the Plan, the Fund is authorized to pay an amount up to 0.25% of its average daily net assets each year for certain distribution-related activities and shareholder services.

**PREMIUM/DISCOUNT INFORMATION**

Information regarding how often Shares traded on the Exchange at a price above (*i.e.*, at a premium) or below *(i.e.*, at a discount) the NAV per share is available on the Fund's website at www.corealtfunds.com.

**ADDITIONAL NOTICES**

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The Shares are not sponsored, endorsed, or promoted by the Exchange. The Exchange is not responsible for, nor has it participated in the determination of, the timing, prices, or quantities of Shares to be issued, nor in the determination or calculation of the equation by which Shares are redeemable. The Exchange has no obligation or liability to owners of Shares in connection with the administration, marketing, or trading of Shares.

Without limiting any of the foregoing, in no event shall the Exchange have any liability for any lost profits or indirect, punitive, special, or consequential damages even if notified of the possibility thereof.

The Adviser and the Fund make no representation or warranty, express or implied, to the owners of the Shares or any member of the public regarding the advisability of investing in securities generally or in the Fund particularly.

**FINANCIAL HIGHLIGHTS**

Financial information is not available because the Fund had not commenced operations prior to the date of this Prospectus.

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**Optimized Equity Income ETF** 

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| | | | |
|:---|:---|:---|:---|
| **Adviser** | &nbsp;&nbsp;**Core Alternative Capital, LLC**<br>3930 East Jones Bridge Road, Suite 380<br>Peachtree Corners, Georgia 30092 | **Transfer Agent and Administrator** | &nbsp;&nbsp;**U.S. Bancorp Fund Services, LLC**<br>d/b/a U.S. Bank Global Fund Services<br>615 East Michigan Street<br>Milwaukee, Wisconsin 53202 |
| **Custodian** | &nbsp;&nbsp;**U.S. Bank National Association** <br>1555 North Rivercenter Drive, Suite 302<br>Milwaukee, Wisconsin 53212 | **Distributor** | &nbsp;&nbsp;**Quasar Distributors, LLC**<br>190 Middle Street, Suite 301<br>Portland, Maine 04101 |
| **Independent Registered Public Accounting Firm** | &nbsp;&nbsp;**Cohen & Company, Ltd.**<br>1835 Market Street, Suite 310<br>Philadelphia, Pennsylvania 19103 | **Legal Counsel** | &nbsp;&nbsp;**Morgan, Lewis & Bockius LLP**<br>1111 Pennsylvania Avenue, NW<br>Washington, DC 20004-2541 |

---

Investors may find more information about the Fund in the following documents:

**Statement of Additional Information:** The Fund's SAI provides additional details about the investments of the Fund and certain other additional information. The SAI is on file with the SEC and is incorporated herein by reference into this Prospectus. It is legally considered a part of this Prospectus.

**Annual/Semi-Annual Reports and Form N-CSR:** Additional information about the Fund's investments will be available in the Fund's Annual and Semi-Annual Reports to shareholders and in Form N-CSR. In the Annual Report, when available, you will find a discussion of the market conditions and investment strategies that significantly affected the Fund's performance during its last fiscal year. In Form N-CSR, you will find the Fund's annual and semi-annual financial statements.

You can obtain free copies of these documents, request other information or make general inquiries about the Fund by calling 1-800-617-0004.

Shareholder reports and other information about the Fund also are available:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Free of charge from the SEC's EDGAR database on the SEC's website at http://www.sec.gov;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Free of charge from the Fund's website at www.corealtfunds.com; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• For a fee, by e-mail request to publicinfo@sec.gov.

(SEC Investment Company Act File No. 811-23226)

------

**Optimized Equity Income ETF (OEI)**

a series of Listed Funds Trust

Principal U.S. Listing Exchange: NYSE Arca, Inc.

**STATEMENT OF ADDITIONAL INFORMATION**

**October 22, 2025**

This Statement of Additional Information (the "SAI") is not a prospectus and should be read in conjunction with the Prospectus for the Optimized Equity Income ETF (the "Fund"), a series of Listed Funds Trust (the "Trust"), dated October 22, 2025, as may be supplemented from time to time (the "Prospectus"). Capitalized terms used in this SAI that are not defined have the same meaning as in the Prospectus, unless otherwise noted. A copy of the Prospectus may be obtained without charge, by calling the Fund at 1-800-617-0004 or by visiting www.corealtfunds.com.

The Fund's audited financial statements for the most recent fiscal year included in the Fund's most recent Form N-CSR filing (File No. 811-23226) (when available) will be incorporated by reference into this SAI. When available, you may obtain a copy of the Fund's Annual Report and Form N-CSR filing at no charge by contacting the Fund at the phone number noted above.

------

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
| [General Information About](#i145d4c78e3ab4aeab071fbd248149b98_7)[t](#i145d4c78e3ab4aeab071fbd248149b98_7)[he Trust](#i145d4c78e3ab4aeab071fbd248149b98_7) | [3](#i145d4c78e3ab4aeab071fbd248149b98_7) |
| [Additional Information About Investment Objective, Policies,](#i145d4c78e3ab4aeab071fbd248149b98_10)[a](#i145d4c78e3ab4aeab071fbd248149b98_10)[nd Related Risks](#i145d4c78e3ab4aeab071fbd248149b98_10) | [3](#i145d4c78e3ab4aeab071fbd248149b98_10) |
| [Diversification](#i145d4c78e3ab4aeab071fbd248149b98_13) | [3](#i145d4c78e3ab4aeab071fbd248149b98_13) |
| [General Risks](#i145d4c78e3ab4aeab071fbd248149b98_16) | [3](#i145d4c78e3ab4aeab071fbd248149b98_16) |
| [Description of Permitted Investments](#i145d4c78e3ab4aeab071fbd248149b98_19) | [4](#i145d4c78e3ab4aeab071fbd248149b98_19) |
| [Investment Restrictions](#i145d4c78e3ab4aeab071fbd248149b98_22) | [12](#i145d4c78e3ab4aeab071fbd248149b98_22) |
| [Exchange Listing and Trading](#i145d4c78e3ab4aeab071fbd248149b98_25) | [13](#i145d4c78e3ab4aeab071fbd248149b98_25) |
| [Management of](#i145d4c78e3ab4aeab071fbd248149b98_28)[t](#i145d4c78e3ab4aeab071fbd248149b98_28)[he Trust](#i145d4c78e3ab4aeab071fbd248149b98_28) | [13](#i145d4c78e3ab4aeab071fbd248149b98_28) |
| [Principal Shareholders, Control Persons, and Management Ownership](#i145d4c78e3ab4aeab071fbd248149b98_31) | [17](#i145d4c78e3ab4aeab071fbd248149b98_31) |
| [Codes of Ethics](#i145d4c78e3ab4aeab071fbd248149b98_34) | [17](#i145d4c78e3ab4aeab071fbd248149b98_34) |
| [Proxy Voting Policies](#i145d4c78e3ab4aeab071fbd248149b98_37) | [17](#i145d4c78e3ab4aeab071fbd248149b98_37) |
| [Investment Adviser](#i145d4c78e3ab4aeab071fbd248149b98_40) | [17](#i145d4c78e3ab4aeab071fbd248149b98_40) |
| D[istributor](#i145d4c78e3ab4aeab071fbd248149b98_43) | [18](#i145d4c78e3ab4aeab071fbd248149b98_43) |
| [Transfer Agent and Administrator](#i145d4c78e3ab4aeab071fbd248149b98_46) | [20](#i145d4c78e3ab4aeab071fbd248149b98_46) |
| [Custodian](#i145d4c78e3ab4aeab071fbd248149b98_49) | [20](#i145d4c78e3ab4aeab071fbd248149b98_49) |
| [Legal Counsel](#i145d4c78e3ab4aeab071fbd248149b98_52) | [20](#i145d4c78e3ab4aeab071fbd248149b98_52) |
| [Independent Registered Public Accounting Firm](#i145d4c78e3ab4aeab071fbd248149b98_55) | [20](#i145d4c78e3ab4aeab071fbd248149b98_55) |
| [Portfolio Holdings Disclosure Policies and Procedures](#i145d4c78e3ab4aeab071fbd248149b98_58) | [20](#i145d4c78e3ab4aeab071fbd248149b98_58) |
| [Description of Shares](#i145d4c78e3ab4aeab071fbd248149b98_61) | [20](#i145d4c78e3ab4aeab071fbd248149b98_61) |
| [Limitation of Trustees' Liability](#i145d4c78e3ab4aeab071fbd248149b98_64) | [21](#i145d4c78e3ab4aeab071fbd248149b98_64) |
| [Brokerage Transactions](#i145d4c78e3ab4aeab071fbd248149b98_67) | [21](#i145d4c78e3ab4aeab071fbd248149b98_67) |
| [Portfolio Turnover Rate](#i145d4c78e3ab4aeab071fbd248149b98_70) | [22](#i145d4c78e3ab4aeab071fbd248149b98_70) |
| [Book Entry Only System](#i145d4c78e3ab4aeab071fbd248149b98_73) | [22](#i145d4c78e3ab4aeab071fbd248149b98_73) |
| [Purchase and Redemption of Creation Units](#i145d4c78e3ab4aeab071fbd248149b98_76) | [23](#i145d4c78e3ab4aeab071fbd248149b98_76) |
| [Determination of Net Asset Value](#i145d4c78e3ab4aeab071fbd248149b98_79) | [28](#i145d4c78e3ab4aeab071fbd248149b98_79) |
| [Dividends and Distributions](#i145d4c78e3ab4aeab071fbd248149b98_82) | [29](#i145d4c78e3ab4aeab071fbd248149b98_82) |
| [Federal Income Taxes](#i145d4c78e3ab4aeab071fbd248149b98_85) | [29](#i145d4c78e3ab4aeab071fbd248149b98_85) |
| [Financial Statements](#i145d4c78e3ab4aeab071fbd248149b98_88) | [35](#i145d4c78e3ab4aeab071fbd248149b98_88) |
| [Appendix A](#i145d4c78e3ab4aeab071fbd248149b98_91) | A-[1](#i145d4c78e3ab4aeab071fbd248149b98_91) |

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**GENERAL INFORMATION ABOUT THE TRUST**

The Trust is an open-end management investment company consisting of multiple investment series. This SAI relates only to the Fund. The Trust was organized as a Delaware statutory trust on August 26, 2016. The Trust is registered with the U.S. Securities and Exchange Commission (the "SEC") under the Investment Company Act of 1940, as amended (together with the rules and regulations adopted thereunder, the "1940 Act"), as an open-end management investment company, and the offering of the Fund's shares (the "Shares") is registered under the Securities Act of 1933 (the "Securities Act"). The Trust is governed by its Board of Trustees (the "Board").

Core Alternative Capital, LLC (the "Adviser") serves as the investment adviser to the Fund.

The Fund offers and issues Shares at their net asset value ("NAV") only in aggregations of a specified number of Shares (each, a "Creation Unit"). The Fund generally offers and issues Shares in exchange for a basket of securities ("Deposit Securities") together with the deposit of a specified cash payment ("Cash Component"). The Trust reserves the right to permit or require the substitution of a "cash in lieu" amount ("Deposit Cash") to be added to the Cash Component to replace any Deposit Security or other instrument in the Fund's portfolio. Shares are listed on the NYSE Arca, Inc. (the "Exchange") and trade on the Exchange at market prices that may differ from the Shares' NAV. Shares also are redeemable only in Creation Unit aggregations, primarily for a basket of Deposit Securities together with a Cash Component. A Creation Unit of the Fund generally consists of 10,000 Shares, though this may change from time to time. As a practical matter, only institutions or large investors purchase or redeem Creation Units. Except when aggregated in Creation Units, Shares are not redeemable securities.

Shares may be issued in advance of receipt of Deposit Securities subject to various conditions, including a requirement to maintain on deposit with the Trust cash at least equal to a specified percentage of the value of the missing Deposit Securities, as set forth in the Participant Agreement (as defined below). The Trust may impose a transaction fee for each creation or redemption. In all cases, such fees will be limited in accordance with the requirements of the SEC applicable to management investment companies offering redeemable securities. As in the case of other publicly traded securities, brokers' commissions on transactions in the secondary market will be based on negotiated commission rates at customary levels.

**ADDITIONAL INFORMATION ABOUT INVESTMENT OBJECTIVE, POLICIES, AND RELATED RISKS**

The Fund's investment objective and principal investment strategies are described in the Prospectus. The following information supplements, and should be read in conjunction with, the Prospectus. For a description of certain permitted investments, see "<u>Description of Permitted Investments</u>" in this SAI.

With respect to the Fund's investments, unless otherwise noted, if a percentage limitation on investment is adhered to at the time of investment or contract, a subsequent increase or decrease as a result of market movement or redemption will not result in a violation of such investment limitation.

**DIVERSIFICATION**

The Fund is classified as a non-diversified investment company under the 1940 Act. A "non-diversified" classification means that the Fund is not limited by the 1940 Act with regard to the percentage of its total assets that may be invested in the securities of a single issuer. This means that the Fund may invest a greater portion of its total assets in the securities of a single issuer or a smaller number of issuers than if it was a diversified fund. The securities of a particular issuer may constitute a greater portion of the Fund's portfolio. This may have an adverse effect on the Fund's performance or subject Shares to greater price volatility than more diversified investment companies. Moreover, in pursuing its objective, the Fund may hold the securities of a single issuer in an amount exceeding 10% of the value of the outstanding securities of the issuer, subject to restrictions imposed by the Internal Revenue Code of 1986, as amended (the "Code"). In particular, as the Fund's size grows and its assets increase, it will be more likely to hold more than 10% of the securities of a single issuer if the issuer has a relatively small public float as compared to other components in the Fund's portfolio.

Although the Fund is non-diversified for purposes of the 1940 Act, the Fund intends to maintain the required level of diversification and otherwise conduct its operations so as to qualify as a "regulated investment company" ("RIC") within the meaning of Subchapter M of the Code. Compliance with the diversification requirements of the Code may limit the investment flexibility of the Fund and may make it less likely that the Fund will meet its investment objectives. To qualify as a RIC under the Code, the Fund must meet the Diversification Requirement described in the section titled "<u>Federal Income Taxes</u>" in this SAI.

**GENERAL RISKS**

The value of the Fund's portfolio investments may fluctuate with changes in the financial condition of an issuer or counterparty, changes in specific economic or political conditions that affect a particular investment or issuer, and changes in general economic or political conditions. An investor in the Fund could lose money over short or long periods of time.

There can be no guarantee that a liquid market for the investments held by the Fund will be maintained. The existence of a liquid trading market for certain investments may depend on whether dealers will make a market in such investments. There can be no assurance that a market will be made or maintained or that any such market will be or remain liquid. The price at which investments

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may be sold and the value of Shares will be adversely affected if trading markets for the Fund's portfolio investments are limited or absent, or if bid/ask spreads are wide.

*Cybersecurity Risk.* Investment companies, such as the Fund, and their service providers may be subject to operational and information security risks resulting from cyber-attacks. Cyber-attacks include, among other behaviors, stealing or corrupting data maintained online or digitally, denial of service attacks on websites, the unauthorized release of confidential information or various other forms of cybersecurity breaches. Cyber-attacks affecting the Fund or the Adviser, custodian, transfer agent, intermediaries and other third-party service providers may adversely impact the Fund. For instance, cyber-attacks may interfere with the processing of shareholder transactions, impact the Fund's ability to calculate its NAV, cause the release of private shareholder information or confidential company information, impede trading, subject the Fund to regulatory fines or financial losses, and cause reputational damage. The Fund also may incur additional costs for cybersecurity risk management purposes. Similar types of cybersecurity risks also are present for issuers of securities in which the Fund invests, which could result in material adverse consequences for such issuers and may cause the Fund's investments in such portfolio companies to lose value.

*Global Pandemics.* Beginning in the first quarter of 2020, financial markets in the United States and around the world experienced extreme and, in many cases, unprecedented volatility and severe losses due to the global pandemic caused by COVID-19, a novel coronavirus. The pandemic resulted in a wide range of social and economic disruptions, including closed borders, voluntary or compelled quarantines of large populations, stressed healthcare systems, reduced or prohibited domestic or international travel, and supply chain disruptions affecting the United States and many other countries. Some sectors of the economy and individual issuers experienced particularly large losses as a result of these disruptions. Although the immediate effects of the COVID-19 pandemic have dissipated, global markets and economies continue to contend with the ongoing and long-term impact of COVID-19. It is unknown how long events related to the pandemic will persist, whether they will reoccur in the future, and what additional implications may follow from the pandemic. The impact of these events and other epidemics or pandemics in the future could adversely affect Fund performance.

*Recent Geopolitical Events*. Geopolitical tensions introduce uncertainty into global markets. Russia's military invasion of Ukraine in February 2022, the resulting responses by the United States and other countries, and the potential for wider conflict could increase volatility and uncertainty in the financial markets and adversely affect regional and global economies. The United States and other countries have imposed broad-ranging economic sanctions on Russia and certain Russian individuals, banking entities and corporations, and Belarus as a response to Russia's invasion of Ukraine, and may impose sanctions on other countries that provide military or economic support to Russia. The extent and duration of Russia's military actions and the repercussions of such actions (including any retaliatory actions or countermeasures that may be taken by those subject to sanctions, including cyber-attacks) are impossible to predict, but could result in significant market disruptions, including in certain industries or sectors, such as the oil and natural gas markets, and may negatively affect global supply chains, inflation and global growth.

Similarly, escalations beginning in October 2023 of the ongoing Israel-Hamas conflict present a potential risk for wider conflict that could negatively affect financial markets due to a myriad of interconnected factors. This conflict could disrupt regional trade and supply chains, potentially affecting U.S. businesses with exposure to the region. For example, attacks on commercial vessels transiting through the Red Sea, commonly referred to as the Red Sea crisis, have led to disruption of international maritime trade and the global supply chain, which has had a direct impact on countries and regions that rely on such routes for the supply of energy and/or food and companies that typically ship goods or receive components by way of the Red Sea. Additionally, the Middle East plays a pivotal role in the global energy sector, and prolonged instability could impact oil prices, leading to increased costs for businesses and consumers. Furthermore, the U.S.'s diplomatic ties and commitments in the region mean that it might become more directly involved, either diplomatically or militarily, diverting attention and resources. These and any related events could significantly impact the Fund's performance and the value of an investment in the Fund, even if the Fund does not have direct exposure.

**DESCRIPTION OF PERMITTED INVESTMENTS**

The following are descriptions of the Fund's permitted investments and investment practices and the associated risk factors. The Fund will only invest in any of the following instruments, or exchange-traded funds ("ETFs") that invest in such instruments, or engage in any of the following investment practices if such investment or activity is consistent with the Fund's investment objective and permitted by the Fund's stated investment policies.

**Borrowing**

Although the Fund does not intend to borrow money, the Fund may do so to the extent permitted by the 1940 Act. Under the 1940 Act, the Fund may borrow up to one-third (1/3) of its total assets. The Fund will borrow money only for short-term or emergency purposes. Such borrowing is not for investment purposes and will be repaid by the borrowing Fund promptly. Borrowing will tend to exaggerate the effect on NAV of any increase or decrease in the market value of the borrowing Fund's portfolio. Money borrowed will be subject to interest costs that may or may not be recovered by earnings on the securities purchased. The Fund also may be required to maintain minimum average balances in connection with a borrowing or to pay a commitment or other fee to maintain a line of credit; either of these requirements would increase the cost of borrowing over the stated interest rate.

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**Equity Securities**

Equity securities, such as the common stock of an issuer, are subject to stock market fluctuations and, therefore, may experience volatile changes in value as market conditions, consumer sentiment, or the financial condition of the issuers change. A decrease in value of the equity securities in the Fund's portfolio may also cause the value of the Fund's Shares to decline. An investment in the Fund should be made with an understanding of the risks inherent in an investment in equity securities, including the risk that the financial condition of issuers may become impaired or that the general condition of the stock market may deteriorate (either of which may cause a decrease in the value of the Fund's portfolio securities and therefore a decrease in the value of Shares).

Common stocks are susceptible to general stock market fluctuations and to volatile increases and decreases in value as market confidence and perceptions change. These investor perceptions are based on various and unpredictable factors, including expectations regarding government, economic, monetary, and fiscal policies; inflation and interest rates; economic expansion or contraction; and global or regional political, economic, or banking crises.

Holders of common stocks incur more risk than holders of preferred stocks and debt obligations because common stockholders, as owners of the issuer, generally have inferior rights to receive payments from the issuer in comparison with the rights of creditors or holders of debt obligations or preferred stocks. Further, unlike debt securities, which typically have a stated principal amount payable at maturity (whose value, however, is subject to market fluctuations prior thereto), or preferred stocks, which typically have a liquidation preference, and which may have stated optional or mandatory redemption provisions, common stocks have neither a fixed principal amount nor a maturity. Common stock values are subject to market fluctuations as long as the common stock remains outstanding.

<u>Types of Equity Securities:</u>

*Common Stocks* — Common stocks represent units of ownership in a company. Common stocks usually carry voting rights and earn dividends. Unlike preferred stocks, which are described below, dividends on common stocks are not fixed but are declared at the discretion of the company's board of directors.

*Preferred Stocks* — Preferred stocks also are units of ownership in a company. Preferred stocks normally have preference over common stock in the payment of dividends and the liquidation of the company. However, in all other respects, preferred stocks are subordinated to the liabilities of the issuer. Unlike common stocks, preferred stocks are generally not entitled to vote on corporate matters. Types of preferred stocks include adjustable-rate preferred stock, fixed dividend preferred stock, perpetual preferred stock, and sinking fund preferred stock.

Generally, the market values of preferred stock with a fixed dividend rate and no conversion element vary inversely with interest rates and perceived credit risk.

*Rights and Warrants* — A right is a privilege granted to existing shareholders of a corporation to subscribe to shares of a new issue of common stock before it is issued. Rights normally have a short life of usually two to four weeks, are freely transferable, and entitle the holder to buy the new common stock at a lower price than the public offering price. Warrants are securities that are usually issued together with a debt security or preferred stock and that give the holder the right to buy a proportionate amount of common stock at a specified price. Warrants are freely transferable and are traded on major exchanges. Unlike rights, warrants normally have a life that is measured in years and entitles the holder to buy common stock of a company at a price that is usually higher than the market price at the time the warrant is issued. Corporations often issue warrants to make the accompanying debt security more attractive.

An investment in warrants and rights may entail greater risks than certain other types of investments. Generally, rights and warrants do not carry the right to receive dividends or exercise voting rights with respect to the underlying securities, and they do not represent any rights in the assets of the issuer. In addition, their value does not necessarily change with the value of the underlying securities, and they cease to have value if they are not exercised on or before their expiration date. Investing in rights and warrants increases the potential profit or loss to be realized from the investment as compared with investing the same amount in the underlying securities.

*Large-Capitalization Companies* — Investments in large-capitalization companies may go in and out of favor based on market and economic conditions and may underperform other market segments. Some large-capitalization companies may be unable to respond quickly to new competitive challenges, such as changes in technology and consumer tastes, and may not be able to attain the high growth rate of successful smaller companies, especially during extended periods of economic expansion. As such, returns on investments in stocks of large-capitalization companies could trail the returns on investments in stocks of small- and mid-capitalization companies.

*Small- and Mid-Capitalization Companies* — The securities of small- and mid-capitalization companies may be more vulnerable to adverse issuer, market, political, or economic developments than securities of larger-capitalization companies. The securities of small- and mid-capitalization companies generally trade in lower volumes and are subject to greater and more unpredictable price changes than larger capitalization stocks or the stock market as a whole. Some small- or mid-capitalization companies have limited product lines, markets, and financial and managerial resources and tend to concentrate on fewer geographical markets relative to larger capitalization companies. There is typically less publicly available information concerning small- and mid-capitalization companies

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than for larger, more established companies. Small- and mid-capitalization companies also may be particularly sensitive to changes in interest rates, government regulation, borrowing costs, and earnings.

*Tracking Stocks* — A tracking stock is a separate class of common stock whose value is linked to a specific business unit or operating division within a larger company and which is designed to "track" the performance of such business unit or division. The tracking stock may pay dividends to shareholders independent of the parent company. The parent company, rather than the business unit or division, generally is the issuer of tracking stock. However, holders of the tracking stock may not have the same rights as holders of the company's common stock.

**Exchange-Traded Funds**

The Fund may invest in shares of other ETFs. As the shareholder of another ETF, the Fund would bear, along with other shareholders, its pro rata portion of the other ETF's expenses, including advisory fees. Such expenses are in addition to the expenses the Fund pays in connection with its own operations. The Fund's investments in other ETFs may be limited by applicable law.

Disruptions in the markets for the securities underlying ETFs purchased or sold by the Fund could result in losses on investments in ETFs. ETFs also carry the risk that the price the Fund pays or receives may be higher or lower than the ETF's NAV. ETFs are also subject to certain additional risks, including the risks of illiquidity and of possible trading halts due to market conditions or other reasons, based on the policies of the relevant exchange. ETFs and other investment companies in which the Fund may invest may be leveraged, which would increase the volatility of the Fund's NAV. The Fund also may invest in ETFs and other investment companies that seek to return the inverse of the performance of an underlying index on a daily, monthly, or other basis, including inverse leveraged ETFs.

Inverse and leveraged ETFs are subject to additional risks not generally associated with traditional ETFs. To the extent that the Fund invests in inverse ETFs, the value of the Fund's investments will decrease when the index underlying the ETF's benchmark rises, a result that is the opposite from traditional equity or bond funds. The NAV and market price of leveraged or inverse ETFs are usually more volatile than the value of the tracked index or of other ETFs that do not use leverage. This is because inverse and leveraged ETFs use investment techniques and financial instruments that may be considered aggressive, including the use of derivative transactions and short selling techniques. The use of these techniques may cause the inverse or leveraged ETFs to lose more money in market environments that are adverse to their investment strategies than other funds that do not use such techniques.

**Illiquid Investments**

The Fund may not acquire any illiquid investment if, immediately after the acquisition, the Fund would have invested more than 15% of its net assets in illiquid investments. An illiquid investment means any investment that the Fund reasonably expects cannot be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the investment. If illiquid investments exceed 15% of the Fund's net assets, certain remedial actions will be taken as required by Rule 22e-4 under the 1940 Act and the Fund's policies and procedures.

The Fund may not be able to sell illiquid securities when its Adviser considers it desirable to do so or may have to sell such securities at a price that is lower than the price that could be obtained if the securities were more liquid. In addition, the sale of illiquid securities also may require more time and may result in higher dealer discounts and other selling expenses than does the sale of securities that are not illiquid. Illiquid securities also may be more difficult to value due to the unavailability of reliable market quotations for such securities, and investment in illiquid securities may have an adverse impact on NAV.

**Investment Company Securities**

The Fund may invest in the securities of other investment companies, including ETFs, mutual funds and money market funds, subject to applicable limitations under Section 12(d)(1) of the 1940 Act and the rules thereunder. Pursuant to Section 12(d)(1), the Fund may invest in the securities of another investment company (the "acquired company") provided that the Fund, immediately after such purchase or acquisition, does not own in the aggregate: (i) more than 3% of the total outstanding voting stock of the acquired company; (ii) securities issued by the acquired company having an aggregate value in excess of 5% of the value of the total assets of the Fund; or (iii) securities issued by the acquired company and all other investment companies (other than treasury stock of the Fund) having an aggregate value in excess of 10% of the value of the total assets of the Fund. Under certain circumstances, including in compliance with Rule 12d1-4 under the 1940 Act, the Fund may invest its assets in securities of investment companies, including money market funds, in excess of the limits discussed above.

Investing in another pooled vehicle exposes the Fund to all the risks of that pooled vehicle. In addition, if the Fund invests in and, thus, is a shareholder of, another investment company, the Fund's shareholders will indirectly bear the Fund's proportionate share of the fees and expenses paid by such other investment company, including advisory fees, in addition to both the management fees payable directly by the Fund to the Fund's own investment adviser and the other expenses that the Fund bears directly in connection with the Fund's own operations.

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**Options**

An option is a contract that gives the purchaser of the option, in return for the premium paid, the right to buy an underlying reference instrument, such as a specified security, currency, index, or other instrument, from the writer of the option (in the case of a call option), or to sell a specified reference instrument to the writer of the option (in the case of a put option) at a designated price during the term of the option. The premium paid by the buyer of an option will reflect, among other things, the relationship of the exercise price to the market price and the volatility of the underlying reference instrument, the remaining term of the option, supply, demand, interest rates and/or currency exchange rates. An American style put or call option may be exercised at any time during the option period while a European style put or call option may be exercised only upon expiration or during a fixed period prior thereto. Put and call options are traded on national securities exchanges and in the over-the-counter ("OTC") market.

Options traded on national securities exchanges are within the jurisdiction of the SEC or other appropriate national securities regulator, as are securities traded on such exchanges. As a result, many of the protections provided to traders on organized exchanges will be available with respect to such transactions. In particular, all option positions entered into on a national securities exchange in the United States are cleared and guaranteed by the Options Clearing Corporation, thereby reducing the risk of counterparty default. Furthermore, a liquid secondary market in options traded on a national securities exchange may be more readily available than in the OTC market, potentially permitting the Fund to liquidate open positions at a profit prior to exercise or expiration, or to limit losses in the event of adverse market movements. There is no assurance, however, that higher than anticipated trading activity or other unforeseen events might not temporarily render the capabilities of the Options Clearing Corporation inadequate, and thereby result in the exchange instituting special procedures which may interfere with the timely execution of the Fund's orders to close out open options positions.

***Purchasing Call and Put Options*.** As the buyer of a call option, the Fund has a right to buy the underlying reference instrument (e.g., a currency or security) at the exercise price at any time during the option period (for American style options). The Fund may enter into closing sale transactions with respect to call options, exercise them, or permit them to expire. For example, a Fund may buy call options on underlying reference instruments that it intends to buy with the goal of limiting the risk of a substantial increase in their market price before the purchase is effected. Unless the price of the underlying reference instrument changes sufficiently, a call option purchased by a Fund may expire without any value to such Fund, in which case the Fund would experience a loss to the extent of the premium paid for the option plus related transaction costs.

As the buyer of a put option, the Fund has the right to sell the underlying reference instrument at the exercise price at any time during the option period (for American style options). Like a call option, the Fund may enter into closing sale transactions with respect to put options, exercise them or permit them to expire. The Fund may buy a put option on an underlying reference instrument owned by the Fund (a protective put) as a hedging technique in an attempt to protect against an anticipated decline in the market value of the underlying reference instrument. Such hedge protection is provided only during the life of the put option when the Fund, as the buyer of the put option, is able to sell the underlying reference instrument at the put exercise price, regardless of any decline in the underlying instrument's market price. The Fund may also seek to offset a decline in the value of the underlying reference instrument through appreciation in the value of the put option. A put option may also be purchased with the intent of protecting unrealized appreciation of an instrument when the Adviser deems it desirable to continue to hold the instrument because of tax or other considerations. The premium paid for the put option and any transaction costs would reduce any short-term capital gain that may be available for distribution when the instrument is eventually sold. Buying put options at a time when the buyer does not own the underlying reference instrument allows the buyer to benefit from a decline in the market price of the underlying reference instrument, which generally increases the value of the put option.

If a put option was not terminated in a closing sale transaction when it has remaining value, and if the market price of the underlying reference instrument remains equal to or greater than the exercise price during the life of the put option, the buyer would not make any gain upon exercise of the option and would experience a loss to the extent of the premium paid for the option plus related transaction costs. In order for the purchase of a put option to be profitable, the market price of the underlying reference instrument must decline sufficiently below the exercise price to cover the premium and transaction costs.

***Writing Call Options.*** Writing options may permit the writer to generate additional income in the form of the premium received for writing the option. The writer of an option may have no control over when the underlying reference instruments must be sold because the writer may be notified of exercise at any time prior to the expiration of the option (for American style options). In general, though, options are infrequently exercised prior to expiration. Whether or not an option expires unexercised, the writer retains the amount of the premium. Writing "covered" call options means that the writer owns the underlying reference instrument that is subject to the call option. Call options also may be written on reference instruments that the writer does not own.

If the Fund writes a covered call option, any underlying reference instruments that are held by the Fund and are subject to the call option will be earmarked on the books of the Fund as segregated to satisfy its obligations under the option. The Fund will be unable to sell the underlying reference instruments that are subject to the written call option until it either effects a closing transaction with respect to the written call, or otherwise satisfies the conditions for release of the underlying reference instruments from segregation. As the writer of a covered call option, the Fund gives up the potential for capital appreciation above the exercise price of the option should the underlying reference instrument rise in value. If the value of the underlying reference instrument rises above the exercise

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price of the call option, the reference instrument will likely be "called away," requiring the Fund to sell the underlying instrument at the exercise price. In that case, the Fund will sell the underlying reference instrument to the option buyer for less than its market value, and the Fund will experience a loss (which will be offset by the premium received by the Fund as the writer of such option). If a call option expires unexercised, the Fund will realize a gain in the amount of the premium received. If the market price of the underlying reference instrument decreases, the call option will not be exercised and the Fund will be able to use the amount of the premium received to hedge against the loss in value of the underlying reference instrument. The exercise price of a call option will be chosen based upon the expected price movement of the underlying reference instrument. The exercise price of a call option may be below, equal to (at-the-money), or above the current value of the underlying reference instrument at the time the option is written.

The writing of call options by the Fund may significantly reduce or eliminate its ability to make distributions eligible to be treated as qualified dividend income. Covered call options also may be subject to the federal tax rules applicable to straddles under the Code. If positions held by the Fund were treated as "straddles" for federal income tax purposes, or the Fund's risk of loss with respect to a position was otherwise diminished as set forth in Treasury regulations, dividends on stocks that are a part of such positions would not constitute qualified dividend income subject to such favorable income tax treatment. In addition, generally, straddles are subject to certain rules that may affect the amount, character and timing of the Fund's gains and losses with respect to straddle positions.

***Closing Out Options (Exchange-Traded Options).*** If the writer of an option wants to terminate its obligation, the writer may effect a "closing purchase transaction" by buying an option of the same series as the option previously written. The effect of the purchase is that the clearing corporation will cancel the option writer's position. However, a writer may not effect a closing purchase transaction after being notified of the exercise of an option. Likewise, the buyer of an option may recover all or a portion of the premium that it paid by effecting a "closing sale transaction" by selling an option of the same series as the option previously purchased and receiving a premium on the sale. There is no guarantee that either a closing purchase or a closing sale transaction may be made at a time desired by a Fund. Closing transactions allow a Fund to terminate its positions in written and purchased options. A Fund will realize a profit from a closing transaction if the price of the transaction is less than the premium received from writing the original option (in the case of written options) or is more than the premium paid by a Fund to buy the option (in the case of purchased options). For example, increases in the market price of a call option sold by a Fund will generally reflect increases in the market price of the underlying reference instrument. As a result, any loss resulting from a closing transaction on a written call option is likely to be offset in whole or in part by appreciation of the underlying instrument owned by a Fund.

***Risks of Options.*** A Fund's options investments involve certain risks, including general risks related to derivative instruments. There can be no assurance that a liquid secondary market on an exchange will exist for any particular option, or at any particular time, and a Fund may have difficulty effecting closing transactions in particular options. Therefore, a Fund would have to exercise the options it purchased in order to realize any profit, thus taking or making delivery of the underlying reference instrument when not desired. A Fund could then incur transaction costs upon the sale of the underlying reference instruments. Similarly, when a Fund cannot effect a closing transaction with respect to a put option it wrote, and the buyer exercises, a Fund would be required to take delivery and would incur transaction costs upon the sale of the underlying reference instruments purchased. If a Fund, as a covered call option writer, is unable to effect a closing purchase transaction in a secondary market, it will not be able to sell the underlying reference instrument until the option expires, or it delivers the underlying instrument upon exercise. When trading options on non-U.S. exchanges or in the OTC market, many of the protections afforded to exchange participants will not be available. For example, there may be no daily price fluctuation limits, and adverse market movements could therefore continue to an unlimited extent over an indefinite period of time.

The effectiveness of an options strategy for hedging depends on the degree to which price movements in the underlying reference instruments correlate with price movements in the relevant portion of a Fund's portfolio that is being hedged. In addition, a Fund bears the risk that the prices of its portfolio investments will not move in the same amount as the option it has purchased or sold for hedging purposes, or that there may be a negative correlation that would result in a loss on both the investments and the option. If the Adviser is not successful in using options in managing a Fund's investments, the Fund's performance will be worse than if the Adviser did not employ such strategies.

***Derivatives Regulatory Risk.*** New rules and regulations could, among other things, restrict the Fund's ability to engage in, or increase the cost to the Fund of, derivatives transactions, for example, by making some types of derivatives no longer available to the Fund, increasing margin or capital requirements, or otherwise limiting liquidity or increasing transaction costs. The costs of derivatives transactions also may increase due to regulatory requirements imposed on clearing members, which may cause clearing members to raise their fees to cover the costs of additional capital requirements and other regulatory changes applicable to the clearing members. Certain aspects of these regulations are still being implemented, so their potential impact on the Fund and the financial system are not yet known. While the regulations and central clearing of some derivatives transactions are designed to reduce systemic risk (*i.e.*, the risk that the interdependence of large derivatives dealers could cause them to suffer liquidity, solvency or other challenges simultaneously), there is no assurance that the mechanisms imposed under the regulations will achieve that result, and in the meantime, as noted above, central clearing, minimum margin requirements and related requirements expose the Fund to new kinds of risks and costs.

Rule 18f-4 under the 1940 Act ("Rule 18f-4") imposes limits on the amount of leverage risk to which a fund may be exposed through the use of such derivatives and requires the adoption of certain derivatives risk management measures. Under Rule 18f-4, a fund's investment in such derivatives is limited through value-at-risk ("VaR") testing. Specifically, the VaR of a fund's portfolio may not

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exceed 200% of the VaR of a specific unleveraged designated reference portfolio using relative VaR testing (or 20% of the value of a fund's net assets using absolute VaR testing). Generally, a fund whose derivatives exposure exceeds 10% of its net assets is required to establish and maintain a comprehensive derivatives risk management program, subject to oversight by a fund's board of trustees, and appoint a derivatives risk manager. Funds whose derivatives exposure does not exceed 10% of their net assets may be considered limited derivatives users and are not required to comply with all of the conditions of Rule 18f-4, including the adoption of a derivatives risk management program and appointment of a derivatives risk manager, though they are required to adopt policies and procedures designed to manage derivatives risk. Compliance with Rule 18f-4 may adversely affect the Fund's performance and/or increase costs related to the Fund's use of derivatives.

**Other Short-Term Instruments**

The Fund may invest in short-term instruments, including money market instruments, on an ongoing basis to provide liquidity or for other reasons. Money market instruments are generally short-term investments that may include but are not limited to: (i) shares of money market funds; (ii) obligations issued or guaranteed by the U.S. government, its agencies, or instrumentalities (including government-sponsored enterprises); (iii) negotiable certificates of deposit ("CDs"), bankers' acceptances, fixed time deposits and other obligations of U.S. and foreign banks (including foreign branches) and similar institutions; (iv) commercial paper rated at the date of purchase "Prime-1" by Moody's or "A-1" by S&P or, if unrated, of comparable quality as determined by the Adviser; (v) non-convertible corporate debt securities (*e.g.*, bonds and debentures) with remaining maturities at the date of purchase of not more than 397 days and that satisfy the rating requirements set forth in Rule 2a-7 under the 1940 Act; and (vi) short-term U.S. dollar-denominated obligations of foreign banks (including U.S. branches) that, in the opinion of the Adviser, are of comparable quality to obligations of U.S. banks which may be purchased by the Fund. Any of these instruments may be purchased on a current or a forward-settled basis. Money market instruments also include shares of money market funds. Time deposits are non-negotiable deposits maintained in banking institutions for specified periods of time at stated interest rates. Bankers' acceptances are time drafts drawn on commercial banks by borrowers, usually in connection with international transactions.

**Real Estate Investment Trusts ("REITs")**

A U.S. REIT is a corporation or business trust (that would otherwise be taxed as a corporation) which meets the definitional requirements of the Code. The Code permits a qualifying REIT to deduct from taxable income the dividends paid, thereby effectively eliminating corporate level federal income tax. To meet the definitional requirements of the Code, a REIT must, among other things: invest substantially all of its assets in interests in real estate (including mortgages and other REITs), cash and government securities; derive most of its income from rents from real property or interest on loans secured by mortgages on real property; and, in general, distribute annually 90% or more of its taxable income (other than net capital gains) to shareholders.

REITs are sometimes informally characterized as Equity REITs and Mortgage REITs. An Equity REIT invests primarily in the fee ownership or leasehold ownership of land and buildings (*e.g.*, commercial equity REITs and residential equity REITs). A Mortgage REIT invests primarily in mortgages on real property, which may secure construction, development, or long-term loans.

REITs may be affected by changes in underlying real estate values, which may have an exaggerated effect to the extent that REITs in which the Fund invests may concentrate investments in particular geographic regions or property types. Additionally, rising interest rates may cause investors in REITs to demand a higher annual yield from future distributions, which may in turn decrease market prices for equity securities issued by REITs. Rising interest rates also generally increase the costs of obtaining financing, which could cause the value of the Fund's investments to decline. During periods of declining interest rates, certain Mortgage REITs may hold mortgages that the mortgagors elect to prepay, which prepayment may diminish the yield on securities issued by such Mortgage REITs. In addition, Mortgage REITs may be affected by the ability of borrowers to repay when due the debt extended by the REIT and Equity REITs may be affected by the ability of tenants to pay rent.

Certain REITs have relatively small market capitalization, which may tend to increase the volatility of the market price of securities issued by such REITs. Furthermore, REITs are dependent upon specialized management skills, have limited diversification and are, therefore, subject to risks inherent in operating and financing a limited number of projects. By investing in REITs indirectly through the Fund, a shareholder will bear not only his or her proportionate share of the expenses of the Fund, but also, indirectly, similar expenses of the REITs. REITs depend generally on their ability to generate cash flow to make distributions to shareholders.

In addition to these risks, Equity REITs may be affected by changes in the value of the underlying property owned by the trusts, while Mortgage REITs may be affected by the quality of any credit extended. Further, Equity and Mortgage REITs are dependent upon management skills and generally may not be diversified. Equity and Mortgage REITs are also subject to heavy cash flow dependency defaults by borrowers and self-liquidation. In addition, Equity and Mortgage REITs could possibly fail to qualify for the favorable U.S. federal income tax treatment generally available to U.S. REITs under the Code or fail to maintain their exemptions from registration under the 1940 Act. The above factors also may adversely affect a borrower's or a lessee's ability to meet its obligations to the REIT. In the event of default by a borrower or lessee, the REIT may experience delays in enforcing its rights as a mortgagee or lessor and may incur substantial costs associated with protecting its investments.

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**Repurchase Agreements**

The Fund may invest in repurchase agreements with commercial banks, brokers, or dealers to generate income from its excess cash balances and to invest in securities lending cash collateral. A repurchase agreement is an agreement under which the Fund acquires a financial instrument (*e.g.*, a security issued by the U.S. government or an agency thereof, a banker's acceptance or a certificate of deposit) from a seller, subject to resale to the seller at an agreed-upon price and date (normally, the next business day). A repurchase agreement may be considered a loan collateralized by securities. The resale price reflects an agreed upon interest rate effective for the period the instrument is held by the Fund and is unrelated to the interest rate on the underlying instrument.

In these repurchase agreement transactions, the securities acquired by the Fund (including accrued interest earned thereon) must have a total value in excess of the value of the repurchase agreement and are held by the Fund's custodian until repurchased. No more than an aggregate of 15% of the Fund's net assets will be invested in illiquid investments, including repurchase agreements having maturities longer than seven days and securities subject to legal or contractual restrictions on resale, or for which there are no readily available market quotations.

The use of repurchase agreements involves certain risks. For example, if the other party to the agreement defaults on its obligation to repurchase the underlying security at a time when the value of the security has declined, the Fund may incur a loss upon disposition of the security. If the other party to the agreement becomes insolvent and subject to liquidation or reorganization under the U.S. Bankruptcy Code or other laws, a court may determine that the underlying security is collateral for a loan by the Fund not within the control of the Fund and, therefore, the Fund may not be able to substantiate its interest in the underlying security and may be deemed an unsecured creditor of the other party to the agreement.

**Reverse Repurchase Agreements**

A Fund may enter into reverse repurchase agreements, which involve the sale of securities held by the Fund subject to its agreement to repurchase the securities at an agreed-upon date or upon demand and at a price reflecting a market rate of interest. Reverse repurchase agreements may be entered into only with banks or securities dealers or their affiliates. While a reverse repurchase agreement is outstanding, a Fund will, for all of its reverse repurchase agreements, either (i) consistent with Section 18 of the 1940 Act, maintain asset coverage of at least 300% of the value of the repurchase agreement or (ii) treat the reverse repurchase agreement as a derivatives transaction for purposes of Rule 18f-4, including, as applicable, the VaR-based limit on leverage risk.

Reverse repurchase agreements involve the risk that the buyer of the securities sold by a Fund might be unable to deliver them when the Fund seeks to repurchase. If the buyer of securities under a reverse repurchase agreement files for bankruptcy or becomes insolvent, the buyer or trustee or receiver may receive an extension of time to determine whether to enforce the Fund's obligation to repurchase the securities, and the Fund's use of the proceeds of the reverse repurchase agreement may effectively be restricted pending such decision.

**Securities Lending**

The Fund may lend portfolio securities in an amount up to one-third of its total assets to brokers, dealers, and other financial institutions. In a portfolio securities lending transaction, the Fund receives from the borrower an amount equal to the interest paid or the dividends declared on the loaned securities during the term of the loan as well as the interest on the collateral securities, less any fees (such as finders or administrative fees) the Fund pays in arranging the loan. The Fund may share the interest it receives on the collateral securities with the borrower. The terms of the Fund's loans permit it to reacquire loaned securities on five business days' notice or in time to vote on any important matter. Loans are subject to termination at the option of the Fund or borrower at any time, and the borrowed securities must be returned when the loan is terminated. The Fund may pay fees to arrange for securities loans.

The SEC currently requires that the following conditions must be met whenever the Fund's portfolio securities are loaned: (1) the Fund must receive at least 100% cash collateral from the borrower; (2) the borrower must increase such collateral whenever the market value of the securities rises above the level of such collateral; (3) the Fund must be able to terminate the loan at any time; (4) the Fund must receive reasonable interest on the loan, as well as any dividends, interest or other distributions on the loaned securities, and any increase in market value; (5) the Fund may pay only reasonable custodian fees approved by the Board in connection with the loan; (6) while voting rights on the loaned securities may pass to the borrower, the Board must terminate the loan and regain the right to vote the securities if a material event adversely affecting the investment occurs; and (7) the Fund may not loan its portfolio securities so that the value of the loaned securities is more than one-third of its total asset value, including collateral received from such loans. These conditions may be subject to future modification. Such loans will be terminable at any time upon specified notice. The Fund might experience the risk of loss if the institution with which it has engaged in a portfolio loan transaction breaches its agreement with the Fund. In addition, the Fund will not enter into any portfolio security lending arrangement having a duration of longer than one year. The principal risk of portfolio lending is potential default or insolvency of the borrower. In either of these cases, the Fund could experience delays in recovering securities or collateral or could lose all or part of the value of the loaned securities. As part of participating in a lending program, the Fund may be required to invest in collateralized debt or other securities that bear the risk of loss of principal. In addition, all investments made with the collateral received are subject to the risks associated with such investments. If such investments lose value, the Fund will have to cover the loss when repaying the collateral.

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Any loans of portfolio securities are fully collateralized based on values that are marked-to-market daily. Any securities that the Fund may receive as collateral will not become part of the Fund's investment portfolio at the time of the loan and, in the event of a default by the borrower, the Fund will, if permitted by law, dispose of such collateral except for such part thereof that is a security in which the Fund is permitted to invest. During the time securities are on loan, the borrower will pay the Fund any accrued income on those securities, and the Fund may invest the cash collateral and earn income or receive an agreed-upon fee from a borrower that has delivered cash-equivalent collateral.

**U.S. Government Securities**

The Fund may invest in U.S. government securities. Securities issued or guaranteed by the U.S. government, or its agencies or instrumentalities, include U.S. Treasury securities, which are backed by the full faith and credit of the U.S. Treasury, and which differ only in their interest rates, maturities, and times of issuance. U.S. Treasury bills have initial maturities of one year or less; U.S. Treasury notes have initial maturities of one to ten years; and U.S. Treasury bonds generally have initial maturities of greater than ten years. Certain U.S. government securities are issued or guaranteed by agencies or instrumentalities of the U.S. government, including, but not limited to, obligations of U.S. government agencies or instrumentalities such as the Federal National Mortgage Association ("Fannie Mae"), the Government National Mortgage Association ("Ginnie Mae"), the Small Business Administration, the Federal Farm Credit Administration, the Federal Home Loan Banks, Banks for Cooperatives (including the Central Bank for Cooperatives), the Federal Land Banks, the Federal Intermediate Credit Banks, the Tennessee Valley Authority, the Export-Import Bank of the United States, the Commodity Credit Corporation, the Federal Financing Bank, the Student Loan Marketing Association, the National Credit Union Administration, and the Federal Agricultural Mortgage Corporation.

Some obligations issued or guaranteed by U.S. government agencies and instrumentalities, including, for example, Ginnie Mae pass- through certificates, are supported by the full faith and credit of the U.S. Treasury. Other obligations issued by or guaranteed by federal agencies, such as those securities issued by Fannie Mae, are supported by the discretionary authority of the U.S. government to purchase certain obligations of the federal agency, while other obligations issued by or guaranteed by federal agencies, such as those of the Federal Home Loan Banks, are supported by the right of the issuer to borrow from the U.S. Treasury, while the U.S. government provides financial support to such U.S. government-sponsored federal agencies, no assurance can be given that the U.S. government will always do so, since the U.S. government is not so obligated by law. U.S. Treasury notes and bonds typically pay coupon interest semi-annually and repay the principal at maturity.

On September 7, 2008, the U.S. Treasury announced a federal takeover of Fannie Mae and the Federal Home Loan Mortgage Corporation ("Freddie Mac"), placing the two federal instrumentalities in conservatorship. Under the takeover, the U.S. Treasury agreed to acquire $1 billion of senior preferred stock of each instrumentality and obtained warrants for the purchase of common stock of each instrumentality (the "Senior Preferred Stock Purchase Agreement" or "Agreement"). Under the Agreement, the U.S. Treasury pledged to provide up to $200 billion per instrumentality as needed, including the contribution of cash capital to the instrumentalities in the event their liabilities exceed their assets. This was intended to ensure that the instrumentalities maintain a positive net worth and meet their financial obligations, preventing mandatory triggering of receivership. On December 24, 2009, the U.S. Treasury announced that it was amending the Agreement to allow the $200 billion cap on the U.S. Treasury's funding commitment to increase as necessary to accommodate any cumulative reduction in net worth over the next three years. As a result of this Agreement, the investments of holders, including the Fund, of mortgage-backed securities and other obligations issued by Fannie Mae and Freddie Mac are protected.

The total public debt of the United States as a percentage of gross domestic product has grown rapidly since the beginning of the 2008-2009 financial downturn. Although high debt levels do not necessarily indicate or cause economic problems, they may create certain systemic risks if sound debt management practices are not implemented. A high national debt can raise concerns that the U.S. government will not be able to make principal or interest payments when they are due. In August 2011, S&P lowered its long-term sovereign credit rating on the U.S. In explaining the downgrade at that time, S&P cited, among other reasons, controversy over raising the statutory debt limit and growth in public spending. In August 2023, Fitch Ratings also downgraded its U.S. debt rating from AAA to AA+, citing expected fiscal deterioration over the next three years and repeated down-to-the-wire debt ceiling negotiations. In May 2025, Moody's lowered the long-term issuer rating of the U.S. to Aa1 from Aaa to reflect over a decade of increasing government debt and high interest payment ratios relative to similarly rated sovereigns.

An increase in national debt levels also may necessitate the need for the U.S. Congress to negotiate adjustments to the statutory debt ceiling to increase the cap on the amount the U.S. government is permitted to borrow to meet its existing obligations and finance current budget deficits. Future downgrades could increase volatility in domestic and foreign financial markets, result in higher interest rates, lower prices of U.S. Treasury securities and increase the costs of different kinds of debt. Any controversy or ongoing uncertainty regarding the statutory debt ceiling negotiations may impact the U.S. long-term sovereign credit rating and may cause market uncertainty. As a result, market prices and yields of securities supported by the full faith and credit of the U.S. government may be adversely affected.

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**When-Issued Securities**

A when-issued security is one whose terms are available and for which a market exists, but which has not been issued. When the Fund engages in when-issued transactions, it relies on the other party to consummate the sale. If the other party fails to complete the sale, the Fund may miss the opportunity to obtain the security at a favorable price or yield.

When purchasing a security on a when-issued basis, the Fund assumes the rights and risks of ownership of the security, including the risk of price and yield changes. At the time of settlement, the value of the security may be more or less than the purchase price. The yield available in the market when the delivery takes place also may be higher than those obtained in the transaction itself. Because the Fund does not pay for the security until the delivery date, these risks are in addition to the risks associated with its other investments.

Decisions to enter into "when-issued" transactions will be considered on a case-by-case basis when necessary to maintain continuity in a company's index membership.

**INVESTMENT RESTRICTIONS**

The Trust has adopted the following investment restrictions as fundamental policies with respect to the Fund. These restrictions cannot be changed with respect to the Fund without the approval of the holders of a majority of the Fund's outstanding voting securities. For the purposes of the 1940 Act, a "majority of outstanding shares" means the vote of the lesser of: (1) 67% or more of the voting securities of the Fund present at the meeting if the holders of more than 50% of the Fund's outstanding voting securities are present or represented by proxy; or (2) more than 50% of the outstanding voting securities of the Fund.

Except with the approval of a majority of the outstanding voting securities, the Fund may not:

1. Borrow money, except to the extent permitted by the 1940 Act, the rules and regulations thereunder and any applicable exemptive relief.

2. Issue senior securities, except to the extent permitted by the 1940 Act, the rules and regulations thereunder and any applicable exemptive relief.

3. Engage in the business of underwriting securities except to the extent that the Fund may be considered an underwriter within the meaning of the 1933 Act in the acquisition, disposition or resale of its portfolio securities or in connection with investments in other investment companies, or to the extent otherwise permitted under the 1940 Act, the rules and regulations thereunder and any applicable exemptive relief.

4. Purchase or sell real estate, except to the extent permitted under the 1940 Act, the rules and regulations thereunder and any applicable exemptive relief.

5. Purchase or sell commodities, contracts relating to commodities or options on contracts relating to commodities except to the extent permitted under the 1940 Act, the rules and regulations thereunder and any applicable exemptive relief. This policy shall not prevent the Fund from purchasing or selling foreign currency or purchasing, selling or entering into futures contracts, options, forward contracts, swaps, caps, floors, collars and other financial instruments as currently exist or may in the future be developed.

6. Make loans, except to the extent permitted under the 1940 Act, the rules and regulations thereunder and any applicable exemptive relief.

7. With respect to 75% of its total assets, (i) purchase securities of any issuer (except securities issued or guaranteed by the U.S. government, its agencies or instrumentalities or shares of investment companies) if, as a result, more than 5% of its total assets would be invested in the securities of such issuer, or (ii) acquire more than 10% of the outstanding voting securities of any one issuer.

8. Concentrate its investments (*i.e.*, hold more than 25% of its total assets) in any industry or group of related industries. For purposes of this limitation, securities of the U.S. government (including its agencies and instrumentalities), repurchase agreements collateralized by U.S. government securities, investment companies and tax-exempt securities of state or municipal governments and their political subdivisions are not considered to be issued by members of any industry.

In addition to the investment restrictions adopted as fundamental policies as set forth above, the Fund has adopted the following non-fundamental restriction, which may be changed without a shareholder vote.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;Under normal circumstances, at least 80% of the Fund's net assets, plus borrowings for investment purposes, will be invested in equity securities.

The following descriptions of certain provisions of the 1940 Act may assist investors in understanding the above policies and restrictions:

<u>Borrowing</u>. The 1940 Act presently allows a fund to borrow from any bank (including pledging, mortgaging, or hypothecating assets) in an amount up to 33 1/3% of its total assets (not including temporary borrowings not in excess of 5% of its total assets).

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<u>Senior Securities</u>. For purposes of fundamental policy no. 2 above, senior securities may include any obligation or instrument constituting a security issued by the Fund and evidencing indebtedness or a future payment obligation. The 1940 Act generally prohibits funds from issuing senior securities other than borrowing from a bank subject to specific asset coverage requirements. The 1940 Act prohibitions and restrictions on the issuance of senior securities are designed to protect shareholders from the potentially adverse effects of a fund's issuance of senior securities, including, in particular, the risks associated with excessive leverage of a fund's assets. Certain types of derivatives give rise to future payment obligations and therefore also may be considered to be senior securities. Rule 18f-4 under the 1940 Act permits funds that comply with the conditions therein to enter into certain types of derivatives transactions notwithstanding the prohibitions and restrictions on the issuance of senior securities under the 1940 Act. To the extent consistent with its investment strategies, the Fund may invest in derivatives in compliance with the conditions set forth in Rule 18f-4 under the 1940 Act.

<u>Lending</u>. Under the 1940 Act, a fund may only make loans if expressly permitted by its investment policies.

<u>Real Estate and Commodities</u>. The 1940 Act does not directly restrict an investment company's ability to invest in real estate or commodities, but does require that every investment company have a fundamental investment policy governing such investments.

<u>Underwriting</u>. Under the 1940 Act, underwriting securities involves a fund purchasing securities directly from an issuer for the purpose of selling (distributing) them or participating in any such activity either directly or indirectly.

If a percentage limitation is adhered to at the time of investment or contract, a later increase or decrease in percentage resulting from any change in value or total or net assets will not result in a violation of such restriction, except that the percentage limitation with respect to the borrowing of money will be observed continuously.

**EXCHANGE LISTING AND TRADING**

Shares are listed for trading and trade throughout the day on the Exchange.

There can be no assurance that the Fund will continue to meet the requirements of the Exchange necessary to maintain the listing of Shares. The Exchange will consider the suspension of trading in, and will initiate delisting proceedings of, the Shares under any of the following circumstances: (i) if any of the requirements set forth in the Exchange rules are not continuously maintained, including compliance with Rule 6c-11(c) under the 1940 Act; (ii) if, following the initial 12-month period beginning at the commencement of trading of the Fund, there are fewer than 50 beneficial owners of the Shares of the Fund; or (iii) if such other event shall occur or condition shall exist that, in the opinion of the Exchange, makes further dealings on the Exchange inadvisable. The Exchange will remove the Shares of the Fund from listing and trading upon termination of the Fund.

The Trust reserves the right to adjust the price levels of Shares in the future to help maintain convenient trading ranges for investors. Any adjustments would be accomplished through stock splits or reverse stock splits, which would have no effect on the net assets of the Fund.

**MANAGEMENT OF THE TRUST**

**Board Responsibilities.** The management and affairs of the Trust and its series are overseen by the Board, which elects the officers of the Trust who are responsible for administering the day-to-day operations of the Trust and the Fund. The Board has approved contracts, as described below, under which certain companies provide essential services to the Trust.

The day-to-day business of the Trust, including the management of risk, is performed by third-party service providers, such as the Adviser, the Distributor, and the Administrator. The Board is responsible for overseeing the Trust's service providers and, thus, has oversight responsibility with respect to risk management performed by those service providers. Risk management seeks to identify and address risks, *i.e.*, events or circumstances that could have material adverse effects on the business, operations, shareholder services, investment performance or reputation of the Fund. The Fund and its service providers employ a variety of processes, procedures and controls to identify various of those possible events or circumstances, to lessen the probability of their occurrence and/or to mitigate the effects of such events or circumstances if they do occur. Each service provider is responsible for one or more discrete aspects of the Trust's business (*e.g.*, the Adviser is responsible for the day-to-day management of the Fund's portfolio investments) and, consequently, for managing the risks associated with that business. The Board has emphasized to the Fund's service providers the importance of maintaining vigorous risk management.

The Board's role in risk oversight begins before the inception of the Fund, at which time certain of the Fund's service providers present the Board with information concerning the investment objective, strategies and risks of the Fund as well as proposed investment limitations for the Fund. Additionally, the Adviser provides the Board with an overview of, among other things, its investment philosophy, brokerage practices and compliance infrastructure. Thereafter, the Board continues its oversight function of various personnel, including the Trust's Chief Compliance Officer, as well as personnel of the Adviser, and other service providers such as the Fund's independent registered public accounting firm, who make periodic reports to the Audit Committee or to the Board with respect to various aspects of risk management. The Board and the Audit Committee oversee efforts by management and service providers to manage risks to which the Fund may be exposed.

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The Board is responsible for overseeing the nature, extent, and quality of the services provided to the Fund by the Adviser and receives information about those services at its regular meetings. In addition, on an annual basis (following the initial two-year period), in connection with its consideration of whether to renew the Advisory Agreement (defined below) with the Adviser, the Board or its designee may meet with the Adviser to review such services. Among other things, the Board regularly considers the Adviser's adherence to the Fund's investment restrictions and compliance with various Fund policies and procedures and with applicable securities regulations. The Board also reviews information about the Fund's performance and investments, including, for example, portfolio holdings schedules.

The Trust's Chief Compliance Officer reports regularly to the Board to review and discuss compliance issues and Fund and Adviser risk assessments. At least annually, the Trust's Chief Compliance Officer provides the Board with a report reviewing the adequacy and effectiveness of the Trust's policies and procedures and those of its service providers, including the Adviser. The report addresses the operation of the policies and procedures of the Trust and each service provider since the date of the last report; any material changes to the policies and procedures since the date of the last report; any recommendations for material changes to the policies and procedures; and any material compliance matters since the date of the last report.

The Board receives reports from the Fund's service providers regarding operational risks and risks related to the valuation and liquidity of portfolio securities. Annually, the Fund's independent registered public accounting firm reviews with the Audit Committee its audit of the Fund's financial statements, focusing on major areas of risk encountered by the Fund and noting any significant deficiencies or material weaknesses in the Fund's internal controls. Additionally, in connection with its oversight function, the Board oversees Fund management's implementation of disclosure controls and procedures, which are designed to ensure that information required to be disclosed by the Trust in its periodic reports with the SEC are recorded, processed, summarized, and reported within the required time periods. The Board also oversees the Trust's internal controls over financial reporting, which comprise policies and procedures designed to provide reasonable assurance regarding the reliability of the Trust's financial reporting and the preparation of the Trust's financial statements.

From their review of these reports and discussions with the Adviser, the Chief Compliance Officer, the independent registered public accounting firm and other service providers, the Board and the Audit Committee learn in detail about the material risks of the Fund, thereby facilitating a dialogue about how management and service providers identify and mitigate those risks.

The Board recognizes that not all risks that may affect the Fund can be identified and/or quantified, that it may not be practical or cost-effective to eliminate or mitigate certain risks, that it may be necessary to bear certain risks (such as investment-related risks) to achieve the Fund's goals, and that the processes, procedures and controls employed to address certain risks may be limited in their effectiveness. Moreover, reports received by the Board as to risk management matters are typically summaries of the relevant information. Most of the Fund's investment management and business affairs are carried out by or through the Adviser, and other service providers, each of which has an independent interest in risk management but whose policies and the methods by which one or more risk management functions are carried out may differ from the Trust's and each other's in the setting of priorities, the resources available or the effectiveness of relevant controls. As a result of the foregoing and other factors, the Board's ability to monitor and manage risk, as a practical matter, is subject to limitations.

**Members of the Board.** There are three members of the Board, none of whom are interested persons of the Trust, as that term is defined in the 1940 Act (the "Independent Trustees").

There is an Audit Committee of the Board that is chaired by an Independent Trustee and comprised solely of Independent Trustees. The Audit Committee chair presides at the Audit Committee meetings, participates in formulating agendas for Audit Committee meetings, and coordinates with management to serve as a liaison between the Independent Trustees and management on matters within the scope of responsibilities of the Audit Committee as set forth in its Board-approved charter. The Trust has not designated a lead Independent Trustee but has determined its leadership structure is appropriate given the specific characteristics and circumstances of the Trust. The Trust made this determination in consideration of, among other things, the fact that the Independent Trustees of the Trust constitute a super-majority of the Board, the number of Independent Trustees that constitute the Board, the amount of assets under management in the Trust, and the number of funds overseen by the Board. The Board also believes that its leadership structure facilitates the orderly and efficient flow of information to the Independent Trustees from Fund management.

Additional information about each Trustee of the Trust is set forth below. The address of each Trustee of the Trust is c/o U.S. Bank Global Fund Services, 615 East Michigan Street, Milwaukee, Wisconsin 53202.

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|:---|:---|:---|:---|:---|:---|
| **Name and Year of Birth** | **Position Held with the Trust** | **Term of Office and Length of Time Served** | **Principal Occupation(s) During Past 5 Years** | **Number of Portfolios in Fund Complex\* Overseen by Trustee** | **Other Directorships Held by Trustee During Past 5 Years** |
| &nbsp;&nbsp;John L. Jacobs<br>Year of birth: 1959 | Trustee and Audit Committee Chair | Indefinite term; since 2017\*\* | &nbsp;&nbsp;Founder and CEO of Q3 Advisors, LLC (financial consulting firm) (since 2015); Chairman of VettaFi, LLC (2018-2024); Executive Director of Center for Financial Markets and Policy (2016–2022); Distinguished Policy Fellow and Executive Director, Center for Financial Markets and Policy, Georgetown University (2015–2022) | 36 | &nbsp;&nbsp;Independent Trustee, TEMA ETF Trust (since 2023) (1 portfolio); NEOS ETF Trust (since 2021) (3 portfolios); Director, tZERO Group, Inc. (since 2020); Independent Trustee, Procure ETF Trust II (since 2018) (2 portfolios) |
| &nbsp;&nbsp;Koji Felton<br>Year of birth: 1961 | Trustee | Indefinite term; since 2019 | &nbsp;&nbsp;Retired; formerly Counsel, Kohlberg Kravis Roberts & Co. L.P. (investment firm) (2013–2015) | 36 | &nbsp;&nbsp;Independent Trustee, Series Portfolios Trust (since 2015) (19 portfolios) |
| &nbsp;&nbsp;Pamela H. Conroy<br>Year of birth: 1961 | Trustee, Chair, and Nominating and Governance Committee Chair | Indefinite term; since 2019 | &nbsp;&nbsp;Retired; formerly Executive Vice President, Chief Operating Officer & Chief Compliance Officer, Institutional Capital Corporation (investment firm) (1994–2008) | 36 | &nbsp;&nbsp;Independent Trustee, Frontier Funds, Inc. (since 2020) (4 portfolios) |

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\*&nbsp;&nbsp;&nbsp;&nbsp;The Trust is the only registered investment company in the Fund Complex.

\*\*&nbsp;&nbsp;&nbsp;&nbsp;Mr. Jacobs began serving as a Trustee when the Trust was known by its former name, Active Weighting Funds ETF Trust.

**Individual Trustee Qualifications.** The Trust has concluded that each of the Trustees should serve on the Board because of their ability to review and understand information about the Fund provided to them by management, to identify and request other information they may deem relevant to the performance of their duties, to question management and other service providers regarding material factors bearing on the management and administration of the Fund, and to exercise their business judgment in a manner that serves the best interests of the Fund's shareholders. The Trust has concluded that each of the Trustees should serve as a Trustee based on his or her own experience, qualifications, attributes and skills as described below.

The Trust has concluded that Mr. Jacobs should serve as a Trustee because of his substantial industry experience. He most recently served as the CEO of Q3 Advisors, LLC and as the Distinguished Policy Fellow and Executive Director of the Center for Financial Markets and Policy, and as Adjunct Professor of Finance at the McDonough School of Business at Georgetown University. He also served as Senior Advisor and principal consultant to Nasdaq's CEO and President. Mr. Jacobs has been determined to qualify as an Audit Committee Financial Expert for the Trust.

The Trust has concluded that Mr. Felton should serve as a Trustee because of his substantial industry experience, including over two decades working in the asset management industry providing legal, regulatory compliance, governance and risk management advice to registered investment companies, their advisers and boards. Prior to that, he gained experience and perspective as a regulator while serving as an enforcement attorney and branch chief for the SEC. He also represented public companies and their boards of directors in securities class actions, derivative litigation and SEC investigations as a litigation associate at a national law firm. Mr. Felton currently serves as an independent trustee and chair of the nominating and governance committee of a mutual fund complex.

The Trust has concluded that Ms. Conroy should serve as a Trustee because of her substantial industry experience, including over 25 years of achievements at both a large, multi-location financial institution as well as a small, entrepreneurial firm. She has expertise in all facets of portfolio accounting, securities processing, trading operations, marketing, as well as legal and compliance.

In its periodic assessment of the effectiveness of the Board, the Board considers the complementary individual skills and experience of the individual Trustees primarily in the broader context of the Board's overall composition so that the Board, as a body, possesses the appropriate (and appropriately diverse) skills and experience to oversee the business of the series of the Trust.

**Board Committees.** The Board has established the following standing committees of the Board:

<u>Audit Committee</u>. The Board has a standing Audit Committee that is composed of each of the Independent Trustees of the Trust. The Audit Committee operates under a written charter approved by the Board. The principal responsibilities of the Audit Committee include: recommending which firm to engage as the Fund's independent registered public accounting firm and when and whether to terminate this relationship, as necessary; reviewing the independent registered public accounting firm's compensation, the proposed scope and terms of its engagement, and the firm's independence; pre-approving audit and non-audit services provided by the Fund's independent registered public accounting firm to the Trust and certain other affiliated entities; serving as a channel of communication between the independent registered public accounting firm and the Trustees; reviewing the results of each external audit, including any

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qualifications in the independent registered public accounting firm's opinion, any related management letter, management's responses to recommendations made by the independent registered public accounting firm in connection with the audit, reports submitted to the Audit Committee by the internal auditing department of the Trust's Administrator that are material to the Trust as a whole, if any, and management's responses to any such reports; reviewing the Fund's audited financial statements and considering any significant disputes between the Trust's management and the independent registered public accounting firm that arose in connection with the preparation of those financial statements; considering, in consultation with the independent registered public accounting firm and the Trust's senior internal accounting executive, if any, the independent registered public accounting firms' report on the adequacy of the Trust's internal financial controls; reviewing, in consultation with the Fund's independent registered public accounting firm, major changes regarding auditing and accounting principles and practices to be followed when preparing the Fund's financial statements; and other audit related matters. As of the date of this SAI, the Audit Committee has not met with respect to the Fund.

The Audit Committee also serves as the Qualified Legal Compliance Committee ("QLCC") for the Trust for the purpose of compliance with Rules 205.2(k) and 205.3(c) of the Code of Federal Regulations, regarding alternative reporting procedures for attorneys retained or employed by an issuer who appear and practice before the SEC on behalf of the issuer (the "issuer attorneys"). An issuer attorney who becomes aware of evidence of a material violation by the Trust, or by any officer, director, employee, or agent of the Trust, may report evidence of such material violation to the QLCC as an alternative to the reporting requirements of Rule 205.3(b) (which requires reporting to the chief legal officer and potentially "up the ladder" to other entities).

<u>Nominating and Governance Committee</u>. The Board has a standing Nominating and Governance Committee that is composed of each of the Independent Trustees of the Trust. The Nominating and Governance Committee operates under a written charter approved by the Board. The principal responsibility of the Nominating and Governance Committee is to consider, recommend and nominate candidates to fill vacancies on the Board, if any. The Nominating and Governance Committee generally will not consider nominees recommended by shareholders. The Nominating and Governance Committee meets periodically, as necessary. As of the date of this SAI, the Nominating and Governance Committee has not met with respect to the Fund.

**Principal Officers of the Trust.** The officers of the Trust conduct and supervise the Trust's and the Fund's daily business. The address of each officer of the Trust is c/o U.S. Bank Global Fund Services, 615 East Michigan Street, Milwaukee, Wisconsin 53202. Additional information about each officer of the Trust is as follows:

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| | | | |
|:---|:---|:---|:---|
| **Name and Year of Birth** | **Position(s) Held with the Trust** | **Term of Office and Length of Time Served** | **Principal Occupation(s) During Past 5 Years** |
| Kacie G. Briody<br>Year of birth: 1992 | President and Principal Executive Officer | Indefinite term,<br>March 2025 | Vice President, U.S. Bancorp Fund Services, LLC (since 2025); Assistant Vice President, U.S. Bancorp Fund Services, LLC (2021-2025); Officer, U.S. Bancorp Fund Services, LLC (2014 to 2021) |
| Travis G. Babich<br>Year of birth: 1980 | Treasurer and Principal Financial Officer | Indefinite term,<br>September 2019 | Vice President, U.S. Bancorp Fund Services, LLC (since 2005) |
| David J. Rantisi<br>Year of birth: 1992 | Assistant Treasurer | Indefinite term,<br>March 2025 | Assistant Vice President, U.S. Bancorp Fund Services, LLC (since 2014) |
| Chad E. Fickett<br>Year of birth: 1973 | Secretary | Indefinite term,<br>June 2024 | Vice President, U.S. Bancorp Fund Services, LLC (since 2024); Assistant General Counsel, The Northwestern Mutual Life Insurance Company (2007 to 2024) |
| Jill S. Silver<br>Year of birth: 1976 | Interim Chief Compliance Officer and Anti-Money Laundering Officer | Indefinite term,<br>July 2025 | Senior Vice President, U.S. Bancorp Fund Services, LLC (since 2022); Compliance Director, Corebridge Financial Inc. (previously AIG) (2019 to 2022) |
| Marissa J. Pawlinski<br>Year of birth: 1996 | Assistant Secretary | Indefinite term,<br>June 2025 | Assistant Vice President, U.S. Bancorp Fund Services, LLC (since 2023); Regulatory Administration Attorney, U.S. Bancorp Fund Services, LLC (since 2022); Judicial Law Clerk, Milwaukee County Circuit Court (2021-2022); Legal Intern, City of Brookfield (2020-2021); Student, Marquette University Law School (2019-2021) |

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**Trustee Ownership of Shares.** The Fund is required to show the dollar amount ranges of each Trustee's "beneficial ownership" of Shares and each other series of the Trust as of the end of the most recently completed calendar year. Dollar amount ranges disclosed are established by the SEC. "Beneficial ownership" is determined in accordance with Rule 16a-1(a)(2) under the Securities Exchange Act of 1934 (the "Exchange Act").

As of the date of this SAI, no Trustee or officer of the Trust owned Shares of the Fund or any other fund within the Trust's Fund Complex.

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**Board Compensation.** Each Independent Trustee receives an annual stipend of $125,000 (prior to January 1, 2025, the annual stipend was $110,000) and reimbursement for all reasonable travel expenses relating to their attendance at Board Meetings. The chair of the Audit Committee receives an annual stipend of $5,000 and the chair of the Nominating and Governance Committee receives an annual stipend of $2,500. Pursuant to the Advisory Agreement, the Adviser has agreed to pay all expenses of the Fund, except those specified in the Fund's Prospectus. As a result, the Adviser is responsible for compensating the Independent Trustees. Trustee compensation disclosed in the table does not include reimbursed reasonable travel expenses relating to their attendance at Board Meetings. The following table shows the compensation expected to be earned by each Trustee during the fiscal year ending April 30, 2026:

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| | | |
|:---|:---|:---|
| **Name** | **Aggregate Compensation <br>From the Fund** | **Total Compensation From Fund Complex\* <br>Paid to Trustees** |
| John L. Jacobs | $0 | $130000 |
| Koji Felton | $0 | $125000 |
| Pamela H. Conroy | $0 | $127500 |

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\*&nbsp;&nbsp;&nbsp;&nbsp;The Trust is the only registered investment company in the Fund Complex.

**PRINCIPAL SHAREHOLDERS, CONTROL PERSONS, AND MANAGEMENT OWNERSHIP**

A principal shareholder is any person who owns of record or beneficially 5% or more of the outstanding Shares. A control person is a shareholder that owns beneficially or through controlled companies more than 25% of the voting securities of a company or acknowledges the existence of control. Shareholders owning voting securities in excess of 25% may determine the outcome of any matter affecting and voted on by shareholders of the Fund. As of the date of this SAI, there were no outstanding Shares.

**CODES OF ETHICS**

The Trust and the Adviser have each adopted codes of ethics pursuant to Rule 17j-1 of the 1940 Act. These codes of ethics are designed to prevent affiliated persons of the Trust and the Adviser from engaging in deceptive, manipulative or fraudulent activities in connection with securities held or to be acquired by the Fund (which also may be held by persons subject to the codes of ethics). Each code of ethics permits personnel subject to that code of ethics to invest in securities for their personal investment accounts, subject to certain limitations, including limitations related to securities that may be purchased or held by the Fund. The Distributor (as defined below) relies on the principal underwriters exception under Rule 17j-1(c)(3), specifically where the Distributor is not affiliated with the Trust or the Adviser, and no officer, director, or general partner of the Distributor serves as an officer, director, or general partner of the Trust or the Adviser.

There can be no assurance that the codes of ethics will be effective in preventing such activities. Each code of ethics may be examined at the office of the SEC in Washington, D.C. or on the Internet at the SEC's website at https://www.sec.gov.

**PROXY VOTING POLICIES**

The Fund has delegated proxy voting responsibilities to the Adviser, subject to the Board's oversight. In delegating proxy responsibilities, the Board has directed that proxies be voted consistent with the Fund's and its shareholders' best interests and in compliance with all applicable proxy voting rules and regulations. The Adviser has engaged Institutional Shareholder Services Inc. ("ISS") to make recommendations to the Adviser on the voting of proxies relating to securities held by the Fund and has adopted the ISS Proxy Voting Guidelines as part of the Adviser's proxy voting policies (the "Proxy Voting Policies") for such purpose.

A copy of the ISS Proxy Voting Guidelines is set forth in <u>Appendix A</u> to this SAI. The Trust's Chief Compliance Officer is responsible for monitoring the effectiveness of the Proxy Voting Policies. The Proxy Voting Policies have been adopted by the Trust as the policies and procedures that the Adviser will use when voting proxies on behalf of the Fund. When the ISS Proxy Voting Guidelines do not cover a specific proxy issue and ISS does not provide a recommendation, the Adviser will use its best judgment in voting such proxies on behalf of the Fund.

When available, information on how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 will be available (1) without charge, upon request, by calling 1-800-617-0004, and (2) on the SEC's website at https://www.sec.gov.

**INVESTMENT ADVISER** 

Core Alternative Capital, LLC, a Georgia limited liability company, serves as the investment adviser to the Fund. The Adviser is located at 3930 East Jones Bridge Road, Suite 380, Peachtree Corners, Georgia 30092. The Adviser is controlled by its founding member, David Pursell, and is an SEC-registered investment adviser.

The Adviser provides investment advice to the Fund and manages the day-to-day operations of the Fund, subject to the general supervision and oversight of the Board of the Trust. The Adviser is responsible for the investment and reinvestment of the assets of the Fund in accordance with the investment objective, policies, and limitations of the Fund. In addition, the Adviser arranges for transfer agency, custody, fund administration, distribution, and all other services necessary for the Fund to operate. For the services it provides

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to the Fund, the Adviser is entitled to a unified management fee, which is calculated daily and paid monthly, at an annual rate 1.05% of the Fund's average daily net assets.

Pursuant to an investment advisory agreement between the Trust, on behalf of the Fund, and the Adviser (the "Advisory Agreement"), the Adviser has agreed to pay all expenses of the Fund except the fee payable to the Adviser under the Advisory Agreement, interest charges on any borrowings, dividends and other expenses on securities sold short, taxes, brokerage commissions and other expenses incurred in placing orders for the purchase and sale of securities and other investment instruments, acquired fund fees and expenses, accrued deferred tax liability, extraordinary expenses, and distribution (12b-1) fees and expenses (if any).

Because the Fund is new, the Fund has not paid any management fees to the Adviser with respect to the Fund as of the date of this SAI.

**Portfolio Managers**

David Pursell and Peter Simasek serve as the Fund's portfolio managers (collectively, the "Portfolio Managers"). This section includes information about the Portfolio Managers, including information about compensation, other accounts managed, and the dollar range of Shares owned.

*Share Ownership*

The Fund is required to show the dollar ranges of the Portfolio Managers' "beneficial ownership" of Shares as of the end of the most recently completed fiscal year or a more recent date for a new portfolio manager. Dollar amount ranges disclosed are established by the SEC. "Beneficial ownership" is determined in accordance with Rule 16a-1(a)(2) under the Exchange Act. As of the date of this SAI, the Portfolio Managers did not beneficially own Shares.

*Other Accounts*

In addition to the Fund, the Portfolio Managers managed the following other accounts for the Adviser as of September 30, 2025, none of which were subject to a performance-based fee:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Registered**<br>**<u>Investment Companies</u>** | **Registered**<br>**<u>Investment Companies</u>** | **Other Pooled**<br>**<u>Investment Vehicles</u>** | **Other Pooled**<br>**<u>Investment Vehicles</u>** | **<u>Other Accounts</u>** | **<u>Other Accounts</u>** |
| Number of Accounts | Total Assets in the Accounts | Number of Accounts | Total Assets in the Accounts | Number of Accounts | Total Assets in the Accounts |
| 1 | $41 million | 0 | $0 | 330 | $320 million |

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*Compensation*

Mr. Pursell's compensation is based on the financial performance and profitability of the Adviser and not based on the performance of the Fund. Mr. Simasek receives a fixed base salary and discretionary bonus that are not tied to the performance of the Fund.

*Conflicts of Interest*

A Portfolio Manager's management of "other accounts" may give rise to potential conflicts of interest in connection with their management of the Fund's investments, on the one hand, and the investments of the other accounts, on the other. The other accounts may have similar investment objectives or strategies as the Fund. A potential conflict of interest may arise as a result, whereby a Portfolio Manager could favor one account over another. Another potential conflict could include a Portfolio Manager's knowledge about the size, timing, and possible market impact of Fund trades, whereby the Portfolio Manager could use this information to the advantage of other accounts and to the disadvantage of the Fund. However, the Adviser has established policies and procedures to ensure that the purchase and sale of securities among all accounts the Adviser manages are fairly and equitably allocated.

**DISTRIBUTOR**

The Trust and Quasar Distributors, LLC, a wholly-owned subsidiary of Foreside Financial Group, LLC (doing business as ACA Group) (the "Distributor"), are parties to a distribution agreement ("Distribution Agreement"), whereby the Distributor acts as principal underwriter for the Trust and distributes Shares. Shares are continuously offered for sale by the Distributor only in Creation Units. The Distributor will not distribute Shares in amounts less than a Creation Unit and does not maintain a secondary market in Shares. The principal business address of the Distributor is 190 Middle Street, Suite 301, Portland, Maine 04101.

Under the Distribution Agreement, the Distributor, as agent for the Trust, will receive orders for the purchase and redemption of Creation Units, provided that any subscriptions and orders will not be binding on the Trust until accepted by the Trust. The Distributor is a broker-dealer registered under the Exchange Act and a member of the Financial Industry Regulatory Authority ("FINRA").

The Distributor also may enter into agreements with securities dealers ("Soliciting Dealers") who will solicit purchases of Creation Units of Shares. Such Soliciting Dealers also may be Authorized Participants (as discussed in "<u>Procedures for Purchase of Creation Units</u>" below) or DTC participants (as defined below).

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The Distribution Agreement will continue for two years from its effective date and is renewable annually thereafter. The continuance of the Distribution Agreement must be specifically approved at least annually (i) by the vote of the Trustees or by a vote of the shareholders of the Fund and (ii) by the vote of a majority of the Independent Trustees who have no direct or indirect financial interest in the operations of the Distribution Agreement or any related agreement, cast in person at a meeting called for the purpose of voting on such approval. The Distribution Agreement is terminable without penalty by the Trust on 60 days' written notice when authorized either by majority vote of its outstanding voting Shares or by a vote of a majority of the Board (including a majority of the Independent Trustees), or by the Distributor on 60 days' written notice, and will automatically terminate in the event of its assignment. The Distribution Agreement provides that in the absence of willful misfeasance, bad faith or gross negligence on the part of the Distributor, or reckless disregard by it of its obligations thereunder, the Distributor shall not be liable for any action or failure to act in accordance with its duties thereunder.

***Intermediary Compensation.*** The Adviser, or its affiliates, out of their own resources and not out of Fund assets (*i.e.*, without additional cost to the Fund or its shareholders), may pay certain broker dealers, banks and other financial intermediaries ("Intermediaries") for certain activities related to the Fund, including participation in activities that are designed to make Intermediaries more knowledgeable about exchange-traded products, including the Fund, or for other activities, such as marketing and educational training or support. These arrangements are not financed by the Fund and, thus, do not result in increased Fund expenses. They are not reflected in the fees and expenses listed in the fees and expenses sections of the Fund's Prospectus and they do not change the price paid by investors for the purchase of Shares or the amount received by a shareholder as proceeds from the redemption of Shares.

Such compensation may be paid to Intermediaries that provide services to the Fund, including marketing and education support (such as through conferences, webinars and printed communications). The Adviser will periodically assess the advisability of continuing to make these payments. Payments to an Intermediary may be significant to the Intermediary, and amounts that Intermediaries pay to your adviser, broker or other investment professional, if any, also may be significant to such adviser, broker or investment professional. Because an Intermediary may make decisions about what investment options it will make available or recommend, and what services to provide in connection with various products, based on payments it receives or is eligible to receive, such payments create conflicts of interest between the Intermediary and its clients. For example, these financial incentives may cause the Intermediary to recommend the Fund rather than other investments. The same conflict of interest exists with respect to your financial adviser, broker or investment professional if he or she receives similar payments from his or her Intermediary firm.

Intermediary information is current only as of the date of this SAI. Please contact your adviser, broker, or other investment professional for more information regarding any payments his or her Intermediary firm may receive. Any payments made by the Adviser or its affiliates to an Intermediary may create the incentive for an Intermediary to encourage customers to buy Shares.

If you have any additional questions, please call 1-800-617-0004.

***Distribution and Service Plan.*** The Board has adopted a Distribution and Service Plan (the "Plan") in accordance with the provisions of Rule 12b-1 under the 1940 Act, which regulates circumstances under which an investment company may directly or indirectly bear expenses relating to the distribution of its shares. No payments pursuant to the Plan are expected to be made during the twelve (12) month period from the date of this SAI. Rule 12b-1 fees to be paid by the Fund under the Plan may only be imposed after approval by the Board.

Continuance of the Plan must be approved annually by a majority of the Trustees of the Trust and by a majority of the Trustees who are not interested persons (as defined in the 1940 Act) of the Trust and have no direct or indirect financial interest in the Plan or in any agreements related to the Plan ("Qualified Trustees"). The Plan requires that quarterly written reports of amounts spent under the Plan and the purposes of such expenditures be furnished to and reviewed by the Trustees. The Plan may not be amended to increase materially the amount that may be spent thereunder without approval by a majority of the outstanding shares of the Fund. All material amendments of the Plan will require approval by a majority of the Trustees of the Trust and of the Qualified Trustees.

The Plan provides that the Fund pays the Distributor an annual fee of up to a maximum of 0.25% of the average daily net assets of its Shares. Under the Plan, the Distributor may make payments pursuant to written agreements to financial institutions and intermediaries such as banks, savings and loan associations and insurance companies including, without limit, investment counselors, broker-dealers and the Distributor's affiliates and subsidiaries (collectively, "Agents") as compensation for services and reimbursement of expenses incurred in connection with distribution assistance. The Plan is characterized as a compensation plan since the distribution fee will be paid to the Distributor without regard to the distribution expenses incurred by the Distributor or the amount of payments made to other financial institutions and intermediaries. The Trust intends to operate the Plan in accordance with its terms and with FINRA's rules concerning sales charges.

Under the Plan, subject to the limitations of applicable law and regulations, the Fund is authorized to compensate the Distributor up to the maximum amount to finance any activity primarily intended to result in the sale of Creation Units of the Fund or for providing or arranging for others to provide shareholder services and for the maintenance of shareholder accounts. Such activities may include, but are not limited to: (i) delivering copies of the Fund's then current reports, prospectuses, notices, and similar materials, to prospective purchasers of Creation Units; (ii) marketing and promotional services, including advertising; (iii) paying the costs of and compensating others, including Authorized Participants with whom the Distributor has entered into written Authorized Participant

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Agreements, for performing shareholder servicing on behalf of the Fund; (iv) compensating certain Authorized Participants for providing assistance in distributing the Creation Units of the Fund, including the travel and communication expenses and salaries and/or commissions of sales personnel in connection with the distribution of the Creation Units of the Fund; (v) payments to financial institutions and intermediaries such as banks, savings and loan associations, insurance companies and investment counselors, broker-dealers, mutual fund supermarkets and the affiliates and subsidiaries of the Trust's service providers as compensation for services or reimbursement of expenses incurred in connection with distribution assistance; (vi) facilitating communications with beneficial owners of Shares, including the cost of providing (or paying others to provide) services to beneficial owners of Shares, including, but not limited to, assistance in answering inquiries related to Shareholder accounts; and (vii) such other services and obligations as are set forth in the Distribution Agreement.

**TRANSFER AGENT AND ADMINISTRATOR**

U.S. Bancorp Fund Services, LLC, doing business as U.S. Bank Global Fund Services ("Fund Services" or the "Transfer Agent"), located at 615 East Michigan Street, Milwaukee, Wisconsin 53202, serves as the Fund's transfer agent and administrator.

Pursuant to an agreement between the Trust and Fund Services (the "Fund Servicing Agreement"), Fund Services provides the Trust with administrative and management services (other than investment advisory services) and accounting services, including portfolio accounting services, tax accounting services, and furnishing financial reports. Under the Fund Servicing Agreement, Fund Services does not have any responsibility or authority for the management of the Fund, the determination of investment policy, or for any matter pertaining to the distribution of Shares. As compensation for the administration, accounting and management services, the Adviser pays Fund Services a fee based on the Fund's average daily net assets, subject to a minimum annual fee. Fund Services also is entitled to certain out-of-pocket expenses for the services mentioned above, including pricing expenses.

The Fund is new and the Adviser has not paid Fund Services any fees for administrative services to the Fund as of the date of this SAI.

**CUSTODIAN**

Pursuant to a custody agreement between the Trust and U.S. Bank National Association ("U.S. Bank" or the "Custodian") (the "Custody Agreement"), U.S. Bank, located at 1555 North Rivercenter Drive, Suite 302, Milwaukee, Wisconsin 53212, serves as the custodian of the Fund's assets. The Custodian holds and administers the assets in the Fund's portfolio. Pursuant to the Custody Agreement, U.S. Bank receives an annual fee from the Adviser based on the Trust's total average daily net assets, subject to a minimum annual fee, and certain settlement charges. The Custodian is also entitled to certain out-of-pocket expenses.

**LEGAL COUNSEL**

Morgan, Lewis & Bockius LLP, located at 1111 Pennsylvania Avenue, NW, Washington, DC 20004-2541, serves as legal counsel for the Trust.

**INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

Cohen & Company, Ltd., located at 1835 Market Street, Suite 310, Philadelphia, Pennsylvania 19103, serves as the independent registered public accounting firm for the Fund. Its services include auditing the Fund's financial statements. Cohen & Co Advisory, LLC, an affiliate of Cohen & Company, Ltd., provides tax services as requested.

**PORTFOLIO HOLDINGS DISCLOSURE POLICIES AND PROCEDURES**

The Board has adopted a policy regarding the disclosure of information about the Fund's security holdings. The Fund's entire portfolio holdings are publicly disseminated each day the Fund is open for business and may be available through financial reporting and news services, including publicly available internet web sites. In addition, the composition of the Deposit Securities (defined herein) is publicly disseminated daily prior to the opening of the Exchange via the facilities of the National Securities Clearing Corporation ("NSCC").

**DESCRIPTION OF SHARES**

The Declaration of Trust authorizes the issuance of an unlimited number of funds and shares. Each share represents an equal proportionate interest in the Fund with each other share. Shares are entitled upon liquidation to a pro rata share in the net assets of the Fund. Shareholders have no preemptive rights. The Declaration of Trust provides that the Trustees may create additional series or classes of shares. All consideration received by the Trust for shares of any additional funds and all assets in which such consideration is invested would belong to that fund and would be subject to the liabilities related thereto. Share certificates representing Shares will not be issued. Shares, when issued, are fully paid and non-assessable.

Each Share has one vote with respect to matters upon which a shareholder vote is required, consistent with the requirements of the 1940 Act and the rules promulgated thereunder. Shares of all funds in the Trust vote together as a single class, except that if the matter being voted on affects only a particular fund it will be voted on only by that fund and if a matter affects a particular fund differently from other funds, that fund will vote separately on such matter. As a Delaware statutory trust, the Trust is not required, and does not intend, to hold annual meetings of shareholders. Approval of shareholders will be sought, however, for certain changes in the operation of the Trust and for the election of Trustees under certain circumstances. Upon the written request of shareholders owning at

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least 10% of the Trust's shares, the Trust will call for a meeting of shareholders to consider the removal of one or more Trustees and other certain matters. In the event that such a meeting is requested, the Trust will provide appropriate assistance and information to the shareholders requesting the meeting.

Under the Declaration of Trust, the Trustees have the power to liquidate the Fund without shareholder approval. While the Trustees have no present intention of exercising this power, they may do so if the Fund fails to reach a viable size within a reasonable amount of time or for such other reasons as may be determined by the Board.

**LIMITATION OF TRUSTEES' LIABILITY**

The Declaration of Trust provides that a Trustee shall be liable only for his or her own willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of the office of Trustee and shall not be liable for errors of judgment or mistakes of fact or law. The Trustees shall not be responsible or liable in any event for any neglect or wrongdoing of any officer, agent, employee, adviser or principal underwriter of the Trust, nor shall any Trustee be responsible for the act or omission of any other Trustee. The Declaration of Trust also provides that the Trust shall indemnify each person who is, or has been, a Trustee, officer, employee or agent of the Trust, any person who is serving or has served at the Trust's request as a Trustee, officer, trustee, employee or agent of another organization in which the Trust has any interest as a shareholder, creditor or otherwise to the extent and in the manner provided in the Amended and Restated By-laws. However, nothing in the Declaration of Trust shall protect or indemnify a Trustee against any liability for his or her willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of the office of Trustee. Nothing contained in this section attempts to disclaim a Trustee's individual liability in any manner inconsistent with the federal securities laws.

**BROKERAGE TRANSACTIONS**

The policy of the Trust regarding purchases and sales of securities for the Fund is that primary consideration will be given to obtaining the most favorable prices and efficient executions of transactions. Consistent with this policy, when securities transactions are effected on a stock exchange, the Trust's policy is to pay commissions which are considered fair and reasonable without necessarily determining that the lowest possible commissions are paid in all circumstances. The Trust believes that a requirement always to seek the lowest possible commission cost could impede effective portfolio management and preclude the Fund from obtaining a high quality of brokerage and research services. In seeking to determine the reasonableness of brokerage commissions paid in any transaction, the Adviser will rely on its experience and knowledge regarding commissions generally charged by various brokers and on its judgment in evaluating the brokerage services received from the broker effecting the transaction. Such determinations are necessarily subjective and imprecise, as in most cases, an exact dollar value for those services is not ascertainable. The Trust has adopted policies and procedures that prohibit the consideration of sales of Shares as a factor in the selection of a broker or dealer to execute its portfolio transactions.

The Adviser owes a fiduciary duty to its clients to seek to provide best execution on trades effected. In selecting a broker/dealer for each specific transaction, the Adviser chooses the broker/dealer deemed most capable of providing the services necessary to obtain the most favorable execution. "Best execution" is generally understood to mean the most favorable cost or net proceeds reasonably obtainable under the circumstances. The full range of brokerage services applicable to a particular transaction may be considered when making this judgment, which may include, but is not limited to: liquidity, price, commission, timing, aggregated trades, capable floor brokers or traders, competent block trading coverage, ability to position, capital strength and stability, reliable and accurate communications and settlement processing, use of automation, knowledge of other buyers or sellers, arbitrage skills, administrative ability, underwriting and provision of information on a particular security or market in which the transaction is to occur. The specific criteria will vary depending upon the nature of the transaction, the market in which it is executed, and the extent to which it is possible to select from among multiple broker/dealers. The Adviser also will use electronic crossing networks ("ECNs") when appropriate.

Subject to the foregoing policies, brokers or dealers selected to execute the Fund's portfolio transactions may include the Fund's Authorized Participants (as discussed in "<u>Procedures for Purchase of Creation Units</u>" below) or their affiliates. An Authorized Participant or its affiliates may be selected to execute the Fund's portfolio transactions in conjunction with an all-cash creation unit order or an order including "cash-in-lieu" (as described below under "<u>Purchase and Redemption of Creation Units</u>"), so long as such selection is in keeping with the foregoing policies. As described below under "<u>Purchase and Redemption of Creation Units — Creation Transaction Fee</u>" and "— <u>Redemption Transaction Fee</u>", the Fund may determine to not charge a variable fee on certain orders when the Adviser has determined that doing so is in the best interests of Fund shareholders, *e.g.*, for creation orders that facilitate the rebalance of the Fund's portfolio in a more tax efficient manner than could be achieved without such order, even if the decision to not charge a variable fee could be viewed as benefiting the Authorized Participant or its affiliate selected to execute the Fund's portfolio transactions in connection with such orders.

The Adviser may use the Fund's assets for, or participate in, third-party soft dollar arrangements, in addition to receiving proprietary research from various full-service brokers, the cost of which is bundled with the cost of the broker's execution services. The Adviser does not "pay up" for the value of any such proprietary research. Section 28(e) of the Exchange Act permits the Adviser, under certain circumstances, to cause the Fund to pay a broker or dealer a commission for effecting a transaction in excess of the amount of commission another broker or dealer would have charged for effecting the transaction in recognition of the value of brokerage and research services provided by the broker or dealer. The Adviser may receive a variety of research services and information on many

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topics, which it can use in connection with its management responsibilities with respect to the various accounts over which it exercises investment discretion or otherwise provides investment advice. The research services may include qualifying order management systems, portfolio attribution and monitoring services and computer software and access charges which are directly related to investment research. Accordingly, the Fund may pay a broker commission higher than the lowest available in recognition of the broker's provision of such services to the Adviser, but only if the Adviser determines the total commission (including the soft dollar benefit) is comparable to the best commission rate that could be expected to be received from other brokers. The amount of soft dollar benefits received depends on the amount of brokerage transactions effected with the brokers. A conflict of interest exists because there is an incentive to: 1) cause clients to pay a higher commission than the firm might otherwise be able to negotiate; 2) cause clients to engage in more securities transactions than would otherwise be optimal; and 3) only recommend brokers that provide soft dollar benefits.

The Adviser faces a potential conflict of interest when it uses client trades to obtain brokerage or research services. This conflict exists because the Adviser can use the brokerage or research services to manage client accounts without paying cash for such services, which reduces the Adviser's expenses to the extent that the Adviser would have purchased such products had they not been provided by brokers. Section 28(e) permits the Adviser to use brokerage or research services for the benefit of any account it manages. Certain accounts managed by the Adviser may generate soft dollars used to purchase brokerage or research services that ultimately benefit other accounts managed by the Adviser, effectively cross subsidizing the other accounts managed by the Adviser that benefit directly from the product. The Adviser may not necessarily use all of the brokerage or research services in connection with managing the Fund whose trades generated the soft dollars used to purchase such products.

The Adviser is responsible, subject to oversight by the Board, for placing orders on behalf of the Fund for the purchase or sale of portfolio securities. If purchases or sales of portfolio securities of the Fund and one or more other investment companies or clients supervised by the Adviser are considered at or about the same time, transactions in such securities are allocated among the several investment companies and clients in a manner deemed equitable and consistent with its fiduciary obligations to all by the Adviser. In some cases, this procedure could have a detrimental effect on the price or volume of the security so far as the Fund is concerned. However, in other cases, it is possible that the ability to participate in volume transactions and to negotiate lower brokerage commissions will be beneficial to the Fund. The primary consideration is prompt execution of orders at the most favorable net price.

The Fund may deal with affiliates in principal transactions to the extent permitted by exemptive order or applicable rule or regulation.

The Fund is new and has not paid any brokerage commissions as of the date of this SAI.

**Directed Brokerage.** The Fund is new, and as of the date of this SAI, the Fund did not pay any commissions on brokerage transactions directed to brokers pursuant to an agreement or understanding whereby the broker provides research or other brokerage services to the Adviser.

**Brokerage with Fund Affiliates.** The Fund may execute brokerage or other agency transactions through registered broker-dealer affiliates of the Fund, the Adviser, or the Distributor for a commission in conformity with the 1940 Act, the Exchange Act and rules promulgated by the SEC. These rules require that commissions paid to the affiliate by the Fund for exchange transactions not exceed "usual and customary" brokerage commissions. The rules define "usual and customary" commissions to include amounts which are "reasonable and fair compared to the commission, fee or other remuneration received or to be received by other brokers in connection with comparable transactions involving similar securities being purchased or sold on a securities exchange during a comparable period of time." The Trustees, including those who are not "interested persons" of the Fund, have adopted procedures for evaluating the reasonableness of commissions paid to affiliates and review these procedures periodically. The Fund is new and has not paid any brokerage commissions to any registered broker-dealer affiliates of the Fund, the Adviser, or the Distributor as of the date of this SAI.

**Securities of "Regular Broker-Dealers."** The Fund is required to identify any securities of its "regular brokers or dealers" (as such term is defined in the 1940 Act) that it may hold at the close of its most recent fiscal year. "Regular brokers or dealers" of the Fund are the ten brokers or dealers that, during the most recent fiscal year: (i) received the greatest dollar amounts of brokerage commissions from the Fund's portfolio transactions; (ii) engaged as principal in the largest dollar amounts of portfolio transactions of the Fund; or (iii) sold the largest dollar amounts of Shares. The Fund is new and, therefore, did not hold any securities of its "regular broker dealers" as of the date of this SAI.

**PORTFOLIO TURNOVER RATE**

Portfolio turnover may vary from year to year, as well as within a year. High turnover rates are likely to result in comparatively greater brokerage expenses. The overall reasonableness of brokerage commissions is evaluated by the Adviser based upon its knowledge of available information as to the general level of commissions paid by other institutional investors for comparable services.

**BOOK ENTRY ONLY SYSTEM**

The Depository Trust Company ("DTC") acts as securities depositary for Shares. Shares are represented by securities registered in the name of DTC or its nominee, Cede & Co., and deposited with, or on behalf of, DTC. Except in limited circumstances set forth below, certificates will not be issued for Shares.

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DTC is a limited-purpose trust company that was created to hold securities of its participants (the "DTC Participants") and to facilitate the clearance and settlement of securities transactions among the DTC Participants in such securities through electronic book-entry changes in accounts of the DTC Participants, thereby eliminating the need for physical movement of securities certificates. DTC Participants include securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations, some of whom (and/or their representatives) own DTC. More specifically, DTC is owned by a number of its DTC Participants and by the New York Stock Exchange ("NYSE") and FINRA. Access to the DTC system also is available to others such as banks, brokers, dealers, and trust companies that clear through or maintain a custodial relationship with a DTC Participant, either directly or indirectly (the "Indirect Participants").

Beneficial ownership of Shares is limited to DTC Participants, Indirect Participants, and persons holding interests through DTC Participants and Indirect Participants. Ownership of beneficial interests in Shares (owners of such beneficial interests are referred to in this SAI as "Beneficial Owners") is shown on, and the transfer of ownership is effected only through, records maintained by DTC (with respect to DTC Participants) and on the records of DTC Participants (with respect to Indirect Participants and Beneficial Owners that are not DTC Participants). Beneficial Owners will receive from or through the DTC Participant a written confirmation relating to their purchase of Shares. The Trust recognizes DTC or its nominee as the record owner of all Shares for all purposes. Beneficial Owners of Shares are not entitled to have Shares registered in their names and will not receive or be entitled to physical delivery of Share certificates. Each Beneficial Owner must rely on the procedures of DTC and any DTC Participant and/or Indirect Participant through which such Beneficial Owner holds its interests, to exercise any rights of the holder of Shares.

Conveyance of all notices, statements, and other communications to Beneficial Owners is effected as described in the ensuing paragraphs. DTC will make available to the Trust upon request and for a fee a listing of Shares held by each DTC Participant. The Trust shall obtain from each such DTC Participant the number of Beneficial Owners holding Shares, directly or indirectly, through such DTC Participant. The Trust shall provide each such DTC Participant with copies of such notice, statement, or other communication, in such form, number and at such place as such DTC Participant may reasonably request, in order that such notice, statement or communication may be transmitted by such DTC Participant, directly or indirectly, to such Beneficial Owners. In addition, the Trust shall pay to each such DTC Participant a fair and reasonable amount as reimbursement for the expenses attendant to such transmittal, all subject to applicable statutory and regulatory requirements.

Share distributions shall be made to DTC or its nominee, Cede & Co., as the registered holder of all Shares. DTC or its nominee, upon receipt of any such distributions, shall credit immediately DTC Participants' accounts with payments in amounts proportionate to their respective beneficial interests in the Fund as shown on the records of DTC or its nominee. Payments by DTC Participants to Indirect Participants and Beneficial Owners of Shares held through such DTC Participants will be governed by standing instructions and customary practices, as is now the case with securities held for the accounts of customers in bearer form or registered in a "street name," and will be the responsibility of such DTC Participants.

The Trust has no responsibility or liability for any aspect of the records relating to or notices to Beneficial Owners, or payments made on account of beneficial ownership interests in Shares, or for maintaining, supervising, or reviewing any records relating to such beneficial ownership interests, or for any other aspect of the relationship between DTC and the DTC Participants or the relationship between such DTC Participants and the Indirect Participants and Beneficial Owners owning through such DTC Participants.

DTC may determine to discontinue providing its service with respect to the Fund at any time by giving reasonable notice to the Fund and discharging its responsibilities with respect thereto under applicable law. Under such circumstances, the Fund shall take action either to find a replacement for DTC to perform its functions at a comparable cost or, if such replacement is unavailable, to issue and deliver printed certificates representing ownership of Shares, unless the Trust makes other arrangements with respect thereto satisfactory to the Exchange.

**PURCHASE AND REDEMPTION OF CREATION UNITS**

The Fund issues and redeems its shares on a continuous basis, at NAV, only in a large, specified number of shares called a "Creation Unit," either principally in-kind for securities or in cash for the value of such securities. The NAV of the Shares is determined once each Business Day, as described below under "<u>Determination of Net Asset Value</u>." The Creation Unit size may change. Authorized Participants will be notified of such change.

**Purchase (Creation).** The Trust issues and sells Shares only in Creation Units on a continuous basis through the Distributor, without a sales load (but subject to transaction fees, if applicable), at the NAV per share next determined after receipt, on any Business Day, of an order in proper form. The NAV of Shares is calculated each Business Day as of the scheduled close of regular trading on the NYSE, generally 4:00 p.m., Eastern Time. The Fund will not issue fractional Creation Units. A "Business Day" is any day on which the NYSE is open for business. As of the date of this SAI, the NYSE observes the following holidays: New Year's Day, Martin Luther King, Jr. Day, President's Day (Washington's Birthday), Good Friday, Memorial Day, Juneteenth Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day.

**Fund Deposit.** The Fund has adopted policies and procedures governing the process of constructing baskets of Deposit Securities (defined below), Fund Securities (defined below) and/or cash, and acceptance of the same (the "Basket Procedures"). The consideration for purchase of a Creation Unit of the Fund generally consists of either: (i) the in-kind deposit of a designated portfolio

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of securities (the "Deposit Securities") per each Creation Unit, constituting a substantial replication, or a portfolio sampling representation, of the securities included in the Fund's portfolio and the Cash Component (defined below), computed as described below, or (ii) the cash value of the Deposit Securities ("Deposit Cash") and the Cash Component to replace any Deposit Security. When accepting purchases of Creation Units for cash, the Fund may incur additional costs associated with the acquisition of Deposit Securities that would otherwise be provided by an in-kind purchaser. These additional costs may be recoverable from the purchaser of Creation Units.

Together, the Deposit Securities or Deposit Cash, as applicable, and the Cash Component constitute the "Fund Deposit," which represents the minimum initial and subsequent investment amount for a Creation Unit of the Fund. The "Cash Component" is an amount equal to the difference between the NAV of Shares (per Creation Unit) and the market value of the Deposit Securities or Deposit Cash, as applicable. If the Cash Component is a positive number (*i.e.*, the NAV per Creation Unit exceeds the value of the Deposit Securities or Deposit Cash, as applicable), the Cash Component shall be such positive amount. If the Cash Component is a negative number (*i.e.*, the NAV per Creation Unit is less than the value of the Deposit Securities or Deposit Cash, as applicable), the Cash Component shall be such negative amount and the creator will be entitled to receive cash in an amount equal to the Cash Component. The Cash Component serves the function of compensating for any differences between the NAV per Creation Unit and the market value of the Deposit Securities or Deposit Cash, as applicable. Computation of the Cash Component excludes any stamp duty or other similar fees and expenses payable upon transfer of beneficial ownership of the Deposit Securities, if applicable, which shall be the sole responsibility of the Authorized Participant (as defined below).

The Fund, through NSCC, makes available on each Business Day, prior to the opening of business on the Exchange (currently, 9:30 a.m., Eastern Time), the list of the names and the required number of Shares of each Deposit Security or the required amount of Deposit Cash, as applicable, to be included in the current Fund Deposit (based on information at the end of the previous Business Day) for the Fund. Such Fund Deposit is subject to any applicable adjustments as described below, to effect purchases of Creation Units of the Fund until such time as the next-announced composition of the Deposit Securities or the required amount of Deposit Cash, as applicable, is made available.

The identity and number of Shares of the Deposit Securities or the amount of Deposit Cash, as applicable, required for a Fund Deposit for the Fund may be changed from time to time by the Adviser, in accordance with the Basket Procedures, with a view to the investment objective of the Fund. Information regarding the Fund Deposit necessary for the purchase of a Creation Unit is made available to Authorized Participants and other market participants seeking to transact in Creation Unit aggregations. The composition of the Deposit Securities also may change in response to portfolio adjustments, interest payments and corporate action events.

The Trust reserves the right to permit or require the substitution of Deposit Cash to replace any Deposit Security, which shall be added to the Cash Component, including, without limitation, in situations where the Deposit Security: (i) may not be available in sufficient quantity for delivery; (ii) may not be eligible for transfer through the systems of DTC for corporate securities and municipal securities; (iii) may not be eligible for trading by an Authorized Participant or the investor for which it is acting; (iv) would be restricted under the securities laws or where the delivery of the Deposit Security to the Authorized Participant would result in the disposition of the Deposit Security by the Authorized Participant becoming restricted under the securities laws; or (v) in certain other situations (collectively, "custom orders"). The Trust also reserves the right to permit or require the substitution of Deposit Securities in lieu of Deposit Cash.

**Cash Purchase.** The Trust may at its discretion permit full or partial cash purchases of Creation Units of the Fund. When full or partial cash purchases of Creation Units are available or specified for the Fund, they will be effected in essentially the same manner as in-kind purchases thereof. In the case of a full or partial cash purchase, the Authorized Participant must pay the cash equivalent of the Deposit Securities it would otherwise be required to provide through an in-kind purchase, plus the same Cash Component required to be paid by an in-kind purchaser together with a creation transaction fee and non-standard charges, as may be applicable.

**Procedures for Purchase of Creation Units.** To be eligible to place orders with the Distributor to purchase a Creation Unit of the Fund, an entity must be (i) a "Participating Party" (*i.e.*, a broker-dealer or other participant in the clearing process through the Continuous Net Settlement System of the NSCC (the "Clearing Process")), a clearing agency that is registered with the SEC; or (ii) a DTC Participant (see "<u>Book Entry Only System</u>"). In addition, each Participating Party or DTC Participant (each, an "Authorized Participant") must execute a Participant Agreement that has been agreed to by the Distributor, and that has been accepted by the Transfer Agent, with respect to purchases and redemptions of Creation Units. Each Authorized Participant will agree, pursuant to the terms of a Participant Agreement, on behalf of itself or any investor on whose behalf it will act, to certain conditions, including that it will pay to the Trust, an amount of cash sufficient to pay the Cash Component together with the creation transaction fee (described below), if applicable, and any other applicable fees and taxes.

All orders to purchase Shares directly from the Fund, including custom orders, must be placed for one or more Creation Units and in the manner and by the time set forth in the Participant Agreement and/or applicable order form. With respect to the Fund, the order cut-off time for orders to purchase Creation Units is 3:00 p.m. Eastern time. Such time may be modified by the Fund from time-to-time by amendment to the Participant Agreement and/or applicable order form. The date on which an order to purchase Creation Units (or an order to redeem Creation Units, as set forth below) is received and accepted is referred to as the "Order Placement Date."

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An Authorized Participant may require an investor to make certain representations or enter into agreements with respect to the order (*e.g.*, to provide for payments of cash, when required). Investors should be aware that their particular broker may not have executed a Participant Agreement and that, therefore, orders to purchase Shares directly from the Fund in Creation Units have to be placed by the investor's broker through an Authorized Participant that has executed a Participant Agreement. In such cases there may be additional charges to such investor. At any given time, there may be only a limited number of broker-dealers that have executed a Participant Agreement and only a small number of such Authorized Participants may have international capabilities.

On days when the Exchange closes earlier than normal, the Fund may require orders to create Creation Units to be placed earlier in the day. In addition, if a market or markets on which the Fund's investments are primarily traded is closed, the Fund also will generally not accept orders on such day(s). Orders must be transmitted by an Authorized Participant by telephone or other transmission method acceptable to the Transfer Agent pursuant to procedures set forth in the Participant Agreement and in accordance with the applicable order form. On behalf of the Fund, the Transfer Agent will notify the Custodian of such order. The Custodian will then provide such information to the appropriate local sub-custodian(s). Those placing orders through an Authorized Participant should allow sufficient time to permit proper submission of the purchase order to the Transfer Agent by the cut-off time on such Business Day. Economic or market disruptions or changes, or telephone or other communication failure may impede the ability to reach the Transfer Agent or an Authorized Participant.

Fund Deposits must be delivered by an Authorized Participant through the Federal Reserve System (for cash) or through DTC (for corporate securities), through a subcustody agent (for foreign securities) and/or through such other arrangements allowed by the Trust or its agents. With respect to foreign Deposit Securities, the Custodian shall cause the subcustodian of the Fund to maintain an account into which the Authorized Participant shall deliver, on behalf of itself or the party on whose behalf it is acting, such Deposit Securities (or Deposit Cash for all or a part of such securities, as permitted or required), with any appropriate adjustments as advised by the Trust. Foreign Deposit Securities must be delivered to an account maintained at the applicable local subcustodian. A Fund Deposit transfer must be ordered by the Authorized Participant in a timely fashion to ensure the delivery of the requisite number of Deposit Securities or Deposit Cash, as applicable, to the account of the Fund or its agents by no later than 12:00 p.m. Eastern Time (or such other time as specified by the Trust) on the Settlement Date. If the Fund or its agents do not receive all of the Deposit Securities, or the required Deposit Cash in lieu thereof, by such time, then the order may be deemed rejected and the Authorized Participant shall be liable to the Fund for losses, if any, resulting therefrom. The "Settlement Date" for the Fund is generally the next Business Day after the Order Placement Date. All questions as to the number of Deposit Securities or Deposit Cash to be delivered, as applicable, and the validity, form and eligibility (including time of receipt) for the deposit of any tendered securities or cash, as applicable, will be determined by the Trust, whose determination shall be final and binding. The amount of cash represented by the Cash Component must be transferred directly to the Custodian through the Federal Reserve Bank wire transfer system in a timely manner to be received by the Custodian no later than the Settlement Date. If the Cash Component and the Deposit Securities or Deposit Cash, as applicable, are not received by the Custodian in a timely manner by the Settlement Date, the creation order may be cancelled. Upon written notice to the Transfer Agent, such canceled order may be resubmitted the following Business Day using a Fund Deposit as newly constituted to reflect the then current NAV of the Fund.

The order shall be deemed to be received on the Business Day on which the order is placed provided that the order is placed in proper form prior to the applicable cut-off time and the federal funds in the appropriate amount are deposited with the Custodian on the Settlement Date. If the order is not placed in proper form as required, or federal funds in the appropriate amount are not received on the Settlement Date, then the order may be deemed to be rejected and the Authorized Participant shall be liable to the Fund for losses, if any, resulting therefrom. A creation request is in "proper form" if all procedures set forth in the Participant Agreement, order form and this SAI are properly followed.

**Issuance of a Creation Unit.** Except as provided in this SAI, Creation Units will not be issued until the transfer of good title to the Trust of the Deposit Securities or payment of Deposit Cash, as applicable, and the payment of the Cash Component have been completed. When the subcustodian has confirmed to the Custodian that the required Deposit Securities (or the cash value thereof) have been delivered to the account of the relevant subcustodian or subcustodians, the Distributor and the Adviser shall be notified of such delivery, and the Trust will issue and cause the delivery of the Creation Units. The delivery of Creation Units so created generally will occur no later than the first Business Day following the day on which the purchase order is deemed received by the Transfer Agent. The Authorized Participant shall be liable to the Fund for losses, if any, resulting from unsettled orders.

In instances where the Trust accepts Deposit Securities for the purchase of a Creation Unit, the Creation Units may be purchased in advance of receipt by the Trust of all or a portion of the applicable Deposit Securities as described below. In these circumstances, the initial deposit will have a value greater than the NAV of Shares on the date the order is placed in proper form since, in addition to available Deposit Securities, cash must be deposited in an amount equal to the sum of (i) the Cash Component, plus (ii) an additional amount of cash equal to a percentage of the value as set forth in the Participant Agreement, of the undelivered Deposit Securities (the "Additional Cash Deposit"), which shall be maintained in a separate non-interest bearing collateral account. The Authorized Participant must deposit with the Custodian the Additional Cash Deposit, as applicable, by 12:00 p.m. Eastern Time (or such other time as specified by the Trust) on the Settlement Date. If the Fund or its agents do not receive the Additional Cash Deposit in the appropriate amount, by such time, then the order may be deemed rejected and the Authorized Participant shall be liable to the Fund for losses, if any, resulting therefrom. An additional amount of cash shall be required to be deposited with the Trust, pending delivery of

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the missing Deposit Securities to the extent necessary to maintain the Additional Cash Deposit with the Trust in an amount at least equal to the applicable percentage, as set forth in the Participant Agreement, of the daily market value of the missing Deposit Securities. The Participant Agreement will permit the Trust to buy the missing Deposit Securities at any time. Authorized Participants will be liable to the Trust for the costs incurred by the Trust in connection with any such purchases. These costs will be deemed to include the amount by which the actual purchase price of the Deposit Securities exceeds the value of such Deposit Securities on the day the purchase order was deemed received by the Transfer Agent plus the brokerage and related transaction costs associated with such purchases. The Trust will return any unused portion of the Additional Cash Deposit once all of the missing Deposit Securities have been properly received by the Custodian or purchased by the Trust and deposited into the Trust. In addition, a transaction fee, as described below under "<u>Creation Transaction Fee</u>," may be charged an additional variable charge also may be applied, as described below. The delivery of Creation Units so created generally will occur no later than the Settlement Date.

**Acceptance of Orders of Creation Units.** Provided that such action does not result in a suspension of sales of Creation Units in contravention of Rule 6c-11 under the 1940 Act and the SEC's positions thereunder, the Trust reserves the right to reject an order for Creation Units transmitted in respect of the Fund at its discretion, including, without limitation, if (a) the order is not in proper form or the Fund Deposit delivered does not consist of the securities the Custodian specified; (b) the investor(s), upon obtaining the Shares ordered, would own 80% or more of the currently outstanding Shares of the Fund; (c) the Deposit Securities or Deposit Cash, as applicable, delivered by the Authorized Participant are not as disseminated through the facilities of the NSCC for that date by the Custodian; (d) the acceptance of the Fund Deposit would, in the opinion of counsel, be unlawful; (e) the acceptance or receipt of the order for a Creation Unit would, in the opinion of counsel, be unlawful; or (f) in the event that circumstances outside the control of the Trust, the Custodian, the Transfer Agent, the Distributor and/or the Adviser make it for all practical purposes not feasible to process orders for Creation Units. Examples of such circumstances include acts of God or public service or utility problems such as fires, floods, extreme weather conditions and power outages resulting in telephone, telecopy and computer failures; market conditions or activities causing trading halts; systems failures involving computer or other information systems affecting the Trust, the Distributor, the Custodian, the Transfer Agent, DTC, NSCC, Federal Reserve System, or any other participant in the creation process, and other extraordinary events. The Trust or its agents shall communicate to the Authorized Participant its rejection of an order. The Trust, the Transfer Agent, the Custodian and the Distributor are under no duty, however, to give notification of any defects or irregularities in the delivery of Fund Deposits nor shall either of them incur any liability for the failure to give any such notification. The Trust, the Transfer Agent, the Custodian and the Distributor shall not be liable for the rejection of any purchase order for Creation Units. Given the importance of the ongoing issuance of Creation Units to maintaining a market price that is at or close to the underlying NAV of the Fund, the Trust does not intend to suspend the acceptance of orders for Creation Units, unless it believes doing so would be in the best interests of the Fund.

All questions as to the number of shares of each security in the Deposit Securities and the validity form, eligibility and acceptance for deposit of any securities to be delivered shall be determined by the Trust, and the Trust's determination shall be final and binding.

**Creation Unit Transaction Fee.** A fixed purchase (*i.e.*, creation) transaction fee, payable to the Fund's custodian, may be imposed for the transfer and other transaction costs associated with the purchase of Creation Units ("Creation Order Costs"). The standard fixed creation unit transaction fee for the Fund, regardless of the number of Creation Units created in the transaction, is $500. The Fund may adjust the standard fixed creation unit transaction fee from time to time. The fixed creation unit transaction fee may be waived on certain orders if the Fund's custodian has determined to waive some or all of the Creation Order Costs associated with the order or another party, such as the Adviser, has agreed to pay such fee.

In addition, a variable fee, payable to the Fund, of up to a maximum of 2% of the value of the Creation Units subject to the transaction may be imposed for cash purchases, non-standard orders, or partial cash purchases of Creation Units. The variable charge is primarily designed to cover additional costs (*e.g.*, brokerage, taxes) involved with buying the securities with cash. The Fund may determine to not charge a variable fee on certain orders when the Adviser has determined that doing so is in the best interests of Fund shareholders, *e.g.*, for creation orders that facilitate the rebalance of the Fund's portfolio in a more tax efficient manner than could be achieved without such order.

Investors who use the services of a broker or other such intermediary may be charged a fee for such services. Investors are responsible for the fixed costs of transferring the Fund Securities from the Trust to their account or on their order.

**Risks of Purchasing Creation Units.** There are certain legal risks unique to investors purchasing Creation Units directly from the Fund. Because Shares may be issued on an ongoing basis, a "distribution" of Shares could be occurring at any time. Certain activities that a shareholder performs as a dealer could, depending on the circumstances, result in the shareholder being deemed a participant in the distribution in a manner that could render the shareholder a statutory underwriter and subject to the prospectus delivery and liability provisions of the Securities Act. For example, a shareholder could be deemed a statutory underwriter if it purchases Creation Units from the Fund, breaks them down into the constituent Shares, and sells those Shares directly to customers, or if a shareholder chooses to couple the creation of a supply of new Shares with an active selling effort involving solicitation of secondary-market demand for Shares. Whether a person is an underwriter depends upon all of the facts and circumstances pertaining to that person's activities, and the examples mentioned here should not be considered a complete description of all the activities that could cause you to be deemed an underwriter.

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Dealers who are not "underwriters" but are participating in a distribution (as opposed to engaging in ordinary secondary-market transactions), and thus dealing with Shares as part of an "unsold allotment" within the meaning of Section 4(a)(3)(C) of the Securities Act, will be unable to take advantage of the prospectus delivery exemption provided by Section 4(a)(3) of the Securities Act.

**Redemption.** Shares may be redeemed only in Creation Units at their NAV next determined after receipt of a redemption request in proper form by the Fund through the Transfer Agent and only on a Business Day. EXCEPT UPON LIQUIDATION OF THE FUND, THE TRUST WILL NOT REDEEM SHARES IN AMOUNTS LESS THAN CREATION UNITS. Investors must accumulate enough Shares in the secondary market to constitute a Creation Unit in order to have such Shares redeemed by the Trust. There can be no assurance, however, that there will be sufficient liquidity in the public trading market at any time to permit assembly of a Creation Unit. Investors should expect to incur brokerage and other costs in connection with assembling a sufficient number of Shares to constitute a redeemable Creation Unit.

With respect to the Fund, the Custodian, through the NSCC, makes available prior to the opening of business on the Exchange (currently, 9:30 a.m., Eastern Time) on each Business Day, the list of the names and Share quantities of the Fund's portfolio securities that will be applicable (subject to possible amendment or correction) to redemption requests received in proper form (as defined below) on that day ("Fund Securities"). Fund Securities received on redemption may not be identical to Deposit Securities.

Redemption proceeds for a Creation Unit are paid either in-kind or in cash, or a combination thereof, as determined by the Trust in accordance with the Basket Procedures. With respect to in-kind redemptions of the Fund, redemption proceeds for a Creation Unit will consist of Fund Securities—as announced by the Custodian on the Business Day of the request for redemption received in proper form plus cash in an amount equal to the difference between the NAV of Shares being redeemed, as next determined after a receipt of a request in proper form, and the value of the Fund Securities (the "Cash Redemption Amount"), less a fixed redemption transaction fee, as applicable, and additional variable charge as set forth below. In the event that the Fund Securities have a value greater than the NAV of Shares, a compensating cash payment equal to the differential is required to be made by or through an Authorized Participant by the redeeming shareholder. Notwithstanding the foregoing, at the Trust's discretion, an Authorized Participant may receive the corresponding cash value of the securities in lieu of the in-kind securities value representing one or more Fund Securities.

**Cash Redemption.** Full or partial cash redemptions of Creation Units will be effected in essentially the same manner as in-kind redemptions thereof. In the case of full or partial cash redemptions, the Authorized Participant receives the cash equivalent of the Fund Securities it would otherwise receive through an in-kind redemption, plus the same Cash Redemption Amount to be paid to an in-kind redeemer.

**Redemption Transaction Fee.** A fixed redemption transaction fee, payable to the Fund's custodian, may be imposed for the transfer and other transaction costs associated with the redemption of Creation Units ("Redemption Order Costs"). The standard fixed redemption transaction fee for the Fund, regardless of the number of Creation Units redeemed in the transaction, is $500. The Fund may adjust the redemption transaction fee from time to time. The fixed redemption fee may be waived on certain orders if the Fund's custodian has determined to waive some or all of the Redemption Order Costs associated with the order or another party, such as the Adviser, has agreed to pay such fee.

In addition, a variable fee, payable to the Fund, of up to a maximum of 2% of the value of the Creation Units subject to the transaction may be imposed for cash redemptions, non-standard orders, or partial cash redemptions (when cash redemptions are available) of Creation Units. The variable charge is primarily designed to cover additional costs (*e.g.*, brokerage, taxes) involved with selling portfolio securities to satisfy a cash redemption. The Fund may determine to not charge a variable fee on certain orders when the Adviser has determined that doing so is in the best interests of Fund shareholders, *e.g.*, for redemption orders that facilitate changes to the Fund's portfolio in a more tax efficient manner than could be achieved without such order.

Investors who use the services of a broker or other such intermediary may be charged a fee for such services. Investors are responsible for the fixed costs of transferring the Fund Securities from the Trust to their account or on their order.

**Procedures for Redemption of Creation Units.** Orders to redeem Creation Units of the Fund on any Business Day must be submitted in proper form to the Transfer Agent prior to 12:00 p.m. Eastern time. A redemption request is considered to be in "proper form" if (i) an Authorized Participant has transferred or caused to be transferred to the Trust's Transfer Agent the Creation Unit(s) being redeemed through the book-entry system of DTC so as to be effective by the time as set forth in the Participant Agreement and (ii) a request in form satisfactory to the Trust is received by the Transfer Agent from the Authorized Participant on behalf of itself or another redeeming investor within the time periods specified in the Participant Agreement. If the Transfer Agent does not receive the investor's Shares through DTC's facilities by the times and pursuant to the other terms and conditions set forth in the Participant Agreement, the redemption request shall be rejected.

The Authorized Participant must transmit the request for redemption, in the form required by the Trust, to the Transfer Agent in accordance with procedures set forth in the Authorized Participant Agreement. Investors should be aware that their particular broker may not have executed an Authorized Participant Agreement, and that, therefore, requests to redeem Creation Units may have to be placed by the investor's broker through an Authorized Participant who has executed an Authorized Participant Agreement. Investors making a redemption request should be aware that such request must be in the form specified by such Authorized Participant. Investors making a request to redeem Creation Units should allow sufficient time to permit proper submission of the request by an

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Authorized Participant and transfer of the Shares to the Transfer Agent; such investors should allow for the additional time that may be required to effect redemptions through their banks, brokers or other financial intermediaries if such intermediaries are not Authorized Participants.

**Additional Redemption Procedures.** In connection with taking delivery of Shares of Fund Securities upon redemption of Creation Units, a redeeming shareholder or Authorized Participant acting on behalf of such shareholder must maintain appropriate custody arrangements with a qualified broker-dealer, bank, or other custody providers in each jurisdiction in which any of the Fund Securities are customarily traded, to which account such Fund Securities will be delivered. Deliveries of redemption proceeds generally will be made within one business day of the trade date.

The Trust may, in its discretion and in accordance with the Basket Procedures, exercise its option to redeem such Shares in cash, and the redeeming investor will be required to receive its redemption proceeds in cash. In addition, an investor may request a redemption in cash that the Fund may, in its sole discretion, permit. In either case, the investor will receive a cash payment equal to the NAV of its Shares based on the NAV of Shares of the Fund next determined after the redemption request is received in proper form (minus a redemption transaction fee, if applicable, and additional charge for requested cash redemptions specified above, to offset the Trust's brokerage and other transaction costs associated with the disposition of Fund Securities). The Fund also may, in its sole discretion, and in accordance with the Basket Procedures, upon request of a shareholder, provide such redeemer a portfolio of securities that differs from the exact composition of the Fund Securities but does not differ in NAV.

Redemptions of Shares for Fund Securities will be subject to compliance with applicable federal and state securities laws and the Fund (whether or not it otherwise permits cash redemptions) reserves the right to redeem Creation Units for cash to the extent that the Trust could not lawfully deliver specific Fund Securities upon redemptions or could not do so without first registering the Fund Securities under such laws. An Authorized Participant or an investor for which it is acting subject to a legal restriction with respect to a particular security included in the Fund Securities applicable to the redemption of Creation Units may be paid an equivalent amount of cash. The Authorized Participant may request the redeeming investor of the Shares to complete an order form or to enter into agreements with respect to such matters as compensating cash payment. Further, an Authorized Participant that is not a "qualified institutional buyer," ("QIB") as such term is defined under Rule 144A of the Securities Act, will not be able to receive Fund Securities that are restricted securities eligible for resale under Rule 144A. An Authorized Participant may be required by the Trust to provide a written confirmation with respect to QIB status to receive Fund Securities.

Because the portfolio securities of the Fund may trade on other exchanges on days that the Exchange is closed or are otherwise not Business Days for the Fund, shareholders may not be able to redeem their Shares, or to purchase or sell Shares on the Exchange, on days when the NAV of the Fund could be significantly affecting by events in the relevant foreign markets.

The right of redemption may be suspended or the date of payment postponed with respect to the Fund (1) for any period during which the Exchange is closed (other than customary weekend and holiday closings); (2) for any period during which trading on the Exchange is suspended or restricted; (3) for any period during which an emergency exists as a result of which disposal of the Shares of the Fund or determination of the NAV of the Shares is not reasonably practicable; or (4) in such other circumstance as is permitted by the SEC.

**DETERMINATION OF NET ASSET VALUE**

NAV per Share for the Fund is computed by dividing the value of the net assets of the Fund (*i.e.*, the value of its total assets less total liabilities) by the total number of Shares outstanding, rounded to the nearest cent. Expenses and fees, including the management fees, are accrued daily and taken into account for purposes of determining NAV. The NAV of the Fund is calculated by Fund Services and determined at the scheduled close of the regular trading session on the NYSE (ordinarily 4:00 p.m., Eastern Time) on each day that the NYSE is open, provided that fixed-income assets may be valued as of the announced closing time for trading in fixed-income instruments on any day that the Securities Industry and Financial Markets Association ("SIFMA") announces an early closing time.

In calculating the Fund's NAV per Share, the Fund's investments are generally valued using market quotations to the extent such market quotations are readily available. If market quotations are not readily available or, are deemed to be unreliable by the Adviser, the Fund will value such investments at fair value, as determined by the Adviser, for purposes of calculating the Fund's NAV. Pursuant to Rule 2a-5 under the 1940 Act, the Board has designated the Adviser to perform the fair value determinations for the Fund's portfolio holdings subject to the Board's oversight. The Adviser has established procedures for its fair valuation of the Fund's portfolio investments. These procedures address, among other things, determining when market quotations are not readily available or reliable and the methodologies to be used for determining the fair value of investments, as well as the use and oversight of third-party pricing services for fair valuation. The Adviser's fair value determinations will be carried out in compliance with Rule 2a-5 and based on fair value methodologies established and applied by the Adviser and periodically tested to ensure such methodologies are appropriate and accurate with respect to the Fund's portfolio investments. The Adviser's fair value methodologies may involve obtaining inputs and prices from third-party pricing services.

When fair value pricing is employed, the prices of securities used by the Fund to calculate its NAV may differ from quoted or published prices for the same securities. Due to the subjective and variable nature of fair value pricing, it is possible that the fair value determined for a particular security may be materially different (higher or lower) from the price of the security quoted or published by others, or the value when trading resumes or is realized upon its sale. There may be multiple methods that can be used to value a

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portfolio investment when market quotations are not readily available. The value established for any portfolio investment at a point in time might differ from what would be produced using a different methodology or if it had been priced using market quotations.

**DIVIDENDS AND DISTRIBUTIONS**

The following information supplements and should be read in conjunction with the section in the Prospectus entitled "<u>Dividends, Distributions and Taxes</u>."

<u>General Policies</u>. Dividends from net investment income, if any, are declared and paid at least annually by the Fund. Distributions of net realized securities gains, if any, generally are declared and paid once a year, but the Fund may make distributions on a more frequent basis to comply with the distribution requirements of the Code, in all events in a manner consistent with the provisions of the 1940 Act.

Dividends and other distributions on Shares are distributed, as described below, on a pro rata basis to Beneficial Owners of such Shares. Dividend payments are made through DTC Participants and Indirect Participants to Beneficial Owners then of record with proceeds received from the Trust.

The Fund makes additional distributions to the extent necessary (i) to distribute the entire annual taxable income of the Fund, plus any net capital gains and (ii) to avoid imposition of the excise tax imposed by Section 4982 of the Code. Management of the Trust reserves the right to declare special dividends if, in its reasonable discretion, such action is necessary or advisable to preserve the Fund's eligibility for treatment as a regulated investment company ("RIC") or to avoid imposition of income or excise taxes on undistributed income.

<u>Dividend Reinvestment Service</u>. The Trust will not make the DTC book-entry dividend reinvestment service available for use by Beneficial Owners for reinvestment of their cash proceeds, but certain individual broker-dealers may make available the DTC book-entry Dividend Reinvestment Service for use by Beneficial Owners of the Fund through DTC Participants for reinvestment of their dividend distributions. Investors should contact their brokers to ascertain the availability and description of these services. Beneficial Owners should be aware that each broker may require investors to adhere to specific procedures and timetables to participate in the dividend reinvestment service and investors should ascertain from their brokers such necessary details. If this service is available and used, dividend distributions of both income and realized gains will be automatically reinvested in additional whole Shares issued by the Trust of the Fund at NAV per Share. Distributions reinvested in additional Shares will nevertheless be taxable to Beneficial Owners acquiring such additional Shares to the same extent as if such distributions had been received in cash.

**FEDERAL INCOME TAXES**

The following is only a summary of certain important U.S. federal income tax considerations generally affecting the Fund and its shareholders that supplements the discussion in the Prospectus. No attempt is made to present a comprehensive explanation of the federal, state, local or foreign tax treatment of the Fund or its shareholders, and the discussion here and in the Prospectus is not intended to be a substitute for careful tax planning. In particular, it does not address tax consequences to investors subject to special rules, such as investors who hold Shares through individual retirement accounts ("IRAs"), 401(k)s, or other tax-advantaged accounts.

The following general discussion of certain U.S. federal income tax consequences is based on provisions of the Code and the regulations issued thereunder as in effect on the date of this SAI. New legislation, as well as administrative changes or court decisions, may significantly change the conclusions expressed herein, and may have a retroactive effect with respect to the transactions contemplated herein.

Unless your investment in Shares is made through a tax-exempt entity or tax-deferred retirement account, such as an IRA, you need to be aware of the possible tax consequences when the Fund makes distributions or you sell Shares.

Shareholders are urged to consult their own tax advisors regarding the application of the provisions of tax law described in this SAI in light of the particular tax situations of the shareholders and regarding specific questions as to federal, state, foreign or local taxes.

<u>Taxation of the Fund</u>. The Fund intends to qualify each year to be treated as a RIC under Subchapter M of the Code. As such, the Fund should not be subject to federal income taxes on its net investment income and capital gains, if any, to the extent that it timely distributes such income and capital gains to its shareholders. To qualify for treatment as a RIC, the Fund must distribute annually to its shareholders at least the sum of 90% of its net investment income (generally including dividends, taxable interest, and the excess of net short-term capital gains over net long-term capital losses, less operating expenses) and at least 90% of its net tax-exempt interest income, if any (the "Distribution Requirement") and must meet several additional requirements. Among these requirements are the following: (i) at least the sum of 90% of the Fund's gross income each taxable year must be derived from dividends, interest, payments with respect to certain securities loans, gains from the sale or other disposition of stock, securities or foreign currencies, or other income derived with respect to its business of investing in such stock, securities or foreign currencies and net income derived from interests in qualified publicly traded partnerships (the "Qualifying Income Requirement"); and (ii) at the end of each quarter of the Fund's taxable year, the Fund's assets must be diversified so that (a) at least 50% of the value of the Fund's total assets is represented by cash and cash items, U.S. government securities, securities of other RICs, and other securities, with such other securities limited, in respect to any one issuer, to an amount not greater in value than 5% of the value of the Fund's total assets and to not more than 10% of the outstanding voting securities of such issuer, including the equity securities of a qualified publicly traded partnership, and (b) not

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more than 25% of the value of its total assets is invested, including through corporations in which the Fund owns a 20% or more voting stock interest, in the securities (other than U.S. government securities or securities of other RICs) of any one issuer, the securities (other than securities of other RICs) of two or more issuers which the Fund controls and which are engaged in the same, similar, or related trades or businesses, or the securities of one or more qualified publicly traded partnerships (the "Diversification Requirement").

To the extent the Fund makes investments that may generate income that is not qualifying income, including certain derivatives, the Fund will seek to restrict the resulting income from such investments so that the Fund's non-qualifying income does not exceed 10% of its gross income.

Although the Fund intends to distribute substantially all of its net investment income and may distribute its capital gains for any taxable year, the Fund will be subject to federal income taxation to the extent any such income or gains are not distributed. The Fund is treated as a separate corporation for federal income tax purposes. The Fund therefore is considered a separate entity in determining its treatment under the rules for RICs described herein, *i.e.,* losses in the Fund do not offset gains in another fund. The requirements (other than certain organizational requirements) for qualifying RIC status are determined at the Fund level rather than at the Trust level.

If the Fund fails to satisfy the Qualifying Income Requirement or the Diversification Requirement in any taxable year, the Fund may be eligible for relief provisions if the failures are due to reasonable cause and not willful neglect and if a penalty tax is paid with respect to each failure to satisfy the applicable requirements. Additionally, relief is provided for certain *de minimis* failures of the Diversification Requirement where the Fund corrects the failure within a specified period of time. To be eligible for the relief provisions with respect to a failure to meet the Diversification Requirement, the Fund may be required to dispose of certain assets. If these relief provisions were not available to the Fund and it were to fail to qualify for treatment as a RIC for a taxable year, all of its taxable income would be subject to federal income tax at the regular 21% corporate rate without any deduction for distributions to shareholders, and its distributions (including capital gains distributions) generally would be taxable to the shareholders of the Fund as ordinary income dividends to the extent of the Fund's current and accumulated earnings and profits, subject to the dividends received deduction for corporate shareholders and the lower tax rates on qualified dividend income received by non-corporate shareholders, subject to certain limitations. To requalify for treatment as a RIC in a subsequent taxable year, the Fund would be required to satisfy the RIC qualification requirements for that year and to distribute any earnings and profits from any year in which the Fund failed to qualify for tax treatment as a RIC. If the Fund failed to qualify as a RIC for a period greater than two taxable years, it would generally be required to pay a Fund-level tax on certain net built in gains recognized with respect to certain of its assets upon disposition of such assets within five years of qualifying as a RIC in a subsequent year. The Board reserves the right not to maintain the qualification of the Fund for treatment as a RIC if it determines such course of action to be beneficial to shareholders. If the Fund determines that it will not qualify as a RIC, the Fund will establish procedures to reflect the anticipated tax liability in the Fund's NAV.

The Fund may elect to treat part or all of any "qualified late year loss" as if it had been incurred in the succeeding taxable year in determining the Fund's taxable income, net capital gain, net short-term capital gain, and earnings and profits. The effect of this election is to treat any such "qualified late year loss" as if it had been incurred in the succeeding taxable year in characterizing Fund distributions for any calendar year. A "qualified late year loss" generally includes net capital loss, net long-term capital loss, or net short-term capital loss incurred after October 31 of the relevant taxable year (commonly referred to as "post-October losses") and certain other late-year losses.

Capital losses in excess of capital gains ("net capital losses") are not permitted to be deducted against a RIC's net investment income. Instead, for U.S. federal income tax purposes, potentially subject to certain limitations, the Fund may carry a net capital loss from any taxable year forward indefinitely to offset its capital gains, if any, in years following the year of the loss. To the extent subsequent capital gains are offset by such losses, they will not result in U.S. federal income tax liability to the Fund and may not be distributed as capital gains to its shareholders. Generally, the Fund may not carry forward any losses other than net capital losses. The carryover of capital losses may be limited under the general loss limitation rules if the Fund experiences an ownership change as defined in the Code.

The Fund will be subject to a nondeductible 4% federal excise tax on certain undistributed income if it does not distribute to its shareholders in each calendar year an amount at least equal to 98% of its ordinary income for the calendar year plus 98.2% of its capital gain net income for the one-year period ending on October 31 of that year, subject to an increase for any shortfall in the prior year's distribution. For this purpose, any ordinary income or capital gain net income retained by the Fund and subject to corporate income tax will be considered to have been distributed. The Fund intends to declare and distribute dividends and distributions in the amounts and at the times necessary to avoid the application of the excise tax but can make no assurances that all such tax liability will be eliminated. For example, the Fund may receive delayed or corrected tax reporting statements from its investments that cause the Fund to accrue additional income and gains after the Fund has already made its excise tax distributions for the year. In such a situation, the Fund may incur an excise tax liability resulting from such delayed receipt of such tax information statements. In addition, the Fund may in certain circumstances be required to liquidate Fund investments to make sufficient distributions to avoid federal excise tax liability at a time when the investment adviser might not otherwise have chosen to do so, and liquidation of investments in such circumstances may affect the ability of the Fund to satisfy the requirement for qualification as a RIC.

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If the Fund meets the Distribution Requirement but retains some or all of its income or gains, it will be subject to federal income tax to the extent that any such income or gains are not distributed. The Fund may designate certain amounts retained as undistributed net capital gain in a notice to its shareholders, who (i) will be required to include in income for U.S. federal income tax purposes, as long-term capital gain, their proportionate shares of the undistributed amount so designated, (ii) will be entitled to credit their proportionate shares of the income tax paid by the Fund on that undistributed amount against their federal income tax liabilities and to claim refunds to the extent such credits exceed their tax liabilities, and (iii) will be entitled to increase their tax basis, for federal income tax purposes, in their Shares by an amount equal to the excess of the amount of undistributed net capital gain included in their respective income over their respective income tax credits.

<u>Taxation of Shareholders – Distributions</u>. The Fund intends to distribute annually to its shareholders substantially all of its investment company taxable income (computed without regard to the deduction for dividends paid), its net tax-exempt income, if any, and any net capital gain (net recognized long-term capital gains in excess of net recognized short-term capital losses, taking into account any capital loss carryforwards). The distribution of investment company taxable income (as so computed) and net realized capital gain will be taxable to Fund shareholders regardless of whether the shareholder receives these distributions in cash or reinvests them in additional Shares.

The Fund (or your broker) will report to shareholders annually the amounts of dividends paid from ordinary income, the amount of distributions of net capital gain, the portion of dividends which may qualify for the dividends received deduction for corporations, and the portion of dividends which may qualify for treatment as qualified dividend income, which, subject to certain limitations and requirements, is taxable to non-corporate shareholders at rates of up to 20%. Distributions from the Fund's net capital gain will be taxable to shareholders at long-term capital gains rates, regardless of how long shareholders have held their Shares.

Qualified dividend income includes, in general, subject to certain holding period and other requirements, dividend income from taxable domestic corporations and certain foreign corporations. Subject to certain limitations, eligible foreign corporations include those incorporated in possessions of the United States, those incorporated in certain countries with comprehensive tax treaties with the United States, and other foreign corporations if the stock with respect to which the dividends are paid is readily tradable on an established securities market in the United States. Dividends received by the Fund from an underlying fund taxable as a RIC or from a REIT may be treated as qualified dividend income generally only to the extent so reported by such underlying fund or REIT. If 95% or more of the Fund's gross income (calculated without taking into account net capital gain derived from sales or other dispositions of stock or securities) consists of qualified dividend income, the Fund may report all distributions of such income as qualified dividend income. Certain of the Fund's investment strategies may significantly reduce or eliminate the ability of the Fund to make distributions eligible to be treated as qualified dividend income.

Fund dividends will not be treated as qualified dividend income if the Fund does not meet holding period and other requirements with respect to dividend paying stocks in its portfolio, and the shareholder does not meet holding period and other requirements with respect to the Shares on which the dividends were paid. Distributions by the Fund of its net short-term capital gains will be taxable as ordinary income. Distributions from the Fund's net capital gain will be taxable to shareholders at long-term capital gains rates, regardless of how long shareholders have held their Shares. Distributions may be subject to state and local taxes.

In the case of corporate shareholders, certain dividends received by the Fund from U.S. corporations (generally, dividends received by the Fund in respect of any share of stock (1) with a tax holding period of at least 46 days during the 91-day period beginning on the date that is 45 days before the date on which the stock becomes ex-dividend as to that dividend and (2) that is held in an unleveraged position) and distributed and appropriately so reported by the Fund may be eligible for the 50% dividends received deduction. Certain preferred stock must have a holding period of at least 91 days during the 181-day period beginning on the date that is 90 days before the date on which the stock becomes ex-dividend as to that dividend to be eligible. Capital gain dividends distributed to the Fund from other RICs are not eligible, and dividends distributed to the Fund from REITs are generally not eligible for the dividends received deduction. To qualify for the deduction, corporate shareholders must meet the minimum holding period requirement stated above with respect to their Shares, taking into account any holding period reductions from certain hedging or other transactions or positions that diminish their risk of loss with respect to their Shares, and, if they borrow to acquire or otherwise incur debt attributable to Shares, they may be denied a portion of the dividends received deduction with respect to those Shares. Certain of the Fund's investment strategies may significantly reduce or eliminate the ability of the Fund to make distributions eligible for the dividends received deduction.

Although dividends generally will be treated as distributed when paid, any dividend declared by the Fund in October, November or December and payable to shareholders of record in such a month that is paid during the following January will be treated for U.S. federal income tax purposes as received by shareholders on December 31 of the calendar year in which it was declared.

Shareholders who have not held Shares for a full year should be aware that the Fund may report and distribute, as ordinary dividends or capital gain dividends, a percentage of income that is not equal to the percentage of the Fund's ordinary income or net capital gain, respectively, actually earned during the applicable shareholder's period of investment in the Fund. A taxable shareholder may wish to avoid investing in the Fund shortly before a dividend or other distribution, because the distribution will generally be taxable even though it may economically represent a return of a portion of the shareholder's investment.

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To the extent that the Fund makes a distribution of income received by the Fund in lieu of dividends (a "substitute payment") with respect to securities on loan pursuant to a securities lending transaction, such income will not constitute qualified dividend income to individual shareholders and will not be eligible for the dividends received deduction for corporate shareholders.

If the Fund's distributions exceed its earnings and profits, all or a portion of the distributions made for a taxable year may be recharacterized as a return of capital to shareholders. A return of capital distribution will generally not be taxable but will reduce each shareholder's cost basis in the Fund and result in a higher capital gain or lower capital loss when the Shares on which the distribution was received are sold. After a shareholder's basis in the Shares has been reduced to zero, distributions in excess of earnings and profits will be treated as gain from the sale of the shareholder's Shares.

<u>Taxation of Shareholders – Sale or Exchange of Shares</u>. A sale or exchange of Shares may give rise to a gain or loss for federal and state income tax purposes. Assuming a shareholder holds Shares as a capital asset, any gain or loss realized upon a taxable disposition of Shares will be treated as long-term capital gain or loss if Shares have been held for more than 12 months. Otherwise, the gain or loss on the taxable disposition of Shares will generally be treated as short-term capital gain or loss. Any loss realized upon a taxable disposition of Shares held for six months or less will be treated as long-term capital loss, rather than short-term capital loss, to the extent of any amounts treated as distributions to the shareholder of long-term capital gain (including any amounts credited to the shareholder as undistributed capital gains). All or a portion of any loss realized upon a taxable disposition of Shares may be disallowed if substantially identical Shares of the Fund are acquired (through the reinvestment of dividends or otherwise) within a 61-day period beginning 30 days before and ending 30 days after the disposition. In such a case, the basis of the newly acquired Shares will be adjusted to reflect the disallowed loss.

The cost basis of Shares acquired by purchase will generally be based on the amount paid for Shares and then may be subsequently adjusted for other applicable transactions as required by the Code. The difference between the selling price and the cost basis of Shares generally determines the amount of the capital gain or loss realized on the sale or exchange of Shares. Contact the broker through whom you purchased your Shares to obtain information with respect to the available cost basis reporting methods and elections for your account.

An Authorized Participant who exchanges securities for Creation Units generally will recognize a gain or a loss. The gain or loss will be equal to the difference between the market value of the Creation Units at the time and the sum of the exchanger's aggregate basis in the securities surrendered plus the amount of cash paid for such Creation Units. The ability of Authorized Participants to receive a full or partial cash redemption of Creation Units of the Fund may limit the tax efficiency of the Fund. An Authorized Participant who redeems Creation Units will generally recognize a gain or loss equal to the difference between the exchanger's basis in the Creation Units and the sum of the aggregate market value of any securities received plus the amount of any cash received for such Creation Units. The Internal Revenue Service (the "IRS"), however, may assert that a loss realized upon an exchange of securities for Creation Units cannot currently be deducted under the rules governing "wash sales" (for a person who does not mark-to-market its portfolio) or on the basis that there has been no significant change in economic position.

Any gain or loss realized upon a creation or redemption of Creation Units will be treated as capital or ordinary gain or loss, depending on the holder's circumstances.

The Trust, on behalf of the Fund, has the right to reject an order for Creation Units if the purchaser (or a group of purchasers) would, upon obtaining the Creation Units so ordered, own 80% or more of the outstanding Shares and if, pursuant to Section 351 of the Code, the Fund would have a basis in the deposit securities different from the market value of such securities on the date of deposit. The Trust also has the right to require the provision of information necessary to determine beneficial Share ownership for purposes of the 80% determination. If the Fund does issue Creation Units to a purchaser (or a group of purchasers) that would, upon obtaining the Creation Units so ordered, own 80% or more of the outstanding Shares, the purchaser (or a group of purchasers) will not recognize gain or loss upon the exchange of securities for Creation Units.

Authorized Participants purchasing or redeeming Creation Units should consult their own tax advisors with respect to the tax treatment of any creation or redemption transaction and whether the wash sales rule applies and when a loss may be deductible.

<u>Taxation of Shareholders – Net Investment Income Tax</u>. U.S. individuals with adjusted gross income (subject to certain adjustments) exceeding certain threshold amounts ($250,000 if married filing jointly or if considered a "surviving spouse" for federal income tax purposes, $125,000 if married filing separately, and $200,000 in other cases) are subject to a 3.8% tax on all or a portion of their "net investment income," which includes taxable interest, dividends, and certain capital gains (generally including capital gain distributions and capital gains realized on the sale of Shares). This 3.8% tax also applies to all or a portion of the undistributed net investment income of certain shareholders that are estates and trusts.

<u>Tax Treatment of Complex Securities</u>. Certain of the Fund's investments may be subject to complex provisions of the Code (including provisions relating to hedging transactions, straddles, integrated transactions, foreign currency contracts, forward foreign currency contracts, and notional principal contracts) that, among other things, may affect the Fund's ability to qualify as a RIC, may affect the character of gains and losses realized by the Fund (*e.g.*, may affect whether gains or losses are ordinary or capital), accelerate recognition of income to the Fund and defer losses. These rules could therefore affect the character, amount and timing of distributions to shareholders. These provisions also may require the Fund to mark-to-market certain types of positions in its portfolio (*i.e.*, treat

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them as if they were closed out) which may cause the Fund to recognize income without the Fund receiving cash with which to make distributions in amounts sufficient to enable the Fund to satisfy the RIC distribution requirements for avoiding income and excise taxes. The Fund intends to monitor its transactions, intends to make appropriate tax elections, and intends to make appropriate entries in its books and records to mitigate the effect of these rules and preserve the Fund's qualification for treatment as a RIC.

Certain derivative investments by the Fund, such as exchange-traded products and over-the-counter derivatives, may not produce qualifying income for purposes of the Qualifying Income Requirement described above, which must be met in order for the Fund to maintain its status as a RIC under the Code. In addition, the determination of the value and the identity of the issuer of such derivative investments are often unclear for purposes of the Diversification Requirement described above. The Fund intends to carefully monitor such investments to ensure that any non-qualifying income does not exceed permissible limits and to ensure that it is adequately diversified under the Diversification Requirement. The Fund, however, may not be able to accurately predict the non-qualifying income from these investments and there are no assurances that the IRS will agree with the Fund's determination of the Diversification Requirement with respect to such derivatives. Failure to satisfy the Diversification Requirement might also result from a determination by the IRS that financial instruments in which the Fund invests are not securities.

The Fund is required for federal income tax purposes to mark-to-market and recognize as income for each taxable year its net unrealized gains and losses on certain futures and options contracts subject to section 1256 of the Code ("Section 1256 Contracts") as of the end of the year as well as those actually realized during the year. Gain or loss from Section 1256 Contracts on broad-based indexes required to be marked to market will be 60% long-term and 40% short-term capital gain or loss. Application of this rule may alter the timing and character of distributions to shareholders. The Fund may be required to defer the recognition of losses on Section 1256 Contracts to the extent of any unrecognized gains on offsetting positions held by the Fund. These provisions also may require the Fund to mark-to-market certain types of positions in its portfolio (*i.e.*, treat them as if they were closed out), which may cause the Fund to recognize income without receiving cash with which to make distributions in amounts necessary to satisfy the Distribution Requirement and for avoiding the excise tax discussed above. Accordingly, to avoid certain income and excise taxes, the Fund may be required to liquidate its investments at a time when the investment adviser might not otherwise have chosen to do so.

Offsetting positions held by the Fund involving certain derivative instruments, such as options, forwards, and futures, as well as its long and short positions in portfolio securities, may be considered to constitute "straddles" for federal income tax purposes. In general, straddles are subject to certain rules that may affect the amount, character and timing of the Fund's gains and losses with respect to the straddle positions by requiring, among other things, that: (1) any loss realized on disposition of one position of a straddle may not be recognized to the extent that the Fund has unrealized gains with respect to the other positions in the straddle; (2) the Fund's holding period in straddle positions be suspended while the straddle exists (possibly resulting in a gain being treated as short-term rather than long-term capital gain); (3) the losses recognized with respect to certain straddle positions that are part of a mixed straddle and are non-Section 1256 Contracts be treated as 60% long-term and 40% short-term capital loss; (4) losses recognized with respect to certain straddle positions that would otherwise constitute short-term capital losses be treated as long-term capital losses; and (5) the deduction of interest and carrying charges attributable to certain straddle positions may be deferred. Various elections are available to the Fund, which may mitigate the effects of the straddle rules, particularly with respect to mixed straddles.

In general, the straddle rules described above do not apply to any straddles held by the Fund if all of the offsetting positions consist of Section 1256 Contracts. The straddle rules described above also do not apply if all the offsetting positions making up a straddle consist of one or more "qualified covered call options" and the stock to be purchased under the options and the straddle is not part of a larger straddle. A qualified covered call option is generally any option granted by the Fund to purchase stock it holds (or stock it acquires in connection with granting the option) if, among other things, (1) the option is traded on a national securities exchange that is registered with the SEC or other market the IRS determined has rules adequate to carry out the purposes of the applicable Code provision, (2) the option is granted more than 30 days before it expires, (3) the option is not a "deep-in-the-money option," (4) such option is not granted by an options dealer in connection with the dealer's activity of dealing in options, and (5) gain or loss with respect to the option is not ordinary income or loss. In addition, the straddle rules could cause distributions from the Fund that would otherwise constitute "qualified dividend income" or qualify for the dividends received deduction to fail to satisfy the applicable holding period requirements.

To the extent the Fund writes options that are not Section 1256 Contracts, the amount of the premium received by the Fund for writing such options is likely to be entirely short-term capital gain to the Fund. In addition, if such an option is closed by the Fund, any gain or loss realized by the Fund as a result of closing the transaction will also generally be short-term capital gain or loss. If such an option is exercised any gain or loss realized by the Fund upon the sale of the underlying security pursuant to such exercise will generally be short-term or long-term capital gain or loss to the Fund depending on the Fund's holding period for the underlying security.

If the Fund enters into a "constructive sale" of any appreciated financial position in its portfolio, the Fund will be treated as if it had sold and immediately repurchased the property and must recognize gain (but not loss) with respect to that position. A constructive sale of an appreciated financial position occurs when the Fund enters into certain offsetting transactions with respect to the same or substantially identical property, including, but not limited to: (i) a short sale; (ii) an offsetting notional principal contract; (iii) a futures or forward contract; or (iv) other transactions identified in future Treasury Regulations. The character of the gain from constructive sales will depend upon the Fund's holding period in the appreciated financial position. Losses realized from a sale of a position that was previously the subject of a constructive sale will be recognized when the position is subsequently disposed of. The character of

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such losses will depend upon the Fund's holding period in the position beginning with the date the constructive sale was deemed to have occurred and the application of various loss deferral provisions in the Code. Constructive sale treatment does not apply to certain closed transactions, including if such a transaction is closed on or before the 30th day after the close of the Fund's taxable year and the Fund holds the appreciated financial position unhedged throughout the 60-day period beginning with the day such transaction was closed.

<u>Foreign Investments</u>. Dividends and interest received by the Fund from sources within foreign countries may be subject to withholding and other taxes imposed by such countries. Tax treaties between certain countries and the U.S. may reduce or eliminate such taxes. The Fund does not expect to satisfy the requirements for passing through to its shareholders any share of foreign taxes paid by the Fund, with the result that shareholders will not include such taxes in their gross incomes and will not be entitled to a tax deduction or credit for such taxes on their own tax returns.

<u>Additional Tax Information Concerning U.S. REITs</u>. The Fund may invest in U.S. entities treated as REITs for U.S. federal income tax purposes. Investments in REIT equity securities may require the Fund to accrue and distribute income not yet received. To generate sufficient cash to make the requisite distributions, the Fund may be required to sell securities in its portfolio (including when it is not advantageous to do so) that it otherwise would have continued to hold. The Fund's investments in REIT equity securities may at other times result in the Fund's receipt of cash in excess of the REIT's earnings; if the Fund distributes these amounts, these distributions could constitute a return of capital to such Fund's shareholders for federal income tax purposes. Dividends paid by a REIT, other than capital gain distributions, will be taxable as ordinary income up to the amount of the REIT's current and accumulated earnings and profits. Capital gain dividends paid by a REIT to the Fund will be treated as long-term capital gains by the Fund and, in turn, may be distributed by the Fund to its shareholders as a capital gain distribution. Dividends received by the Fund from a REIT generally will not constitute qualified dividend income or qualify for the dividends received deduction. If a REIT is operated in a manner such that it fails to qualify as a REIT, an investment in the REIT would become subject to double taxation, meaning the taxable income of the REIT would be subject to federal income tax at the regular corporate rate without any deduction for dividends paid to shareholders and the dividends would be taxable to shareholders as ordinary income (or possibly as qualified dividend income) to the extent of the REIT's current and accumulated earnings and profits.

REITs in which the Fund invests often do not provide complete and final tax information to the Fund until after the time that such Fund issues a tax reporting statement. As a result, the Fund may at times find it necessary to reclassify the amount and character of its distributions to you after it issues your tax reporting statement. When such reclassification is necessary, you will be sent a corrected, final Form 1099-DIV to reflect the reclassified information. If you receive a corrected Form 1099-DIV, use the information on this corrected form, and not the information on the previously issued tax reporting statement, in completing your tax returns.

"Qualified REIT dividends" (*i.e.*, ordinary REIT dividends other than capital gain dividends and portions of REIT dividends designated as qualified dividend income eligible for capital gain tax rates) are treated as eligible for a 20% deduction by non-corporate taxpayers. This deduction, if allowed in full, equates to a maximum effective tax rate of 29.6% (37% top rate applied to income after 20% deduction). Distributions by the Fund to its shareholders that are attributable to qualified REIT dividends received by such Fund and which the Fund properly reports as "section 199A dividends," are treated as "qualified REIT dividends" in the hands of non-corporate shareholders. A section 199A dividend is treated as a qualified REIT dividend only if the shareholder receiving such dividend holds the dividend-paying RIC shares for at least 46 days of the 91-day period beginning 45 days before the shares become ex-dividend, and is not under an obligation to make related payments with respect to a position in substantially similar or related property. The Fund is permitted to report such part of its dividends as section 199A dividends as are eligible, but is not required to do so.

<u>Backup Withholding</u>. The Fund will be required in certain cases to withhold (as "backup withholding") on amounts payable to any shareholder who (1) fails to provide a correct taxpayer identification number certified under penalty of perjury; (2) is subject to backup withholding by the IRS for failure to properly report all payments of interest or dividends; (3) fails to provide a certified statement that he or she is not subject to "backup withholding"; or (4) fails to provide a certified statement that he or she is a U.S. person (including a U.S. resident alien). The backup withholding rate is currently 24%. Backup withholding is not an additional tax and any amounts withheld may be credited against the shareholder's ultimate U.S. tax liability. Backup withholding will not be applied to payments that have been subject to the 30% withholding tax on shareholders who are neither citizens nor permanent residents of the U.S.

<u>Non-U.S. Shareholders</u>. Any non-U.S. investors in the Fund may be subject to U.S. withholding and estate tax and are encouraged to consult their tax advisors prior to investing in the Fund. Foreign shareholders (*i.e.*, nonresident alien individuals and foreign corporations, partnerships, trusts and estates) are generally subject to U.S. withholding tax at the rate of 30% (or a lower tax treaty rate) on distributions derived from taxable ordinary income. The Fund may, under certain circumstances, report all or a portion of a dividend as an "interest-related dividend" or a "short-term capital gain dividend," which would generally be exempt from this 30% U.S. withholding tax, provided certain other requirements are met. Short-term capital gain dividends received by a nonresident alien individual who is present in the U.S. for a period or periods aggregating 183 days or more during the taxable year are not exempt from this 30% withholding tax. Gains realized by foreign shareholders from the sale or other disposition of Shares of the Fund generally are not subject to U.S. taxation, unless the recipient is an individual who is physically present in the U.S. for 183 days or more per year. Foreign shareholders who fail to provide an applicable IRS form may be subject to backup withholding on certain payments from the Fund. Backup withholding will not be applied to payments that are subject to the 30% (or lower applicable treaty rate) withholding tax

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described in this paragraph. Different tax consequences may result if the foreign shareholder is engaged in a trade or business within the United States. In addition, the tax consequences to a foreign shareholder entitled to claim the benefits of a tax treaty may be different than those described above.

Under legislation generally known as "FATCA" (the Foreign Account Tax Compliance Act), the Fund is required to withhold 30% of certain ordinary dividends it pays to shareholders that fail to meet prescribed information reporting or certification requirements. In general, no such withholding will be required with respect to a U.S. person or non-U.S. person that timely provides the certifications required by the Fund or its agent on a valid IRS Form W-9 or applicable series of IRS Form W-8, respectively. Shareholders potentially subject to withholding include foreign financial institutions ("FFIs"), such as non-U.S. investment funds, and non-financial foreign entities ("NFFEs"). To avoid withholding under FATCA, an FFI generally must enter into an information sharing agreement with the IRS in which it agrees to report certain identifying information (including name, address, and taxpayer identification number) with respect to its U.S. account holders (which, in the case of an entity shareholder, may include its direct and indirect U.S. owners), and an NFFE generally must identify and provide other required information to the Fund or other withholding agent regarding its U.S. owners, if any. Such non-U.S. shareholders also may fall into certain exempt, excepted or deemed compliant categories as established by regulations and other guidance. A non-U.S. shareholder resident or doing business in a country that has entered into an intergovernmental agreement with the United States to implement FATCA will be exempt from FATCA withholding provided that the shareholder and the applicable foreign government comply with the terms of the agreement. A non-U.S. entity that invests in the Fund will need to provide the fund with documentation properly certifying the entity's status under FATCA in order to avoid FATCA withholding. Non-U.S. investors in the Fund should consult their tax advisors in this regard.

The Fund's shares held in a tax-qualified retirement account will generally not be subject to federal taxation on income and capital gains distributions from the Fund until a shareholder begins receiving payments from their retirement account.

<u>Certain Potential Tax Reporting Requirements</u>. Under U.S. Treasury regulations, if a shareholder recognizes a loss on disposition of Shares of $2 million or more for an individual shareholder or $10 million or more for a corporate shareholder (or certain greater amounts over a combination of years), the shareholder must file with the IRS a disclosure statement on IRS Form 8886. Direct shareholders of portfolio securities are in many cases excepted from this reporting requirement, but under current guidance, shareholders of a RIC are not excepted. Significant penalties may be imposed for the failure to comply with the reporting requirements. The fact that a loss is reportable under these regulations does not affect the legal determination of whether the taxpayer's treatment of the loss is proper. Shareholders should consult their tax advisors to determine the applicability of these regulations in light of their individual circumstances.

<u>Other Issues</u>. In those states which have income tax laws, the tax treatment of the Fund and of Fund shareholders with respect to distributions by the Fund may differ from federal tax treatment.

The foregoing discussion is based on U.S. federal tax laws and regulations which are in effect on the date of this SAI. Such laws and regulations may be changed by legislative or administrative action. Shareholders are advised to consult their tax advisors concerning their specific situations and the application of foreign, federal, state, or local taxes.

**FINANCIAL STATEMENTS**

Financial statements included in Form N-CSR will be available after the Fund has completed a fiscal year of operations. When available, you may request a copy of the Fund's Form N-CSR or Annual Report at no charge by calling 800-617-0004, or through the Fund's website at www.corealtfunds.com.

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**APPENDIX A**

**ISS United States Proxy Voting Guidelines**

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**UNITEDSTATES**

ProxyVotingGuidelines

BenchmarkPolicyRecommendations

EffectiveforMeetingsonorafterFebruary1, 2025

Published January 9, 2025

UpdatedFebruary25, 2025

Effective for Meetings Published on or after February 25, 2025, Consideration of Certain

DiversityFactorsinMakingVoteRecommendationsIsSuspended(seepp.12-13formore

information).

<u>W</u> <u>W</u> <u>W</u> <u>.</u> <u>I S S</u> <u>G</u> <u>O</u> <u>V</u> <u>E</u> <u>R</u> <u>N</u> <u>A</u> <u>N</u> <u>C</u> <u>E</u> <u>.</u> <u>C</u> <u>O</u><u>M</u>

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**TABLE OF CONTENTS**

**Coverage8**

**1. Board ofDirectors9**

Voting on Director Nominees in Uncontested Elections9

Independence9

ISS Classification of Directors –U.S.10

Composition12

Attendance12

OverboardedDirectors12

GenderDiversity12

Racial and/or EthnicDiversity13

Responsiveness13

Accountability14

PoisonPills14

Unequal VotingRights14

Classified Board Structure15

Removal of Shareholder Discretion on Classified Boards15

ProblematicGovernanceStructure15

UnilateralBylaw/CharterAmendments15

RestrictingBindingShareholderProposals16

Director PerformanceEvaluation16

Management Proposals to Ratify Existing Charter or BylawProvisions16

ProblematicAudit-RelatedPractices16

ProblematicCompensationPractices17

Problematic Pledging of CompanyStock17

ClimateAccountability17

GovernanceFailures18

Voting on Director Nominees in ContestedElections18

Vote-NoCampaigns18

ProxyContests/ProxyAccess18

Other Board-RelatedProposals19

AdoptAnti-Hedging/Pledging/SpeculativeInvestmentsPolicy19

BoardRefreshment19

Term/TenureLimits19

AgeLimits19

BoardSize20

Classification/DeclassificationoftheBoard20

CEO SuccessionPlanning20

CumulativeVoting20

Director and Officer Indemnification, Liability Protection, and Exculpation21

Establish/AmendNomineeQualifications21

Establish Other Board Committee Proposals22

Filling Vacancies/Removal ofDirectors22

Independent BoardChair22

Majority of Independent Directors/Establishment of IndependentCommittees23

Majority Vote Standard for the Election ofDirectors23

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ProxyAccess23

Require More Nominees than OpenSeats23

Shareholder Engagement Policy (Shareholder AdvisoryCommittee)24

**2. Audit-Related25**

Auditor Indemnification and Limitation ofLiability25

AuditorRatification25

Shareholder Proposals Limiting Non-Audit Services25

Shareholder Proposals on Audit FirmRotation26

**3. Shareholder Rights &Defenses27**

Advance Notice Requirements for Shareholder Proposals/Nominations27

Amend Bylaws without Shareholder Consent27

Control Share AcquisitionProvisions27

Control Share Cash-Out Provisions28

DisgorgementProvisions28

Fair PriceProvisions28

Freeze-OutProvisions28

Greenmail28

ShareholderLitigationRights29

Federal Forum SelectionProvisions29

Exclusive Forum Provisions for State LawMatters29

Feeshifting29

Net Operating Loss (NOL) ProtectiveAmendments30

Poison Pills (Shareholder RightsPlans)30

Shareholder Proposals to Put Pill to a Vote and/or Adopt a Pill Policy30

Management Proposals to Ratify a PoisonPill31

Management Proposals to Ratify a Pill to Preserve Net Operating Losses(NOLs)31

Proxy Voting Disclosure, Confidentiality, andTabulation31

Ratification Proposals: Management Proposals to Ratify Existing Charter or BylawProvisions32

Reimbursing Proxy SolicitationExpenses32

ReincorporationProposals33

Shareholder Ability to Act by WrittenConsent33

Shareholder Ability to Call Special Meetings33

StakeholderProvisions34

State AntitakeoverStatutes34

Supermajority Vote Requirements34

VirtualShareholderMeetings34

**4. Capital/Restructuring35**

Capital35

Adjustments to Par Value of CommonStock35

Common Stock Authorization35

GeneralAuthorizationRequests35

SpecificAuthorizationRequests36

Dual Class Structure36

Issue Stock for Use with Rights Plan36

PreemptiveRights36

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Preferred Stock Authorization37

GeneralAuthorizationRequests37

RecapitalizationPlans38

Reverse StockSplits38

Share Issuance Mandates at U.S. Domestic Issuers Incorporated Outside theU.S.38

Share Repurchase Programs39

Share Repurchase Programs Shareholder Proposals39

Stock Distributions: Splits andDividends39

TrackingStock40

Restructuring40

AppraisalRights40

AssetPurchases40

AssetSales40

BundledProposals41

Conversion ofSecurities41

Corporate Reorganization/Debt Restructuring/Prepackaged Bankruptcy Plans/Reverse Leveraged Buyouts/Wrap

Plans41

Formation of HoldingCompany41

Going Private and Going Dark Transactions (LBOs and Minority Squeeze-outs)42

JointVentures42

Liquidations43

Mergers and Acquisitions43

PrivatePlacements/Warrants/ConvertibleDebentures43

Reorganization/RestructuringPlan(Bankruptcy)45

SpecialPurposeAcquisitionCorporations(SPACs)45

Special Purpose Acquisition Corporations (SPACs) - Proposals for Extensions45

Spin-offs46

ValueMaximizationShareholderProposals46

**5. Compensation47**

Executive PayEvaluation47

AdvisoryVotesonExecutiveCompensation—ManagementProposals(Say-on-Pay)47

Pay-for-PerformanceEvaluation48

Problematic PayPractices49

CompensationCommitteeCommunicationsandResponsiveness50

Frequency of Advisory Vote on Executive Compensation ("Say When on Pay")50

Voting on Golden Parachutes in an Acquisition, Merger, Consolidation, or Proposed Sale50

Equity-Based and Other Incentive Plans51

Shareholder Value Transfer(SVT)52

Three-Year Value-Adjusted Burn Rate52

EgregiousFactors53

Liberal Change in ControlDefinition53

RepricingProvisions53

Problematic Pay Practices or Significant Pay-for-PerformanceDisconnect53

Amending Cash and Equity Plans (including Approval for Tax Deductibility(162(m))54

Specific Treatment of Certain Award Types in Equity PlanEvaluations54

Dividend EquivalentRights54

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Operating Partnership (OP) Units in Equity Plan Analysis of Real Estate Investment Trusts (REITs)55

Other CompensationPlans55

401(k) Employee BenefitPlans55

Employee Stock Ownership Plans (ESOPs)55

Employee Stock Purchase Plans—Qualified Plans55

Employee Stock Purchase Plans—Non-Qualified Plans55

OptionExchangePrograms/RepricingOptions56

Stock Plans in Lieu ofCash56

Transfer Stock Option (TSO)Programs57

DirectorCompensation57

Shareholder Ratification of Director Pay Programs57

Equity Plans for Non-EmployeeDirectors58

Non-Employee Director Retirement Plans58

Shareholder Proposals onCompensation58

Bonus Banking/Bonus Banking "Plus"58

Compensation Consultants—Disclosure of Board or Company'sUtilization59

Disclosure/Setting Levels or Types of Compensation for Executives andDirectors59

Golden Coffins/Executive Death Benefits59

Hold Equity Past Retirement or for a Significant Period of Time59

PayDisparity60

PayforPerformance/Performance-BasedAwards60

Pay for SuperiorPerformance61

Pre-Arranged Trading Plans (10b5-1 Plans)61

Prohibit Outside CEOs from Serving on CompensationCommittees61

Recoupment of Incentive or Stock Compensation in Specified Circumstances62

Severance and Golden ParachuteAgreements62

Share Buyback Impact on Incentive Program Metrics62

Supplemental Executive Retirement Plans (SERPs)63

Tax Gross-UpProposals63

Termination of Employment Prior to Severance Payment/Eliminating Accelerated Vesting of UnvestedEquity

.63

**6. Routine/Miscellaneous64**

AdjournMeeting64

Amend QuorumRequirements64

Amend Minor Bylaws64

Change CompanyName64

Change Date, Time, or Location of AnnualMeeting65

OtherBusiness65

**7. Social and EnvironmentalIssues66**

Global Approach – E&S Shareholder Proposals66

Endorsement ofPrinciples66

AnimalWelfare66

Animal Welfare Policies66

AnimalTesting67

AnimalSlaughter67

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ConsumerIssues67

Genetically Modified Ingredients67

Reports on Potentially Controversial Business/Financial Practices68

Pharmaceutical Pricing, Access to Medicines, and Prescription DrugReimportation68

Product Safety and Toxic/HazardousMaterials68

[Tobacco-Related](#i3a2efcc9db514d66a79775e6e31641f7_10) [Proposals](#i3a2efcc9db514d66a79775e6e31641f7_10)[69](#i3a2efcc9db514d66a79775e6e31641f7_10)

ClimateChange70

Say on Climate (SoC) ManagementProposals70

Say on Climate (SoC) ShareholderProposals70

Climate Change/Greenhouse Gas (GHG) Emissions70

EnergyEfficiency71

RenewableEnergy71

Diversity72

BoardDiversity72

Equality ofOpportunity72

Gender Identity, Sexual Orientation, and Domestic PartnerBenefits72

Gender, Race/Ethnicity PayGap73

Racial Equity and/or Civil Rights AuditGuidelines73

Environment andSustainability73

Facility and Workplace Safety73

Natural Capital- Related and/or Community Impact AssessmentProposals74

HydraulicFracturing74

Operations in ProtectedAreas74

Recycling75

SustainabilityReporting75

WaterIssues75

General CorporateIssues75

CharitableContributions75

Data Security, Privacy, and Internet Issues76

ESGCompensation-RelatedProposals76

Human Rights, Human Capital Management, and InternationalOperations76

Human RightsProposals76

MandatoryArbitration77

Operations in High-Risk Markets77

Outsourcing/Offshoring77

SexualHarassment78

Weapons and Military Sales78

PoliticalActivities78

Lobbying78

PoliticalContributions79

Political Expenditures and LobbyingCongruency79

PoliticalTies79

**8. Mutual FundProxies81**

Election ofDirectors81

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Closed End Funds- Unilateral Opt-In to Control Share AcquisitionStatutes81

Converting Closed-end Fund to Open-endFund81

ProxyContests81

Investment AdvisoryAgreements82

Approving New Classes or Series ofShares82

Preferred Stock Proposals82

1940 ActPolicies82

Changing a Fundamental Restriction to a NonfundamentalRestriction82

Change Fundamental Investment Objective toNonfundamental83

Name Change Proposals83

Change in Fund's Subclassification83

Business Development Companies—Authorization to Sell Shares of Common Stock at a Price below Net Asset

Value83

Disposition ofAssets/Termination/Liquidation84

Changes to the Charter Document84

Changing the Domicile of a Fund84

Authorizing the Board to Hire and Terminate Subadvisers Without ShareholderApproval84

DistributionAgreements85

Master-FeederStructure85

Mergers85

Shareholder Proposals for MutualFunds85

Establish Director OwnershipRequirement85

Reimburse Shareholder for Expenses Incurred85

Terminate the InvestmentAdvisor86

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**COVERAGE**

The U.S. research team provides proxy analyses and voting recommendations for the common shareholder

meetings of U.S. - incorporated companies that are publicly-traded on U.S. exchanges, as well as certain OTC

companies, if they are held in our institutional investor clients' portfolios. Coverage generally includes corporate

actions for common equity holders, such as written consents and bankruptcies. ISS' U.S. coverage includes

investmentcompanies(includingopen-endfunds,closed-endfunds,exchange-tradedfunds,andunitinvestment

trusts),limitedpartnerships("LPs"),masterlimitedpartnerships("MLPs"),limitedliabilitycompanies("LLCs"),and

business development companies. ISS reviews its universe of coverage on an annual basis, and the coverage is

subject to change based on client need and industry trends.

**Foreign-incorporatedcompanies**

In addition to U.S.- incorporated, U.S.- listed companies, ISS' U.S. policies are applied to certain foreign-

incorporatedcompanyanalyses.LiketheSEC,ISSdistinguishestwotypesofcompaniesthatlistbutarenot

incorporated in the U.S.:

U.S.DomesticIssuers–whichhaveamajorityofoutstandingsharesheldintheU.S.andmeetothercriteria,

as determined by the SEC, and are subject to the same disclosure and listingstandards as U.S. incorporated

companies (e.g. they are required to file DEF14A proxy statements) – are generally covered under standard

U.S.policyguidelines.

<u>Foreign</u> <u>Private</u> <u>Issuers</u>(FPIs)–whichareallowedtotakeexemptionsfrommostdisclosurerequirements(e.g.,

theyareallowedtofile6-Kfortheirproxymaterials)andU.S.listingstandards –aregenerallycovered undera

combination of policy guidelines:

FPIGuidelines(seethe<u>Americas</u> <u>Regional</u> <u>Proxy Voting</u> <u>Guidelines</u>),mayapplytocompaniesincorporated

in governance havens, and apply certain minimum independence and disclosure standards in the

evaluation of key proxy ballot items, such as the election of directors; and/or

Guidelinesforthemarketthatisresponsiblefor,ormostrelevantto,theitemontheballot.

U.S.incorporatedcompanieslistedonlyonnon-U.S.exchangesaregenerallycoveredundertheISSguidelinesfor

the market on which they are traded.

An FPI is generally covered under ISS' approach to FPIs outlined above, even if such FPI voluntarily files a proxy

statementand/orotherfilingnormallyrequiredofaU.S.DomesticIssuer,solongasthecompanyretainsitsFPI

status.

In all cases – including with respect to other companies with cross-market features that may lead to ballot items

relatedtomultiplemarkets –itemsthatareontheballotsolelyduetotherequirementsofanothermarket(listing,

incorporation, or national code) may be evaluated under the policy of the relevant market, regardless of the

"assigned" primary market coverage.

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**1. BoardofDirectors**

VotingonDirectorNomineesinUncontestedElections

Fourfundamentalprinciplesapplywhendeterminingvotesondirectornominees:

**Independence**: Boards should be sufficiently independent from management (and significant shareholders) to

ensurethattheyareableandmotivatedtoeffectivelysupervisemanagement'sperformanceforthebenefitofall

shareholders, including in setting and monitoring the execution of corporate strategy, with appropriate use of

shareholder capital, and in setting and monitoring executive compensation programs that support that strategy.

The chair of the board should ideally be an independent director, and all boards should have an independent

leadership position or a similar role in order to help provide appropriate counterbalance to executive

management,aswellashavingsufficientlyindependentcommitteesthatfocusonkeygovernanceconcernssuch

as audit, compensation, and nomination of directors.

**Composition**:Companiesshouldensurethatdirectorsaddvaluetotheboardthroughtheirspecificskillsand

expertise and by having sufficient time and commitment to serve effectively. Boards should be of a size

appropriatetoaccommodate diversity,expertise,andindependence,whileensuringactiveandcollaborative

participationbyallmembers.Boardsshouldbesufficientlydiversetoensureconsiderationofawiderangeof

perspectives.

**Responsiveness**:Directorsshouldrespondtoinvestorinput,suchasthatexpressedthroughsignificantopposition

to management proposals, significant support for shareholder proposals (whether binding or non-binding), and

tender offers where a majority of shares are tendered.

**Accountability**:Boardsshouldbesufficientlyaccountabletoshareholders,includingthroughtransparencyofthe

company's governance practices and regular board elections, by the provision of sufficient information for

shareholders to be able to assess directors and board composition, and through the ability of shareholders to

remove directors.

**GeneralRecommendation:**Generallyvotefordirectornominees,exceptunderthefollowingcircumstances (with

new nominees<sup>1</sup>considered on case-by-case basis):

**Independence**

Voteagainst<sup>2</sup>orwithholdfrom non-independentdirectors(ExecutiveDirectorsandNon-IndependentNon-

Executive Directors per ISS' Classification of Directors) when:

• Independentdirectorscomprise50percentorlessoftheboard;

• Thenon-independentdirectorservesontheaudit,compensation,ornominatingcommittee;

• Thecompanylacksanaudit,compensation,ornominatingcommitteesothatthefullboardfunctionsasthat

committee; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**1**A"newnominee"isa directorwhoisbeingpresentedforelectionbyshareholdersforthefirsttime.Recommendationson

new nominees who have served for less than one year are made on a case-by-case basis depending on the timing of their

appointment and the problematic governance issue in question.

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**2**In general, companies with a plurality vote standard use "Withhold" as the contrary vote option in director elections;

companieswithamajorityvotestandarduse"Against".However,itwillvarybycompanyandtheproxymustbechecked to

determine the valid contrary vote option for the particular company.

• Thecompanylacksaformalnominatingcommittee,eveniftheboardatteststhattheindependentdirectors

fulfill the functions of such a committee.

**ISSClassificationofDirectors–U.S.**

1.**ExecutiveDirector**

1.1.Currentofficer<sup>1</sup>ofthecompanyoroneofitsaffiliates<sup>2</sup>*.***

2.**Non-IndependentNon-ExecutiveDirector**

<u>Board</u><u>Identification</u>

2.1.Directoridentifiedasnotindependentbythe

board. <u>Controlling/Significant Shareholder</u>

2.2.Beneficialownerofmorethan50percentofthe company'svotingpower(thismaybeaggregatedif

voting power is distributed among more than one member of a group).

<u>Current</u><u>Employment</u><u>at</u><u>Company</u><u>or</u><u>Related</u><u>Company</u>

2.3.Non-officeremployeeofthefirm(includingemployeerepresentatives).

2.4.Officer<sup>1</sup><sup>,</sup>formerofficer,orgeneralorlimitedpartnerofajointventureorpartnershipwiththe

company.

<u>Former</u><u>Employment</u>

2.5.FormerCEOofthecompany.<sup>3,</sup><sup>4</sup>

2.6.Formernon-CEOofficer<sup>1</sup>ofthecompanyoranaffiliate<sup>2</sup>withinthepastfiveyears.

2.7.Formerofficer<sup>1</sup>ofanacquiredcompanywithinthepastfiveyears.<sup>4</sup>

2.8.Officer<sup>1</sup>ofaformerparentorpredecessorfirmatthetimethecompanywassoldorsplitoffwithinthe

past five years.

2.9.Formerinterimofficeriftheservicewaslongerthan18months.Iftheservicewasbetween12and18

monthsanassessmentoftheinterimofficer'semploymentagreementwillbemade.<sup>5</sup>

<u>Family</u><u>Members</u>

2.10.Immediatefamilymember<sup>6</sup>ofacurrentorformerofficer<sup>1</sup>ofthecompanyoritsaffiliates<sup>2</sup>withinthe

last five years.

2.11.Immediatefamilymember<sup>6</sup>ofacurrentemployeeofcompanyoritsaffiliates<sup>2</sup>whereadditionalfactors

raise concern (which may include, but are not limited to, the following: a director related to numerous

employees; the company or its affiliates employ relatives of numerous board members; or a non-

Section 16 officer in a key strategic role).

<u>Professional,</u><u>Transactional,</u><u>and</u><u>Charitable</u><u>Relationships</u>

2.12.Director who (or whose immediate family member<sup>6</sup>) currently provides professional services<sup>7</sup>in excess

of$10,000peryearto:thecompany,anaffiliate<sup>2</sup>,oranindividualofficerofthecompanyoranaffiliate;

or who is (or whose immediate family member<sup>6</sup>is) a partner, employee, or controlling shareholder of

an organization which provides the services.

2.13.Director who (or whose immediate family member<sup>6</sup>) currently has any material transactional

relationship<sup>8</sup>withthecompanyoritsaffiliates<sup>2</sup>;orwhois(orwhoseimmediatefamilymember<sup>6</sup>is)a

partner in, or a controlling shareholder or an executive officer of, an organization which has the

material transactional relationship<sup>8</sup>(excluding investments in the company through a private

placement).

2.14.Directorwho(orwhoseimmediatefamilymember<sup>6</sup>**)**isatrustee,director,oremployeeofacharitable

or non-profit organization that receives material grants or endowments<sup>8</sup>from the company or its

affiliates<sup>2</sup>.

<u>Other</u><u>Relationships</u>

2.15.Partytoavotingagreement<sup>9</sup>tovoteinlinewithmanagementonproposalsbeingbroughtto

shareholder vote.

2.16.Has(oranimmediatefamilymember<sup>6</sup>has)aninterlockingrelationshipasdefinedbytheSECinvolving

members of the board of directors or its Compensation Committee.<sup>10</sup>

2.17.Founder<sup>11</sup>ofthecompanybutnotcurrentlyanemployee.

2.18.DirectorwithpaycomparabletoNamedExecutiveOfficers.

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2.19.Anymaterial<sup>12</sup>relationshipwiththecompany.

3.**IndependentDirector**

3.1.Nomaterial<sup>12</sup>connectiontothecompanyotherthanaboardseat.

**Footnotes:**

*1.*The definition of officer will generally follow that of a "Section 16 officer" (officers subject to Section 16 of the

SecuritiesandExchangeActof1934)andincludesthechiefexecutive,operating,financial,legal,technology,andaccounting

officers ofa company (including the president, treasurer, secretary, controller, or any vice president in charge of a principal

business unit, division, or policy function). Current interim officers are included in this category. For private companies, the

equivalent positions are applicable. A non-employee director serving as an officer due to statutory requirements (e.g.

corporate secretary) will generally be classified as a Non-Independent Non-Executive Director under "Any material

relationship with the company." However, if the company provides explicit disclosure that the director is not receiving

additional compensation exceeding $10,000 per year for serving in that capacity, then the director will be classified as an

Independent Director.

*2.*"Affiliate"includesasubsidiary,siblingcompany,orparentcompany.ISSuses50percentcontrolownershipbythe

parent companyasthestandardforapplyingitsaffiliate designation. Themanager/advisorofanexternally managedissuer

(EMI)is considered an affiliate.

*3.*IncludesanyformerCEOofthecompanypriortothecompany'sinitialpublicoffering(IPO).

*4.*When thereis a former CEO ofa special purpose acquisition company (SPAC) serving on the boardof an acquired

company, ISSwillgenerallyclassifysuchdirectorsasindependentunlessdeterminedotherwisetakingintoaccountthe

followingfactors: the applicable listing standards determination of such director's independence; any operating ties to the

firm; and the existence of any other conflicting relationships or related party transactions.

*5.*ISSwilllook at the termsofthe interim officer'semployment contract to determineifit contains severance pay, long-

term healthandpensionbenefits,orothersuchstandardprovisionstypicallycontainedincontractsofpermanent,non-

temporary CEOs. ISS will also consider if a formal search process was under way for a full-time officer at the time.

*6.*"Immediatefamilymember"followstheSEC'sdefinitionofsuchandcoversspouses,parents,children,step-parents,

step- children,siblings,in-laws,andanyperson(otherthanatenantor employee)sharingthehouseholdofanydirector,

nominee for director, executive officer, or significant shareholder of the company.

*7.*Professionalservicescanbecharacterizedasadvisoryinnature,generallyinvolveaccesstosensitivecompany

information or to strategic decision-making, and typically have a commission- or fee-based payment structure. Professional

services generally include but are not limited to the following: investment banking/financial advisory services, commercial

banking (beyond deposit services), investment services, insurance services, accounting/audit services, consulting services,

marketing services, legal services, property management services, realtor services, lobbying services, executive search

services, and IT consulting services. The following would generally be considered transactional relationships and not

professional services: deposit services, IT tech support services, educational services, and construction services. The case of

participation in a banking syndicate by a non-lead bank should be considered a transactional (and hence subject to the

associated materiality test) rather than a professional relationship. "Of Counsel" relationships are only considered

immaterial if the individual does not receive any form of compensation (in excess of $10,000 per year) from, or is a retired

partner of, the firm providing the professional service.Thecaseofa company providinga professional service to oneofits

directors or to anentity withwhich one of its directors is affiliated, will be considered a transactional rather than a

professional relationship. Insurance services and marketing services are assumed to be professional services unless the

company explains why such services are not advisory.

*8.*Amaterialtransactionalrelationship,includinggrantstonon-profitorganizations,existsifthecompanymakes

annual payments to, or receives annual payments from, another entity, exceeding the greater of: $200,000 or 5 percent

of the

recipient'sgrossrevenues,foracompanythatfollowsNASDAQlistingstandards;orthegreaterof$1,000,000or2percentof

the recipient's gross revenues, for a company that follows NYSE listing standards. For a company that follows neither of the

preceding standards, ISS will apply the NASDAQ-based materiality test. (The recipient is the party receiving the financial

proceeds from the transaction).

*9.*Dissidentdirectorswhoarepartiestoavotingagreementpursuanttoasettlementorsimilararrangementmaybe

classified asIndependentDirectorsifananalysisofthefollowingfactorsindicatesthatthevotingagreement doesnot

compromisetheir alignment with all shareholders' interests: the terms of the agreement; the duration of the standstill

provision in the agreement;thelimitationsandrequirementsofactionsthat areagreedupon; ifthe dissident director

nominee(s) is subject to the standstill; and if there any conflicting relationships or related party transactions.

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*10.*Interlocks include: executive officers serving as directors on each other's compensation or similar committees (or, in

the absenceofsuchacommittee,ontheboard);orexecutiveofficerssittingoneachother'sboardsandatleastoneserveson

the other's compensation or similar committees (or, in the absence of such a committee, on the board).

*11.*Theoperatinginvolvementofthefounderwiththecompanywillbeconsidered;ifthefounder wasneveremployed

bythe company, ISS may deem him or her an Independent Director.

*12.*For purposes of ISS's director independence classification, "material" will be defined as a standard of relationship

(financial,personal,orotherwise)thatareasonablepersonmightconcludecouldpotentiallyinfluenceone'sobjectivityinthe

boardroom ina manner that would have a meaningful impact on an individual's ability to satisfy requisite fiduciary standards

on behalf of shareholders.

**Composition**

**Attendance at Board and Committee Meetings:** Generally vote against or withhold from directors (except

nomineeswhoservedonlypartofthefiscalyear<sup>3</sup>)whoattendlessthan75percentoftheaggregateoftheirboard

and committee meetings for the period for which they served, unless an acceptable reason for absences is

disclosed in the proxy or another SEC filing. Acceptable reasons for director absences are generally limited to the

following:

Medicalissues/illness;

Familyemergencies;and

Missingonlyonemeeting(whenthetotalofallmeetingsisthreeorfewer).

Incasesofchronicpoorattendancewithoutreasonablejustification,inadditiontovotingagainstthedirector(s)

with poor attendance, generally vote against or withhold from appropriate members of the nominating/

governance committees or the full board.

If the proxy disclosure is unclear and insufficient to determine whether a director attended at least 75 percent of

theaggregateofhis/herboardandcommitteemeetingsduringhis/herperiodofservice,voteagainstorwithhold

from the director(s) in question.

**OverboardedDirectors:**Generallyvoteagainstorwithholdfromindividualdirectorswho:

Sitonmorethanfivepubliccompanyboards; or

AreCEOsofpubliccompanieswhositontheboardsofmorethantwopubliccompaniesbesidestheirown—

withholdonlyattheiroutsideboards<sup>4</sup><sup>.</sup>

*NOTE: For shareholder meeting reports published on or after February 25th, 2025, Institutional Shareholder* 

*Services(ISS)hasindefinitelyhaltedtheconsiderationofthegenderdiversityofacompany'sboardwhenmaking* 

*voterecommendationswithrespecttotheelectionorre-electionofdirectorsatU.S.companies coveredbythese* 

*guidelines under its proprietary ISS U.S. Benchmark policy.*

**GenderDiversity:** Generally vote against or withhold from the chair of the nominating committee (or other

directorsonacase-by-casebasis)atcompanieswheretherearenowomenonthecompany'sboard.Anexception

willbemadeiftherewas at least one woman on theboardat theprecedingannual meetingand theboard makes

a firm commitment to return to a gender-diverse status within a year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**3**Nomineeswhoservedforonlypartofthefiscalyeararegenerally exemptedfromtheattendance policy.

**4**AlthoughallofaCEO'ssubsidiaryboardswithpublicly-tradedcommonstockwillbecountedasseparateboards,ISSwillnot

recommend a withhold vote for the CEO of a parent company board or any of the controlled (>50 percent ownership)

subsidiaries of that parent but may do so at subsidiaries that are less than 50 percent controlled and boards outside the

parent/subsidiary relationships.

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*NOTE: For shareholder meeting reports published on or after February 25th, 2025, Institutional Shareholder* 

*Services(ISS)hasindefinitelyhaltedtheconsiderationoftheracialand/orethnicdiversityofacompany'sboard* 

*when making vote recommendations with respect to the election or re-election of directors at U.S. companies* 

*covered under these guidelines under its proprietary ISS U.S. Benchmark policy.*

**Racialand/orEthnicDiversity:** For companies in the Russell 3000 or S&P 1500 indices, generally vote against

or withhold from the chair of the nominating committee (or other directors on a case-by-case basis) where the

board has no apparent racially or ethnically diverse members<sup>5</sup><sup>.</sup> An exception will be made if there was racial and/

orethnicdiversityontheboardattheprecedingannualmeetingandtheboardmakesafirmcommitmentto

appoint at least one racial and/or ethnic diverse member within a year.

**Responsiveness**

Votecase-by-caseonindividualdirectors,committeemembers,ortheentireboardofdirectorsasappropriateif:

Theboardfailedtoactonashareholderproposalthatreceivedthesupportofamajorityofthesharescastin

the previous year or failed to act on a management proposal seeking to ratify an existing charter/bylaw

provision that received opposition of a majority of the shares cast in the previous year. Factors that will be

considered are:

Disclosedoutreacheffortsbytheboardtoshareholdersinthewakeofthevote;

Rationaleprovidedintheproxystatementforthelevelofimplementation;

Thesubjectmatteroftheproposal;

Thelevelofsupportforandoppositiontotheresolutioninpastmeetings;

Actionstakenbytheboardinresponsetothemajorityvoteanditsengagementwithshareholders;

Thecontinuationoftheunderlyingissueasavotingitemontheballot(aseithershareholderor

management proposals); and

Otherfactorsasappropriate.

Theboardfailedtoactontakeoverofferswherethemajorityofsharesaretendered;or

At the previous board election, any director received more than 50 percent withhold/against votes of the

sharescastandthecompanyhasfailedtoaddresstheissue(s)thatcausedthehighwithhold/againstvote.

Votecase-by-caseonCompensationCommitteemembers(or,inexceptionalcases,thefullboard)andtheSayon

Pay proposal if:

Thecompany'sprevioussay-on-payreceivedthesupportoflessthan70percentofvotescast.Factorsthat

will be considered are:

Thecompany'sresponse,including:

Disclosureofengagementeffortswithmajorinstitutionalinvestors,includingthefrequencyand

timingofengagementsandthecompanyparticipants(includingwhetherindependentdirectors

participated);

Disclosureofthespecificconcernsvoicedbydissentingshareholdersthatledtothesay-on-pay

opposition; and

Disclosureofspecificandmeaningfulactionstakentoaddressshareholders'concerns;

Otherrecentcompensationactionstakenbythecompany;

Whethertheissuesraisedarerecurringorisolated;

Thecompany'sownershipstructure;and

Whetherthesupportlevelwaslessthan50percent,whichwouldwarrantthehighestdegreeof

responsiveness.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**5**Aggregatediversitystatisticsprovidedbytheboardwillonlybeconsideredifspecifictoracialand/orethnic diversity.

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Theboardimplementsanadvisoryvoteonexecutivecompensationonalessfrequentbasisthanthe

frequency that received the plurality of votes cast.

**Accountability**

***ProblematicTakeoverDefenses,CapitalStructure,andGovernanceStructure***

**PoisonPills:** Generally vote against or withhold from all nominees (except new nominees<sup>1</sup><sup>,</sup> who should be

considered case-by-case) if:

Thecompanyhasapoisonpillwithadeadhandorslowhandfeature<sup>6</sup><sup>;</sup>

Theboardmakesamaterialadversemodificationtoanexistingpill,including,butnotlimitedto,extension,

renewal, or lowering the trigger, without shareholder approval; or

Thecompanyhasalong-termpoisonpill(withatermofoveroneyear)thatwasnotapprovedbythepublic

shareholders<sup>7</sup><sup>.</sup>

Votecase-by-caseonnomineesiftheboardadoptsaninitialshort-termpill<sup>6</sup>(withatermofoneyearorless)

without shareholder approval, taking into consideration:

Thetriggerthresholdandothertermsofthepill;

Thedisclosedrationalefortheadoption;

Thecontextinwhichthepillwasadopted,(e.g., factorssuchasthecompany'ssizeandstageof

development, sudden changes in its market capitalization, and extraordinary industry-wide or

macroeconomic events);

Acommitmenttoputanyrenewaltoashareholdervote;

Thecompany'soveralltrackrecordoncorporategovernanceandresponsivenesstoshareholders;and

Otherfactorsasrelevant.

**UnequalVotingRights**: Generally vote withhold or against directors individually, committee members, or the

entireboard(exceptnewnominees<sup>1</sup><sup>,</sup> whoshouldbeconsideredcase-by-case),ifthecompanyemploysacommon

stock structure with unequal voting rights<sup>8</sup><sup>.</sup>

Exceptionstothispolicywillgenerallybelimitedto:

Newly-publiccompanies<sup>9</sup>withasunsetprovisionofnomorethansevenyearsfromthedateofgoingpublic;

LimitedPartnershipsandtheOperatingPartnership(OP)unitstructureofREITs;

Situationswherethesuper-votingsharesrepresentlessthan5%oftotalvotingpowerandtherefore

considered to be *de minimis*; or

**6**Ifashort-termpillwithadeadhandorslowhandfeatureisenactedbutexpiresbeforethenextshareholdervote,ISSwill

generally still recommend withhold/against nominees at the next shareholder meeting following its adoption.

**7**Approvalpriorto,orinconnection,withacompany'sbecomingpublicly-traded,orinconnectionwithade-SPACtransaction,

isinsufficient.

**8**Thisgenerallyincludesclassesof commonstockthathaveadditionalvotespersharethanother shares;classesofsharesthat

are not entitled to vote on all the same ballot items or nominees; or stock with time-phased voting rights ("loyalty shares").

**9**Includescompaniesthatemergefrombankruptcy,SPACtransactions,spin-offs,directlistings,andthosewhocompletea

traditional initial public offering.

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Thecompanyprovidessufficientprotectionsforminorityshareholders,suchasallowingminorityshareholders

a regular binding vote on whether the capital structure should be maintained.

**ClassifiedBoard Structure:** The board is classified, and a continuing director responsible for a problematic

governanceissueattheboard/committeelevelthatwouldwarrantawithhold/againstvoterecommendationis

not up for election. All appropriate nominees (except new) may be held accountable.

**RemovalofShareholderDiscretiononClassifiedBoards**:Thecompanyhasoptedinto,orfailedtooptout

of, state laws requiring a classified board structure.

**ProblematicGovernanceStructure**:For companies that hold or held their first annual meeting<sup>9</sup>of public

shareholders after Feb. 1, 2015, generally vote against or withhold from directors individually, committee

members, or the entire board (except new nominees<sup>1</sup><sup>,</sup> who should be considered case-by-case) if, prior to or in

connectionwiththecompany'spublicoffering,thecompanyoritsboardadoptedthefollowingbylaworcharter

provisions that are considered to be materially adverse to shareholder rights:

Supermajorityvoterequirementstoamendthebylawsorcharter;

Aclassifiedboardstructure;or

Otheregregiousprovisions.

Aprovisionwhichspecifiesthattheproblematicstructure(s)willbesunsetwithinsevenyearsofthedateofgoing

public will be considered a mitigating factor.

Unlesstheadverseprovisionisreversedorremoved,votecase-by-caseondirectornomineesinsubsequentyears.

**UnilateralBylaw/Charter Amendments:** Generally vote against or withhold from directors individually,

committeemembers,ortheentireboard(exceptnewnominees<sup>1</sup><sup>,</sup>whoshouldbeconsideredcase-by-case)ifthe

board amends the company's bylaws or charter without shareholder approval in a manner that materially

diminishes shareholders' rights or that could adversely impact shareholders, considering the following factors:

Theboard'srationaleforadoptingthebylaw/charteramendmentwithoutshareholderratification;

Disclosurebythecompanyofanysignificantengagementwithshareholdersregardingtheamendment;

Thelevelofimpairmentofshareholders'rightscausedbytheboard'sunilateralamendmenttothe

bylaws/charter;

Theboard'strackrecordwithregardtounilateralboardactiononbylaw/charteramendmentsorother

entrenchment provisions;

Thecompany'sownershipstructure;

Thecompany'sexistinggovernanceprovisions;

Thetimingoftheboard'samendmenttothebylaws/charterinconnectionwithasignificantbusiness

development; and

Otherfactors,asdeemedappropriate,thatmayberelevanttodeterminetheimpactoftheamendmenton

shareholders.

Unlesstheadverseamendmentisreversedorsubmittedtoa bindingshareholdervote,insubsequentyearsvote

case-by-case on director nominees. Generally vote against (except new nominees<sup>1</sup><sup>,</sup> who should be considered

case-by-case) if the directors:

Classifiedtheboard;

Adoptedsupermajorityvoterequirementstoamendthebylawsorcharter;

Eliminatedshareholders'abilitytoamendbylaws;

Adoptedafee-shifting provision; or

Adoptedanotherprovisiondeemedegregious.

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**RestrictingBindingShareholderProposals:** Generally vote against or withhold from the members of the

governance committee if:

Thecompany'sgoverningdocumentsimposeunduerestrictionsonshareholders'abilitytoamendthebylaws.

Such restrictions includebut arenot limited to:outright prohibition on thesubmission ofbindingshareholder

proposals or share ownership requirements, subject matter restrictions, or time holding requirements in

excess of SEC Rule 14a-8. Vote against or withhold on an ongoing basis.

Submission of management proposals to approve or ratify requirements in excess of SEC Rule 14a-8 for the

submission of binding bylaw amendments will generally be viewed as an insufficient restoration of shareholders'

rights.Generallycontinuetovoteagainstorwithholdonanongoingbasisuntilshareholdersareprovidedwithan

unfettered ability to amend the bylaws or a proposal providing for such unfettered right is submitted for

shareholder approval.

**DirectorPerformance Evaluation:** The board lacks mechanisms to promote accountability and oversight,

coupled with sustained poorperformance relative to peers. Sustained poor performance is measured by one-,

three-,andfive-yeartotalshareholderreturnsinthebottomhalfof acompany'sfour-digitGICSindustrygroup

(Russell3000companiesonly).Takeintoconsiderationthecompany'soperationalmetrics andotherfactorsas

warranted. Problematic provisions include but are not limited to:

Aclassifiedboardstructure;

Asupermajorityvoterequirement;

Eitherapluralityvotestandardinuncontesteddirectorelections,oramajorityvotestandardincontested

elections;

Theinabilityofshareholderstocallspecialmeetings;

Theinabilityofshareholderstoactbywrittenconsent;

Amulti-classcapitalstructure;and/or

Anon-shareholder-approvedpoisonpill.

**ManagementProposalstoRatifyExistingCharterorBylawProvisions:** Voteagainst/withholdfrom

individualdirectors,membersofthegovernancecommittee,orthefullboard,whereboardsask shareholdersto

ratify existing charter or bylaw provisions considering the following factors:

Thepresenceofashareholderproposaladdressingthesameissueonthesameballot;

Theboard'srationaleforseekingratification;

Disclosureofactionstobetakenbytheboardshouldtheratificationproposalfail;

Disclosureofshareholderengagementregardingtheboard'sratificationrequest;

Thelevelofimpairmenttoshareholders'rightscausedbytheexistingprovision;

Thehistoryofmanagementandshareholderproposalsontheprovisionatthecompany'spastmeetings;

Whetherthecurrentprovisionwasadoptedinresponsetotheshareholderproposal;

Thecompany'sownershipstructure;and

Previoususeofratificationproposalstoexcludeshareholderproposals.

**ProblematicAudit-RelatedPractices**

GenerallyvoteagainstorwithholdfromthemembersoftheAuditCommitteeif:

Thenon-auditfeespaidtotheauditorareexcessive;

Thecompanyreceivesanadverseopiniononthecompany'sfinancialstatementsfromitsauditor;or

There is persuasive evidence that the Audit Committee entered into an inappropriate indemnification

agreementwithitsauditorthatlimitstheabilityofthecompany,oritsshareholders,topursuelegitimatelegal

recourse against the audit firm.

Votecase-by-caseonmembersoftheAuditCommitteeand potentiallythefullboard if:

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Pooraccountingpractices areidentifiedthatrisetoalevelofseriousconcern,suchas:fraud;misapplicationof

GAAP; and material weaknesses identified in Section 404 disclosures. Examine the severity, breadth,

chronologicalsequence, andduration,aswellasthecompany'sefforts atremediationorcorrectiveactions, in

determining whether withhold/against votes are warranted.

**ProblematicCompensationPractices**

IntheabsenceofanAdvisoryVoteonExecutiveCompensation(SayonPay)ballotitemorinegregioussituations,

vote against or withhold from the members of the Compensation Committee and potentially the full board if:

ThereisanunmitigatedmisalignmentbetweenCEOpayandcompanyperformance(pay forperformance);

Thecompanymaintainssignificantproblematic pay practices;or

Theboardexhibitsasignificantlevelofpoor communication and responsivenesstoshareholders.

GenerallyvoteagainstorwithholdfromtheCompensationCommitteechair,othercommitteemembers,or

potentially the full board if:

ThecompanyfailstoincludeaSayonPayballotitemwhenrequiredunderSECprovisions,orunderthe

company'sdeclaredfrequencyofsayonpay;or

ThecompanyfailstoincludeaFrequencyofSayonPayballotitemwhenrequiredunderSECprovisions.

Generallyvoteagainstmembersoftheboardcommitteeresponsibleforapproving/settingnon-employeedirector

compensation if there is a pattern (i.e. two or more years) of awarding excessive non-employee director

compensation without disclosing a compelling rationale or other mitigating factors.

**ProblematicPledgingofCompanyStock**: Vote against the members of the committee that oversees risks

relatedtopledging,orthefullboard,whereasignificantlevelofpledgedcompanystockbyexecutivesordirectors

raises concerns. The following factors will be considered:

Thepresenceofananti-pledgingpolicy,disclosedintheproxystatement,thatprohibitsfuturepledging

activity;

Themagnitudeofaggregatepledgedsharesintermsoftotalcommonsharesoutstanding,marketvalue,and

trading volume;

Disclosureofprogressorlackthereofinreducingthemagnitudeofaggregatepledgedsharesovertime;

Disclosureintheproxystatementthatsharessubjecttostockownershipandholdingrequirementsdonot

include pledged company stock; and

Anyotherrelevantfactors.

**ClimateAccountability**

For companies that are significant greenhouse gas (GHG) emitters, through their operations or value chain<sup>10</sup><sup>,</sup>

generallyvoteagainstorwithholdfromtheincumbentchairoftheresponsiblecommittee(orotherdirectorsona

case-by-case basis) in cases where ISS determines that the company is not taking the minimum steps needed to

understand, assess, and mitigate risks related to climate change to the company and the larger economy.

Minimumstepstounderstandandmitigatethoserisksareconsideredtobe thefollowing.Bothminimumcriteria

will be required to be in alignment with the policy :

Detaileddisclosureofclimate-relatedrisks,suchasaccordingtothe frameworkestablishedbytheTaskForce

on Climate-related Financial Disclosures (TCFD), including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**10**Companiesdefinedas"significantGHGemitters"willbethoseonthecurrentClimateAction100+FocusGroup list.

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Boardgovernancemeasures;

Corporatestrategy;

Riskmanagementanalyses;and

Metricsandtargets.

AppropriateGHGemissionsreductiontargets.

Atthistime,"appropriateGHGemissionsreductionstargets"willbe medium-termGHGreductiontargetsorNet

Zero-by-2050 GHG reduction targets for a company's operations (Scope 1) and electricity use (Scope 2). Targets

should cover the vast majority of the company's direct emissions.

**GovernanceFailures**

Underextraordinarycircumstances,vote againstorwithholdfromdirectorsindividually,committee members,or

the entire board, due to:

Materialfailuresofgovernance,stewardship,riskoversight<sup>11</sup><sup>,</sup>orfiduciaryresponsibilitiesatthecompany;

Failuretoreplacemanagementasappropriate;or

Egregiousactionsrelatedtoadirector'sserviceonotherboardsthatraisesubstantialdoubtabouthisor her

abilitytoeffectivelyoverseemanagementandservethebestinterestsofshareholdersatanycompany.

VotingonDirectorNomineesinContestedElections

**Vote-NoCampaigns**

**GeneralRecommendation:** Incaseswherecompaniesaretargetedinconnectionwithpublic"vote-no"campaigns,

evaluate director nominees under the existing governance policies for voting on director nominees in uncontested

elections. Take into consideration the arguments submitted by shareholders and other publicly available

information.

**ProxyContests/ProxyAccess**

**GeneralRecommendation:**Votecase-by-caseontheelectionofdirectorsincontestedelections,consideringthe

following factors:

Long-termfinancialperformanceofthecompanyrelativeto itsindustry;

Management'strackrecord;

Backgroundtothecontestedelection;

Nomineequalificationsandanycompensatoryarrangements;

Strategicplanofdissidentslateandqualityofthecritiqueagainstmanagement;

Likelihoodthattheproposedgoalsandobjectivescanbeachieved(bothslates);and

Stockownershippositions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**11**Examples of failure of risk oversight include but are not limited to: bribery; large or serial fines or sanctions from regulatory

bodies; demonstrablypoorriskoversightofenvironmentalandsocialissues,includingclimatechange;significantadverselegal

judgments or settlement; or hedging of company stock.

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Inthecaseofcandidatesnominatedpursuanttoproxyaccess,votecase-by-caseconsideringanyapplicablefactors

listed above or additional factors which may be relevant, including those that are specific to the company, to the

nominee(s) and/or to the nature of the election (such as whether there are more candidates than board seats).

OtherBoard-RelatedProposals

**AdoptAnti-Hedging/Pledging/SpeculativeInvestmentsPolicy**

**GeneralRecommendation:** Generally votefor proposals seekinga policy that prohibits named executiveofficers

fromengaginginderivativeorspeculativetransactionsinvolvingcompanystock,includinghedging,holdingstock

inamarginaccount,orpledgingstockascollateralfor aloan.However,thecompany'sexistingpoliciesregarding

responsible use of company stock will be considered.

**BoardRefreshment**

Boardrefreshmentisbestimplementedthroughanongoingprogramofindividualdirectorevaluations,conducted

annually, to ensure the evolving needs ofthe board are met and to bring infresh perspectives, skills,and diversity

as needed.

**Term/TenureLimits**

**GeneralRecommendation:**Votecase-by-caseonmanagementproposalsregardingdirectorterm/tenurelimits,

considering:

Therationaleprovidedforadoptionoftheterm/tenurelimit;

Therobustnessofthecompany'sboardevaluationprocess;

Whetherthelimitisofsufficientlengthtoallowforabroadrangeofdirectortenures;

Whetherthelimitwoulddisadvantageindependentdirectorscomparedtonon-independentdirectors;and

Whethertheboardwillimposethelimitevenly,andnothavetheabilitytowaiveitinadiscriminatory

manner.

Votecase-by-caseonshareholderproposalsaskingforthecompanytoadoptdirectorterm/tenurelimits,

considering:

Thescopeoftheshareholderproposal;and

Evidenceofproblematicissuesatthecompanycombinedwith,orexacerbatedby,alackofboard

refreshment.

**AgeLimits**

**GeneralRecommendation:**Generallyvoteagainstmanagementandshareholderproposalstolimitthetenureof

independent directors through mandatory retirement ages. Vote for proposals to remove mandatory age limits.

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**BoardSize**

**GeneralRecommendation:**Voteforproposalsseekingtofixtheboardsizeordesignatearangefortheboardsize.

Voteagainstproposalsthatgivemanagementtheabilitytoalterthesizeoftheboardoutsideofaspecifiedrange

without shareholder approval.

**Classification/DeclassificationoftheBoard**

**GeneralRecommendation:**Voteagainstproposalstoclassify(stagger)theboard.

Vote for proposals to repeal classified boards and to elect all directors annually.

**CEOSuccessionPlanning**

**GeneralRecommendation:**GenerallyvoteforproposalsseekingdisclosureonaCEOsuccessionplanningpolicy,

considering, at a minimum, the following factors:

Thereasonableness/scopeoftherequest;and

Thecompany'sexistingdisclosureonitscurrentCEOsuccessionplanningprocess.

**CumulativeVoting**

**GeneralRecommendation:**Generallyvoteagainstmanagementproposalstoeliminatecumulatevoting,andfor

shareholder proposals to restore or provide for cumulative voting, unless:

Thecompanyhasproxyaccess<sup>12</sup><sup>,</sup>therebyallowingshareholderstonominatedirectorstothecompany's

ballot;and

Thecompanyhasadoptedamajorityvotestandard,withacarve-outforpluralityvotinginsituationswhere

there are more nominees than seats, and a director resignation policy to address failed elections.

Voteforproposalsforcumulativevotingatcontrolledcompanies(insidervotingpower>50%).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**12**Aproxyaccessrightthatmeetstherecommended guidelines.

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**DirectorandOfficerIndemnification,LiabilityProtection,andExculpation**

**GeneralRecommendation:**Votecase-by-caseonproposalsondirectorandofficerindemnification,liability

protection, and exculpation<sup>13</sup><sup>.</sup>

Considerthestatedrationaleforthe proposedchange.Alsoconsider,amongotherfactors,theextenttowhichthe

proposal would:

Eliminatedirectors'andofficers'liabilityformonetarydamagesforviolatingthedutyofcare;

Eliminatedirectors'andofficers'liabilityformonetarydamagesforviolatingthedutyofloyalt;

Expandcoveragebeyondjustlegalexpensestoliabilityforactsthataremoreseriousviolationsoffiduciary

obligation than mere carelessness; and

Expand the scope of indemnification to provide for mandatory indemnification of company officials in

connection with acts that previously the company was permitted to provide indemnification for, at the

discretionofthecompany'sboard(*i.e.*,"permissiveindemnification"),butthatpreviously thecompanywas

not required to indemnify.

Voteforthoseproposalsprovidingsuchexpandedcoverageincaseswhenadirector'sorofficer'slegaldefense

wasunsuccessfulifbothofthefollowingapply:

Iftheindividualwasfoundtohaveactedingoodfaithandinamannerthattheindividualreasonablybelieved

was in the best interests of the company; and

Ifonlytheindividual'slegalexpenseswouldbecovered.

**Establish/AmendNomineeQualifications**

**GeneralRecommendation:**Votecase-by-caseonproposalsthatestablishoramenddirectorqualifications.Votes

should be based on the reasonableness of the criteria and the degree to which they may preclude dissident

nominees from joining the board.

Votecase-by-caseonshareholderresolutionsseekingadirectornomineewhopossesses aparticularsubject

matter expertise, considering:

Thecompany'sboardcommitteestructure, existingsubjectmatterexpertise,andboardnomination

provisions relative to that of its peers;

Thecompany'sexistingboardandmanagementoversightmechanismsregardingtheissueforwhichboard

oversightissought;

Thecompany'sdisclosureandperformancerelatingtotheissueforwhichboardoversightissoughtandany

significant related controversies; and

Thescopeandstructureoftheproposal.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**13Indemnification**:theconditionofbeingsecuredagainstlossordamage.

**Limitedliability**:aperson'sfinancialliabilityislimitedtoafixedsum,orpersonalfinancialassetsarenotatriskiftheindividual

loses a lawsuit that results in financial award/damages to the plaintiff.

**Exculpation**:toeliminateorlimitthepersonalliabilityofadirectororofficertothecorporationoritsshareholdersfor

monetary damages for breach of fiduciary duty as a director or officer.

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**EstablishOtherBoardCommitteeProposals**

**GeneralRecommendation:**Generallyvoteagainstshareholderproposalstoestablishanewboardcommittee,as

such proposals seek a specific oversight mechanism/structure that potentially limits a company's flexibility to

determine an appropriate oversight mechanism for itself. However, the following factors will be considered:

Existingoversightmechanisms(includingcurrentcommitteestructure)regardingtheissueforwhichboard

oversight is sought;

Levelofdisclosureregardingtheissueforwhichboardoversightissought;

Companyperformancerelatedtotheissueforwhichboardoversightissought;

Boardcommitteestructurecomparedtothatofothercompaniesinitsindustrysector;and

Thescopeandstructureoftheproposal.

**FillingVacancies/RemovalofDirectors**

**GeneralRecommendation:**Voteagainstproposalsthatprovidethatdirectorsmayberemovedonlyforcause.

Voteforproposalstorestoreshareholders'abilitytoremovedirectorswithorwithoutcause.

Voteagainstproposalsthatprovidethatonlycontinuingdirectorsmayelectreplacementstofillboardvacancies.

Vote for proposals that permit shareholders to elect directors to fill board vacancies.

**IndependentBoardChair**

**GeneralRecommendation:**Generallyvoteforshareholderproposalsrequiringthatthe boardchairpositionbe

filled by an independent director, taking into consideration the following:

Thescopeandrationaleoftheproposal;

Thecompany'scurrentboardleadershipstructure;

Thecompany'sgovernancestructureandpractices;

Companyperformance;and

Anyotherrelevantfactorsthatmaybeapplicable.

Thefollowingfactorswillincreasethelikelihoodofa"for"recommendation:

Amajoritynon-independentboardand/orthepresenceofnon-independentdirectorsonkeyboard

committees;

Aweakorpoorly-definedleadindependentdirectorrolethatfailstoserveasanappropriatecounterbalance

to a combined CEO/chair role;

Thepresenceofanexecutiveornon-independentchairinadditiontotheCEO,arecentrecombinationofthe

role of CEO and chair, and/or departure from a structure with an independent chair;

Evidencethattheboardhasfailedtooverseeandaddressmaterialrisksfacingthecompany;

Amaterialgovernancefailure,particularlyiftheboardhasfailedtoadequatelyrespondtoshareholder

concerns or if the board has materially diminished shareholder rights; or

Evidencethattheboardhasfailedtointervenewhenmanagement'sinterestsarecontraryto shareholders'

interests.

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**Majority of Independent Directors/Establishment of Independent**

**Committees**

**General Recommendation:** Vote for shareholder proposals asking that a majority or more of directors be

independentunlesstheboardcompositionalreadymeetstheproposedthresholdbyISS'definitionofIndependent

Director (See ISS' Classification of Directors.)

Voteforshareholderproposalsaskingthatboardaudit,compensation,and/ornominatingcommitteesbe

composed exclusively of independent directors unless they currently meet that standard.

**MajorityVoteStandardfortheElectionofDirectors**

**GeneralRecommendation:** Generallyvoteformanagementproposalstoadoptamajorityofvotescaststandard

for directors in uncontested elections. Vote against if no carve-out for a plurality vote standard in contested

elections is included.

Generallyvoteforprecatoryandbindingshareholderresolutionsrequestingthattheboardchangethecompany's

bylaws to stipulate that directors need to be elected with an affirmative majority of votes cast, provided it does

not conflict with the state law where the company is incorporated. Binding resolutions need to allow for a carve-

out for a plurality vote standard when there are more nominees than board seats.

Companies are strongly encouraged to also adopt a post-election policy (also known as a director resignation

policy)thatwillprovideguidelinessothatthecompanywillpromptlyaddressthesituationofaholdoverdirector.

**ProxyAccess**

**GeneralRecommendation:**Generallyvoteformanagementandshareholderproposalsforproxyaccesswiththe

following provisions:

**Ownershipthreshold:**maximumrequirementnotmorethanthreepercent(3%)ofthevotingpower;

**Ownershipduration:**maximumrequirementnotlongerthanthree(3)yearsofcontinuousownershipforeach

member of the nominating group;

**Aggregation:**minimalornolimitsonthenumberofshareholderspermittedtoformanominatinggroup;and

**Cap:**caponnomineesofgenerallytwenty-fivepercent(25%)oftheboard.

Reviewforreasonablenessanyotherrestrictionsontherightofproxyaccess. Generallyvoteagainstproposals

that are more restrictive than these guidelines.

**RequireMoreNomineesthanOpenSeats**

**GeneralRecommendation:**Voteagainstshareholderproposalsthatwouldrequireacompanytonominatemore

candidates than the number of open board seats.

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**ShareholderEngagementPolicy(ShareholderAdvisoryCommittee)**

**General Recommendation:** Generally vote for shareholder proposals requesting that theboard establish an

internalmechanism/process,whichmayincludeacommittee,inordertoimprovecommunicationsbetween

directors and shareholders, unless the company has the following features, as appropriate:

Establishedacommunicationstructurethatgoesbeyondtheexchangerequirementstofacilitatethe

exchange of information between shareholders and members of the board;

Effectivelydisclosedinformationwithrespecttothisstructuretoitsshareholders;

Companyhasnotignoredmajority-supportedshareholderproposals,oramajoritywithholdvoteonadirector

nominee; and

Thecompanyhasanindependentchairor aleaddirector,accordingto ISS' definition. Thisindividualmustbe

made available for periodic consultation and direct communication with major shareholders.

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**2. Audit-Related**

**AuditorIndemnificationandLimitationofLiability**

**GeneralRecommendation:**Votecase-by-caseontheissueofauditorindemnificationandlimitationofliability.

Factors to be assessed include, but are not limited to:

Thetermsoftheauditoragreement—thedegreetowhichtheseagreementsimpactshareholders'rights;

Themotivationandrationaleforestablishingtheagreements;

Thequalityofthecompany'sdisclosure;and

Thecompany'shistoricalpracticesintheauditarea.

Vote against or withhold from members of an audit committee in situations where there is persuasive evidence

thattheauditcommitteeenteredintoaninappropriateindemnificationagreementwithitsauditorthatlimitsthe

ability of the company, or its shareholders, to pursue legitimate legal recourse against the audit firm.

**AuditorRatification**

**GeneralRecommendation:**Voteforproposalstoratifyauditorsunlessanyofthefollowingapply:

Anauditorhasafinancialinterestinorassociationwiththecompany,andisthereforenotindependent;

Thereisreasontobelievethattheindependentauditorhasrenderedanopinionthatisneitheraccuratenor

indicativeofthecompany'sfinancialposition;

Pooraccountingpracticesareidentifiedthatrisetoaseriouslevelofconcern,suchasfraud ormisapplication

of GAAP; or

Feesfornon-auditservices("Other"fees)areexcessive.

Non-auditfeesareexcessiveif:

Non-audit("other")fees>auditfees+audit-relatedfees+taxcompliance/preparationfees

Tax compliance and preparation include the preparation of original and amended tax returns and refund claims,

andtaxpaymentplanning.Allotherservicesinthetaxcategory,suchastaxadvice,planning,orconsulting,should

be added to "Other" fees. If the breakout of tax fees cannot be determined, add all tax fees to "Other" fees.

Incircumstanceswhere"Other"feesincludefeesrelatedtosignificantone-timecapitalstructureevents(suchas

initial public offerings, bankruptcy emergence, and spin-offs) and the company makes public disclosure of the

amount and nature of those fees that are an exception to the standard "non-audit fee" category, then such fees

maybeexcludedfromthenon-auditfeesconsideredindeterminingtheratioofnon-audittoaudit/audit-related

fees/tax compliance and preparation for purposes of determining whether non-audit fees are excessive.

**ShareholderProposalsLimitingNon-AuditServices**

**GeneralRecommendation:**Votecase-by-caseonshareholderproposalsaskingcompaniestoprohibitorlimittheir

auditors from engaging in non-audit services.

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**ShareholderProposalsonAuditFirmRotation**

**GeneralRecommendation:**Votecase-by-caseonshareholderproposalsaskingforauditfirmrotation,takinginto

account:

Thetenureoftheaudit firm;

Thelengthofrotationspecifiedintheproposal;

Anysignificantaudit-relatedissuesatthecompany;

ThenumberofAuditCommitteemeetingsheldeachyear;

Thenumberoffinancialexpertsservingonthecommittee; and

Whetherthecompanyhasaperiodicrenewalprocesswheretheauditorisevaluatedforbothauditquality

and competitive price.

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**3. ShareholderRights&Defenses**

**AdvanceNoticeRequirementsforShareholderProposals/Nominations**

**General Recommendation:** Vote case-by-case on advance notice proposals, giving support to those proposals

which allow shareholders to submit proposals/nominations as close to the meeting date as reasonably possible

andwithinthebroadestwindowpossible,recognizingtheneedtoallowsufficientnoticeforcompany,regulatory,

and shareholder review.

To be reasonable, the company's deadline for shareholder notice of a proposal/nominations must be no earlier

than 120 days prior to the anniversary of the previous year's meeting and have a submittal window of no shorter

than30daysfromthebeginningofthenoticeperiod (alsoknownasa90-120-daywindow).Thesubmittalwindow

is the period under which shareholders must file their proposals/nominations prior to the deadline.

Ingeneral,supportadditionaleffortsbycompaniestoensurefulldisclosureinregardtoaproponent'seconomic

and voting position in the company so long as the informational requirements are reasonable and aimed at

providing shareholders with the necessary information to review such proposals.

**AmendBylawswithoutShareholderConsent**

**GeneralRecommendation:**Voteagainstproposalsgivingtheboardexclusiveauthoritytoamendthebylaws.

Votecase-by-caseonproposalsgivingtheboardtheabilitytoamendthebylawsinadditiontoshareholders,taking

into account the following:

Anyimpedimentstoshareholders'abilitytoamendthebylaws(i.e.supermajorityvotingrequirements);

Thecompany'sownershipstructureandhistoricalvotingturnout;

Whethertheboardcouldamendbylawsadoptedbyshareholders;and

Whethershareholderswouldretaintheabilitytoratifyanyboard-initiatedamendments.

**ControlShareAcquisitionProvisions**

**GeneralRecommendation:** Voteforproposalstooptoutofcontrolshareacquisitionstatutesunlessdoingso

would enable the completion of a takeover that would be detrimental to shareholders.

Voteagainstproposalstoamendthechartertoincludecontrolshareacquisitionprovisions.

Vote for proposals to restore voting rights to the control shares.

Control share acquisition statutes function by denying shares their voting rights when they contribute to

ownership in excess of certain thresholds. Voting rights for those shares exceeding ownership limits may only be

restored by approvalofeither a majority or supermajority ofdisinterested shares. Thus, control share acquisition

statuteseffectivelyrequireahostilebiddertoputitsoffertoashareholdervoteorriskvotingdisenfranchisement

if the bidder continues buying up a large block of shares.

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**ControlShareCash-OutProvisions**

**GeneralRecommendation:**Voteforproposalstooptoutofcontrolsharecash-outstatutes.

Controlsharecash-outstatutesgivedissidentshareholderstherightto"cash-out"oftheirpositioninacompanyat

the expense of the shareholder who has taken a control position. In other words, when an investor crosses a

preset threshold level, remaining shareholders are given the right to sell their shares to the acquirer, who must

buy them at the highest acquiring price.

**DisgorgementProvisions**

**GeneralRecommendation:**Voteforproposalstooptoutofstatedisgorgementprovisions.

Disgorgement provisions require an acquirer or potential acquirer of more than a certain percentage of a

company's stock to disgorge, or pay back, to the company any profits realized from the sale of that company's

stockpurchased24monthsbeforeachievingcontrolstatus.Allsalesofcompanystockbytheacquireroccurring

withinacertainperiodoftime(between18monthsand24months)priortotheinvestor'sgainingcontrolstatus

are subject to these recapture-of-profits provisions.

**FairPriceProvisions**

**GeneralRecommendation:**Votecase-by-caseonproposalstoadoptfairpriceprovisions(provisionsthatstipulate

that an acquirer must pay the same price to acquire all shares as it paid to acquire the control shares), evaluating

factors such as the vote required to approve the proposed acquisition, the vote required to repeal the fair price

provision, and the mechanism for determining the fair price.

Generallyvoteagainstfairpriceprovisionswithshareholdervoterequirementsgreaterthanamajorityof

disinterested shares.

**Freeze-OutProvisions**

**GeneralRecommendation:** Voteforproposalstooptoutofstatefreeze-outprovisions.Freeze-outprovisions

forceaninvestorwhosurpassesacertainownershipthresholdinacompanytowaitaspecifiedperiodoftime

before gaining control of the company.

**Greenmail**

**GeneralRecommendation:**Voteforproposalstoadoptanti-greenmailcharterorbylawamendmentsorotherwise

restrict a company's ability to make greenmail payments.

Votecase-by-caseonanti-greenmailproposalswhentheyarebundledwithothercharterorbylawamendments.

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Greenmailpaymentsaretargetedsharerepurchasesbymanagementofcompanystockfromindividualsorgroups

seeking control of the company. Since only the hostile party receives payment, usually at a substantial premium

over the market value of its shares, the practice discriminates against all other shareholders.

**ShareholderLitigationRights**

**FederalForumSelectionProvisions**

FederalforumselectionprovisionsrequirethatU.S.federalcourtsbethesoleforumforshareholderstolitigate

claims arising under federal securities law.

**General Recommendation:** Generally vote for federal forum selection provisions in the charter or bylaws that

specify"thedistrictcourtsoftheUnitedStates"astheexclusiveforumforfederalsecuritieslawmatters,inthe

absence of serious concerns about corporate governance or board responsiveness to shareholders.

Voteagainstprovisionsthatrestricttheforumtoaparticularfederaldistrictcourt;unilateraladoption(withouta

shareholder vote) of such a provision will generally be considered a one-time failure under the Unilateral Bylaw/

Charter Amendments policy.

**ExclusiveForumProvisionsforStateLawMatters**

Exclusiveforumprovisionsinthecharterorbylawsrestrictshareholders'abilitytobringderivativelawsuitsagainst

thecompany,forclaimsarisingoutofstatecorporatelaw,tothecourtsofaparticularstate(generallythestateof

incorporation).

**GeneralRecommendation:** Generallyvoteforcharterorbylawprovisionsthatspecifycourts locatedwithinthe

stateofDelawareastheexclusiveforumforcorporatelawmattersforDelawarecorporations,intheabsenceof

serious concerns about corporate governance or board responsiveness to shareholders.

ForstatesotherthanDelaware,votecase-by-caseonexclusiveforumprovisions,takingintoconsideration:

Thecompany'sstatedrationaleforadoptingsuchaprovision;

Disclosureofpastharmfromduplicativeshareholderlawsuitsinmorethanoneforum;

Thebreadthofapplicationofthecharterorbylawprovision,includingthetypesoflawsuitstowhichitwould

apply and the definition of key terms; and

Governancefeaturessuchasshareholders'abilitytorepealtheprovisionatalaterdate(includingthevote

standard applied when shareholders attempt to amend the charter or bylaws) and their ability to hold

directors accountable through annual director elections and a majority vote standard in uncontested

elections.

Generallyvoteagainstprovisionsthatspecifyastateotherthanthestateofincorporationastheexclusiveforum

for corporate law matters, or that specify a particular local court within the state; unilateral adoption of such a

provisionwillgenerallybeconsideredaone-timefailureundertheUnilateral Bylaw/Charter Amendments policy.

**Feeshifting**

Fee-shiftingprovisionsinthecharterorbylawsrequirethatashareholderwhosuesacompanyunsuccessfullypay

all litigation expenses of the defendant corporation and its directors and officers.

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**GeneralRecommendation:**Generallyvoteagainstprovisionsthatmandatefee-shiftingwheneverplaintiffsarenot

completely successful on the merits (i.e., including cases where the plaintiffs are partially successful).

Unilateraladoptionofafee-shiftingprovisionwillgenerallybeconsideredanongoingfailure undertheUnilateral

[Bylaw/Charter Amendments](#i3a2efcc9db514d66a79775e6e31641f7_10) policy.

**NetOperatingLoss(NOL)ProtectiveAmendments**

**GeneralRecommendation:**Voteagainstproposalstoadoptaprotectiveamendmentforthestatedpurposeof

protecting a company's net operating losses (NOL) if the effective term of the protective amendment would

exceed the shorter of three years and the exhaustion of the NOL.

Vote case-by-case, considering the following factors, for management proposals to adopt an NOL protective

amendmentthatwouldremainineffect fortheshorterofthreeyears(orless)andtheexhaustionoftheNOL:

The ownership threshold (NOL protective amendments generally prohibit stock ownership transfers that

wouldresultinanew5-percentholderorincreasethestockownershippercentageofanexisting 5-percent

holder);

Thevalueofthe NOLs;

Shareholderprotectionmechanisms(sunsetprovisionorcommitmenttocauseexpirationoftheprotective

amendment upon exhaustion or expiration of the NOL);

Thecompany'sexistinggovernancestructureincluding:boardindependence,existingtakeoverdefenses,track

record of responsiveness to shareholders, and any other problematic governance concerns; and

Anyotherfactorsthatmaybeapplicable.

PoisonPills(ShareholderRightsPlans)

**ShareholderProposalstoPutPilltoaVoteand/orAdoptaPillPolicy**

**GeneralRecommendation:** Voteforshareholderproposalsrequestingthatthecompanysubmititspoisonpilltoa

shareholder vote or redeem it unless the company has: (1)A shareholder-approved poison pill in place; or (2)The

company has adopted a policy concerning the adoption of a pill in the future specifying that the board will only

adopt a shareholder rights plan if either:

Shareholdershaveapprovedtheadoptionoftheplan;or

The board, in its exercise of its fiduciary responsibilities, determines that it is in the best interest of

shareholders under the circumstances to adopt a pill without the delay in adoption that would result from

seekingstockholderapproval(i.e.,the"fiduciaryout"provision).Apoisonpilladoptedunderthisfiduciaryout

willbeputtoashareholderratificationvotewithin12monthsofadoptionorexpire.Ifthepillisnotapproved

by a majority of the votes cast on this issue, the plan will immediately terminate.

If the shareholder proposal calls for a time period of less than 12 months for shareholder ratification after

adoption,votefortheproposal,butaddthecaveatthatavotewithin12monthswouldbeconsideredsufficient

implementation.

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**ManagementProposalstoRatifyaPoisonPill**

**GeneralRecommendation:**Votecase-by-caseonmanagementproposalsonpoisonpillratification,focusingon

the features of the shareholder rights plan. Rights plans should contain the following attributes:

Nolowerthana20percenttrigger,flip-inorflip-over;

Atermofnomorethanthreeyears;

Nodeadhand,slowhand,no-hand,orsimilarfeaturethatlimitstheabilityofafutureboardtoredeemthepill;

and

Shareholderredemptionfeature(qualifyingofferclause);iftheboardrefusestoredeemthepill90daysafter

aqualifyingofferisannounced,10percentofthesharesmay callaspecialmeetingorseekawrittenconsent

to vote on rescinding the pill.

Inaddition,therationaleforadoptingthepillshouldbethoroughlyexplainedbythecompany.Inexaminingthe

request for the pill, take into consideration the company's existing governance structure, including: board

independence, existing takeover defenses, and any problematic governance concerns.

**ManagementProposalstoRatifyaPilltoPreserveNetOperatingLosses** 

**(NOLs)**

**GeneralRecommendation:** Voteagainstproposalstoadoptapoisonpillforthestatedpurposeofprotectinga

company's net operating losses (NOL) if the term of the pill would exceed the shorter of three years and the

exhaustion of the NOL.

Votecase-by-caseonmanagementproposalsforpoisonpillratification,consideringthefollowingfactors,ifthe

term of the pill would be the shorter of three years (or less) and the exhaustion of the NOL:

Theownershipthresholdtotransfer(NOLpillsgenerallyhaveatriggerslightlybelow5percent);

Thevalueofthe NOLs;

Shareholderprotectionmechanisms(sunsetprovision,orcommitmenttocauseexpirationofthepillupon

exhaustion or expiration of NOLs);

Thecompany'sexistinggovernancestructure,including:boardindependence,existingtakeoverdefenses,

track record of responsiveness to shareholders, and any other problematic governance concerns; and

Anyotherfactorsthatmaybeapplicable.

**ProxyVotingDisclosure,Confidentiality,andTabulation**

**General Recommendation:** Vote case-by-case on proposals regarding proxy voting mechanics, taking into

consideration whether implementation of the proposal is likely to enhance or protect shareholder rights. Specific

issuescoveredunderthepolicyinclude,butarenotlimitedto, confidentialvotingofindividualproxiesandballots,

confidentiality ofrunningvotetallies, and thetreatment of abstentionsand/or brokernon-votes in thecompany's

vote-counting methodology.

Whileavarietyoffactorsmaybeconsideredineachanalysis,theguidingprinciplesare:transparency,consistency,

and fairness in the proxy voting process. The factors considered, as applicable to the proposal, may include:

Thescopeandstructureoftheproposal;

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The company's stated confidential voting policy (or other relevant policies) and whether it ensures a "level

playingfield"byprovidingshareholderproponentswithequalaccesstovoteinformationpriortotheannual

meeting;

Thecompany'svotestandardformanagementandshareholderproposalsandwhetherit ensuresconsistency

and fairness in the proxy voting process and maintains the integrity of vote results;

Whetherthecompany'sdisclosureregardingitsvotecountingmethodandotherrelevantvotingpolicieswith

respect to management and shareholder proposals are consistent and clear;

Anyrecentcontroversiesorconcernsrelatedtothecompany'sproxyvotingmechanics;

Anyunintendedconsequencesresultingfromimplementationoftheproposal; and

Anyotherfactorsthatmayberelevant.

**RatificationProposals:ManagementProposalstoRatifyExistingCharteror** 

**Bylaw Provisions**

**GeneralRecommendation:**Generallyvoteagainstmanagementproposalstoratifyprovisionsofthecompany's

existingcharterorbylaws,unlessthesegovernanceprovisionsalignwithbestpractice.

Inaddition,votingagainst/withholdfromindividualdirectors,membersofthegovernancecommittee,orthefull

board may be warranted, considering:

Thepresenceofashareholderproposaladdressingthesameissueonthesameballot;

Theboard'srationaleforseekingratification;

Disclosureofactionstobetakenbytheboardshouldtheratificationproposalfail;

Disclosureofshareholderengagementregardingtheboard'sratificationrequest;

Thelevelofimpairmenttoshareholders'rightscausedbytheexistingprovision;

Thehistoryofmanagementandshareholderproposalsontheprovisionatthecompany'spastmeetings;

Whetherthecurrentprovisionwasadoptedinresponsetotheshareholderproposal;

Thecompany'sownershipstructure;and

Previoususeofratificationproposalstoexcludeshareholderproposals.

**ReimbursingProxySolicitationExpenses**

**GeneralRecommendation:**Votecase-by-caseonproposalstoreimburseproxysolicitationexpenses.

Whenvotinginconjunctionwithsupportofadissidentslate,voteforthe reimbursementofallappropriateproxy

solicitation expenses associated with the election.

Generallyvoteforshareholderproposalscallingforthereimbursementofreasonablecostsincurredinconnection

with nominating one or more candidates in a contested election where the following apply:

Theelectionoffewerthan50percentofthedirectorstobeelectediscontestedintheelection;

Oneormoreofthedissident'scandidatesiselected;

Shareholdersarenotpermittedtocumulatetheirvotesfordirectors;and

Theelectionoccurred,andtheexpenseswereincurred,aftertheadoptionofthisbylaw.

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**ReincorporationProposals**

**GeneralRecommendation:**Managementorshareholderproposalstochangeacompany'sstateofincorporation

should be evaluated case-by-case, giving consideration to both financial and corporate governance concerns

including the following:

Reasonsforreincorporation;

Comparisonofcompany'sgovernancepracticesandprovisionspriortoandfollowingthereincorporation;and

Comparisonofcorporationlawsoforiginalstateanddestinationstate.

Voteforreincorporationwhentheeconomicfactorsoutweighanyneutralornegativegovernancechanges.

**ShareholderAbilitytoActbyWrittenConsent**

**GeneralRecommendation:**Generallyvoteagainstmanagementandshareholderproposalstorestrictorprohibit

shareholders' ability to act by written consent.

Generallyvoteformanagementandshareholderproposalsthatprovideshareholderswiththeabilitytoactby

written consent, taking into account the following factors:

Shareholders'currentrighttoactbywrittenconsent;

Theconsentthreshold;

Theinclusionofexclusionaryorprohibitivelanguage;

Investorownershipstructure;and

Shareholdersupportof,andmanagement'sresponseto,previousshareholderproposals.

Votecase-by-caseonshareholderproposalsif,inadditiontotheconsiderationsabove,thecompanyhasthe

following governance and antitakeover provisions:

Anunfettered<sup>14</sup>rightforshareholderstocallspecialmeetingsata10percentthreshold;

Amajorityvotestandardinuncontesteddirectorelections;

Nonon-shareholder-approvedpill;and

Anannuallyelectedboard.

**ShareholderAbilitytoCallSpecialMeetings**

**GeneralRecommendation:**Voteagainstmanagementorshareholderproposalstorestrictorprohibit

shareholders'abilitytocallspecialmeetings.

Generallyvoteformanagementorshareholderproposalsthatprovideshareholderswiththeabilitytocallspecial

meetings taking into account the following factors:

Shareholders'currentrighttocallspecialmeetings;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**14**"Unfettered"meansnorestrictionsonagendaitems,norestrictionsonthenumberofshareholderswhocangrouptogether

to reach the 10 percent threshold, and only reasonable limits on when a meeting can be called: no greater than 30 days after

the last annual meeting and no greater than 90 prior to the next annual meeting.

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Minimumownershipthresholdnecessarytocallspecialmeetings(10 percentpreferred);

Theinclusionofexclusionaryorprohibitivelanguage;

Investorownershipstructure;and

Shareholdersupportof,andmanagement'sresponseto,previousshareholderproposals.

**StakeholderProvisions**

**GeneralRecommendation:**Voteagainstproposalsthatasktheboardtoconsidernon-shareholderconstituencies

or other non-financial effects when evaluating a merger or business combination.

**StateAntitakeoverStatutes**

**General Recommendation:** Vote case-by-case on proposals to opt in or out of state takeover statutes (including

fairpriceprovisions,stakeholderlaws,poisonpillendorsements,severancepayandlaborcontractprovisions,and

anti-greenmail provisions).

**SupermajorityVoteRequirements**

**GeneralRecommendation:**Voteagainstproposalstorequireasupermajorityshareholdervote.

Vote for management or shareholder proposals to reduce supermajority vote requirements. However, for

companieswithshareholder(s)whohavesignificantownershiplevels,votecase-by-case,takingintoaccount:

Ownershipstructure;

Quorumrequirements;and

Voterequirements.

**VirtualShareholderMeetings**

**General Recommendation:** Generally vote for management proposals allowing for the convening of shareholder

meetingsbyelectronicmeans,solongastheydonotprecludein-personmeetings.Companiesareencouragedto

disclosethecircumstancesunderwhichvirtual-only<sup>15</sup>meetingswouldbeheld,andtoallowforcomparablerights

and opportunities for shareholders to participate electronically as they would have during an in-person meeting.

Votecase-by-caseonshareholderproposalsconcerningvirtual-onlymeetings,considering:

Scopeandrationaleoftheproposal;and

Concernsidentifiedwiththecompany'spriormeetingpractices.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**15**Virtual-onlyshareholdermeeting"referstoameetingofshareholdersthatisheldexclusivelyusingtechnologywithouta

correspondingin-personmeeting.

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**4. Capital/Restructuring**

Capital

**AdjustmentstoParValueofCommonStock**

**GeneralRecommendation:**Voteformanagementproposalstoreducetheparvalueofcommonstockunlessthe

action is being taken to facilitate an anti-takeover device or some other negative corporate governance action.

Voteformanagementproposalstoeliminateparvalue.

**CommonStockAuthorization**

**GeneralAuthorizationRequests**

**GeneralRecommendation:**Votecase-by-caseonproposalstoincreasethenumberofauthorizedsharesof

common stock that are to be used for general corporate purposes:

Ifshareusage(outstandingplusreserved)islessthan50%ofthecurrentauthorizedshares,voteforan

increase of up to **50**% of current authorized share;

Ifshareusageis50%to100%ofthecurrentauthorized,vote foranincreaseofupto **100**%ofcurrent

authorized shares;

Ifshareusageisgreaterthancurrentauthorizedshares,voteforanincreaseofuptothecurrentshareusage;

or

Inthecaseofastocksplit,theallowableincrease iscalculated (perabove)basedonthepost-splitadjusted

authorization.

Generallyvoteagainstproposedincreases,evenifwithintheaboveratios,iftheproposalorthecompany'sprior

orongoinguseofauthorizedsharesisproblematic,including,butnotlimitedto:

Theproposalseekstoincreasethenumberofauthorizedsharesoftheclassofcommonstockthathas

superior voting rights to other share classes;

Onthesameballotisaproposalfora reversesplitforwhichsupport iswarranteddespitethefactthatit

would result in an excessive increase in the share authorization;

Thecompanyhasanon-shareholderapprovedpoisonpill(includinganNOLpill);or

Thecompanyhasprevioussizeableplacements(withinthepast3years)ofstockwith insidersatprices

substantially below market value, or with problematic voting rights, without shareholder approval.

However,generallyvoteforproposedincreasesbeyondtheaboveratios orproblematicsituations whenthereis

disclosure of specific and severe risks to shareholders of not approving the request, such as:

In,orsubsequentto,thecompany'smostrecent10-Kfiling,thecompanydisclosesthatthereissubstantial

doubt about its ability to continue as a going concern;

Thecompanystatesthatthereisariskofimminentbankruptcyorimminentliquidationifshareholdersdonot

approve the increase in authorized capital; or

Agovernmentbodyhasinthepastyearrequiredthecompanytoincreaseitscapitalratios.

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For companies incorporated in states that allow increases in authorized capital without shareholder approval,

generallyvotewithholdoragainstallnomineesifaunilateralcapitalauthorizationincreasedoesnotconformto

the above policies.

**SpecificAuthorizationRequests**

**General Recommendation:** Generally vote for proposals to increase the number of authorized common shares

where the primary purpose of the increase is to issue shares in connection with transaction(s) (such as

acquisitions,SPACtransactions,privateplacements,orsimilartransactions)onthesameballot,ordisclosedinthe

proxy statement, that warrant support. For such transactions, the allowable increase will be the greater of:

twicetheamountneededtosupportthetransactionsontheballot, and

theallowableincreaseascalculatedforgeneralissuancesabove.

**DualClassStructure**

**GeneralRecommendation:**Generallyvoteagainstproposalstocreateanewclassofcommonstockunless:

Thecompanydisclosesacompellingrationaleforthedual-classcapitalstructure,suchas:

Thecompany'sauditorhasconcludedthatthereissubstantialdoubtaboutthecompany'sabilitytocontinue

as a going concern; or

Thenewclassofshareswillbetransitory;

Thenewclassisintendedforfinancingpurposeswithminimalornodilutiontocurrentshareholdersinboth

the short term and long term; and

Thenewclassisnotdesignedtopreserveorincreasethevotingpowerofaninsiderorsignificantshareholder.

**IssueStockforUsewithRightsPlan**

**GeneralRecommendation:**Voteagainstproposalsthatincreaseauthorizedcommonstockfortheexplicitpurpose

of implementing a non-shareholder-approved shareholder rights plan (poison pill).

**PreemptiveRights**

**GeneralRecommendation:**Votecase-by-caseonshareholderproposalsthatseekpreemptiverights,takinginto

consideration:

Thesizeofthecompany;

Theshareholderbase;and

Theliquidityofthestock.

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**PreferredStockAuthorization**

**GeneralAuthorizationRequests**

**GeneralRecommendation:**Votecase-by-caseonproposalstoincreasethenumberofauthorizedsharesof

preferred stock that are to be used for general corporate purposes:

Ifshareusage(outstandingplusreserved)islessthan50%ofthecurrentauthorizedshares,voteforan

increase of up to **50**% of current authorized shares;

Ifshareusageis50%to100%ofthecurrentauthorized,vote foranincreaseofupto **100**%ofcurrent

authorized shares;

Ifshareusageisgreaterthancurrentauthorizedshares,voteforanincreaseofuptothecurrentshareusage.

Inthecaseofastocksplit,theallowableincrease iscalculated (perabove)basedonthepost-splitadjusted

authorization; or

Ifnopreferredsharesarecurrentlyissuedandoutstanding,voteagainsttherequest,unlessthecompany

discloses a specific use for the shares.

Generallyvoteagainstproposedincreases,evenifwithintheaboveratios,iftheproposalorthecompany'sprior

orongoinguseofauthorizedsharesis problematic,including,butnotlimitedto:

Ifthesharesrequestedareblankcheckpreferredsharesthatcanbeusedforantitakeoverpurposes;<sup>16</sup>

Thecompanyseekstoincreaseaclassofnon-convertiblepreferred sharesentitledtomorethanonevoteper

share on matters that do not solely affect the rights of preferred stockholders "supervoting shares");

The company seeks to increase a class of convertible preferred shares entitled to a number of votes greater

thanthenumberofcommon sharesintowhichtheyareconvertible("supervotingshares")onmattersthatdo

not solely affect the rights of preferred stockholders;

Thestatedintentoftheincreaseinthe generalauthorizationistoallow thecompanytoincreaseanexisting

designated class of supervoting preferred shares;

Onthesameballotisaproposalfora reversesplitforwhichsupport iswarranteddespitethefactthatit

would result in an excessive increase in the share authorization;

Thecompanyhasanon-shareholderapprovedpoisonpill(includinganNOLpill);and

Thecompanyhasprevioussizeableplacements(withinthepast3years)ofstockwithinsidersatprices

substantially below market value, or with problematic voting rights, without shareholder approval.

However,generallyvoteforproposedincreasesbeyondtheaboveratios orproblematicsituations whenthereis

disclosure of specific and severe risks to shareholders of not approving the request, such as:

In,orsubsequentto,thecompany'smostrecent10-Kfiling,thecompanydisclosesthatthereissubstantial

doubt about its ability to continue as a going concern;

Thecompanystatesthatthereisariskofimminentbankruptcyorimminentliquidationifshareholdersdonot

approve the increase in authorized capital; or

Agovernmentbodyhasinthepastyearrequiredthecompanytoincreaseitscapitalratios.

For companies incorporated in states that allow increases in authorized capital without shareholder approval,

generallyvotewithholdoragainstallnomineesifaunilateralcapitalauthorizationincreasedoesnotconformto

the above policies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**16**Tobeacceptable,appropriatedisclosurewould beneededthatthesharesare"declawed":i.e.,representationbytheboard

thatitwillnot,withoutpriorstockholderapproval,issueorusethepreferredstockforanydefensiveoranti-takeoverpurpose

or for the purpose of implementing any stockholder rights plan.

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**<u>Specific</u><u>Authorization</u><u>Requests</u>**

**General Recommendation:** Generally vote for proposals to increase the number of authorized preferred shares

where the primary purpose of the increase is to issue shares in connection with transaction(s) (such as

acquisitions,SPACtransactions,privateplacements,orsimilartransactions)onthesameballot,ordisclosedinthe

proxy statement, that warrant support. For such transactions, the allowable increase will be the greater of:

twicetheamountneededtosupportthetransactionsontheballot, and

theallowableincreaseascalculatedforgeneralissuancesabove.

**RecapitalizationPlans**

**GeneralRecommendation:**Votecase-by-caseonrecapitalizations(reclassificationsofsecurities),takinginto

account the following:

Moresimplifiedcapitalstructure;

Enhancedliquidity;

Fairnessofconversionterms;

Impactonvotingpoweranddividends;

Reasonsforthereclassification;

Conflictsofinterest;and

Otheralternativesconsidered.

**ReverseStockSplits**

**GeneralRecommendation:**Voteformanagementproposalstoimplementareversestocksplitif:

Thenumberofauthorizedshareswillbeproportionatelyreduced;or

Theeffectiveincreaseinauthorizedsharesisequaltoorlessthantheallowableincreasecalculatedin

accordance with ISS' Common Stock Authorization policy.

Votecase-by-caseonproposalsthatdonotmeeteitheroftheaboveconditions,takingintoconsiderationthe

following factors:

Stockexchangenotificationtothecompanyofapotentialdelisting;

Disclosureofsubstantialdoubtaboutthecompany'sabilitytocontinueasagoingconcernwithoutadditional

financing;

Thecompany'srationale;or

Otherfactorsasapplicable.

**ShareIssuanceMandatesatU.S.DomesticIssuersIncorporatedOutsidethe**

**U.S.**

**General Recommendation:** For U.S. domestic issuers incorporated outside the U.S. and listed <u>solely</u> on a U.S.

exchange,generallyvoteforresolutionstoauthorizetheissuanceofcommonsharesupto20percentof currently

issued common share capital, where not tied to a specific transaction or financing proposal.

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Forpre-revenueorotherearly-stagecompaniesthatareheavilyreliantonperiodicequityfinancing,generallyvote

for resolutions to authorize the issuance of common shares up to 50 percent of currently issued common share

capital. The burden of proof will be on the company to establish that it has a need for the higher limit.

Renewalofsuchmandatesshouldbesoughtateachyear'sannualmeeting.

Votecase-by-caseonshareissuancesforaspecifictransactionorfinancingproposal.

**ShareRepurchasePrograms**

**GeneralRecommendation:**ForU.S.-incorporatedcompanies,andforeign-incorporatedU.S.DomesticIssuersthat

are traded solely on U.S. exchanges, vote for management proposals to institute open-market share repurchase

plans in which all shareholders may participate on equal terms, or to grant the board authority to conduct open-

market repurchases, in the absence of company-specific concerns regarding:

Greenmail;

Theuseofbuybackstoinappropriatelymanipulateincentivecompensationmetrics;

Threatstothecompany'slong-termviability;or

Othercompany-specificfactorsaswarranted.

Votecase-by-caseonproposalstorepurchasesharesdirectlyfromspecifiedshareholders,balancingthestated

rationale against the possibility for the repurchase authority to be misused, such as to repurchase shares from

insiders at a premium to market price.

**ShareRepurchaseProgramsShareholderProposals**

**General Recommendation:** Generally vote against shareholder proposals prohibiting executives from selling

sharesofcompanystockduringperiodsinwhichthecompanyhasannouncedthatitmayorwillberepurchasing

shares of its stock. Vote for the proposal when there is a pattern of abuse by executives exercising options or

selling shares during periods of share buybacks.

**StockDistributions:SplitsandDividends**

**General Recommendation:** Generally vote for management proposals to increase the common share

authorizationforstocksplitorstockdividend,providedthattheeffectiveincreaseinauthorizedsharesisequalto

or is less than the allowable increase calculated in accordance with ISS' Common Stock Authorization policy.

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**TrackingStock**

**GeneralRecommendation:** Votecase-by-caseonthecreationoftrackingstock,weighingthestrategicvalueofthe

transaction against such factors as:

Adversegovernancechanges;

Excessiveincreasesinauthorizedcapitalstock;

Unfairmethodofdistribution;

Diminutionofvotingrights;

Adverseconversionfeatures;

Negativeimpactonstockoptionplans;and

Alternativessuchasspin-off.

Restructuring

**AppraisalRights**

**GeneralRecommendation:**Voteforproposalstorestoreorprovideshareholderswithrightsofappraisal.

**AssetPurchases**

**GeneralRecommendation:**Votecase-by-caseonassetpurchaseproposals,consideringthefollowingfactors:

Purchaseprice;

Fairnessopinion;

Financialandstrategicbenefits;

Howthedealwasnegotiated;

Conflictsofinterest;

Otheralternativesforthebusiness;and

Non-completionrisk.

**AssetSales**

**GeneralRecommendation:**Votecase-by-caseonassetsales,consideringthefollowingfactors:

Impactonthebalancesheet/workingcapital;

Potentialeliminationofdiseconomies;

Anticipatedfinancialandoperatingbenefits;

Anticipateduseoffunds;

Valuereceivedfortheasset;

Fairnessopinion;

Howthedealwasnegotiated;and

Conflictsofinterest.

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**BundledProposals**

**GeneralRecommendation:**Votecase-by-caseonbundledor"conditional"proxyproposals.Inthecaseofitems

thatareconditioneduponeachother,examinethebenefitsandcostsofthepackageditems.Ininstanceswhen

the joint effect of the conditioned items is not in shareholders' best interests, vote againstthe proposals.If the

combined effect is positive, support such proposals.

**ConversionofSecurities**

**GeneralRecommendation:** Votecase-by-caseon proposalsregardingconversion ofsecurities. When evaluating

theseproposals,theinvestorshouldreviewthedilutiontoexistingshareholders,theconversionpricerelativeto

market value, financial issues, control issues, termination penalties, and conflicts of interest.

Votefortheconversionifitisexpectedthatthecompanywillbesubjecttoonerouspenaltiesorwillbeforcedto

file for bankruptcy if the transaction is not approved.

**CorporateReorganization/DebtRestructuring/PrepackagedBankruptcyPlans/**

**ReverseLeveragedBuyouts/WrapPlans**

**GeneralRecommendation:**Votecase-by-caseonproposalstoincreasecommonand/orpreferredsharesandto

issue shares as part of a debt restructuring plan, after evaluating:

Dilutiontoexistingshareholders'positions;

Termsoftheoffer-discount/premiuminpurchasepricetoinvestor,includinganyfairnessopinion;

termination penalties; exit strategy;

Financialissues-company'sfinancialsituation;degreeofneedforcapital;useofproceeds;effectofthe

financing on the company's cost of capital;

Management'seffortstopursueotheralternatives;

Controlissues-changeinmanagement;changeincontrol,guaranteedboardandcommitteeseats;standstill

provisions; voting agreements; veto power over certain corporate actions; and

Conflictofinterest-arm'slengthtransaction,managerialincentives.

Voteforthedebtrestructuringifitisexpectedthatthecompanywillfileforbankruptcyifthetransactionisnot

approved.

**FormationofHoldingCompany**

**GeneralRecommendation:**Votecase-by-caseonproposalsregardingtheformationofaholdingcompany,taking

into consideration the following:

Thereasonsforthechange;

Anyfinancialortaxbenefits;

Regulatorybenefits;

Increasesincapitalstructure;and

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Changestothearticlesofincorporationorbylawsofthecompany.

Absentcompellingfinancialreasonstorecommendforthetransaction,voteagainsttheformationofaholding

company if the transaction would include either of the following:

Increasesincommonorpreferredstockinexcessoftheallowablemaximum(seediscussionunder"Capital");

or

Adversechangesinshareholderrights.

**GoingPrivateandGoingDarkTransactions(LBOsandMinoritySqueeze-** 

**outs)**

**GeneralRecommendation:**Votecase-by-caseongoingprivatetransactions,takingintoaccountthefollowing:

Offerprice/premium;

Fairnessopinion;

Howthedealwasnegotiated;

Conflictsofinterest;

Otheralternatives/offersconsidered;and

Non-completionrisk.

Votecase-by-caseongoingdarktransactions,determiningwhetherthetransactionenhancesshareholdervalueby

taking into consideration:

Whetherthecompanyhasattainedbenefitsfrombeingpublicly-traded(examinationoftradingvolume,

liquidity, and market research of the stock); and

Balancedinterestsofcontinuingvs.cashed-outshareholders,takingintoaccountthefollowing:

Areallshareholdersabletoparticipateinthetransaction?

Willtherebealiquidmarketforremainingshareholdersfollowingthetransaction?

Doesthecompanyhavestrongcorporategovernance?

Willinsidersreapthegainsofcontrolfollowingtheproposedtransaction? and

Doesthestateofincorporationhavelawsrequiringcontinuedreportingthatmaybenefitshareholders?

**JointVentures**

**GeneralRecommendation:** Votecase-by-caseonproposalstoformjointventures,takingintoaccountthe

following:

Percentageofassets/businesscontributed;

Percentageownership;

Financialandstrategicbenefits;

Governancestructure;

Conflictsofinterest;

Otheralternatives;and

Non-completionrisk.

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**Liquidations**

**GeneralRecommendation:**Votecase-by-caseonliquidations,takingintoaccountthefollowing:

Management'seffortstopursueotheralternatives;

Appraisalvalueofassets;and

Thecompensationplanforexecutivesmanagingtheliquidation.

Votefortheliquidationifthecompanywillfileforbankruptcyiftheproposalisnotapproved.

**MergersandAcquisitions**

**GeneralRecommendation:**Votecase-by-caseonmergersandacquisitions.Reviewandevaluatethemeritsand

drawbacks of the proposed transaction, balancing various and sometimes countervailing factors including:

*Valuation*-Isthevaluetobereceivedbythetargetshareholders(orpaidbytheacquirer)reasonable?While

the fairness opinion may provide an initial starting point forassessingvaluation reasonableness, emphasis is

placed on the offer premium, market reaction, and strategic rationale.

*Marketreaction*-Howhasthemarketrespondedtotheproposeddeal?Anegativemarketreactionshould

cause closer scrutiny of a deal.

*Strategic rationale* - Does the deal make sense strategically? From where is the value derived? Cost and

revenuesynergiesshouldnotbeoverlyaggressiveoroptimistic,butreasonablyachievable.Management

should also have a favorable track record of successful integration of historical acquisitions.

*Negotiationsandprocess* -Werethetermsofthetransactionnegotiatedatarm's-length?Wastheprocessfair

and equitable? A fair process helps to ensure the best price for shareholders. Significant negotiation "wins"

can also signify the deal makers' competency. The comprehensiveness of the sales process (e.g., full auction,

partial auction, no auction) can also affect shareholder value.

*Conflicts of interest* - Are insiders benefiting from the transaction disproportionately and inappropriately as

compared to non-insider shareholders? As the result of potential conflicts, the directors and officers of the

company may be more likely to vote to approve a merger than if they did not hold these interests. Consider

whether these interests may have influenced these directors and officers to support or recommend the

merger.TheCICfigurepresentedinthe"ISSTransactionSummary"sectionofthisreport isanaggregatefigure

that can in certain cases be a misleading indicator of the true value transfer from shareholders to insiders.

Where such figure appears to be excessive, analyze the underlying assumptions to determine whether a

potential conflict exists.

*Governance* - Will the combined company have a better or worse governance profile than the current

governance profiles of the respective parties to the transaction? If the governance profile is to change for the

worse,theburdenisonthecompanytoprovethatother issues(suchasvaluation)outweighanydeterioration

in governance.

**PrivatePlacements/Warrants/ConvertibleDebentures**

**GeneralRecommendation:**Votecase-by-caseonproposalsregardingprivateplacements,warrants,and

convertible debentures taking into consideration:

Dilutiontoexistingshareholders'position:Theamountandtimingofshareholderownershipdilutionshould

be weighed against the needs and proposed shareholder benefits of the capital infusion. Although newly

issued common stock, absent preemptive rights, is typically dilutive to existing shareholders, share price

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appreciation is often the necessary event to trigger the exercise of "out of the money" warrants and

convertibledebt.Intheseinstancesfromavaluestandpoint,thenegativeimpactofdilutionismitigatedby

the increase in the company's stock price that must occur to trigger the dilutive event.

Termsoftheoffer(discount/premiuminpurchasepricetoinvestor,includinganyfairnessopinion,conversion

features, termination penalties, exit strategy):

The terms of the offer should be weighed against the alternatives of the company and in light of

company'sfinancialcondition.Ideally,theconversionpriceforconvertibledebtandtheexercisepricefor

warrants should be at a premium to the then prevailing stock price at the time of private placement.

When evaluating the magnitude of a private placement discount or premium, consider factors that

influencethediscountorpremium,suchas,liquidity,duediligencecosts,controlandmonitoringcosts,

capital scarcity, information asymmetry, and anticipation of future performance.

Financialissues:

Thecompany'sfinancialcondition;

Degreeofneedforcapital;

Useofproceeds;

Effectofthefinancingonthecompany'scostofcapital;

Currentandproposedcashburnrate;and

Goingconcernviabilityandthestateofthecapitalandcreditmarkets.

Management'seffortstopursuealternativesand whetherthecompanyengagedinaprocesstoevaluate

alternatives: A fair, unconstrained process helps to ensure the best price for shareholders. Financing

alternatives can include joint ventures, partnership, merger, or sale of part or all of the company.

Controlissues:

Changeinmanagement;

Changeincontrol;

Guaranteedboardandcommitteeseats;

Standstillprovisions;

Votingagreements;

Vetopowerovercertaincorporateactions;and

Minorityversusmajorityownershipandcorrespondingminoritydiscountormajoritycontrolpremium.

Conflictsofinterest:

Conflictsofinterestshouldbeviewedfromtheperspectiveofthecompanyandtheinvestor;and

Werethetermsofthetransactionnegotiatedatarm'slength?Aremanagerialincentivesalignedwith

shareholder interests?

Marketreaction:

Themarket'sresponsetotheproposeddeal.Anegativemarketreactionisacauseforconcern.Market

reaction may be addressed by analyzing the one-day impact on the unaffected stock price.

Votefortheprivateplacement,orfortheissuanceofwarrantsand/orconvertibledebenturesinaprivate

placement, if it is expected that the company will file for bankruptcy if the transaction is not approved.

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**Reorganization/RestructuringPlan(Bankruptcy)**

**GeneralRecommendation:**Votecase-by-caseonproposalstocommonshareholdersonbankruptcyplansof

reorganization, considering the following factors including, but not limited to:

Estimatedvalueandfinancialprospectsofthereorganizedcompany;

Percentageownershipofcurrentshareholdersinthereorganizedcompany;

Whethershareholdersareadequatelyrepresentedinthereorganizationprocess(particularlythroughthe

existence of an Official Equity Committee);

Thecause(s)ofthebankruptcyfiling,andtheextenttowhichtheplanofreorganizationaddressesthe

cause(s);

Existenceofasuperioralternativetotheplanofreorganization;and

Governanceofthereorganizedcompany.

**SpecialPurposeAcquisitionCorporations(SPACs)**

**GeneralRecommendation:**Votecase-by-caseonSPACmergersandacquisitionstakingintoaccountthefollowing:

*Valuation* - Is the value being paid by the SPAC reasonable? SPACs generally lack an independent fairness

opinionandthefinancialsonthetargetmaybelimited.Comparetheconversionpricewiththeintrinsicvalue

of the target company provided in the fairness opinion. Also, evaluate the proportionate value of the

combinedentityattributabletotheSPACIPOshareholdersversusthepre-mergervalueofSPAC.Additionally,

a private company discount may be applied to the target if it is a private entity.

*Marketreaction*-Howhasthemarketrespondedtotheproposeddeal?Anegativemarketreaction maybea

cause for concern. Market reaction may be addressed by analyzing the one-day impact on the unaffected

stock price.

*Deal timing* - A main driver for most transactions is that the SPAC charter typically requires the deal to be

completewithin18to24months,ortheSPACistobeliquidated.Evaluatethevaluation,marketreaction,and

potential conflicts of interest for deals that are announced close to the liquidation date.

*Negotiationsandprocess*-Whatwastheprocessundertakentoidentifypotentialtargetcompanieswithin

specified industry or location specified in charter? Consider the background of the sponsors.

*Conflicts of interest* - How are sponsors benefiting from the transaction compared to IPO shareholders?

Potential conflicts could arise if a fairness opinion is issued by the insiders to qualify the deal rather than a

third party or if management is encouraged to pay a higherprice for the target because of an 80 percent rule

(thecharterrequiresthatthefairmarketvalueofthetarget isatleastequalto80 percentofnetassetsofthe

SPAC). Also, there may be sense of urgency by the management team of the SPAC to close the deal since its

charter typically requires a transaction to be completed within the 18-24-month timeframe.

*Votingagreements*-Arethesponsorsenteringintoenterintoanyvotingagreements/tenderofferswith

shareholders who are likely to vote against the proposed merger or exercise conversion rights?

*Governance*-WhatistheimpactofhavingtheSPACCEOorfounderonkeycommitteesfollowingthe

proposed merger?

**SpecialPurposeAcquisitionCorporations(SPACs)-ProposalsforExtensions**

ThemainpurposeofSPACsistoidentifyandacquireaviabletargetwithina specifiedtimeframe,andfailureto

achieve this objective within the allotted time calls into question management's ability to execute its primary

objective. The end of that timeframe is generally referred to as the termination date.

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**GeneralRecommendation:** Generallysupportrequeststoextendtheterminationdatebyuptooneyearfromthe

SPAC's original termination date (inclusive of any built-in extension options, and accounting for prior extension

requests).

Other factors that may be considered include: any added incentives, business combination status, other

amendmentterms,and,ifapplicable, useofmoneyinthetrustfundtopayexcisetaxesonredeemedshares.

**Spin-offs**

**GeneralRecommendation:**Votecase-by-caseonspin-offs,considering:

Taxandregulatoryadvantages;

Planneduseofthesaleproceeds;

Valuationofspinoff;

Fairnessopinion;

Benefitstotheparentcompany;

Conflictsofinterest;

Managerialincentives;

Corporategovernancechanges;and

Changesinthecapitalstructure.

**ValueMaximizationShareholderProposals**

**GeneralRecommendation:**Votecase-by-caseonshareholderproposalsseekingtomaximizeshareholdervalueby:

Hiringafinancialadvisortoexplorestrategicalternatives;

Sellingthecompany;or

Liquidatingthecompanyanddistributingtheproceedstoshareholders.

Theseproposalsshouldbeevaluatedbasedonthefollowingfactors:

Prolongedpoorperformancewithnoturnaroundinsight;

Signsofentrenchedboardandmanagement(suchastheadoptionoftakeoverdefenses);

Strategicplaninplaceforimprovingvalue;

Likelihoodofreceivingreasonablevalueinasaleordissolution;and

Thecompanyactivelyexploringitsstrategicoptions,includingretainingafinancialadvisor.

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**5. Compensation**

ExecutivePayEvaluation

Underlyingallevaluationsarefiveglobalprinciplesthatmostinvestorsexpectcorporationstoadheretoin

designing and administering executive and director compensation programs:

1. Maintain appropriate pay-for-performance alignment, with emphasis on long-term shareholder value: This

principle encompasses overall executive pay practices, which must be designed to attract, retain, and

appropriately motivate the key employees who drive shareholder value creation over the long term. It will

takeintoconsideration,amongotherfactors,thelinkbetweenpayandperformance;themixbetweenfixed

and variable pay; performance goals; and equity-based plan costs;

2. Avoidarrangementsthatrisk"payforfailure":Thisprincipleaddressestheappropriatenessoflongor

indefinitecontracts,excessiveseverancepackages,andguaranteedcompensation;

3. Maintain an independent and effective compensation committee: This principle promotes oversight of

executivepayprogramsbydirectorswithappropriateskills,knowledge,experience,andasoundprocessfor

compensation decision-making (*e.g.*, including access to independent expertise and advice when needed);

4. Provide shareholders with clear, comprehensive compensation disclosures: This principle underscores the

importanceofinformativeandtimelydisclosuresthatenableshareholderstoevaluateexecutivepaypractices

fully and fairly; and

5. Avoid inappropriate pay to non-executive directors: This principle recognizes the interests of shareholders in

ensuring that compensation to outside directors is reasonable and does not compromise their independence

andabilitytomakeappropriatejudgmentsinoverseeingmanagers'payandperformance.Atthemarketlevel,

it may incorporate a variety of generally accepted best practices.

**AdvisoryVotesonExecutiveCompensation—ManagementProposals(Say-** 

**on-Pay)**

**GeneralRecommendation:** Votecase-by-caseonballotitemsrelatedtoexecutive payandpractices,aswellas

certain aspects of outside director compensation.

VoteagainstAdvisoryVotesonExecutiveCompensation(Say-on-Payor"SOP")if:

ThereisanunmitigatedmisalignmentbetweenCEOpayandcompanyperformance(pay forperformance);

Thecompanymaintainssignificantproblematic pay practices;or

Theboardexhibitsasignificantlevelofpoor communication and responsivenesstoshareholders.

VoteagainstorwithholdfromthemembersoftheCompensationCommitteeandpotentiallythefullboardif:

ThereisnoSOPontheballot,andanagainstvoteonanSOPwouldotherwisebewarrantedduetopay-for-

performance misalignment, problematic pay practices, or the lack of adequate responsiveness on

compensation issues raised previously, or a combination thereof;

TheboardfailstorespondadequatelytoapreviousSOPproposalthatreceivedlessthan70percentsupport

of votes cast;

Thecompanyhasrecentlypracticedorapprovedproblematicpaypractices,suchasoptionrepricingoroption

backdating; or

Thesituationisegregious.

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PrimaryEvaluationFactorsforExecutivePay

**Pay-for-PerformanceEvaluation**

ISSannuallyconductsapay-for-performanceanalysistoidentify strongorsatisfactoryalignmentbetweenpayand

performance over a sustained period. With respect to companies in the S&P1500, Russell 3000, or Russell 3000E

Indices<sup>17</sup><sup>,</sup> this analysis considers the following:

1. PeerGroup<sup>18</sup>Alignment:

Thedegreeofalignmentbetweenthecompany'sannualizedTSRrankandtheCEO'sannualizedtotalpayrank

within a peer group, each measured over a three-year period.

TherankingsofCEOtotalpayandcompanyfinancialperformancewithinapeergroup,eachmeasuredovera

three-year period.

ThemultipleoftheCEO'stotalpayrelativetothepeergroupmedianinthemostrecentfiscalyear.

2. AbsoluteAlignment<sup>19</sup>–theabsolutealignmentbetweenthetrendinCEOpayandcompanyTSRovertheprior

fivefiscalyears–i.e.,thedifferencebetweenthetrendinannualpaychangesandthetrendinannualizedTSR

during the period.

Iftheaboveanalysisdemonstratessignificantunsatisfactorylong-termpay-for-performancealignmentor,inthe

case of companies outside the Russell indices, a misalignment between pay and performance is otherwise

suggested, our analysis may include any of the following qualitative factors, as relevant to an evaluation of how

various pay elements may work to encourage or to undermine long-term value creation and alignment with

shareholder interests:

Theratioofperformance-totime-basedincentiveawards;

Theoverallratioofperformance-basedcompensationtofixedordiscretionarypay;

Therigorofperformancegoals;

Thecomplexityandrisksaroundpayprogramdesign;

Thetransparencyandclarityofdisclosure;

Thecompany'speergroupbenchmarkingpractices;

Financial/operationalresults,bothabsoluteandrelativetopeers;

Specialcircumstancesrelated to,forexample,anewCEOinthepriorFYoranomalousequitygrantpractices

(e.g., bi-annual awards);

Realizablepay<sup>20</sup>comparedtograntpay;and

Anyotherfactorsdeemedrelevant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**17**TheRussell 3000EIndexincludesapproximately4,000ofthelargestU.S.equitysecurities.

**18**The revised peer group is generally comprised of 14-24 companies that areselected using market cap, revenue (or assets for

certain financial firms), GICS industry group, and company's selected peers' GICS industry group, with size constraints, via a

processdesignedtoselectpeersthatarecomparable tothesubjectcompanyintermsofrevenue/assetsandindustry,andalso

withinamarket-cap bucketthatisreflectiveofthecompany's marketcap.ForOil,Gas&ConsumableFuelscompanies,market

cap is the only size determinant.

**19**OnlyRussell3000IndexcompaniesaresubjecttotheAbsoluteAlignment analysis.

**20**ISSresearchreportsincluderealizablepayforS&P1500companies.

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**ProblematicPayPractices**

Problematicpayelementsaregenerallyevaluatedcase-by-caseconsideringthecontextofacompany'soverallpay

program and demonstrated pay-for-performance philosophy. The focus is on executive compensation practices

that contravene the global pay principles, including:

Problematicpracticesrelatedtonon-performance-basedcompensationelements;

Incentivesthatmaymotivateexcessiverisk-takingorpresentawindfallrisk;and

Paydecisionsthatcircumventpay-for-performance,suchasoptionsbackdatingorwaivingperformance

requirements.

Thelistofexamplesbelowhighlightscertainproblematicpracticesthatcarrysignificantweightinthisoverall

consideration and may result in adverse vote recommendations:

Repricingorreplacingofunderwaterstockoptions/SARswithoutpriorshareholderapproval(includingcash

buyouts and voluntary surrender of underwater options);

Extraordinaryperquisitesortaxgross-ups;

Newormateriallyamendedagreementsthatprovidefor:

ExcessiveterminationorCICseverancepayments(generallyexceeding3timesbasesalaryand

average/target/most recent bonus);

CICseverancepaymentswithoutinvoluntaryjoblossorsubstantialdiminutionofduties("single"or

"modified single" triggers) or in connection with a problematic Good Reason definition;

CICexcisetaxgross-upentitlements(including"modified"gross-ups);and/or

Multi-yearguaranteedawardsthatarenotatriskduetorigorousperformanceconditions;

LiberalCICdefinitioncombinedwithanysingle-triggerCICbenefits;

Insufficientexecutivecompensationdisclosurebyexternally-managedissuers(EMIs)suchthatareasonable

assessment of pay programs and practices applicable to the EMI's executives is not possible;

Severancepaymentsmadewhentheterminationisnotclearlydisclosedasinvoluntary(forexample,a

termination without cause or resignation for good reason); and/or

Anyotherprovisionorpracticedeemedtobeegregiousandpresentasignificantrisktoinvestors.

Theaboveexamplesarenotan exhaustivelist.Pleaserefer toISS' U.S. Compensation Policies FAQ documentfor

additionaldetailonspecificpaypracticesthathavebeenidentifiedasproblematicandmayleadtonegativevote

recommendations.

**OptionsBackdating**

Thefollowingfactorsshouldbeexaminedcase-by-casetoallowfordistinctionstobemadebetween"sloppy"plan

administrationversusdeliberateactionorfraud:

Reasonandmotivefortheoptionsbackdatingissue,suchasinadvertentvs.deliberategrantdatechanges;

Durationofoptionsbackdating;

Sizeofrestatementduetooptionsbackdating;

Correctiveactionstakenbytheboardorcompensationcommittee,suchascancelingorre-pricingbackdated

options, the recouping of option gains on backdated grants; and

Adoptionofagrantpolicythatprohibitsbackdatingandcreatesafixedgrantscheduleorwindowperiodfor

equity grants in the future.

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**CompensationCommitteeCommunicationsandResponsiveness**

Considerthefollowingfactorscase-by-casewhenevaluatingballotitemsrelatedtoexecutivepayontheboard's

responsivenesstoinvestorinputandengagementoncompensationissues:

Failuretorespondtomajority-supportedshareholderproposalsonexecutivepaytopics;or

Failuretoadequatelyrespondtothecompany'sprevioussay-on-payproposalthatreceivedthesupportofless

than 70 percent of votes cast, taking into account:

Disclosureofengagementeffortswithmajorinstitutionalinvestors,includingthefrequencyandtimingof

engagements and the company participants (including whether independent directors participated);

Disclosureofthespecificconcernsvoicedbydissentingshareholdersthatledtothesay-on-pay

opposition;

Disclosureofspecificandmeaningfulactionstakentoaddressshareholders'concerns;

Otherrecentcompensationactionstakenbythecompany;

Whethertheissuesraisedarerecurringorisolated;

Thecompany'sownershipstructure;and

Whetherthesupportlevelwaslessthan50percent,whichwouldwarrantthehighestdegreeof

responsiveness.

**Frequency ofAdvisory VoteonExecutiveCompensation("Say Whenon** 

**Pay")**

**GeneralRecommendation:**Voteforannualadvisoryvotesoncompensation,whichprovidethemostconsistent

and clear communication channel for shareholder concerns about companies' executive pay programs.

**VotingonGoldenParachutesinanAcquisition,Merger,Consolidation,or** 

**Proposed Sale**

**GeneralRecommendation:**Votecase-by-caseonsayonGoldenParachuteproposals,includingconsiderationof

existing change-in-control arrangements maintained with named executive officers but also considering new or

extended arrangements.

Featuresthatmayresultin an"against"recommendationincludeoneormoreofthefollowing,depending onthe

number, magnitude, and/or timing of issue(s):

Single-ormodified-single-triggercashseverance;

Single-triggeraccelerationofunvestedequityawards;

Fullaccelerationofequityawardsgrantedshortlybeforethechangeincontrol;

Accelerationofperformanceawardsabovethetargetlevelofperformancewithoutcompellingrationale;

Excessivecashseverance(generally>3xbasesalaryandbonus);

Excisetaxgross-upstriggeredandpayable;

Excessivegoldenparachutepayments(onanabsolutebasisorasapercentageoftransactionequityvalue);or

Recentamendmentsthatincorporateanyproblematicfeatures(suchasthoseabove)orrecentactions(such

asextraordinaryequitygrants)thatmaymakepackagessoattractiveastoinfluencemergeragreementsthat

may not be in the best interests of shareholders; or

Thecompany'sassertionthataproposedtransactionisconditionedonshareholderapprovalofthegolden

parachute advisory vote.

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Recentamendment(s)thatincorporateproblematicfeatureswilltendtocarrymoreweightontheoverallanalysis.

However, the presence of multiple legacy problematic features will also be closely scrutinized.

In cases where the golden parachute vote is incorporated into a company's advisory vote on compensation

(managementsay-on-pay),ISSwillevaluatethesay-on-payproposalinaccordancewiththeseguidelines,which

may give higher weight to that component of the overall evaluation.

Equity-BasedandOtherIncentivePlans

PleaserefertoISS'U.S. Equity Compensation Plans FAQ documentforadditionaldetailsontheEquityPlan

Scorecard policy.

**General Recommendation:** Vote case-by-case on certain equity-based compensation plans<sup>21</sup>depending on a

combination of certain plan features and equity grant practices, where positive factors may counterbalance

negativefactors,andviceversa,asevaluatedusingan"EquityPlanScorecard"(EPSC)approachwiththreepillars:

**Plan Cost:** The total estimated cost of the company's equity plans relative to industry/market cap peers,

measuredbythecompany'sestimatedShareholderValueTransfer(SVT)inrelationtopeersandconsidering

both:

SVTbasedonnewsharesrequestedplussharesremainingforfuturegrants,plusoutstanding

unvested/unexercised grants; and

SVTbasedonlyonnewsharesrequestedplussharesremainingforfuturegrants.

**PlanFeatures:**

Qualityofdisclosurearoundvestinguponachangeincontrol(CIC);

Discretionaryvestingauthority;

Liberalsharerecyclingonvariousawardtypes;

Lackofminimumvestingperiodforgrantsmadeundertheplan;and

Dividendspayablepriortoawardvesting.

**GrantPractices:**

Thecompany'sthree-yearburnraterelativetoitsindustry/marketcappeers;

VestingrequirementsinCEO'srecentequitygrants(3-yearlook-back);

Theestimateddurationoftheplan(basedonthesumofsharesremainingavailableandthenewshares

requested, divided by the average annual shares granted in the prior three years);

TheproportionoftheCEO'smostrecentequitygrants/awardssubjecttoperformanceconditions;

Whetherthecompanymaintainsasufficientclaw-backpolicy;and

Whetherthecompanymaintainssufficientpost-exercise/vestingshare-holdingrequirements.

Generallyvoteagainsttheplanproposalifthecombinationofabovefactorsindicatesthattheplanisnot,overall,

in shareholders' interests, or if any of the following egregious factors ("overriding factors") apply:

Awardsmayvestinconnectionwithaliberalchange-of-controldefinition;

The plan would permit repricing or cash buyout of underwater options without shareholder approval (either

byexpresslypermittingit –forNYSEandNasdaqlistedcompanies –orbynotprohibitingitwhenthecompany

has a history of repricing – for non-listed companies);

**21**ProposalsevaluatedundertheEPSCpolicygenerallyincludethosetoapproveoramend(1)stockoptionplansforemployees

and/or employees and directors, (2) restricted stock plans for employees and/or employees and directors, and (3) omnibus

stock incentive plans for employees and/or employees and directors; amended plans will be further evaluated case-by-case.

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Theplanisavehicleforproblematicpaypracticesorasignificantpay-for-performancedisconnectunder

certain circumstances;

Theplanisexcessivelydilutivetoshareholders'holdings;

Theplancontainsanevergreen(automaticsharereplenishment)feature;or

Anyotherplanfeaturesaredeterminedtohaveasignificantnegativeimpactonshareholderinterests.

**FurtherInformationoncertainEPSCFactors:**

**ShareholderValueTransfer(SVT)**

The cost of the equity plans is expressed as Shareholder Value Transfer (SVT), which is measured using a binomial

option pricing model that assesses the amount of shareholders' equity flowing out of the company to employees

anddirectors.SVTisexpressed asbothadollaramountandasapercentageofmarketvalue,andincludesthenew

shares proposed, shares available under existing plans, and shares granted but unexercised (using two measures,

in the case of plans subject to the Equity Plan Scorecard evaluation, as noted above). All award types are valued.

Foromnibusplans,unlesslimitationsareplacedonthemostexpensivetypesofawards(forexample,full-value

awards), the assumption is made that all awards to be granted will be the most expensive types.

For proposals that are not subject to the Equity Plan Scorecard evaluation, Shareholder Value Transfer is

reasonable if it falls below a company-specific benchmark. The benchmark is determined as follows: The top

quartileperformersineachindustrygroup(usingtheGlobalIndustryClassification Standard:GICS)areidentified.

Benchmark SVT levels for each industry are established based on these top performers' historic SVT. Regression

analysesarerunoneachindustrygrouptoidentifythevariablesmost stronglycorrelatedtoSVT.Thebenchmark

industry SVT level is then adjusted upwards or downwards for the specific company by plugging the company-

specific performance measures, size, and cash compensation into the industry cap equations to arrive at the

company's benchmark.<sup>22</sup>

**Three-YearValue-AdjustedBurnRate**

A "Value-Adjusted Burn Rate" is used for stock plan evaluations. Value-Adjusted Burn Rate benchmarks are

calculatedasthegreaterof:(1)anindustry-specificthresholdbasedonthree-yearburnrateswithinthecompany's

GICS group segmented by S&P 500, Russell 3000 index (less the S&P 500) and non-Russell 3000 index; and (2) a *de* 

*minimis* threshold establishedseparately for each oftheS&P 500,theRussell3000index less theS&P 500,and the

non-Russell 3000 index. Year-over-year burn-rate benchmark changes will be limited to a predetermined range

above or below the prior year's burn-rate benchmark.

TheValue-AdjustedBurnRateiscalculatedasfollows:

Value-AdjustedBurnRate=((#ofoptions\*option'sdollarvalueusingaBlack-Scholesmodel)+(#offull-value

awards \* stock price)) / (Weighted average common shares \* stock price).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**22**ForplansevaluatedundertheEquityPlanScorecardpolicy,thecompany'sSVTbenchmarkisconsideredalongwithother

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**EgregiousFactors**

**LiberalChangeinControlDefinition**

Generally vote against equity plans if the plan has a liberal definition of change in control and the equity awards

could vest upon such liberal definition of change in control, even though an actual change in control may not

occur.Examplesofsuchadefinitioninclude,butarenotlimitedto,announcementorcommencementofatender

offer, provisions for acceleration upon a "potential" takeover, shareholder approval of a merger or other

transactions, or similar language.

**RepricingProvisions**

Voteagainstplansthatexpresslypermittherepricingorexchangeofunderwater stockoptions/stockappreciate

rights (SARs) without prior shareholder approval. "Repricing" typically includes the ability to do any of the

following:

AmendthetermsofoutstandingoptionsorSARstoreducetheexercisepriceofsuchoutstandingoptionsor

SARs;

CanceloutstandingoptionsorSARsinexchangeforoptionsorSARswithanexercisepricethatislessthanthe

exercise price of the original options or SARs;

Cancelunderwateroptionsinexchangeforstockawards;or

Providecashbuyoutsofunderwateroptions.

Whiletheabovecovermosttypesofrepricing,ISSmayviewotherprovisionsasakintorepricingdependingonthe

facts and circumstances.

Also,voteagainstorwithholdfrommembersoftheCompensationCommitteewhoapproved repricing(asdefined

above or otherwise determined by ISS), without prior shareholder approval, even if such repricings are allowed in

their equity plan.

Vote against plans that do not expressly prohibit repricing or cash buyout of underwater options without

shareholderapprovalifthecompanyhasahistoryofrepricing/buyoutswithoutshareholderapproval,andthe

applicable listing standards would not preclude them from doing so.

**ProblematicPayPracticesorSignificantPay-for-PerformanceDisconnect**

Iftheequityplanontheballotisavehicleforproblematic pay practices,voteagainsttheplan.

ISS may recommend a vote against the equity plan if the plan is determined to be a vehicle for pay-for-

performancemisalignment.Considerationsinvotingagainsttheequityplanmayinclude,butarenotlimitedto:

Severityofthepay-for-performancemisalignment;

Whetherproblematicequitygrantpracticesaredrivingthemisalignment;and/or

WhetherequityplanawardshavebeenheavilyconcentratedtotheCEOand/ortheotherNEOs.

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**AmendingCashandEquityPlans(includingApprovalforTaxDeductibility** 

**(162(m))**

**GeneralRecommendation:**Votecase-by-caseonamendmentstocashandequityincentiveplans.

Generallyvoteforproposalstoamendexecutivecash,stock,orcashandstockincentiveplansiftheproposal:

Addressesadministrativefeaturesonly;or

Seeks approvalforSection162(m)purposes <u>only</u>,andtheplanadministeringcommittee consists entirelyof

independentdirectors,perISS' Classification of Directors.Notethatifthecompanyispresentingtheplanto

shareholders for the first time for any reason (including after the company's initial public offering), or ifthe

proposal is bundled with other material plan amendments, then the recommendation will be case-by-case

(see below).

Voteagainstproposalstoamendexecutivecash,stock,orcashandstockincentiveplansiftheproposal:

SeeksapprovalforSection162(m)purposesonly,andtheplanadministeringcommitteedoesnotconsist

entirely of independent directors, per ISS' Classification of Directors.

Vote case-by-case on all other proposals to amend <u>cash</u> incentive plans. This includes plans presented to

shareholdersforthefirsttimeafterthecompany'sIPOand/orproposalsthatbundlematerialamendment(s)other

than those for Section 162(m) purposes.

Votecase-by-caseonallotherproposalstoamend<u>equity</u>incentiveplans,consideringthefollowing:

Iftheproposalrequestsadditionalsharesand/ortheamendments includeatermextensionoradditionoffull

valueawardsasanawardtype,therecommendationwillbebasedontheEquityPlanScorecardevaluationas

well as an analysis of the overall impact of the amendments;

Iftheplanisbeingpresentedtoshareholdersforthefirsttime (includingafterthecompany'sIPO),whetheror

not additional shares are being requested, the recommendation will be based on the Equity Plan Scorecard

evaluation as well as an analysis of the overall impact of any amendments; and

Ifthereisnorequestforadditionalsharesandtheamendments donotincludeatermextensionoradditionof

full value awards as an award type, then the recommendation will be based entirely on an analysis of the

overall impact of the amendments, and the EPSC evaluation will be shown only for informational purposes.

Inthefirsttwocase-by-caseevaluationscenarios,theEPSCevaluation/scoreisthemoreheavilyweighted

consideration.

**SpecificTreatmentofCertainAwardTypesinEquityPlanEvaluations**

**DividendEquivalentRights**

OptionsthathaveDividendEquivalentRights (DERs)associatedwiththemwillhaveahighercalculatedaward

value than those without DERs under the binomial model, based on the value of these dividend streams. The

higher value will be applied to new shares, shares available under existing plans, and shares awarded but not

exercisedpertheplanspecifications.DERStransfermoreshareholderequitytoemployeesandnon-employee

directors and this cost should be captured.

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**OperatingPartnership(OP)UnitsinEquityPlanAnalysisofRealEstateInvestment** 

**Trusts (REITs)**

For Real Estate Investment Trusts (REITS), include the common shares issuable upon conversion of outstanding

OperatingPartnership(OP)unitsinthesharecountforthepurposesofdetermining:(1)marketcapitalizationin

the Shareholder Value Transfer (SVT) analysis and (2) shares outstanding in the burn rate analysis.

OtherCompensationPlans

**401(k)EmployeeBenefitPlans**

**GeneralRecommendation:**Voteforproposalstoimplementa401(k)savingsplanforemployees.

**EmployeeStockOwnershipPlans(ESOPs)**

**GeneralRecommendation:**VoteforproposalstoimplementanESOPorincreaseauthorizedsharesforexisting

ESOPs, unless the number of shares allocated to the ESOP is excessive (more than five percent of outstanding

shares).

**EmployeeStockPurchasePlans—QualifiedPlans**

**GeneralRecommendation:**Votecase-by-caseonqualifiedemployeestockpurchaseplans.Vote foremployee

stock purchase plans where all of the following apply:

Purchasepriceisatleast85percentoffairmarketvalue;

Offeringperiodis27monthsorless;and

Thenumberofsharesallocatedtotheplanis 10percentorlessoftheoutstandingshares.

Voteagainstqualifiedemployeestockpurchaseplanswherewhentheplanfeaturesdonotmeetalloftheabove

criteria.

**EmployeeStockPurchasePlans—Non-QualifiedPlans**

**GeneralRecommendation:**Votecase-by-caseonnonqualifiedemployeestockpurchaseplans.Votefor

nonqualified employee stock purchase plans with all the following features:

Broad-basedparticipation;

Limitsonemployeecontribution,whichmaybeafixeddollaramountorexpressedasapercentofbasesalary;

Companymatchingcontributionupto25percentofemployee'scontribution,whichiseffectivelyadiscount

of20percentfrommarketvalue;and

Nodiscountonthestockpriceonthedateofpurchasewhenthereisacompanymatchingcontribution.

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Vote against nonqualified employee stock purchase plans when the plan features do not meet all of the above

criteria.Ifthematchingcontributionoreffectivediscountexceedstheabove,ISSmayevaluatetheSVTcostofthe

plan as part of the assessment.

**OptionExchangePrograms/RepricingOptions**

**GeneralRecommendation:**Votecase-by-caseonmanagementproposalsseekingapprovaltoexchange/reprice

options taking into consideration:

Historictradingpatterns--thestockpriceshouldnotbesovolatilethattheoptionsarelikelytobeback"in-

the-money" over the near term;

Rationaleforthere-pricing--wasthestockpricedeclinebeyondmanagement'scontrol?;

Isthisavalue-for-valueexchange?;

Aresurrenderedstockoptionsaddedbacktotheplanreserve?;

Timing--repricingshouldoccuratleastoneyearoutfromanyprecipitousdropincompany'sstockprice;

Optionvesting--doesthenewoptionvestimmediatelyoristhereablack-outperiod?;

Termoftheoption--thetermshouldremainthesameasthatofthereplacedoption;

Exerciseprice--shouldbesetatfairmarketorapremiumtomarket; and

Participants--executiveofficersanddirectorsmustbeexcluded.

Ifthesurrenderedoptionsareaddedbacktotheequityplansforre-issuance,thenalsotakeintoconsideration the

company'stotalcostofequityplansanditsthree-yearaverageburnrate.

In addition to the above considerations, evaluate the intent, rationale, and timing of the repricing proposal. The

proposalshouldclearlyarticulatewhytheboardischoosingtoconductanexchangeprogramatthispointintime.

Repricing underwater options after a recent precipitous drop in the company's stock price demonstrates poor

timing and warrants additional scrutiny. Also, consider the terms of the surrendered options, such as the grant

date, exercise price and vesting schedule. Grant dates of surrendered options should be far enough back (two to

three years) so as not to suggest that repricings are being done to take advantage of short-term downward price

movements. Similarly, the exercise price of surrendered options should be above the 52-week high for the stock

price.

Voteforshareholderproposalstoputoptionrepricingstoashareholdervote.

**StockPlansinLieuofCash**

**GeneralRecommendation:** Votecase-by-caseonplansthatprovideparticipantswiththeoptionoftakingallora

portion of their cash compensation in the form of stock.

Votefornon-employeedirector-onlyequityplansthatprovideadollar-for-dollarcash-for-stockexchange.

Votecase-by-caseon plans which do not providea dollar-for-dollar cash for stock exchange. In cases wherethe

exchange is not dollar-for-dollar, the request for new or additional shares for such equity program will be

consideredusingthebinomialoptionpricingmodel.Inanefforttocapturethetotalcostoftotalcompensation,

ISS will not make any adjustments to carve out the in-lieu-of cash compensation.

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**TransferStockOption(TSO)Programs**

**GeneralRecommendation:**One-timeTransfers:Voteagainstorwithholdfromcompensationcommitteemembers

if they fail to submit one-time transfers to shareholders for approval.

Votecase-by-caseonone-timetransfers.Votefor if:

Executiveofficersandnon-employeedirectorsareexcludedfromparticipating;

Stockoptionsarepurchasedbythird-partyfinancialinstitutionsatadiscounttotheirfairvalueusingoption

pricing models such as Black-Scholes or a Binomial Option Valuation or other appropriate financial models;

and

Thereisatwo-yearminimumholdingperiodforsaleproceeds(cashorstock)forallparticipants.

Additionally,managementshouldprovideaclearexplanationofwhyoptionsarebeingtransferredtoathird-party

institution and whether the events leading up to a decline in stock price were beyond management's control. A

review of the company's historic stock price volatility should indicate if the options are likely to be back "in-the-

money" over the near term.

Ongoing TSO program: Vote against equity plan proposals if the details of ongoing TSO programs are not provided

toshareholders.SinceTSOswillbeoneoftheawardtypesunderastockplan,theongoingTSOprogram,structure,

and mechanics must be disclosed to shareholders. The specific criteria to be considered in evaluating these

proposals include, but not limited, to the following:

Eligibility;

Vesting;

Bid-price;

Termofoptions;

CostoftheprogramandimpactoftheTSOsoncompany'stotaloptionexpense;and

Optionrepricingpolicy.

Amendmentstoexistingplansthatallowforintroductionoftransferabilityofstockoptionsshouldmakeclearthat

only options granted post-amendment shall be transferable.

DirectorCompensation

**ShareholderRatificationofDirectorPayPrograms**

**GeneralRecommendation:**Votecase-by-caseonmanagementproposalsseekingratificationofnon-employee

director compensation, based on the following factors:

Iftheequityplanunderwhichnon-employeedirectorgrantsaremadeisontheballot,whetherornotit

warrants support; and

Anassessmentofthefollowingqualitativefactors:

Therelativemagnitudeofdirectorcompensationascomparedtocompaniesofasimilarprofile;

Thepresenceofproblematicpaypracticesrelatingtodirectorcompensation;

Directorstockownershipguidelinesandholdingrequirements;

Equityawardvestingschedules;

Themixofcashandequity-basedcompensation;

Meaningfullimitsondirectorcompensation;

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Theavailabilityofretirementbenefitsorperquisites;and

Thequalityofdisclosuresurroundingdirectorcompensation.

**EquityPlansforNon-EmployeeDirectors**

**GeneralRecommendation:**Votecase-by-caseoncompensationplansfornon-employeedirectors,basedon:

Thetotalestimatedcostofthecompany'sequityplansrelativetoindustry/marketcappeers,measuredbythe

company's estimated Shareholder Value Transfer (SVT) based on new shares requested plus shares remaining

for future grants, plus outstanding unvested/unexercised grants;

Thecompany'sthree-yearburnraterelativetoitsindustry/marketcappeers(incertaincircumstances);and

Thepresenceofanyegregiousplanfeatures(suchasanoptionrepricingprovisionorliberalCICvestingrisk).

On occasion, non-employee director stock plans will exceed the plan cost or burn-rate benchmarks when

combinedwithemployeeorexecutivestockplans.Insuchcases,votecase-by-caseontheplantakinginto

consideration the following qualitative factors:

Therelativemagnitudeofdirectorcompensationascomparedtocompaniesofasimilarprofile;

Thepresenceofproblematicpaypracticesrelatingtodirectorcompensation;

Directorstockownershipguidelinesandholdingrequirements;

Equityawardvestingschedules;

Themixofcashandequity-basedcompensation;

Meaningfullimitsondirectorcompensation;

Theavailabilityofretirementbenefitsorperquisites;and

Thequalityofdisclosuresurroundingdirectorcompensation.

**Non-EmployeeDirectorRetirementPlans**

**GeneralRecommendation:**Voteagainstretirementplansfornon-employeedirectors.Voteforshareholder

proposals to eliminate retirement plans for non-employee directors.

ShareholderProposalsonCompensation

**BonusBanking/BonusBanking"Plus"**

**GeneralRecommendation:** Votecase-by-caseonproposalsseekingdeferralofaportionofannualbonuspay,with

ultimate payout linked to sustained results for the performance metrics on which the bonus was earned (whether

for the named executive officers or a wider group of employees), taking into account the following factors:

Thecompany'spastpracticesregardingequityandcashcompensation;

Whetherthecompanyhasaholdingperiodorstockownershiprequirementsinplace,suchasameaningful

retention ratio (at least 50 percent for full tenure); and

Whetherthecompanyhasarigorousclaw-backpolicyinplace.

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**CompensationConsultants—DisclosureofBoardorCompany'sUtilization**

**GeneralRecommendation:**Generallyvoteforshareholderproposalsseekingdisclosureregardingthe company,

board, or compensation committee's use of compensation consultants, such as company name, business

relationship(s), and fees paid.

**Disclosure/SettingLevelsorTypesofCompensationforExecutivesand** 

**Directors**

**GeneralRecommendation:** Generally vote for shareholder proposals seeking additionaldisclosure ofexecutive

anddirectorpayinformation,providedtheinformationrequestedisrelevanttoshareholders'needs,wouldnot

put the company at a competitive disadvantage relative to its industry, and is not unduly burdensome to the

company.

Generallyvoteagainstshareholderproposalsseekingtosetabsolutelevelsoncompensationorotherwisedictate

theamount or formofcompensation (suchas types ofcompensation elements or specificmetrics)to beused for

executive or directors.

Generallyvoteagainstshareholderproposalsthatmandateaminimumamountofstockthatdirectorsmustownin

order to qualify as a director or to remain on the board.

Vote case-by-case on all other shareholder proposals regarding executive and director pay, taking into account

relevantfactors,includingbutnotlimitedto:companyperformance,paylevelanddesignversuspeers,historyof

compensation concerns or pay-for-performance disconnect, and/or the scope and prescriptive nature of the

proposal.

**GoldenCoffins/ExecutiveDeathBenefits**

**General Recommendation:** Generally vote for proposals calling for companies to adopt a policy of obtaining

shareholder approval for any future agreements and corporate policies that could oblige the company to make

payments or awards following the death of a senior executive in the form of unearned salary or bonuses,

accelerated vesting or the continuation in force of unvested equity grants, perquisites and other payments or

awardsmadeinlieuofcompensation.Thiswouldnotapplytoanybenefitprogramsorequityplanproposalsfor

which the broad-based employee population is eligible.

**HoldEquityPastRetirementorforaSignificantPeriodofTime**

**General Recommendation:** Vote case-by-case on shareholder proposals asking companies to adopt policies

requiringseniorexecutiveofficerstoretainaportionofnetsharesacquiredthroughcompensationplans.The

following factors will be taken into account:

Thepercentage/ratioofnetsharesrequiredtoberetained;

Thetimeperiodrequiredtoretaintheshares;

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Whetherthecompanyhasequityretention,holdingperiod,and/orstockownershiprequirementsinplace

and the robustness of such requirements;

Whetherthecompanyhasanyotherpoliciesaimedatmitigatingrisktakingbyexecutives;

Executives'actualstockownershipandthedegreetowhichitmeetsorexceedstheproponent'ssuggested

holding period/retention ratio or the company's existing requirements; and

Problematicpaypractices,currentandpast,whichmaydemonstrateashort-termversuslong-termfocus.

**PayDisparity**

**GeneralRecommendation:** Votecase-by-caseonproposalscallingforananalysisofthe paydisparitybetween

corporate executives and other non-executive employees. The following factors will be considered:

Thecompany'scurrentlevelofdisclosureofitsexecutivecompensationsettingprocess,includinghowthe

companyconsiderspaydisparity;

Ifanyproblematicpaypracticesorpay-for-performanceconcernshavebeenidentifiedatthecompany;and

Thelevelofshareholdersupportforthecompany'spayprograms.

Generallyvoteagainstproposalscallingforthecompanytousethepaydisparityanalysisorpayratioinaspecific

way to set or limit executive pay.

**PayforPerformance/Performance-BasedAwards**

**General Recommendation:** Vote case-by-case on shareholder proposals requesting that a significant amount of

futurelong-termincentivecompensationawardedtoseniorexecutivesshallbeperformance-basedandrequesting

that the board adopt and disclose challenging performance metrics to shareholders, based on the following

analytical steps:

First, vote for shareholder proposals advocating the use of performance-based equity awards, such as

performancecontingentoptionsorrestrictedstock,indexedoptions,orpremium-pricedoptions,unlessthe

proposal is overly restrictive or if the company has demonstrated that it is using a "substantial" portion of

performance-based awards for its top executives. Standard stock options and performance-accelerated

awards do not meet the criteria to be considered as performance-based awards. Further, premium-priced

options should have a meaningful premium to be considered performance-based awards; and

Second, assess the rigor of the company's performance-based equity program. If the bar set for the

performance-basedprogramistoolowbasedonthecompany'shistoricalorpeergroupcomparison,generally

vote for the proposal. Furthermore, if target performance results in an above target payout, vote for the

shareholder proposal duetoprogram's poor design. Ifthecompany does not disclosetheperformancemetric

oftheperformance-basedequityprogram,votefortheshareholderproposalregardless oftheoutcomeofthe

first step to the test.

Ingeneral,votefortheshareholderproposalifthecompanydoesnotmeetbothoftheabovetwosteps.

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**PayforSuperiorPerformance**

**GeneralRecommendation:**Votecase-by-caseonshareholderproposals thatrequesttheboardestablishapay-for-

superior performance standard in the company's executive compensation plan for senior executives. These

proposals generally include the following principles:

Setcompensationtargetsfortheplan'sannualandlong-termincentivepaycomponentsatorbelowthepeer

group median;

Deliveramajorityoftheplan'stargetlong-termcompensationthroughperformance-vested,notsimplytime-

vested, equity awards;

Providethestrategicrationaleandrelativeweightingsofthefinancialandnon-financialperformancemetrics

or criteria used in the annual and performance-vested long-term incentive components of the plan;

Establishperformancetargetsforeachplanfinancialmetricrelativetotheperformanceofthecompany's

peercompanies;and

Limit payment under the annual and performance-vested long-term incentive components of the plan to

whenthecompany'sperformanceonitsselectedfinancialperformancemetricsexceedspeergroupmedian

performance.

Considerthefollowingfactorsinevaluatingthisproposal:

Whataspectsofthecompany'sannualandlong-termequityincentiveprogramsareperformancedriven?

Iftheannualandlong-termequityincentiveprogramsareperformancedriven,aretheperformancecriteria

and hurdle rates disclosed to shareholders or are they benchmarked against a disclosed peer group?

Canshareholdersassessthecorrelationbetweenpayandperformancebasedonthecurrentdisclosure?and

Whattypeofindustryandstageofbusinesscycledoesthecompanybelongto?

**Pre-ArrangedTradingPlans(10b5-1Plans)**

**GeneralRecommendation:**Generallyvoteforshareholderproposalscallingfor theadditionofcertainsafeguards

in prearranged trading plans (10b5-1 plans) for executives. Safeguards may include:

Adoption,amendment,orterminationofa10b5-1PlanmustbedisclosedinaForm8-K;

Amendmentorearlyterminationofa10b5-1Planallowedonlyunderextraordinarycircumstances,as

determined by the board;

Requestthatacertainnumberofdaysthatmustelapsebetweenadoptionoramendmentofa10b5-1Plan

and initial trading under the plan;

ReportsonForm4mustidentifytransactionsmadepursuanttoa10b5-1Plan;

Anexecutivemaynottradeincompanystockoutsidethe10b5-1Plan; and

Tradesundera10b5-1Planmustbehandledbyabrokerwhodoesnothandleothersecuritiestransactions

for the executive.

**ProhibitOutsideCEOsfromServingonCompensationCommittees**

**GeneralRecommendation:**GenerallyvoteagainstproposalsseekingapolicytoprohibitanyoutsideCEOfrom

serving on a company's compensation committee, unless the company has demonstrated problematic pay

practices that raise concerns about the performance and composition of the committee.

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**RecoupmentofIncentiveorStockCompensationinSpecifiedCircumstances**

**GeneralRecommendation:** Vote case-by-caseon proposalsto recoup incentive cash or stock compensation made

toseniorexecutivesifitislaterdeterminedthat thefiguresuponwhichincentivecompensationisearnedturnout

to have been in error, or if the senior executive has breached company policy or has engaged in misconduct that

may be significantly detrimental to the company's financial position or reputation, or if the senior executive failed

to manage or monitor risks that subsequently led to significant financial or reputational harm to the company.

Manycompanieshaveadoptedpoliciesthatpermitrecoupmentincaseswhereanexecutive's fraud,misconduct,

or negligence significantly contributed to a restatement of financial results that led to the awarding of unearned

incentive compensation. However, such policies may be narrow given that not all misconduct or negligence may

result in significant financial restatements. Misconduct, negligence, or lack of sufficient oversight by senior

executives may lead to significant financial loss or reputational damage that may have long-lasting impact.

Inconsideringwhethertosupportsuchshareholderproposals,ISSwill takeintoconsiderationthefollowing

factors:

Ifthecompanyhasadoptedaformalrecoupmentpolicy;

Therigoroftherecoupmentpolicyfocusingonhowandunderwhatcircumstancesthecompanymayrecoup

incentive or stock compensation;

Whetherthecompanyhaschronicrestatementhistoryormaterialfinancialproblems;

Whetherthecompany'spolicysubstantiallyaddressestheconcernsraisedbytheproponent;

Disclosureofrecoupmentofincentiveorstockcompensationfromseniorexecutivesorlackthereof;and

Anyotherrelevantfactors.

**SeveranceandGoldenParachuteAgreements**

**GeneralRecommendation:**Votecase-by-caseonshareholderproposalsrequiringthatexecutiveseverance

(including change-in-control related) arrangements or payments be submitted for shareholder ratification.

Factorsthatwillbeconsideredinclude,butarenotlimitedto:

Thecompany'sseveranceorchange-in-controlagreementsinplace,andthepresenceofproblematicfeatures

(such as excessive severance entitlements, single triggers, excise tax gross-ups, etc.);

Anyexistinglimitsoncashseverancepayoutsorpolicieswhichrequireshareholderratificationofseverance

payments exceeding a certain level;

Anyrecentseverance-relatedcontroversies;and

Whethertheproposalisoverlyprescriptive,suchasrequiringshareholderapprovalofseverancethatdoesnot

exceed market norms.

**ShareBuybackImpactonIncentiveProgramMetrics**

**GeneralRecommendation:** Votecase-by-caseonproposalsrequestingthecompanyexcludetheimpactofshare

buybacks from the calculation of incentive program metrics, considering the following factors:

Thefrequencyandtimingofthecompany'ssharebuybacks;

Theuseofper-sharemetricsinincentiveplans;

Theeffectofrecentbuybacksonincentivemetricresultsandpayouts;and

Whetherthereisanyindicationofmetricresultmanipulation.

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**SupplementalExecutiveRetirementPlans(SERPs)**

**General Recommendation:** Generally vote for shareholder proposals requesting to put extraordinary benefits

containedinSERPagreementstoashareholdervoteunlessthecompany'sexecutivepensionplansdonotcontain

excessive benefits beyond what is offered under employee-wide plans.

Generallyvoteforshareholderproposalsrequestingtolimittheexecutivebenefitsprovidedunderthecompany's

supplemental executive retirement plan (SERP) by limiting covered compensation to a senior executive's annual

salary or those pay elements covered for the general employee population.

**TaxGross-UpProposals**

**General Recommendation:** Generally vote for proposals calling for companies to adopt a policy of not providing

taxgross-uppaymentstoexecutives,exceptin situationswheregross-upsareprovidedpursuanttoaplan,policy,

or arrangement applicable to management employees of the company, such as a relocation or expatriate tax

equalization policy.

**Termination ofEmployment Prior to Severance Payment/Eliminating**

**Accelerated Vestingof UnvestedEquity**

**GeneralRecommendation:**Votecase-by-caseonshareholderproposalsseekingapolicyrequiringterminationof

employment prior to severance payment and/or eliminating accelerated vesting of unvested equity.

Thefollowingfactorswillbeconsidered:

The company's current treatment of equity upon employment termination and/or in change-in-control

situations(i.e.,vestingisdoubletriggeredand/orprorata,doesitallowfortheassumptionofequityby

acquiring company, the treatment of performance shares, etc.); and

Currentemploymentagreements,includingpotentialpoorpaypracticessuchasgross-upsembeddedinthose

agreements.

Generally vote for proposals seeking a policy that prohibits automatic acceleration of the vesting of equity awards

toseniorexecutives uponavoluntaryterminationofemployment orintheeventofachangeincontrol(exceptfor

proratavestingconsideringthetimeelapsedandattainmentofanyrelatedperformancegoalsbetweentheaward

date and the change in control).

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**6. Routine/Miscellaneous**

**AdjournMeeting**

**GeneralRecommendation:**Generallyvoteagainstproposalstoprovidemanagementwiththeauthoritytoadjourn

an annual or special meeting absent compelling reasons to support the proposal.

Voteforproposalsthatrelatespecificallytosolicitingvotesforamergerortransactionifsupportingthatmerger

or transaction. Vote against proposals if the wording is too vague or if the proposal includes "other business."

**AmendQuorumRequirements**

**GeneralRecommendation:**Votecase-by-caseonproposalstoreducequorumrequirementsforshareholder

meetings below a majority of the shares outstanding, taking into consideration:

Thenewquorumthresholdrequested;

Therationalepresentedforthereduction;

Themarketcapitalizationofthecompany(size,inclusioninindices);

Thecompany'sownershipstructure;

Previousvoterturnoutorattemptstoachievequorum;

Anyprovisionsorcommitmentstorestorequorumtoamajorityofsharesoutstanding,shouldvoterturnout

improve sufficiently; and

Otherfactorsasappropriate.

Ingeneral,aquorumthresholdkeptasclosetoamajorityofsharesoutstandingasisachievableispreferred.

Votecase-by-caseondirectorswhounilaterallylowerthequorumrequirementsbelowamajorityoftheshares

outstanding, taking into consideration the factors listed above.

**AmendMinorBylaws**

**GeneralRecommendation:** Voteforbylaworcharterchangesthatareofahousekeepingnature(updatesor

corrections).

**ChangeCompanyName**

**GeneralRecommendation:**Voteforproposalstochangethecorporatenameunlessthereiscompellingevidence

that the change would adversely impact shareholder value.

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**ChangeDate,Time,orLocationofAnnualMeeting**

**GeneralRecommendation:** Voteformanagementproposalstochangethedate,time,orlocationoftheannual

meeting unless the proposed change is unreasonable.

Voteagainstshareholderproposalstochangethedate,time,orlocationoftheannualmeetingunlessthecurrent

scheduling or location is unreasonable.

**OtherBusiness**

**GeneralRecommendation:**Voteagainstproposalstoapproveotherbusinesswhenitappearsasavotingitem.

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**7. SocialandEnvironmentalIssues**

GlobalApproach–E&SShareholderProposals

ISSappliesacommonapproachgloballytoevaluatingsocialandenvironmentalproposalswhichcoverawide

rangeoftopics,includingconsumerandproductsafety,environmentandenergy,laborstandardsandhuman

rights, workplace and board diversity, and corporate political issues. Whilea variety offactors goes into each

analysis,theoverallprincipleguidingallvoterecommendationsfocusesonhowtheproposalmayenhanceor

protect shareholder value in either the short or long term.

**GeneralRecommendation:**Generallyvotecase-by-case,examiningprimarilywhetherimplementationofthe

proposal is likely to enhance or protect shareholder value. The following factors will be considered:

Iftheissuespresentedintheproposalare beingappropriatelyoreffectivelydealt withthroughlegislationor

government regulation;

Ifthecompanyhasalreadyrespondedinanappropriateandsufficientmannertotheissue(s)raisedinthe

proposal;

Whethertheproposal'srequestisundulyburdensome(scopeortimeframe)oroverlyprescriptive;

Thecompany'sapproachcomparedwithanyindustrystandardpracticesforaddressingtheissue(s)raisedby

the proposal;

Whethertherearesignificantcontroversies,fines,penalties,orlitigationassociatedwiththecompany's

practices related to the issue(s) raised in the proposal;

If the proposal requests increased disclosure or greater transparency, whether reasonable and sufficient

informationiscurrentlyavailabletoshareholdersfromthecompanyorfromotherpubliclyavailablesources;

and

Iftheproposalrequestsincreaseddisclosureorgreatertransparency,whetherimplementationwouldreveal

proprietary or confidential information that could place the company at a competitive disadvantage.

EndorsementofPrinciples

**GeneralRecommendation:** Generallyvoteagainstproposalsseekingacompany'sendorsementofprinciplesthat

supportaparticularpublicpolicyposition.Endorsingasetofprinciplesmayrequireacompanytotakeastandon

an issue that is beyond its own control and may limit its flexibility with respect to future developments.

Managementandtheboardshouldbeaffordedtheflexibilitytomakedecisionsonspecificpublicpolicypositions

based on their own assessment of the most beneficial strategies for the company.

AnimalWelfare

**AnimalWelfarePolicies**

**GeneralRecommendation:**Generallyvoteforproposalsseekingareportonacompany'sanimalwelfare

standards,oranimalwelfare-relatedrisks,unless:

Thecompanyhasalreadypublishedasetofanimalwelfarestandardsandmonitorscompliance;

Thecompany'sstandardsarecomparabletoindustrypeers;and

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Therearenorecentsignificantfines,litigation,orcontroversiesrelatedtothecompany'sand/oritssuppliers'

treatmentofanimals.

**AnimalTesting**

**GeneralRecommendation:** Generallyvoteagainstproposalstophaseouttheuseofanimalsinproducttesting,

unless:

Thecompanyisconductinganimaltestingprogramsthatareunnecessaryornotrequiredbyregulation;

Thecompanyisconductinganimaltestingwhensuitable alternativesarecommonlyacceptedandusedby

industry peers; or

Therearerecent,significantfinesorlitigationrelatedtothecompany'streatmentofanimals.

**AnimalSlaughter**

**General Recommendation:** Generally vote against proposals requesting the implementation of Controlled

AtmosphereKilling(CAK)methodsatcompanyand/orsupplieroperationsunlesssuchmethodsarerequiredby

legislation or generally accepted as the industry standard.

Vote case-by-case on proposals requesting a report on the feasibility of implementing CAK methods at company and/

orsupplieroperationsconsideringtheavailabilityofexistingresearchconductedbythecompanyorindustry groups

on this topic and any fines or litigation related to current animal processing procedures at the company.

ConsumerIssues

**GeneticallyModifiedIngredients**

**General Recommendation:** Generally vote against proposals requesting that a company voluntarily label

geneticallyengineered(GE)ingredientsinitsproducts.ThelabelingofproductswithGEingredientsisbestleftto

the appropriate regulatory authorities.

Votecase-by-caseonproposalsaskingforareportonthefeasibilityoflabelingproductscontainingGEingredients,

taking into account:

Thepotentialimpactofsuchlabelingonthecompany'sbusiness;

Thequalityofthecompany'sdisclosureonGEproductlabeling,relatedvoluntaryinitiatives,andhowthis

disclosurecompareswithindustrypeerdisclosure;and

Company'scurrentdisclosureonthefeasibilityofGEproductlabeling.

Generally vote against proposals seeking a report on the social, health, and environmental effects of genetically

modifiedorganisms(GMOs).Studiesofthissortarebetterundertakenbyregulatorsandthescientificcommunity.

GenerallyvoteagainstproposalstoeliminateGEingredientsfromthecompany'sproducts,orproposalsaskingfor

reportsoutliningthestepsnecessarytoeliminateGEingredientsfromthecompany'sproducts.Suchdecisionsare

more appropriately made by management with consideration of current regulations.

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**ReportsonPotentiallyControversialBusiness/FinancialPractices**

**GeneralRecommendation:**Votecase-by-caseonrequestsforreportsonacompany'spotentiallycontroversial

business or financial practices or products, taking into account:

Whetherthecompanyhasadequatelydisclosedmechanismsinplacetopreventabuses;

Whetherthecompanyhasadequatelydisclosedthefinancialrisksoftheproducts/practicesinquestion;

Whetherthecompanyhasbeensubjecttoviolationsofrelatedlawsorseriouscontroversies;and

Peercompanies'policies/practicesinthisarea.

**PharmaceuticalPricing,AccesstoMedicines,andPrescriptionDrug** 

**Reimportation**

**GeneralRecommendation:**Generallyvoteagainstproposalsrequestingthatcompaniesimplementspecificprice

restraints on pharmaceutical products unless the company fails to adhere to legislative guidelines or industry

norms in its product pricing practices.

Votecase-by-caseonproposalsrequestingthatacompanyreportonitsproductpricingoraccesstomedicine

policies, considering:

Thepotentialforreputational,market,andregulatoryriskexposure;

Existingdisclosureofrelevantpolicies;

Deviationfromestablishedindustrynorms;

Relevantcompanyinitiativestoprovideresearchand/orproductstodisadvantagedconsumers;

Whethertheproposalfocusesonspecificproductsorgeographicregions;

Thepotentialburdenandscopeoftherequestedreport; and

Recentsignificantcontroversies,litigation,orfinesatthecompany.

Generallyvoteforproposalsrequestingthat acompanyreportonthefinancialandlegalimpactof itsprescription

drug reimportation policies unless such information is already publicly disclosed.

Generally vote against proposals requesting that companies adopt specific policies to encourage or constrain

prescriptiondrugreimportation.Suchmattersaremoreappropriatelytheprovinceoflegislativeactivityandmay

place the company at a competitive disadvantage relative to its peers.

**ProductSafetyandToxic/HazardousMaterials**

**General Recommendation:** Generally vote for proposals requesting that a company report on its policies,

initiatives/procedures,andoversightmechanismsrelatedtotoxic/hazardousmaterialsorproductsafetyinits

supply chain, unless:

Thecompanyalreadydisclosessimilarinformationthroughexistingreportssuchasasuppliercodeofconduct

and/or a sustainability report;

Thecompanyhasformallycommittedtotheimplementationofatoxic/hazardousmaterialsand/orproduct

safety and supply chain reporting and monitoring program based on industry norms or similar standards

within a specified time frame; or

Thecompanyhasnotbeenrecentlyinvolvedinrelevantsignificantcontroversies,fines,orlitigation.

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Vote case-by-case on resolutions requesting that companies develop a feasibility assessment to phase-out of

certaintoxic/hazardousmaterials,orevaluateanddisclosethepotentialfinancialandlegalrisksassociatedwith

utilizing certain materials, considering:

Thecompany'scurrentlevelofdisclosureregardingitsproductsafetypolicies,initiatives,andoversight

mechanisms;

Currentregulationsinthemarketsinwhichthecompanyoperates;and

Recentsignificantcontroversies,litigation,orfinesstemmingfromtoxic/hazardousmaterialsatthecompany.

Generallyvoteagainstresolutionsrequiringthatacompanyreformulateitsproducts.

**Tobacco-RelatedProposals**

**GeneralRecommendation:**Votecase-by-caseonresolutionsregardingtheadvertisementof tobaccoproducts,

considering:

Recentrelatedfines,controversies,orsignificantlitigation;

Whetherthecompanycomplieswithrelevantlawsandregulationsonthemarketingoftobacco;

Whetherthecompany'sadvertisingrestrictionsdeviatefromthoseofindustrypeers;

WhetherthecompanyenteredintotheMasterSettlementAgreement,whichrestrictsmarketingoftobacco

to youth; and

Whetherrestrictionsonmarketingtoyouthextendtoforeigncountries.

Votecase-by-caseonproposalsregardingsecond-handsmoke,considering;

Whetherthecompanycomplieswithalllawsandregulations;

Thedegreethatvoluntaryrestrictionsbeyondthosemandatedbylawmighthurtthecompany's

competitiveness;and

Theriskofanyhealth-relatedliabilities.

Generallyvoteagainstresolutionstoceaseproductionoftobacco-relatedproducts,toavoidsellingproductsto

tobacco companies, to spin-off tobacco-related businesses, or prohibit investment in tobacco equities. Such

business decisions are better left to company management or portfolio managers.

Generallyvoteagainstproposalsregardingtobaccoproductwarnings.Suchdecisionsarebetterlefttopublic

health authorities.

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ClimateChange

**SayonClimate(SoC)ManagementProposals**

**GeneralRecommendation:**Votecase-by-caseonmanagementproposalsthatrequestshareholderstoapprove

thecompany'sclimatetransitionactionplan<sup>23</sup><sup>,</sup>takingintoaccountthecompletenessandrigoroftheplan.

Information that will be considered where available includes the following:

Theextenttowhichthecompany'sclimaterelateddisclosuresareinlinewithTCFDrecommendationsand

meetothermarketstandards;

DisclosureofitsoperationalandsupplychainGHGemissions(Scopes1,2,and3);

Thecompletenessandrigorofcompany'sshort-,medium-,andlong-termtargetsforreducingoperationaland

supply chain GHG emissions (Scopes 1, 2, and 3 if relevant);

Whetherthecompanyhassoughtandreceivedthird-partyapprovalthatitstargetsarescience-based;

Whetherthecompanyhasmadeacommitmenttobe"netzero"foroperationalandsupplychainemissions

(Scopes1,2,and3)by2050;

Whetherthecompanydisclosesacommitmenttoreportontheimplementationofitsplaninsubsequent

years;

Whetherthecompany'sclimatedatahasreceivedthird-partyassurance;

Disclosureofhowthecompany'slobbyingactivitiesanditscapitalexpendituresalignwithcompanystrategy;

Whethertherearespecificindustrydecarbonizationchallenges;and

Thecompany'srelatedcommitment,disclosure,andperformancecomparedtoitsindustrypeers.

**SayonClimate(SoC)ShareholderProposals**

**General Recommendation:** Vote case-by-case on shareholder proposals that request the company to disclose a

reportprovidingitsGHGemissionslevelsandreductiontargetsand/oritsupcoming/approvedclimatetransition

action plan and provide shareholders the opportunity to express approval or disapproval of its GHG emissions

reduction plan, taking into account information such as the following:

Thecompletenessandrigorofthecompany'sclimate-relateddisclosure;

Thecompany'sactualGHGemissionsperformance;

Whetherthecompanyhasbeenthesubjectofrecent,significantviolations,fines,litigation,orcontroversy

related to its GHG emissions; and

Whethertheproposal'srequestisundulyburdensome(scopeortimeframe)oroverlyprescriptive.

**ClimateChange/GreenhouseGas(GHG)Emissions**

**GeneralRecommendation:**Generallyvoteforresolutionsrequestingthatacompanydiscloseinformationonthe

financial, physical, or regulatory risks it faces related to climate change on its operations and investments or on

how the company identifies, measures, and manages such risks, considering:

Whether the company already provides current, publicly-available information on the impact that climate

changemayhaveonthecompanyaswellasassociatedcompanypoliciesandprocedurestoaddressrelated

risks and/or opportunities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;___________________________________

**23**Variationsofthisrequestalsoincludeclimatetransitionrelatedambitions,orcommitmenttoreportingonthe

implementation of a climate plan.

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Thecompany'slevelofdisclosurecomparedtoindustrypeers;and

Whethertherearesignificantcontroversies,fines,penalties,orlitigationassociatedwiththecompany's

climate change-related performance.

Generallyvoteforproposalsrequestingareportongreenhousegas (GHG)emissionsfromcompanyoperations

and/or products and operations, unless:

Thecompanyalreadydisclosescurrent,publicly-availableinformationontheimpactsthatGHGemissionsmay

have on the company as well as associated company policies and procedures to address related risks and/or

opportunities;

Thecompany'slevelofdisclosureiscomparabletothatofindustrypeers;or

Therearenosignificant,controversies,fines,penalties,orlitigationassociatedwiththecompany'sGHG

emissions.

Votecase-by-caseonproposalsthatcallfortheadoptionofGHGreductiongoalsfromproductsandoperations,

taking into account:

Whetherthecompanyprovidesdisclosureofyear-over-yearGHGemissionsperformancedata;

Whethercompanydisclosurelagsbehindindustrypeers;

Thecompany'sactualGHGemissionsperformance;

Thecompany'scurrentGHGemissionpolicies,oversightmechanisms,andrelatedinitiatives;and

Whetherthecompanyhasbeenthesubjectofrecent,significantviolations,fines,litigation,orcontroversy

related to GHG emissions.

**EnergyEfficiency**

**GeneralRecommendation:**Generallyvoteforproposalsrequestingthatacompanyreportonitsenergyefficiency

policies, unless:

Thecompanycomplieswithapplicableenergyefficiencyregulationsandlaws,anddisclosesitsparticipationin

energy efficiency policies and programs, including disclosure of benchmark data, targets, and performance

measures; or

Theproponentrequestsadoptionofspecificenergyefficiencygoalswithinspecifictimelines.

**RenewableEnergy**

**General Recommendation:** Generally vote for requests for reports on the feasibility of developing renewable

energyresourcesunlessthereport wouldbeduplicativeofexistingdisclosureorirrelevanttothecompany'sline

of business.

Generally vote against proposals requesting that the company invest in renewable energy resources. Such

decisionsarebestlefttomanagement's evaluationofthefeasibilityandfinancialimpactthatsuchprogramsmay

have on the company.

Generallyvoteagainstproposalsthatcallfortheadoptionofrenewableenergygoals,takingintoaccount:

Thescopeandstructureoftheproposal;

Thecompany'scurrentlevelofdisclosureonrenewableenergyuseandGHGemissions;and

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Thecompany'sdisclosureofpolicies,practices,andoversightimplementedtomanageGHGemissionsand

mitigate climate change risks.

Diversity

**BoardDiversity**

**GeneralRecommendation:**Generallyvoteforrequestsforreportsonacompany'seffortstodiversifytheboard,

unless:

Thegenderandracialminorityrepresentationofthecompany'sboardisreasonablyinclusiveinrelationto

companiesofsimilarsizeandbusiness;or

Theboardalreadyreportsonitsnominatingproceduresandgenderandracialminorityinitiativesonthe

board and within the company.

Votecase-by-caseonproposalsasking acompanytoincreasethegenderandracialminorityrepresentationonits

board, taking into account:

Thedegreeofexistinggenderandracialminoritydiversityonthecompany'sboardandamongitsexecutive

officers;

Thelevelofgenderandracialminorityrepresentationthatexistsatthecompany'sindustrypeers;

Thecompany'sestablishedprocessforaddressinggenderandracialminorityboardrepresentation;

Whethertheproposalincludesanoverlyprescriptiverequesttoamendnominatingcommitteecharter

language;

Theindependenceofthecompany'snominatingcommittee;

Whetherthecompanyusesanoutsidesearchfirmtoidentifypotentialdirectornominees;and

Whetherthecompanyhashadrecentcontroversies,fines,orlitigationregardingequalemploymentpractices.

**EqualityofOpportunity**

**General Recommendation:** Generally vote for proposals requesting a company disclose its diversity policies or

initiatives,orproposalsrequestingdisclosureofacompany'scomprehensiveworkforcediversitydata,including

requests for EEO-1 data, unless:

Thecompanypubliclydisclosesequalopportunitypoliciesandinitiativesinacomprehensivemanner;

Thecompanyalreadypubliclydisclosescomprehensiveworkforcediversitydata;or

ThecompanyhasnorecentsignificantEEO-relatedviolationsorlitigation.

Generallyvoteagainstproposalsseekinginformationonthediversityeffortsofsuppliersandserviceproviders.

Such requests may pose a significant burden on the company.

**GenderIdentity,SexualOrientation,andDomesticPartnerBenefits**

**GeneralRecommendation:**Generallyvoteforproposalsseekingtoamendacompany'sEEOstatement ordiversity

policies to prohibit discrimination based onsexual orientation and/or gender identity, unless the changewould be

unduly burdensome.

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Generallyvoteagainstproposalstoextendcompanybenefitsto,oreliminatebenefitsfrom,domesticpartners.

Decisions regarding benefits should be left to the discretion of the company.

**Gender,Race/EthnicityPayGap**

**GeneralRecommendation:**Votecase-by-caseonrequestsforreportsonacompany'spaydatabygenderorrace/

ethnicity, or a report on a company's policies and goals to reduce any gender or race/ethnicity pay gaps, taking

into account:

Thecompany'scurrentpoliciesanddisclosurerelatedtobothitsdiversityandinclusionpoliciesandpractices

and its compensation philosophy on fair and equitable compensation practices;

Whetherthecompanyhasbeenthesubjectofrecentcontroversy,litigation,orregulatoryactionsrelatedto

gender, race, or ethnicity pay gap issues;

Thecompany'sdisclosureregardinggender,race,orethnicitypaygappoliciesorinitiativescomparedtoits

industrypeers;and

Locallawsregardingcategorizationofraceand/orethnicityanddefinitionsofethnicand/orracialminorities.

**RacialEquityand/orCivilRightsAuditGuidelines**

**GeneralRecommendation:**Votecase-by-caseonproposalsaskingacompanytoconductanindependentracial

equity and/or civil rights audit, taking into account:

Thecompany'sestablishedprocessorframeworkforaddressingracialinequityanddiscriminationinternally;

Whetherthecompanyadequatelydisclosesworkforcediversityandinclusionmetricsandgoals;

Whetherthecompanyhasissuedapublicstatementrelatedtoitsracialjusticeeffortsinrecentyears,orhas

committed to internal policy review;

Whetherthecompanyhasengagedwithimpactedcommunities,stakeholders,andcivilrightsexperts;

Thecompany'strackrecordinrecentyearsofracialjusticemeasuresandoutreachexternally;and

Whetherthecompanyhasbeenthesubjectofrecentcontroversy,litigation,orregulatoryactionsrelatedto

racial inequity or discrimination.

EnvironmentandSustainability

**FacilityandWorkplaceSafety**

**GeneralRecommendation:**Votecase-by-caseonrequestsforworkplacesafetyreports,includingreportson

accident risk reduction efforts, taking into account:

Thecompany'scurrentlevelofdisclosureofitsworkplacehealthandsafetyperformancedata,healthand

safetymanagementpolicies,initiatives,andoversightmechanisms;

Thenatureofthecompany'sbusiness,specificallyregardingcompanyandemployeeexposuretohealthand

safetyrisks;

Recentsignificantcontroversies,fines,orviolationsrelatedtoworkplacehealthandsafety;and

Thecompany'sworkplacehealthandsafetyperformancerelativetoindustrypeers.

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Votecase-by-caseonresolutionsrequesting thatacompanyreportonsafetyand/orsecurityrisksassociatedwith

its operations and/or facilities, considering:

Thecompany'scompliancewithapplicableregulationsandguidelines;

Thecompany'scurrentlevelofdisclosureregardingitssecurityandsafetypolicies,procedures,and

compliancemonitoring;and

Theexistenceofrecent,significantviolations,fines,orcontroversyregardingthesafetyandsecurityofthe

company'soperationsand/orfacilities.

**NaturalCapital-Relatedand/orCommunityImpactAssessmentProposals**

**GeneralRecommendation:**Votecase-by-caseonrequestsforreportsonpoliciesand/orthepotential

(community) social and/or environmental impact of company operations, considering:

Alignmentofcurrentdisclosureofapplicablecompanypolicies,metrics,riskassessmentreport(s)andrisk

management procedures with any relevant, broadly accepted reporting frameworks;

Theimpactofregulatorynon-compliance,litigation,remediation,orreputationallossthatmaybeassociated

with failure to manage the company's operations in question, including the management of relevant

community and stakeholder relations;

Thenature,purpose,andscopeofthecompany'soperationsinthespecificregion(s);

Thedegreetowhichcompanypoliciesandproceduresareconsistentwithindustrynorms;and

Thescopeoftheresolution.

**HydraulicFracturing**

**GeneralRecommendation:**Generallyvoteforproposalsrequestinggreaterdisclosureofacompany's(naturalgas)

hydraulic fracturing operations, including measures the company has taken to manage and mitigate the potential

community and environmental impacts of those operations, considering:

Thecompany'scurrentlevelofdisclosureofrelevantpoliciesandoversightmechanisms;

Thecompany'scurrentlevelofsuchdisclosurerelativetoitsindustrypeers;

Potentialrelevantlocal,state,ornationalregulatorydevelopments;and

Controversies,fines,orlitigationrelatedtothecompany'shydraulicfracturingoperations.

**OperationsinProtectedAreas**

**GeneralRecommendation:**Generallyvoteforrequestsforreportsonpotentialenvironmentaldamageasaresult

of company operations in protected regions, unless:

Operationsinthespecifiedregionsarenotpermittedbycurrentlawsorregulations;

Thecompanydoesnotcurrentlyhaveoperationsorplanstodevelopoperationsintheseprotectedregions;or

Thecompany'sdisclosureofitsoperationsandenvironmentalpoliciesintheseregionsiscomparableto

industrypeers.

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**Recycling**

**GeneralRecommendation:** Votecase-by-caseonproposalstoreportonanexistingrecyclingprogram,oradopta

new recycling program, taking into account:

Thenatureofthecompany'sbusiness;

Thecurrentlevelofdisclosureofthecompany'sexistingrelatedprograms;

Thetimetableandmethodsofprogramimplementationprescribedbytheproposal;

Thecompany'sabilitytoaddresstheissuesraisedintheproposal;and

Howthecompany'srecyclingprogramscomparetosimilarprogramsofitsindustrypeers.

**SustainabilityReporting**

**General Recommendation:** Generally vote for proposals requesting that a company report on its policies,

initiatives,andoversightmechanismsrelatedtosocial,economic,andenvironmentalsustainability,unless:

The company already discloses similar information through existing reports or policies such as an

environment,health,andsafety(EHS)report;acomprehensivecodeofcorporateconduct;and/oradiversity

report; or

ThecompanyhasformallycommittedtotheimplementationofareportingprogrambasedonGlobal

Reporting Initiative (GRI) guidelines or a similar standard within a specified time frame.

**WaterIssues**

**GeneralRecommendation:** Votecase-by-caseonproposalsrequestingacompanyreporton,oradoptanewpolicy

on, water-related risks and concerns, taking into account:

Thecompany'scurrentdisclosureofrelevantpolicies,initiatives,oversightmechanisms,andwaterusage

metrics;

Whetherornotthecompany'sexistingwater-relatedpoliciesandpracticesareconsistentwithrelevant

internationally recognized standards and national/local regulations;

Thepotentialfinancialimpactorrisktothecompanyassociatedwithwater-relatedconcernsorissues;and

Recent,significantcompanycontroversies,fines,orlitigationregardingwaterusebythecompanyandits

suppliers.

GeneralCorporateIssues

**CharitableContributions**

**General Recommendation:** Vote against proposals restricting a company from making charitable contributions.

Charitable contributions are generally useful for assisting worthwhile causes and for creating goodwill in the

community.Intheabsenceofbadfaith,self-dealing,orgrossnegligence,managementshoulddeterminewhich,

and if, contributions are in the best interests of the company.

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**DataSecurity,Privacy,andInternetIssues**

**GeneralRecommendation:**Votecase-by-caseonproposalsrequestingthedisclosureorimplementationofdata

security, privacy, or information access and management policies and procedures, considering:

Thelevelofdisclosureofcompanypoliciesandproceduresrelatingtodatasecurity,privacy,freedomof

speech, information access and management, and Internet censorship;

Engagementindialoguewithgovernmentsorrelevantgroupswithrespecttodatasecurity,privacy,orthe

free flow of information on the Internet;

Thescopeofbusinessinvolvementandofinvestmentincountrieswhosegovernmentscensorormonitorthe

Internet and other telecommunications;

Applicablemarket-specificlawsorregulationsthatmaybeimposedonthecompany;and

Controversies,fines,orlitigationrelatedtodatasecurity,privacy,freedomofspeech,orInternetcensorship.

**ESGCompensation-RelatedProposals**

**General Recommendation:** Vote case-by-case on proposals seeking a report or additional disclosure on the

company'sapproach,policies,andpracticesonincorporatingenvironmentalandsocialcriteriaintoitsexecutive

compensation strategy, considering:

Thescopeandprescriptivenatureoftheproposal;

Thecompany'scurrentlevelofdisclosureregardingitsenvironmentalandsocialperformanceand

governance;

Thedegreetowhichtheboardorcompensationcommitteealreadydisclosesinformationonwhetherithas

considered related E&S criteria; and

Whetherthecompanyhassignificantcontroversiesorregulatoryviolationsregardingsocialorenvironmental

issues.

Human Rights, Human Capital Management, and

International Operations

**HumanRightsProposals**

**GeneralRecommendation:**Generallyvoteforproposalsrequestingareportoncompanyorcompanysupplier

labor and/or human rights standards and policies unless such information is already publicly disclosed.

Votecase-by-caseonproposalstoimplementcompanyorcompanysupplierlaborand/orhumanrightsstandards

and policies, considering:

Thedegreetowhichexistingrelevantpoliciesandpracticesaredisclosed;

Whetherornotexistingrelevantpoliciesareconsistentwithinternationallyrecognizedstandards;

Whethercompanyfacilitiesandthoseofitssuppliersaremonitoredandhow;

Companyparticipationinfairlabororganizationsorotherinternationallyrecognizedhumanrightsinitiatives;

Scopeandnatureofbusinessconductedinmarketsknowntohavehigherriskofworkplacelabor/human

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Recent,significantcompanycontroversies,fines,orlitigationregardinghumanrightsatthecompanyorits

suppliers;

Thescopeoftherequest; and

Deviationfromindustrysectorpeercompanystandardsandpractices.

Votecase-by-caseonproposalsrequestingthatacompanyconductanassessmentofthehumanrightsrisksinits

operations or in its supply chain, or report on its human rights risk assessment process, considering:

Thedegreetowhichexistingrelevantpoliciesandpracticesaredisclosed,includinginformationonthe

implementation of these policies and any related oversight mechanisms;

Thecompany'sindustryandwhetherthecompanyoritssuppliersoperateincountriesorareaswherethereis

ahistoryofhumanrightsconcerns;

Recentsignificantcontroversies,fines,orlitigationregardinghumanrightsinvolvingthecompanyorits

suppliers, and whether the company has taken remedial steps; and

Whethertheproposalisundulyburdensomeoroverlyprescriptive.

**MandatoryArbitration**

**GeneralRecommendation:**Votecase-by-caseonrequestsforareportonacompany'suseofmandatory

arbitrationonemployment-relatedclaims,takingintoaccount:

Thecompany'scurrentpoliciesandpracticesrelatedtotheuseofmandatoryarbitrationagreementson

workplace claims;

Whetherthecompanyhasbeenthesubjectofrecentcontroversy,litigation,orregulatoryactionsrelatedto

the use of mandatory arbitration agreements on workplace claims; and

Thecompany'sdisclosureofitspoliciesandpracticesrelatedtotheuseofmandatoryarbitrationagreements

compared to its peers.

**OperationsinHigh-RiskMarkets**

**GeneralRecommendation:**Votecase-by-caseonrequestsforareportonacompany'spotentialfinancialand

reputational risks associated with operations in "high-risk" markets, such as a terrorism-sponsoring state or

politically/socially unstable region, taking into account:

Thenature,purpose,andscopeoftheoperationsandbusinessinvolvedthatcouldbeaffectedbysocialor

political disruption;

Currentdisclosureofapplicableriskassessment(s)andriskmanagementprocedures;

CompliancewithU.S.sanctionsandlaws;

Considerationofotherinternationalpolicies,standards,andlaws;and

Whetherthecompanyhasbeenrecentlyinvolvedinrecent,significantcontroversies,fines,orlitigation

related to its operations in "high-risk" markets.

**Outsourcing/Offshoring**

**GeneralRecommendation:** Votecase-by-caseonproposalscallingforcompaniestoreportontherisksassociated

with outsourcing/plant closures, considering:

Controversiessurroundingoperationsintherelevantmarket(s);

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Thevalueoftherequestedreporttoshareholders;

Thecompany'scurrentlevelofdisclosureofrelevantinformationonoutsourcingandplantclosure

procedures;and

Thecompany'sexistinghumanrightsstandardsrelativetoindustrypeers.

**SexualHarassment**

**General Recommendation:** Vote case-by-case on requests for a report on company actions taken to strengthen

policiesandoversighttopreventworkplacesexualharassment,orareportonrisksposedbyacompany'sfailure

to prevent workplace sexual harassment, taking into account:

Thecompany'scurrentpolicies,practices,oversightmechanismsrelatedtopreventingworkplacesexual

harassment;

Whetherthecompanyhasbeenthesubjectofrecentcontroversy,litigation,orregulatoryactionsrelatedto

workplace sexual harassment issues; and

Thecompany'sdisclosureregardingworkplacesexualharassmentpoliciesorinitiativescomparedtoits

industry peers.

**WeaponsandMilitarySales**

**GeneralRecommendation:**Voteagainstreportsonforeignmilitarysalesoroffsets.Suchdisclosuresmayinvolve

sensitive and confidential information. Moreover, companies must comply with government controls and

reporting on foreign military sales.

Generallyvoteagainstproposalsaskingacompanytoceaseproductionorreportontherisksassociatedwiththe

useofdepleteduraniummunitionsornuclearweaponscomponents anddeliverysystems,includingdisengaging

from current and proposed contracts. Such contracts are monitored by government agencies, serve multiple

military and non-military uses, and withdrawal from these contracts could have a negative impact on the

company's business.

PoliticalActivities

**Lobbying**

**GeneralRecommendation:**Votecase-by-caseonproposalsrequestinginformationonacompany'slobbying

(includingdirect,indirect,andgrassrootslobbying)activities,policies,orprocedures,considering:

Thecompany'scurrentdisclosureofrelevantlobbyingpolicies,andmanagementandboardoversight;

Thecompany'sdisclosureregardingtradeassociationsorothergroupsthatitsupports,orisamemberof,that

engageinlobbyingactivities;and

Recentsignificantcontroversies,fines,orlitigationregardingthecompany'slobbying-relatedactivities.

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**PoliticalContributions**

**GeneralRecommendation:**Generallyvoteforproposalsrequestinggreaterdisclosureofacompany'spolitical

contributions and trade association spending policies and activities, considering:

Thecompany'spolicies,andmanagementandboardoversightrelatedtoitsdirectpoliticalcontributionsand

payments to trade associations or other groups that may be used for political purposes;

Thecompany'sdisclosureregardingitssupportof,andparticipationin,tradeassociationsorothergroupsthat

may make political contributions; and

Recentsignificantcontroversies,fines,orlitigationrelatedtothecompany'spoliticalcontributionsorpolitical

activities.

Vote against proposals barring a company from making political contributions. Businesses are affected by

legislationatthefederal,state,andlocallevel;barringpoliticalcontributionscanputthecompanyatacompetitive

disadvantage.

Vote against proposals to publish in newspapers and other media a company's political contributions. Such

publicationscouldpresentsignificantcosttothecompanywithoutprovidingcommensuratevaluetoshareholders.

**PoliticalExpendituresandLobbyingCongruency**

**GeneralRecommendation:**Generallyvotecase-by-caseonproposalsrequestinggreaterdisclosureofacompany's

alignmentofpoliticalcontributions,lobbying,andelectioneeringspendingwithacompany'spubliclystatedvalues

and policies, considering:

Thecompany'spolicies,management,boardoversight,governanceprocesses,andlevelofdisclosurerelated

to direct political contributions, lobbying activities, and payments to trade associations, political action

committees, or other groups that may be used for political purposes;

Thecompany'sdisclosureregarding:thereasonsforitssupportofcandidatesforpublicoffices;thereasons

forsupportofandparticipationintradeassociationsorothergroupsthatmaymakepoliticalcontributions;

and other political activities;

Anyincongruenciesidentifiedbetweenacompany'sdirectandindirectpoliticalexpendituresanditspublicly

statedvaluesandpriorities;and

Recentsignificantcontroversiesrelatedtothecompany'sdirectandindirectlobbying,politicalcontributions,

orpoliticalactivities.

Generallyvotecase-by-caseonproposalsrequestingcomparisonofacompany'spoliticalspendingtoobjectives

thatcanmitigatematerialrisksforthecompany,suchaslimitingglobalwarming.

**PoliticalTies**

**GeneralRecommendation:**Generallyvoteagainstproposalsaskingacompanytoaffirmpoliticalnonpartisanship

in the workplace, so long as:

Therearenorecent,significantcontroversies,fines,orlitigationregardingthecompany'spolitical

contributionsortradeassociationspending;and

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Thecompanyhasproceduresinplacetoensurethatemployeecontributionstocompany-sponsoredpolitical

action committees (PACs) are strictly voluntary and prohibit coercion.

Vote against proposals asking for a list of company executives, directors, consultants, legal counsels, lobbyists, or

investmentbankersthathavepriorgovernmentserviceandwhethersuchservicehadabearingonthebusinessof

the company. Such a list would be burdensome to prepare without providing any meaningful information to

shareholders.

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**8. Mutual FundProxies**

**ElectionofDirectors**

**General Recommendation:** Vote case-by-case on the election of directors and trustees, following the same

guidelinesforuncontesteddirectorsforpubliccompanyshareholdermeetings.However,mutualfundboardsdo

not usually have compensation committees, so do not withhold for the lack of this committee.

**ClosedEndFunds-UnilateralOpt-IntoControlShareAcquisitionStatutes**

**GeneralRecommendation:** Forclosed-endmanagementinvestmentcompanies(CEFs),voteagainstorwithhold

fromnominating/governancecommitteemembers(orotherdirectorsonacase-by-casebasis)atCEFsthathave

not provided a compelling rationale for opting-in to a Control Share Acquisition statute, nor submitted a by-law

amendment to a shareholder vote.

**ConvertingClosed-endFundtoOpen-endFund**

**GeneralRecommendation:**Votecase-by-caseonconversionproposals,consideringthefollowingfactors:

Pastperformanceasaclosed-endfund;

Marketinwhichthefundinvests;

Measurestakenbytheboardtoaddressthediscount;and

Pastshareholderactivism,boardactivity,andvotesonrelatedproposals.

**ProxyContests**

**GeneralRecommendation:**Votecase-by-caseonproxycontests,consideringthefollowingfactors:

Pastperformancerelativetoitspeers;

Marketinwhichthefundinvests;

Measurestakenbytheboardtoaddresstheissues;

Pastshareholderactivism,boardactivity,andvotesonrelatedproposals;

Strategyoftheincumbentsversusthedissidents;

Independenceofdirectors;

Experienceandskillsofdirectorcandidates;

Governanceprofileofthecompany;and

Evidenceofmanagemententrenchment.

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**InvestmentAdvisoryAgreements**

**GeneralRecommendation:**Votecase-by-caseoninvestmentadvisoryagreements,consideringthefollowing

factors:

Proposedandcurrentfeeschedules;

Fundcategory/investmentobjective;

Performancebenchmarks;

Sharepriceperformanceascomparedwithpeers;

Resultingfeesrelativetopeers;and

Assignments(wheretheadvisorundergoesachangeofcontrol).

**ApprovingNewClassesorSeriesofShares**

**GeneralRecommendation:**Votefortheestablishmentofnewclassesorseriesofshares.

**PreferredStockProposals**

**GeneralRecommendation:**Votecase-by-caseontheauthorizationfororincreaseinpreferredshares,considering

the following factors:

Statedspecificfinancingpurpose;

Possibledilutionforcommonshares;and

Whetherthesharescanbeusedforantitakeoverpurposes.

**1940ActPolicies**

**GeneralRecommendation:**Votecase-by-caseonpoliciesundertheInvestmentAdvisorActof1940,considering

the following factors:

Potentialcompetitiveness;

Regulatorydevelopments;

Currentandpotentialreturns;and

Currentandpotentialrisk.

Generallyvotefortheseamendmentsaslongastheproposedchangesdonotfundamentallyaltertheinvestment

focus of the fund and do comply with the current SEC interpretation.

**ChangingaFundamentalRestrictiontoaNonfundamentalRestriction**

**GeneralRecommendation:** Votecase-by-caseonproposalstochangeafundamentalrestrictiontoanon-

fundamental restriction, considering the following factors:

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Thefund'stargetinvestments;

Thereasonsgivenbythefundforthechange; and

Theprojectedimpactofthechangeontheportfolio.

**ChangeFundamentalInvestmentObjectivetoNonfundamental**

**GeneralRecommendation:** Voteagainstproposalstochangeafund'sfundamentalinvestmentobjectivetonon-

fundamental.

**NameChangeProposals**

**GeneralRecommendation:**Votecase-by-caseonnamechangeproposals,consideringthefollowingfactors:

Political/economicchangesinthetargetmarket;

Consolidationinthetargetmarket;and

Currentassetcomposition.

**ChangeinFund'sSubclassification**

**GeneralRecommendation:**Votecase-by-caseonchangesinafund'ssub-classification,consideringthefollowing

factors:

Potentialcompetitiveness;

Currentandpotentialreturns;

Riskofconcentration; and

Consolidationintargetindustry.

**BusinessDevelopmentCompanies—AuthorizationtoSellSharesofCommon** 

**Stock at a Price below Net AssetValue**

**GeneralRecommendation:**VoteforproposalsauthorizingtheboardtoissuesharesbelowNetAssetValue(NAV)

if:

TheproposaltoallowshareissuancesbelowNAVhasanexpirationdatenomorethanoneyearfromthedate

shareholders approve the underlying proposal, as required under the Investment Company Act of 1940;

Thesaleisdeemedtobeinthebestinterestsofshareholdersby(1)amajorityofthecompany'sindependent

directors and (2) a majority of the company's directors who have no financial interest in the issuance; and

Thecompanyhasdemonstratedresponsiblepastuseofshareissuancesbyeither:

Outperformingpeersinits8-digitGICSgroupasmeasuredbyone-andthree-yearmedianTSRs;or

Providingdisclosurethatitspastshareissuanceswerepricedatlevelsthatresultedinonlysmallormoderate

discounts to NAV and economic dilution to existing non-participating shareholders.

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**DispositionofAssets/Termination/Liquidation**

**GeneralRecommendation:**Votecase-by-caseonproposalstodisposeofassets,toterminateorliquidate,

considering the following factors:

Strategiesemployedtosalvagethecompany;

Thefund'spastperformance;and

Thetermsoftheliquidation.

**ChangestotheCharterDocument**

**GeneralRecommendation:**Votecase-by-caseonchangestothecharterdocument,consideringthefollowing

factors:

Thedegreeofchangeimpliedbytheproposal;

Theefficienciesthatcouldresult;

Thestateofincorporation;and

Regulatorystandardsandimplications.

Voteagainstanyofthefollowingchanges:

Removalofshareholderapprovalrequirementtoreorganizeorterminatethetrustoranyofitsseries;

Removalofshareholderapprovalrequirementforamendmentstothenewdeclarationoftrust;

Removal of shareholder approval requirement to amend the fund's management contract, allowing the

contracttobemodifiedbytheinvestmentmanagerandthetrustmanagement,aspermittedbythe1940Act;

Allowthetrusteestoimposeotherfeesinadditiontosaleschargesoninvestmentinafund,suchasdeferred

sales charges and redemption fees that may be imposed upon redemption of a fund's shares;

Removalofshareholderapprovalrequirementtoengageinandterminatesubadvisoryarrangements;or

Removalofshareholderapprovalrequirementtochangethedomicileofthefund.

**ChangingtheDomicileofaFund**

**GeneralRecommendation:**Votecase-by-caseonre-incorporations,consideringthefollowingfactors:

Regulationsofbothstates;

Requiredfundamentalpoliciesofbothstates;and

Theincreasedflexibilityavailable.

**Authorizing the Board to Hire and Terminate Subadvisers Without**

**Shareholder Approval**

**GeneralRecommendation:**Voteagainstproposalsauthorizingtheboardtohire orterminatesubadviserswithout

shareholder approval if the investment adviser currently employs only one subadviser.

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**DistributionAgreements**

**GeneralRecommendation:**Votecase-by-caseondistributionagreementproposals,consideringthe following

factors:

Feeschargedtocomparablysizedfundswithsimilarobjectives;

Theproposeddistributor'sreputationandpastperformance;

Thecompetitivenessofthefundintheindustry; and

Thetermsoftheagreement.

**Master-FeederStructure**

**GeneralRecommendation:**Votefortheestablishmentofamaster-feederstructure.

**Mergers**

**GeneralRecommendation:**Votecase-by-caseonmergerproposals,consideringthefollowingfactors:

Resultingfeestructure;

Performanceofbothfunds;

Continuityofmanagementpersonnel;and

Changesincorporategovernanceandtheirimpactonshareholderrights.

ShareholderProposals forMutualFunds

**EstablishDirectorOwnershipRequirement**

**GeneralRecommendation:**Generallyvoteagainstshareholderproposalsthatmandateaspecificminimum

amount of stock that directors must own in order to qualify as a director or to remain on the board.

**ReimburseShareholderforExpensesIncurred**

**GeneralRecommendation:**Votecase-by-caseonshareholderproposalstoreimburseproxysolicitationexpenses.

When supporting the dissidents, vote for the reimbursement of the proxy solicitation expenses.

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**TerminatetheInvestmentAdvisor**

**GeneralRecommendation:**Votecase-by-caseonproposalstoterminatetheinvestmentadvisor, consideringthe

following factors:

Performanceofthefund'sNetAssetValue(NAV);

Thefund'shistoryofshareholderrelations;and

Theperformanceofotherfundsundertheadvisor'smanagement.

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Weempowerinvestorsandcompaniestobuild

forlong-termandsustainablegrowthbyproviding

high-quality data, analytics, and insight.

**GETSTARTEDWITHISSSOLUTION S**

Email<u>sales@issgovernance.com</u>orvisit<u>www.issgovernance.com</u>formoreinformation.

Foundedin1985,InstitutionalShareholderServicesgroupofcompanies(ISS)empowersinvestorsandcompanies

to build for long-term and sustainable growth by providing high-quality data, analytics and insight. ISS, which is

majorityownedbyDeutscheBourseGroup,alongwithGenstarCapitalandISSmanagement,isaleadingprovider

ofcorporategovernanceandresponsibleinvestmentsolutions,marketintelligence,fundservices,andeventsand

editorial content for institutional investors and corporations, globally. ISS' 2,600 employees operate worldwide

across 29 global locations in 15 countries. Its approximately 3,400 clients include many of the world's leading

institutionalinvestorswhorelyonISS'objectiveandimpartialofferings,aswellaspubliccompaniesfocusedon

ESG and governance risk mitigation as a shareholder value enhancing measure. Clients rely on ISS' expertise to

helpthemmakeinformedinvestmentdecisions. Thisdocumentandalloftheinformationcontainedinit,including

without limitation all text, data, graphs, and charts (collectively, the "Information") is the property of Institutional

Shareholder Services Inc. (ISS), its subsidiaries, or, in some cases third party suppliers.

TheInformationhasnotbeensubmittedto,norreceivedapprovalfrom,theUnitedStatesSecuritiesandExchange

Commission or any other regulatory body. None of the Information constitutes an offer to sell (or a solicitation of

anoffertobuy),orapromotionorrecommendationof,anysecurity,financialproductorotherinvestmentvehicle

or any tradingstrategy, and ISSdoes not endorse, approve,or otherwiseexpress any opinion regardingany issuer,

securities, financial products or instruments or trading strategies.

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------

**PART C: OTHER INFORMATION**

**Item 28. Exhibits**

---

| | | | |
|:---|:---|:---|:---|
| **<u>Exhibit No.</u>** | **<u>Exhibit No.</u>** | **<u>Exhibit No.</u>** | **<u>Description of Exhibit</u>** |
| (a) | (i) |  | <u>[Certificate of Trust of Active Weighting Funds ETF Trust dated August 26, 2016 is incorporated herein by reference Exhibit (a)(i) to Post-Effective Amendment No. 8 to the Registrant's Registration Statement on Form N-1A (File No. 333-215588 and 811-23226), as filed with on April 26, 2019.](https://www.sec.gov/Archives/edgar/data/1683471/000089418919002369/cert-of_trust.htm)</u> |
|  | (ii) |  | <u>[Certificate of Amendment to the Certificate of Trust of Active Weighting Funds ETF Trust dated December 21, 2018 is incorporated herein by reference to Exhibit (a)(ii) to Post-Effective Amendment No. 8 to the Registrant's Registration Statement on Form N-1A (File No. 333-215588 and 811-23226), as filed on April 26, 2019.](https://www.sec.gov/Archives/edgar/data/1683471/000089418919002369/amend_cert_trust.htm)</u> |
|  | (iii) |  | <u>[Amended and Restated Declaration of Trust of Listed Funds Trust (the "Registrant" or the "Trust") dated](https://www.sec.gov/Archives/edgar/data/1683471/000089418919002369/declaroftrust.htm)[March 19,](https://www.sec.gov/Archives/edgar/data/1683471/000089418919002369/declaroftrust.htm)[201](https://www.sec.gov/Archives/edgar/data/1683471/000089418919002369/declaroftrust.htm)[9](https://www.sec.gov/Archives/edgar/data/1683471/000089418919002369/declaroftrust.htm)[is incorporated herein by reference to Exhibit (a)(iii) to Post-Effective Amendment No. 8 to the Registrant's Registration Statement on Form N-1A (File No. 333-215588 and 811-23226), as filed on April 26, 2019.](https://www.sec.gov/Archives/edgar/data/1683471/000089418919002369/declaroftrust.htm)</u> |
| (b) |  |  | <u>[Amended and Restated By-Laws of the Registrant dated March 19, 2019 are incorporated by reference to Exhibit (b) to Post-Effective Amendment No. 8 to the Registrant's Registration Statement on Form N-1A (File No. 333-215588 and 811-23226), as filed on April 26, 2019.](https://www.sec.gov/Archives/edgar/data/1683471/000089418919002369/by-laws.htm)</u> |
| (c) |  |  | For information regarding the rights of the holders of securities, please see Articles IV, VII and VIII of the Declaration of Trust, filed as Exhibit (a)(i) above. |
| (d) | (i) | (A) | <u>[Investment Advisory Agreement dated September 23, 2019 between the Trust and Core Alternative Capital LLC is incorporated herein by reference to Exhibit (d) to the Registrant's Registration Statement on Form N-1A, as filed on December 13, 2019.](https://www.sec.gov/Archives/edgar/data/1683471/000089418919008354/exd-advisoryagreementxcore.htm)</u> |
|  |  | (B) | Amended Schedule A to the Investment Advisory Agreement for Optimized Equity Income ETF – ***<u>[Filed Herewith](coreamendscheduleatoinvadv.htm)[.](coreamendscheduleatoinvadv.htm)</u>*** |
| (e) | (i) |  | <u>[ETF Distribution Agreement between the Trust and Quasar Distributors, LLC dated September 30, 2021 is incorporated herein by reference to Exhibit (e)(i) to the Registrant's Registration Statement on Form N-1A, as filed on December 30, 2021.](https://www.sec.gov/Archives/edgar/data/1683471/000089418921009375/exeietfdistributionagreeme.htm)</u> |
|  | (ii) |  | Second Amendment to the ETF Distribution Agreement effective October 15, 2025 for Optimized Equity Income ETF – ***<u>[Filed Herewith](coreamendtoliftetfdistagrmt.htm)[.](coreamendtoliftetfdistagrmt.htm)</u>*** |
|  | (iii) |  | <u>[Form of Authorized Participant Agreement is incorporated by reference to Exhibit (E)(ii) to Post-Effective Amendment No. 11 to the Registrant's Registration Statement on Form N-1A (File No. 333-215588 and 811- 23226), as filed with the Securities and Exchange Commission on May 23, 2019.](https://www.sec.gov/Archives/edgar/data/1683471/000089418919003172/quasarapagreementtemplate.htm)</u> |
| (f) |  |  | Not applicable. |
| (g) | (i) |  | <u>[Custody Agreement between Registrant and U.S. Bank National Association dated April 9, 2019 is incorporated herein by reference to Exhibit (G) to Post-Effective Amendment No. 8 to the Registrant's Registration Statement on Form N-1A (File No. 333-215588 and 811- 23226), as filed with the Securities and Exchange Commission on April 26, 2019.](https://www.sec.gov/Archives/edgar/data/1683471/000089418919002369/custo_agree.htm)</u> |
|  | (ii) |  | Amended Exhibit 5 to the Custody Agreement for Optimized Equity Income ETF – ***<u>[Filed Herewith](exhibit5totheliftcustodyag.htm)[.](exhibit5totheliftcustodyag.htm)</u>*** |
| (h) | (i) | (A) | <u>[Fund Servicing Agreement between the Registrant and U.S. Bancorp Fund Services, LLC dated April 9, 2019 is incorporated herein by reference to Exhibit (h)(1) to Post-Effective Amendment No. 8 to the Registrant's Registration Statement on Form N-1A (File No. 333-215588 and 811- 23226), as filed with the Securities and Exchange Commission on April 26, 2019.](https://www.sec.gov/Archives/edgar/data/1683471/000089418919002369/fundserv-agree.htm)</u> |
|  |  | (B) | Amended Exhibit 5 to the Fund Servicing Agreement for Optimized Equity Income ETF – ***<u>[Filed Herewith](exhibit5totheliftfundservi.htm)[.](exhibit5totheliftfundservi.htm)</u>*** |
|  | (ii) |  | <u>[Power of Attorney is incorporated herein by reference to Exhibit (h)(ii) to the Registrant's Registration Statement on Form N-1A, as filed on March 27, 2025.](https://www.sec.gov/Archives/edgar/data/1683471/000089418925002115/lifpowerofattorney3525.htm)</u> |
|  | (iii) |  | <u>[Certificate of Secretary dated February 6, 2019 is incorporated herein by reference to Exhibit (h)(vi) to the Registrant's Registration Statement on Form N-1A, as filed on February 6, 2019.](https://www.sec.gov/Archives/edgar/data/1683471/000089418919000783/cert-of_sec.htm)</u> |
| (i) | (i) |  | <u>[Opinion and Consent of Counsel is incorporated herein by reference to Exhibit (i) to the Registrant's Registration Statement on Form N-1A, as filed on December 13, 2019.](https://www.sec.gov/Archives/edgar/data/1683471/000089418919008354/exi-legalopinionforccor.htm)</u> |
|  | (ii) |  | Opinion and Consent of Counsel for Optimized Equity Income ETF – ***<u>[Filed Herewith](legalopinionoptimizedequity.htm)[.](legalopinionoptimizedequity.htm)</u>*** |
| (j) |  |  | Consent of Independent Registered Public Accounting Firm – ***<u>[Filed Herewith.](optimizedequityauditconsent.htm)</u>*** |
| (k) |  |  | Not applicable. |
| (l) |  |  | Not applicable. |
| (m) | (i) |  | <u>[Rule 12b-1 Plan dated September 13, 2017 (the "12b-1 Plan") is incorporated herein by reference to Exhibit (m) to Pre-Effective Amendment No. 3 to the Registrant's Registration Statement on Form N-1A, as filed with the SEC on October 2, 2017.](https://www.sec.gov/Archives/edgar/data/1683471/000089109217007054/e75901ex_m.htm)</u> |
|  | (ii) |  | Amended Appendix A to the Rule 12b-1 Plan for Optimized Equity Income ETF – ***<u>[Filed Herewith](amendappendixatotherule12b.htm)[.](amendappendixatotherule12b.htm)</u>*** |
| (n) |  |  | Not applicable. |
| (o) |  |  | Reserved. |

---

------

---

| | | |
|:---|:---|:---|
| **<u>Exhibit No.</u>** | **<u>Exhibit No.</u>** | **<u>Description of Exhibit</u>** |
| (p) | (i) | <u>[Registrant's Code of Ethics dated March 19, 2019 is incorporated herein by reference to Exhibit (p)(i) to Post-Effective Amendment No. 8 to the Registrant's Registration Statement on Form N-1A (File No. 333-215588 and 811-233236), as filed on April 26, 2019.](https://www.sec.gov/Archives/edgar/data/1683471/000089418919002369/coe-lift.htm)</u> |
|  | (ii) | <u>[Code of Ethics of Core Alternative Capital LLC dated May 1, 2019 is incorporated herein by referenced to Exhibit (p)(ii) to the Registrant's Registration Statement on Form N-1A, as filed on December 13, 2019.](https://www.sec.gov/Archives/edgar/data/1683471/000089418919008354/expii-corealternativecapit.htm)</u> |

---

**Item 29. Persons Controlled by or Under Common Control with the Registrant**

No person is directly or indirectly controlled by or under common control with the Registrant.

**Item 30. Indemnification**

Every person who is, has been, or becomes a Trustee or officer of the Registrant (hereinafter referred to as a "Covered Person") shall be indemnified by the Registrant to the fullest extent permitted by law against any and all liabilities and expenses reasonably incurred or paid by them in connection with the defense of any proceeding in which they become involved as a party or otherwise by virtue of their being or having been such a Trustee or officer, and against amounts paid or incurred by them in the settlement thereof. Every person who is, has been, or becomes an agent of the Registrant may, upon due approval of the Trustees (including a majority of the Trustees who are not interested persons of the Registrant), be indemnified by the Registrant, to the fullest extent permitted by law, against any and all liabilities and expenses reasonably incurred or paid by them in connection with the defense of any proceeding in which they become involved as a party or otherwise by virtue of their being or having been an agent, and against amounts paid or incurred by him in the settlement thereof. Every Person who is serving or has served at the request of the Registrant as a director, officer, partner, trustee, employee, agent or fiduciary of another domestic or foreign corporation, partnership, joint venture, trust, other enterprise or employee benefit plan ("Other Position") and who was or is a party or is threatened to be made a party to any proceeding by reason of alleged acts or omissions while acting within the scope of his or her service in such Other Position, may, upon due approval of the Trustees (including a majority of the Trustees who are not interested persons of the Registrant), be indemnified by the Registrant, to the fullest extent permitted by law, against any and all liabilities and expenses reasonably incurred or paid by them in connection with the defense of any proceeding in which they become involved as a party or otherwise by virtue of their being or having held such Other Position, and against amounts paid or incurred by them in the settlement thereof.

The Registrant shall indemnify each Covered Person who was or is a party or is threatened to be made a party to any proceeding, by reason of alleged acts or omissions within the scope of their service as a Covered Person, against judgments, fines, penalties, settlements and reasonable expenses (including attorneys' fees) actually incurred by them in connection with such proceeding to the maximum extent consistent with state law and the Investment Company Act of 1940, as amended.

No indemnification shall be provided to any person who shall have been adjudicated by a court or body before which the proceeding was brought: (i) to be liable to the Registrant or its shareholders by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of their office, or (ii) not to have acted in good faith in the reasonable belief that his action was in the best interest of the Registrant.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the "1933 Act") may be permitted to directors, officers or persons controlling the Registrant pursuant to the foregoing provisions, the Registrant has been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the 1933 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 connection with the successful defense of any action, suit or proceeding or payment pursuant to any insurance policy) is asserted against the Registrant by such director, officer or controlling person in connection with the securities 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 1933 Act and will be governed by the final adjudication of such issue.

**Item 31. Business and Other Connections of Investment Adviser**

This Item incorporates by reference each investment adviser's Uniform Application for Investment Adviser Registration ("Form ADV") on file with the SEC, as listed below. Each Form ADV may be obtained, free of charge, at the SEC's website at www.adviserinfo.sec.gov. Additional information as to any other business, profession, vocation or employment of a substantial nature engaged in by each officer and director of the below-listed investment advisers is included in the Trust's Statement of Additional Information.

<u>Investment Adviser</u> <u>SEC File No.</u> <br> Core Alternative Capital, LLC 801-115285

------

**Item 32. Principal Underwriters**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)&nbsp;&nbsp;&nbsp;&nbsp;Quasar Distributors, LLC (the "Distributor") serves as principal underwriter for the following investment companies registered under the Investment Company Act of 1940, as amended:

&nbsp;&nbsp;&nbsp;&nbsp;1.Abacus FCF ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;2.Advisor Managed Portfolios

&nbsp;&nbsp;&nbsp;&nbsp;3.Antares Private Credit Fund

&nbsp;&nbsp;&nbsp;&nbsp;4.Capital Advisors Growth Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;5.Chase Growth Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;6.Davidson Multi Cap Equity Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;7.Edgar Lomax Value Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;8.First Sentier American Listed Infrastructure Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;9.First Sentier Global Listed Infrastructure Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;10.Huber Large Cap Value Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;11.Huber Mid Cap Value Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;12.Huber Select Large Cap Value Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;13.Huber Small Cap Value Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;14.Logan Capital Broad Innovative Growth ETF, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;15.Medalist Partners MBS Total Return Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;16.Medalist Partners Short Duration Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;17.O'Shaughnessy Market Leaders Value Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;18.PIA BBB Bond Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;19.PIA High Yield (MACS) Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;20.PIA High Yield Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;21.PIA MBS Bond Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;22.PIA Short-Term Securities Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;23.Poplar Forest Cornerstone Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;24.Poplar Forest Partners Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;25.Pzena Emerging Markets Value Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;26.Pzena International Small Cap Value Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;27.Pzena International Value Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;28.Pzena Mid Cap Value Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;29.Pzena Small Cap Value Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;30.Reverb ETF, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;31.Scharf Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;32.Scharf Global Opportunity Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;33.Scharf Multi-Asset Opportunity Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;34.Shenkman Capital Floating Rate High Income Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;35.Shenkman Capital Short Duration High Income Fund, Series of Advisors Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;36.The Aegis Funds

&nbsp;&nbsp;&nbsp;&nbsp;37.Allied Asset Advisors Funds

&nbsp;&nbsp;&nbsp;&nbsp;38.Angel Oak Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;39.Angel Oak Strategic Credit Fund

&nbsp;&nbsp;&nbsp;&nbsp;40.Brookfield Infrastructure Income Fund Inc.

&nbsp;&nbsp;&nbsp;&nbsp;41.Brookfield Investment Funds

&nbsp;&nbsp;&nbsp;&nbsp;42.Buffalo Funds

&nbsp;&nbsp;&nbsp;&nbsp;43.DoubleLine Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;44.EA Series Trust *(f/k/a Alpha Architect ETF Trust)*

&nbsp;&nbsp;&nbsp;&nbsp;45.AAM Bahl & Gaynor Small/Mid Cap Income Growth ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;46.AAM Brentview Dividend Growth ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;47.AAM Low Duration Preferred and Income Securities ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;48.AAM S&P 500 High Dividend Value ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;49.AAM Sawgrass U.S. Large Cap Quality Growth ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;50.AAM Sawgrass U.S. Small Cap Quality Growth ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;51.AAM SLC Low Duration Income ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;52.AAM Transformers ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;53.Acquirers Deep Value ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;54.Aptus Collared Investment Opportunity ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;55.Aptus Deferred Income ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;56.Aptus Defined Risk ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;57.Aptus Drawdown Managed Equity ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;58.Aptus Enhanced Yield ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;59.Aptus International Enhanced Yield ETF, Series of ETF Series Solutions

------

&nbsp;&nbsp;&nbsp;&nbsp;60.Aptus Large Cap Enhanced Yield ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;61.Aptus Large Cap Upside ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;62.Bahl & Gaynor Dividend ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;63.Bahl & Gaynor Income Growth ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;64.Bahl & Gaynor Small Cap Dividend ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;65.BTD Capital Fund, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;66.Carbon Strategy ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;67.ClearShares OCIO ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;68.ClearShares Piton Intermediate Fixed Income Fund, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;69.ClearShares Ultra-Short Maturity ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;70.Distillate International Fundamental Stability & Value ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;71.Distillate Small/Mid Cash Flow ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;72.Distillate U.S. Fundamental Stability & Value ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;73.ETFB Green SRI REITs ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;74.Hoya Capital High Dividend Yield ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;75.Hoya Capital Housing ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;76.LHA Market State Tactical Beta ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;77.LHA Market State Tactical Q ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;78.LHA Risk-Managed Income ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;79.McElhenny Sheffield Managed Risk ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;80.NETLease Corporate Real Estate ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;81.Opus Small Cap Value ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;82.The Acquirers Fund, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;83.The Brinsmere Fund - Conservative ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;84.The Brinsmere Fund - Growth ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;85.U.S. Global GO GOLD and Precious Metal Miners ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;86.U.S. Global JETS ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;87.U.S. Global Sea to Sky Cargo ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;88.U.S. Global Technology and Aerospace & Defense ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;89.US Vegan Climate ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;90.Vest 10 Year Interest Rate Hedge ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;91.Vest 2 Year Interest Rate Hedge ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;92.First American Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;93.FundX Investment Trust

&nbsp;&nbsp;&nbsp;&nbsp;94.The Glenmede Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;95.The GoodHaven Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;96.Harding, Loevner Funds, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;97.Hennessy Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;98.Horizon Funds

&nbsp;&nbsp;&nbsp;&nbsp;99.Hotchkis & Wiley Funds

&nbsp;&nbsp;&nbsp;&nbsp;100.Intrepid Capital Management Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;101.Jacob Funds Inc.

&nbsp;&nbsp;&nbsp;&nbsp;102.The Jensen Quality Growth Fund Inc.

&nbsp;&nbsp;&nbsp;&nbsp;103.Kirr, Marbach Partners Funds, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;104.Core Alternative ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;105.Wahed Dow Jones Islamic World ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;106.Wahed FTSE USA Shariah ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;107.LKCM Funds

&nbsp;&nbsp;&nbsp;&nbsp;108.LoCorr Investment Trust

&nbsp;&nbsp;&nbsp;&nbsp;109.MainGate Trust

&nbsp;&nbsp;&nbsp;&nbsp;110.ATAC Rotation Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;111.Coho Relative Value Equity Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;112.Coho Relative Value ESG Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;113.Cove Street Capital Small Cap Value Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;114.Jackson Square Large-Cap Growth Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;115.Jackson Square SMID-Cap Growth Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;116.Kensington Active Advantage Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;117.Kensington Defender Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;118.Kensington Dynamic Allocation Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;119.Kensington Hedged Premium Income ETF, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;120.Kensington Managed Income Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;121.LK Balanced Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;122.Leuthold Core ETF, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;123.Leuthold Core Investment Fund, Series of Managed Portfolio Series

------

&nbsp;&nbsp;&nbsp;&nbsp;124.Leuthold Global Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;125.Leuthold Grizzly Short Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;126.Leuthold Select Industries ETF, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;127.Muhlenkamp Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;128.Nuance Concentrated Value Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;129.Nuance Mid Cap Value Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;130.Olstein All Cap Value Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;131.Olstein Strategic Opportunities Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;132.Port Street Quality Growth Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;133.Principal Street High Income Municipal Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;134.Principal Street Short Term Municipal Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;135.Reinhart Genesis PMV Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;136.Reinhart International PMV Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;137.Reinhart Mid Cap PMV Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;138.Tortoise Global Water ESG Fund, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;139.Tremblant Global ETF, Series of Managed Portfolio Series

&nbsp;&nbsp;&nbsp;&nbsp;140.Greenspring Income Opportunities Fund, Series of Manager Directed Portfolios

&nbsp;&nbsp;&nbsp;&nbsp;141.Hood River International Opportunity Fund, Series of Manager Directed Portfolios

&nbsp;&nbsp;&nbsp;&nbsp;142.Hood River New Opportunities Fund, Series of Manager Directed Portfolios

&nbsp;&nbsp;&nbsp;&nbsp;143.Hood River Small-Cap Growth Fund, Series of Manager Directed Portfolios

&nbsp;&nbsp;&nbsp;&nbsp;144.SanJac Alpha Core Plus Bond ETF, Series of Manager Directed Portfolios

&nbsp;&nbsp;&nbsp;&nbsp;145.SanJac Alpha Low Duration ETF, Series of Manager Directed Portfolios

&nbsp;&nbsp;&nbsp;&nbsp;146.SWP Growth & Income ETF, Series of Manager Directed Portfolios

&nbsp;&nbsp;&nbsp;&nbsp;147.Vert Global Sustainable Real Estate ETF, Series of Manager Directed Portfolios

&nbsp;&nbsp;&nbsp;&nbsp;148.Mason Capital Fund Trust

&nbsp;&nbsp;&nbsp;&nbsp;149.Matrix Advisors Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;150.Monetta Trust

&nbsp;&nbsp;&nbsp;&nbsp;151.Nicholas Equity Income Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;152.Nicholas Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;153.Nicholas II, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;154.Nicholas Limited Edition, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;155.Oaktree Diversified Income Fund Inc.

&nbsp;&nbsp;&nbsp;&nbsp;156.Permanent Portfolio Family of Funds

&nbsp;&nbsp;&nbsp;&nbsp;157.Perritt Funds, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;158.Procure ETF Trust II

&nbsp;&nbsp;&nbsp;&nbsp;159.Professionally Managed Portfolios

&nbsp;&nbsp;&nbsp;&nbsp;160.Prospector Funds, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;161.Provident Mutual Funds, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;162.Abbey Capital Futures Strategy Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;163.Abbey Capital Multi-Asset Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;164.Adara Smaller Companies Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;165.Aquarius International Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;166.Boston Partners All Cap Value Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;167.Boston Partners Emerging Markets Dynamic Equity Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;168.Boston Partners Global Equity Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;169.Boston Partners Global Sustainability Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;170.Boston Partners Long/Short Equity Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;171.Boston Partners Long/Short Research Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;172.Boston Partners Small Cap Value Fund II, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;173.Campbell Systematic Macro Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;174.F/m 10-Year Investment Grade Corporate Bond ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;175.F/m 2-Year Investment Grade Corporate Bond ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;176.F/m 3-Year Investment Grade Corporate Bond ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;177.F/m Emerald Life Sciences Innovation ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;178.F/m High Yield 100 ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;179.F/m Investments Large Cap Focused Fund Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;180.F/m Opportunistic Income ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;181.F/m Ultrashort Treasury Inflation-Protected Security (TIPS) ETF Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;182.Motley Fool 100 Index ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;183.Motley Fool Capital Efficiency 100 Index ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;184.Motley Fool Global Opportunities ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;185.Motley Fool Mid-Cap Growth ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;186.Motley Fool Next Index ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;187.Motley Fool Small-Cap Growth ETF, Series of The RBB Fund, Inc.

------

&nbsp;&nbsp;&nbsp;&nbsp;188.Optima Strategic Credit Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;189.SEG Partners Long/Short Equity Fund

&nbsp;&nbsp;&nbsp;&nbsp;190.SGI Dynamic Tactical ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;191.SGI Enhanced Core ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;192.SGI Enhanced Global Income ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;193.SGI Enhanced Market Leaders ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;194.SGI Global Equity Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;195.SGI Peak Growth Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;196.SGI Prudent Growth Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;197.SGI Small Cap Core Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;198.SGI U.S. Large Cap Core ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;199.SGI U.S. Large Cap Equity Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;200.SGI U.S. Small Cap Equity Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;201.US Treasury 10 Year Note ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;202.US Treasury 12 Month Bill ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;203.US Treasury 2 Year Note ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;204.US Treasury 20 Year Bond ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;205.US Treasury 3 Month Bill ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;206.US Treasury 3 Year Note ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;207.US Treasury 30 Year Bond ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;208.US Treasury 5 Year Note ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;209.US Treasury 6 Month Bill ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;210.US Treasury 7 Year Note ETF, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;211.WPG Partners Select Hedged Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;212.WPG Partners Select Small Cap Value Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;213.WPG Partners Small Cap Value Diversified Fund, Series of The RBB Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;214.The RBB Fund Trust

&nbsp;&nbsp;&nbsp;&nbsp;215.RBC Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;216.Rockefeller Municipal Opportunities Fund

&nbsp;&nbsp;&nbsp;&nbsp;217.Series Portfolios Trust

&nbsp;&nbsp;&nbsp;&nbsp;218.Tax-Exempt Private Credit Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;219.Thompson IM Funds, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;220.Tortoise Capital Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;221.Bright Rock Mid Cap Growth Fund, Series of Trust for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;222.Bright Rock Quality Large Cap Fund, Series of Trust for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;223.CrossingBridge Low Duration High Income Fund, Series of Trust for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;224.CrossingBridge Nordic High Income Bond Fund, Series of Trust for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;225.CrossingBridge Responsible Credit Fund, Series of Trust for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;226.CrossingBridge Ultra-Short Duration Fund, Series of Trust for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;227.RiverPark Strategic Income Fund, Series of Trust for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;228.Dearborn Partners Rising Dividend Fund, Series of Trust for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;229.Jensen Global Quality Growth Fund, Series of Trust for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;230.Jensen Quality MidCap Fund, Series of Trust for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;231.Rockefeller Climate Solutions Fund, Series of Trust for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;232.Rockefeller US Small Cap Core Fund, Series of Trust for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;233.USQ Core Real Estate Fund

&nbsp;&nbsp;&nbsp;&nbsp;234.Wall Street EWM Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;235.Wisconsin Capital Funds, Inc.

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;To the best of Registrant's knowledge, the directors and executive officers of Quasar Distributors, LLC are as follows:

---

| | | | |
|:---|:---|:---|:---|
| <u>Name</u> | <u>Address</u> | <u>Position with Underwriter</u> | <u>Position with Registrant</u> |
| Teresa Cowan | 190 Middle Street, Suite 301, Portland, Maine 04101 | President/Manager |  |
| Chris Lanza | 190 Middle Street, Suite 301, Portland, Maine 04101 | Vice President |  |
| Kate Macchia | 190 Middle Street, Suite 301, Portland, Maine 04101 | Vice President |  |
| Susan L. LaFond | 190 Middle Street, Suite 301, Portland, Maine 04101 | Vice President and Chief Compliance Officer and Treasurer |  |
| Kelly B. Whetstone | 190 Middle Street, Suite 301, Portland, Maine 04101 | Secretary |  |
| Weston Sommers | 190 Middle Street, Suite 301, Portland, Maine 04101 | Financial and Operations Principal and Chief Financial Officer |  |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;Not applicable.

**Item 33. Location of Accounts and Records**

The books and records required to be maintained by Section 31(a) of the Investment Company Act of 1940 are maintained at the following locations:

---

| | |
|:---|:---|
| **Records Relating to:** | **Are located at:** |
| Registrant's Fund Administrator, Fund Accountant and Transfer Agent | U.S. Bancorp Fund Services, LLC<br>d/b/a U.S. Bank Global Fund Services<br>615 East Michigan Street<br>Milwaukee, Wisconsin 53202 |
| Registrant's Custodian | U.S. Bank, National Association<br>1555 N. Rivercenter Drive, Suite 302 <br>Milwaukee, Wisconsin 53212 |
| Registrant's Principal Underwriter | Quasar Distributors, LLC<br>190 Middle Street, Suite 301<br>Portland, Maine 04101 |
| Registrant's Investment Adviser | Core Alternative Capital, LLC<br>3930 East Jones Bridge Road, Suite 380<br>Peachtree Corners, Georgia 30092 |

---

**Item 34. Management Services**

Not applicable.

**Item 35. Undertakings**

Not applicable.

------

**SIGNATURES**

Pursuant to the requirements of the Securities Act of 1933, as amended, and the Investment Company Act of 1940, as amended, the Registrant certifies that it meets all of the requirements for effectiveness of this registration statement under rule 485(b) under the Securities Act and has duly caused this Registration Statement on Form N-1A to be signed on its behalf by the undersigned, duly authorized, in the City of Milwaukee, State of Wisconsin, on October 17, 2025.

---

| | |
|:---|:---|
| | **Listed Funds Trust** |
| By: | */s/ Chad Fickett* |
|  | Chad Fickett |
|  | Secretary |

---

Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed below by the following persons in the capacities indicated on October 17, 2025.

---

| | |
|:---|:---|
| <u>Signature</u> | <u>Title</u> |
| \*/s/ John L. Jacobs | Trustee |
| John L. Jacobs |  |
| \*/s/ Koji Felton | Trustee |
| Koji Felton |  |
| \*/s/ Pamela H. Conroy | Trustee and Chairperson |
| Pamela H. Conroy |  |
| \*/s/ Kacie G. Briody | President and Principal Executive Officer |
| Kacie G. Briody |  |
| \*/s/ Travis G. Babich | Treasurer and Principal Financial Officer |
| Travis G. Babich |  |
| \*By: *<u>/s/ Chad Fickett</u>*<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Chad Fickett, Attorney-in-Fact<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pursuant to <u>[Power of Attorney](https://www.sec.gov/Archives/edgar/data/1683471/000089418925002115/lifpowerofattorney3525.htm)</u> | \*By: *<u>/s/ Chad Fickett</u>*<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Chad Fickett, Attorney-in-Fact<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pursuant to <u>[Power of Attorney](https://www.sec.gov/Archives/edgar/data/1683471/000089418925002115/lifpowerofattorney3525.htm)</u> |

---

------

**INDEX TO EXHIBITS**

---

| | |
|:---|:---|
| **Exhibit**<br>**Number** | <br>**Description** |
| (d)(i)(B) | <u>[Amended Schedule A to the Investment Advisory Agreement](coreamendscheduleatoinvadv.htm)</u> |
| (e)(ii) | <u>[Second Amendment to the ETF Distribution Agreement](coreamendtoliftetfdistagrmt.htm)</u> |
| (g)(ii) | <u>[Amended Exhibit 5 to the Custody Agreement](exhibit5totheliftcustodyag.htm)</u> |
| (h)(i)(B) | <u>[Amended Exhibit 5 to the Fund Servicing Agreement](exhibit5totheliftfundservi.htm)</u> |
| (i)(ii) | <u>[Opinion and Consent of Counsel](legalopinionoptimizedequity.htm)</u> |
| (j) | <u>[Consent of Independent Registered Public Accounting Firm](optimizedequityauditconsent.htm)</u> |
| (m)(ii) | <u>[Amended Appendix A to the Rule 12b-1 Plan](amendappendixatotherule12b.htm)</u> |

---

## Ex-99.(D)(I)(B)

**SCHEDULE A**

**to the**

**INVESTMENT ADVISORY AGREEMENT**

**Dated October 15, 2025 between**

**LISTED FUNDS TRUST**

**and**

**CORE ALTERNATIVE CAPITAL, LLC**

The Trust will pay to the Adviser, as compensation for the Adviser's services rendered, a fee computed daily at an annual rate based on the average daily net assets of the Fund in accordance with the following fee schedule:

---

| | |
|:---|:---|
| **<u>Fund</u>** | **<u>Rate</u>** |
| Core Alternative ETF | 1.05% |
| Optimized Equity Income ETF | 1% |

---

IN WITNESS WHEREOF, the parties hereto have caused this Schedule A to be signed on their behalf by their duly authorized officers as of October 15, 2025.

---

| | |
|:---|:---|
| **LISTED FUNDS TRUST** | **CORE ALTERNATIVE CAPITAL, LLC** |
| By: *<u>/s/ Chad Fickett</u>* | By: *<u>/s/ David Pursell</u>* |
| Name: Chad Fickett | Name: David Pursell |
| Title: Secretary | Title: Managing Partner |

---

## Ex-99.(E)(Ii)

**SECOND AMENDMENT TO**

**ETF DISTRIBUTION AGREEMENT**

This second amendment ("Amendment") to the ETF distribution agreement (the "Agreement") dated as of September 30, 2021, by and between Listed Funds Trust ("Trust") and Quasar Distributors, LLC (together with Trust, the "Parties") is effective as of October 15, 2025.

**WHEREAS**, the Parties desire to amend the Agreement to reflect an updated funds list; and

**WHEREAS**, Section 8(b) of the Agreement requires that all amendments and modifications to the Agreement be in writing and executed by the Parties.

**NOW THEREFORE**, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.Capitalized terms not otherwise defined herein shall have the meanings set forth in the Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.Exhibit A to the Agreement is hereby deleted in its entirety and replaced by Exhibit A attached hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.Except as expressly amended hereby, all of the provisions of the Agreement shall remain unamended and in full force and effect to the same extent as if fully set forth herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.This Amendment shall be governed by, and the provisions of this Amendment shall be construed and interpreted under and in accordance with, the laws of the State of Delaware.

**IN WITNESS WHEREOF**, the Parties have caused this Amendment to be executed in their names and on their behalf by and through their duly authorized officers.

---

| | |
|:---|:---|
| **LISTED FUNDS TRUST** | **QUASAR DISTRIBUTORS, LLC** |
| By: *<u>/s/ Kacie Briody</u>* | By: *<u>/s/ Teresa Cowan</u>* |
| Name: Kacie Briody, President | Name: Teresa Cowan, President |
| Date: October 15, 2025 | Date: October 16, 2025 |

---

------

**EXHIBIT A**

As of October 15, 2025

Core Alternative ETF

Optimized Equity Income ETF

Wahed FTSE USA Shariah ETF

Wahed Dow Jones Islamic World ETF

## Ex-99.(G)(Ii)

*Certain identified information has been excluded from the exhibit because it is both not material and the type that the Registrant treats as private or confidential.*

**AMENDMENT TO THE** 

**LISTED FUNDS TRUST CUSTODY AGREEMENT**

&nbsp;&nbsp;&nbsp;&nbsp;**THIS AMENDMENT** to the Custody Agreement, dated as of April 25, 2019 (the "Agreement"), is entered into as of the last date on the signature block, by and between **LISTED FUNDS TRUST**, a Delaware statutory trust (the "Trust"), and **U.S. BANK NATIONAL ASSOCIATION,** a national banking association (the "Custodian").

**RECITALS**

&nbsp;&nbsp;&nbsp;&nbsp;**WHEREAS,** the parties have entered into the Agreement; and

**&nbsp;&nbsp;&nbsp;&nbsp;WHEREAS,** the parties desire to amend the Agreement to add the Optimized Equity Income ETF.

**WHEREAS,** Article XV, Section 15.02 of the Agreement allows for its amendment by a written instrument executed by both parties.

**NOW, THEREFORE,** the parties agree to amend the Agreement by updating Exhibit 5:

**&nbsp;&nbsp;&nbsp;&nbsp;** 

**Exhibit 5 is hereby superseded and replaced in its entirety with Exhibit 5 attached hereto.** 

This amendment will become effective upon the commencement of operations of the Optimized Equity Income ETF. Except to the extent amended hereby, the Agreement shall remain in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;**IN WITNESS WHEREOF**, the parties hereto have caused this Amendment to be executed by a duly authorized officer on one or more counterparts as of the date and year written below.

---

| | | | |
|:---|:---|:---|:---|
| **LISTED FUNDS TRUST** | **LISTED FUNDS TRUST** | **U.S. BANK NATIONAL ASSOCIATION** | **U.S. BANK NATIONAL ASSOCIATION** |
| By: | */s/ Kacie Briody* | By: | */s/ Greg Farley* |
| Name: | Kacie Briody | Name: | Greg Farley |
| Title: | President | Title: | Senior Vice President |
| Date: | 10/09/25 1:42:07 PDT | Date: | 10/10/2025 |

---

------

**<u>EXHIBIT 5</u>**

**to the Listed Funds Trust Custody Agreement**

**List of Funds and Fee Schedule** 

**Name of Series&nbsp;&nbsp;&nbsp;&nbsp;**&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**Optimized Equity Income ETF**

**Base Fee for Domestic Custody Services**

**The following reflects the greater of the basis point fee or annual minimum**<sup>1</sup> **where Core Alternative Capital acts as investment adviser to the fund in the Listed Funds Trust.**

**<u>Annual Minimum per Fund</u>**<sup>2</sup>**<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basis Points on Trust AUM</u>**<sup>2</sup>

All Funds $[ ]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;First $[ ] [ ] bp

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Balance [ ] bp

<sup>1</sup> Each fund, regardless of asset size, will have fees allocated to it equal to the per fund minimum. Should the complex level basis point fee calculation exceed the complex level minimum fee level calculation, the fees in excess of the minimum will be allocated to each fund based on the percent on AUM.

Once a Fund is operational, should "The Adviser" terminate this service agreement with U.S. Bank, N.A.prior to the end of the initial contract period, "The Adviser" will be responsible for the balance of the minimum fees for the remainder of the service agreement's 12-month period beginning with the Fund's launch or any anniversary of launch. To avoid doubt, if "The Adviser" launched a Fund on March 1, 2019 and terminated the relationship on June 30, 2020, "The Adviser" would owe U.S. Bank up to 50% of $[ ] ($[ ] admin/acct/ta + $[ ] Custody + $[ ] distributor)

Additional services not included above shall be mutually agreed upon at the time of the service being added. In addition to the fees described above, additional fees may be charged to the extent that changes to applicable laws, rules or regulations require additional work or expenses related to services provided (*e.g*., compliance with new liquidity risk management and reporting requirements).

<sup>2</sup> Subject to annual CPI increase: All Urban Consumers – U.S. City Average

Fees are calculated pro rata and billed monthly

**Adviser's signature on this Exhibit 5 is not needed. Adviser signed and acknowledged the fee schedule listed on Exhibit 5 on September 24, 2019.**

------

**EXHIBIT 5 (continued) to the Listed Funds Trust Custody Agreement**

**Domestic Custody Services in addition to the Base Fee**

**Portfolio Transaction Fees**<sup>2</sup>

$[ ] – Book entry DTC transaction, Federal Reserve transaction, principal paydown

$[ ] – Repurchase agreement, reverse repurchase agreement, time deposit/CD or other non-depository transaction

$[ ] – Option/SWAPS/future contract written, exercised or expired

$[ ] – Mutual fund trade, Margin Variation Wire and outbound Fed wire

$[ ] – Physical security transaction

$[ ] – Check disbursement (waived if U.S. Bank is Administrator)

A transaction is a purchase/sale of a security, free receipt/free delivery, maturity, tender or exchange.

**Securities Lending and Money Market Deposit Account (MMDA)**

*Miscellaneous Expenses* 

All other miscellaneous fees and expenses, including but not limited to the following, will be separately billed as incurred: expenses incurred in the safekeeping, delivery and receipt of securities, shipping, transfer fees, deposit withdrawals at custodian (DWAC) fees, SWIFT charges, negative interest charges and extraordinary expenses based upon complexity.

*Additional Services*

Additional fees apply for global servicing. Fund of Fund expenses quoted separately.

$[ ] per custody sub – account per year (e.g., per sub –adviser, segregated account, etc.)

Class Action Services – $[ ] filing fee per class action per account, plus 3% of gross proceeds, up to a maximum per recovery not to exceed $[ ]

No charge for the initial conversion free receipt.

Overdrafts – charged to the account at prime interest rate plus [ ]%, unless a line of credit is in place

Fees are calculated pro rata and billed monthly

Additional services not included above shall be mutually agreed upon at the time of the service being added. In addition to the fees described above, additional fees may be charged to the extent that changes to applicable laws, rules or regulations require additional work or expenses related to services provided (e.g., compliance with new liquidity risk management and reporting requirements).

<sup>2</sup> "Sponsor trades" are defined as any trades put through the Portfolio, on behalf of the Fund by any portfolio manager/sub advisor and their affiliates authorized by the BOT to act on behalf of the Fund, outside of the create/redeem process. Cash-in-Lieu proceeds received as part of the create/redeem process, and their related transactions are <u>not</u> considered to be "Sponsor trades.

------

**EXHIBIT 5 (continued) to the Listed Funds Trust Custody Agreement**

**Additional Global Sub-Custodial Services Annual Fee Schedule**

**Base Fee**

A monthly base fee per fund will apply when foreign securities are held. If no global assets are held within a given month, the monthly base charge will not apply for that month.

$[ ] foreign securities

Euroclear Eurobonds only. Eurobonds are held in Euroclear at a standard rate, but other types of securities (including but not limited to equities, domestic market debt and mutual funds) will be subject to a surcharge. In addition, certain transactions that are delivered within Euroclear or from a Euroclear account to a third party depository or settlement system, will be subject to a surcharge.

For all other markets specified above, surcharges may apply if a security is held outside of the local market.

**Plus:**

**Global Custody Transaction Fees**<sup>1</sup>

Global Custody transaction fees associate with Sponsor Trades<sup>2</sup>. (See schedule below)

A transaction is defined as any purchase/sale, free receipt / free delivery, maturity, tender or exchange of a security.

**Global Safekeeping and Transaction Fees**

(See schedule below)

**Tax Reclamation Services** 

*Miscellaneous Expenses*

Tax reclaims that have been outstanding for more than 6 (six) months with the client will be charged $[ ] per claim.

Charges incurred by U.S. Bank, N.A. directly or through sub-custodians for account opening fees, local taxes, stamp duties or other local duties and assessments, stock exchange fees, foreign exchange transactions, postage and insurance for shipping, facsimile reporting, extraordinary telecommunications fees, proxy services and other shareholder communications, recurring administration fees, negative interest charges, overdraft charges or other expenses which are unique to a country in which the client or its clients is investing will be passed along as incurred.

A surcharge may be added to certain miscellaneous expenses listed herein to cover handling, servicing and other administrative costs associated with the activities giving rise to such expenses. Also, certain expenses are charged at a predetermined flat rate.

SWIFT reporting and message fees.

Fees are calculated pro rata and billed monthly

<sup>2</sup>"Sponsor trades" are defined as any trades put through the Portfolio, on behalf of the Fund by any portfolio manager/sub advisor and their affiliates authorized by the BOT to act on behalf of the Fund, outside of the create/redeem process. Cash-in-Lieu proceeds received as part of the create/redeem process, and their related transactions are <u>not</u> considered to be "Sponsor trades."

------

**Additional Global Sub-Custodial Services Annual Fee Schedule**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Country** | **Safekeeping (BPS)** | **Transaction fee** | **Country** | **Safekeeping (BPS)** | **Transaction fee** | **Country** | **Safekeeping (BPS)** | **Transaction fee** |
| Argentina | [ ] | $[ ] | Guinea Bissau | [ ] | $[ ] | Peru | [ ] | $[ ] |
| Australia | [ ] | $[ ] | Hong Kong | [ ] | $[ ] | Philippines | [ ] | $[ ] |
| Austria | [ ] | $[ ] | Hungary | [ ] | $[ ] | Poland | [ ] | $[ ] |
| Bahrain | [ ] | $[ ] | Iceland | [ ] | $[ ] | Portugal | [ ] | $[ ] |
| Bangladesh | [ ] | $[ ] | India | [ ] | $[ ] | Qatar | [ ] | $[ ] |
| Belgium | [ ] | $[ ] | Indonesia | [ ] | $[ ] | Romania | [ ] | $[ ] |
| &nbsp;&nbsp;Benin | [ ] | $[ ] | &nbsp;&nbsp;Ireland | [ ] | $[ ] | &nbsp;&nbsp;Russia | [ ] | $[ ] |
| Bermuda | [ ] | $[ ] | Israel | [ ] | $[ ] | Senegal | [ ] | $[ ] |
| Botswana | [ ] | $[ ] | Italy | [ ] | $[ ] | Serbia | [ ] | $[ ] |
| Brazil | [ ] | $[ ] | Ivory Coast | [ ] | $[ ] | Singapore | [ ] | $[ ] |
| Bulgaria | [ ] | $[ ] | Japan | [ ] | $[ ] | Slovak Republic | [ ] | $[ ] |
| &nbsp;&nbsp;Burkina Faso | [ ] | $[ ] | &nbsp;&nbsp;Jordan | [ ] | $[ ] | &nbsp;&nbsp;Slovenia | [ ] | $[ ] |
| Canada | [ ] | $[ ] | Kazakhstan | [ ] | $[ ] | South Africa | [ ] | $[ ] |
| &nbsp;&nbsp;Cayman Islands\* | [ ] | $[ ] | &nbsp;&nbsp;Kenya | [ ] | $[ ] | &nbsp;&nbsp;South Korea | [ ] | $[ ] |
| &nbsp;&nbsp;Channel Islands\* | [ ] | $[ ] | Kuwait | [ ] | $[ ] | &nbsp;&nbsp;Spain | [ ] | $[ ] |
| Chile | [ ] | $[ ] | Latvia | [ ] | $[ ] | Sri Lanka | [ ] | $[ ] |
| China (A Shares) | [ ] | $[ ] | Lithuania | [ ] | $[ ] | Swaziland | [ ] | $[ ] |
| China (B Shares) | [ ] | $[ ] | Luxembourg | [ ] | $[ ] | Sweden | [ ] | $[ ] |
| Colombia | [ ] | $[ ] | Malaysia | [ ] | $[ ] | Switzerland | [ ] | $[ ] |
| Costa Rica | [ ] | $[ ] | &nbsp;&nbsp;Mali | [ ] | $[ ] | Taiwan | [ ] | $[ ] |
| Croatia | [ ] | $[ ] | Malta | [ ] | $[ ] | Thailand | [ ] | $[ ] |
| Cyprus | [ ] | $[ ] | Mauritius | [ ] | $[ ] | Togo | [ ] | $[ ] |
| Czech Republic | [ ] | $[ ] | Mexico | [ ] | $[ ] | Tunisia | [ ] | $[ ] |
| Denmark | [ ] | $[ ] | Morocco | [ ] | $[ ] | Turkey | [ ] | $[ ] |
| Egypt | [ ] | $[ ] | Namibia | [ ] | $[ ] | UAE | [ ] | $[ ] |
| Estonia | [ ] | $[ ] | Netherlands | [ ] | $[ ] | United Kingdom | [ ] | $[ ] |
| Euromarkets\* | [ ] | $[ ] | New Zealand | [ ] | $[ ] | United States | [ ] | $[ ] |
| Finland | [ ] | $[ ] | Niger | [ ] | $[ ] | Ukraine | [ ] | $[ ] |
| France | [ ] | $[ ] | Nigeria | [ ] | $[ ] | Uruguay | [ ] | $[ ] |
| Germany | [ ] | $[ ] | Norway | [ ] | $[ ] | Vietnam | [ ] | $[ ] |
| Ghana | [ ] | $[ ] | Oman | [ ] | $[ ] | Zambia | [ ] | $[ ] |
| Greece | [ ] | $[ ] | Pakistan | [ ] | $[ ] | Zimbabwe | [ ] | $[ ] |

---

Safekeeping and transaction fees are assessed on security and currency transactions

\* Additional customer documentation and indemnification will be required prior to establishing accounts in these markets.

\*\* Tiered by market value ≥$[ ] [ ]bp, ≥$[ ] and ≤$[ ] [ ]bps; ≥$[ ] [ ]bps.

\*\* Euromarkets - non-Eurobonds: Surcharges vary by local market.

---

| | |
|:---|:---|
| **LISTED FUNDS TRUST** | **LISTED FUNDS TRUST** |
| By: | */s/ Kacie Briody* |
| Name: | Kacie Briody |
| Title: | President |
| Date: | 10/09/25 1:42:07 |

---

## Ex-99.(H)(I)(B)

*Certain identified information has been excluded from the exhibit because it is both not material and the type that the Registrant treats as private or confidential.*

**AMENDMENT TO THE** 

**LISTED FUNDS TRUST** 

**FUND SERVICING AGREEMENT**

&nbsp;&nbsp;&nbsp;&nbsp;**THIS AMENDMENT** to the Fund Servicing Agreement, dated as of April 25, 2019, (the "Agreement"), is entered into as of the last date on the signature block, by and between **LISTED FUNDS TRUST**, a Delaware statutory trust (the "Trust"), and **U.S. BANCORP FUND SERVICES, LLC d/b/a U.S. BANK GLOBAL FUND SERVICES**, a Wisconsin limited liability company ("Fund Services").

**RECITALS**

**WHEREAS,** the parties have entered into the Agreement; and

**WHEREAS,** the parties desire to amend the Agreement to add the Optimized Equity Income ETF.

**WHEREAS,** Section 13 of the Agreement allows for its amendment by a written instrument executed by both parties.

**NOW, THEREFORE,** the parties agree to amend the Agreement by updating Exhibit 5:

**&nbsp;&nbsp;&nbsp;&nbsp;** 

**&nbsp;&nbsp;&nbsp;&nbsp;Exhibit 5 is hereby superseded and replaced in its entirety with Exhibit 5 attached hereto.** 

This amendment will become effective upon the commencement of operations of the Optimized Equity Income ETF. Except to the extent amended hereby, the Agreement shall remain in full force and effect.

**IN WITNESS WHEREOF**, the parties hereto have caused this Amendment to be executed by a duly authorized officer on one or more counterparts as of the date and year last written below.

---

| | | | |
|:---|:---|:---|:---|
| **LISTED FUNDS TRUST** | **LISTED FUNDS TRUST** | **U.S. BANCORP FUND SERVICES, LLC** | **U.S. BANCORP FUND SERVICES, LLC** |
| By: | */s/ Kacie Briody* | By: | */s/ Greg Farley* |
| Name: | Kacie Briody | Name: | Greg Farley |
| Title: | President | Title: | Senior Vice President |
| Date: | 10/09/25 1:52:20 PDT | Date: | 10/10/2025 |

---

------

**Exhibit 5**

**to the Listed Funds Trust Fund Servicing Agreement**

**List of Funds and Fee Schedule** 

<u>Name of Series</u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

**Optimized Equity Income ETF**

**Base Fee for Accounting, Administration, Transfer Agent & Account Services**

The following reflects the greater of the basis point fee or annual minimum1 where Core Alternative Capital

acts as Adviser to the fund in the Listed Funds Trust

---

| | | | |
|:---|:---|:---|:---|
| Annual Minimum per Fund<sup>2</sup> | Annual Minimum per Fund<sup>2</sup> | Basis Points on Trust AUM<sup>2</sup> | Basis Points on Trust AUM<sup>2</sup> |
| Funds 1-5 | $[ ] | First $[ ] | [ ] bps |
| Funds 6-10 | $[ ] | Next $[ ] | [ ] bps |
| Funds 11-15 | $[ ] | Balance | [ ] bps |
| Funds 16+ | $[ ] |  |  |

---

<sup>1</sup>Each fund, regardless of asset size, will have fees allocated to it equal to the per fund minimum. Should the complex level basis

point fee calculation exceed the complex level minimum fee level calculation, the fees in excess of the minimum will be allocated to

each fund based on the percent on AUM.

Once a Fund is operational, should "The Adviser" terminate this service agreement with U.S. Bank, N.A. prior to the end of the initial

contract period, "The Adviser" will be responsible for the balance of the minimum fees for the remainder of the service agreement's

12-month period beginning with the Fund's launch or any anniversary of launch. To avoid doubt, if "The Adviser" launched a Fund

on March 1, 2019 and terminated the relationship on June 30, 2020, "The Adviser" would owe U.S. Bank up to 50% of

$[...] ($[...] admin/acct/ta + $[...] Custody + $[...] distributor)

Additional services not included above shall be mutually agreed upon at the time of the service being added. In addition to the fees

described above, additional fees may be charged to the extent that changes to applicable laws, rules or regulations require

additional work or expenses related to services provided (e.g., compliance with new liquidity risk management and reporting

requirements).

<sup>2</sup> Subject to annual CPI increase All Urban Consumers U.S. City Average.

Fees are calculated pro rata and billed monthly

**Adviser's signature on this Exhibit 5 is not needed. Adviser signed and acknowledged the fee schedule listed on Exhibit 5 on April 21, 2022.**

------

**Exhibit 5 (continued) to the Listed Funds Trust Fund Servicing Agreement**

**Accounting, Administration, Transfer Agent & Account Services** 

**(in addition to the Base Fee)**

**Pricing Services**

For daily pricing of each securities (estimated 252 pricing days annually)

$[ ] – Domestic Equities, Options, ADRs, Foreign Equities, Futures, Forwards, Currency Rates, Mutual Funds, ETFs, Total Return Swaps

$[ ] – Domestic Corporates, Domestic Convertibles, Domestic Governments, Domestic Agencies, Mortgage Backed, and Municipal Bonds

$[ ] – CMOs, Money Market Instruments, Foreign Corporates, Foreign Convertibles, Foreign Governments, Foreign Agencies, Asset Backed, and High Yield

$[ ] – Interest Rate Swaps, Foreign Currency Swaps

$[ ] – Bank Loans

$[ ] – Swaptions, Intraday money market funds pricing, up to 3 times per day

$[ ] – Credit Default Swaps

$[ ] per Month Manual Security Pricing (>25 per day)

NOTE: Prices are based on using U.S. Bank primary pricing service which may vary by security type and are subject to change. Use

of alternative and/or additional sources may result in additional fees. Pricing vendors may designate certain securities as hard to

value or as a non-standard security type, such as CLOs and CDOs, which may result in additional fees. All schedules subject to

change depending upon the use of unique security type requiring special pricing or accounting arrangements.

**Corporate Action Services**

Fee for ICE data used to monitor corporate actions

$[ ] per Foreign Equity Security per Month

$[ ] per Domestic Equity Security per Month

$[ ] per CMOs, Asset Backed, Mortgage Backed Security per Month

**Trust Chief Compliance Officer Annual Fee (subject to board approval)**

$[ ] fund 1

$[ ] funds 2-5

$[ ] funds 6+

$[ ] per sub-adviser

**Third Party Administrative Data Charges (descriptive data for analytics, reporting and compliance)**

$[ ] per security per month for fund administrative

**SEC Modernization Requirements**

Form N-PORT – $[ ] per year, per Fund

Form N-CEN – $[ ] per year, per Fund

**Section 15(c) Reporting**

&nbsp;&nbsp;&nbsp;&nbsp;$[ ] per fund per standard reporting package\*

\*Standard reporting packages for annual 15(c) meeting

-&nbsp;&nbsp;&nbsp;&nbsp;Expense reporting package: 2 peer comparison reports (adviser fee) and (net expense ratio w classes on one report) OR Full 15(c) report

-&nbsp;&nbsp;&nbsp;&nbsp;Performance reporting package: Peer Comparison Report

&nbsp;&nbsp;&nbsp;&nbsp;Additional 15c reporting is subject to additional charges

&nbsp;&nbsp;&nbsp;&nbsp;Standard data source – Morningstar; additional charges will apply for other data services

*Miscellaneous Expenses* 

All other miscellaneous fees and expenses, including but not limited to the following, will be separately billed as incurred: SWIFT

processing, customized reporting, third-party data provider costs (including GICS, MSCI, Lipper, etc.), postage, stationary,

programming, special reports, proxies, insurance, EDGAR/XBRL filing, retention of records, federal and state regulatory filing fees,

expenses related to and including travel to and from Board of Trustee meetings, third party auditing and legal expenses, wash sales

reporting (GainsKeeper), tax e-filing, PFIC monitoring, conversion expenses (if necessary), and travel related costs.

Additional services not included above shall be mutually agreed upon at the time of the service being added. In addition to the fees

described above, additional fees may be charged to the extent that changes to applicable laws, rules or regulations require

additional work or expenses related to services provided (e.g., compliance with new liquidity risk management and reporting

requirements).

Fees are calculated pro rata and billed monthly

------

**Exhibit 5 (continued) to the Listed Funds Trust Fund Servicing Agreement**

**OPTIONAL Supplemental Services for Fund Accounting, Fund Administration & Portfolio Compliance (provided by U.S. Bank upon client request)** 

**Daily Compliance Services** 

Base fee – $[ ] per fund per year

Setup – $[ ] per fund group

**Section 18 Daily Compliance Testing (for derivatives and leverage)**

$[ ] set up fee per fund complex

$[ ] per fund per month

**C- Corp Administrative Services**

1940 Act C-Corp – U.S. Bank Fee Schedule plus $[ ]

1933 Act C-Corp – U.S. Bank Fee Schedule plus $[ ]

**Controlled Foreign Corporation (CFC)**

U.S. Bank Fee Schedule plus $[ ]

Fees are calculated pro rata and billed monthly

------

**Exhibit 5 (continued) to the Listed Funds Trust Fund Servicing Agreement**

**Fund Start-up & Registration Services Project Fee Schedule**

**Legal Administration Service Proposal In support of external legal counsel**

*(Subject to services provided; if applicable)*

$[ ] per project one fund

$[ ] per project two funds

$[ ] per project three funds

$[ ] per project four funds

Negotiated Fee five funds and above

Additional fee of $[ ] per sub-advisor for 2 or more sub-advisors

Note: External legal costs are included in the above fee, unless otherwise stated, for the first fund(s) launched by advisor. Additional

reviews by Trust counsel for extraordinary circumstances are billed at cost.

**Additional Legal Administration Services**

Subsequent new fund launch – $[ ] per fund or as negotiated

Drafting SEC exemptive order application for active and/or passively-managed ETF(s), multi-manager relief or other requested

relief.

Active Exemptive Relief $[ ]

Ongoing Annual Legal Administration Services

Add the following for legal administration services in support of external legal counsel, including annual registration statement

update and drafting of supplements

$[ ] first fund

$[ ] each additional fund up to 5 funds

Fees negotiated for funds 6+

All other miscellaneous fees and expenses, including but not limited to the following, will be separately billed as incurred:

Postage, if necessary

Federal and state regulatory filing fees

Expenses from Board of Trustee meetings

Third party auditing

EDGAR/XBRL filing

All other Miscellaneous expenses

Fund startup and registration services project fee is paid for by the advisor and not the Fund(s). This fee is not able to be recouped

by the advisor under the expense waiver limitation or similar agreement. Fund startup and registration fees are billed 50% following

the selection of U.S. Bank and 50% 75 days after the preliminary registration statement is filed with the SEC filings.

## Ex-99.(I)(Ii)

![image_0a.jpg](image_0a.jpg)<br>

October 17, 2025

Listed Funds Trust

615 East Michigan Street

Milwaukee, Wisconsin 53202

Re: Registration Statement on Form N-1A

Ladies and Gentlemen:

We have acted as counsel to Listed Funds Trust (the "Trust"), a Delaware statutory trust, in connection with Post-Effective Amendment No. 393 to the Trust's registration statement on Form N-1A to be filed with the U.S. Securities and Exchange Commission (the "Commission") on or about October 17, 2025 (the "Registration Statement"), with respect to the issuance of shares of beneficial interest with no par value per share (collectively, the "Shares") of the Trust's Optimized Equity Income ETF (the "Fund"). You have requested that we deliver this opinion to you in connection with the Trust's filing of the Registration Statement.

In connection with the furnishing of this opinion, we have examined the following documents:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A certificate of the Secretary of State of the State of Delaware (the "Delaware Secretary of State"), dated as of a recent date, as to the existence and good standing of the Trust;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) A copy, certified by the Delaware Secretary of State, of the Trust's Certificate of Trust and all amendments thereto, as filed with the Delaware Secretary of State (the "Certificate of Trust");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Copies of the Trust's Amended and Restated Declaration of Trust dated March 19, 2019 (the "Declaration of Trust"), the Trust's Amended and Restated Bylaws, as approved by the Board of Trustees (the "Board") on March 19, 2019 (the "Bylaws"), and resolutions approved by the Board authorizing the issuance of the Shares of the Fund (the "Resolutions"), each certified by an authorized officer of the Trust; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) A printer's proof of the Registration Statement.

In such examination, we have assumed the genuineness of all signatures, including electronic signatures, the conformity to the originals of all of the documents reviewed by us as copies, including conformed copies, the authenticity and completeness of all original documents reviewed by us in original or copy form, and the legal competence of each individual executing any document. We have assumed that the Registration Statement, as filed with the Commission, will be in substantially the form of the printer's proof referred to in paragraph (d) above. We also have assumed for the purposes of this opinion that, with respect to matters relating to the Shares, the Certificate of Trust, the Declaration of Trust, the Bylaws, and the Resolutions will not have been amended, modified, or withdrawn and will be in full force and effect on the date of the issuance of such Shares.

![mlbaddressa.jpg](mlbaddressa.jpg)

------

October 17, 2025

This opinion is based entirely on our review of the documents listed above and such other documents as we have deemed necessary or appropriate for the purposes of this opinion and such investigation of law as we have deemed necessary or appropriate. We have made no other review or investigation of any kind whatsoever, and we have assumed, without independent inquiry, the accuracy of the information set forth in such documents.

This opinion is limited solely to the Delaware Statutory Trust Act to the extent that the same may apply to or govern the transactions referred to herein, and we express no opinion with respect to the laws of any other jurisdiction or to any other laws of the State of Delaware. Further, we express no opinion as to any state or federal securities laws, including the securities laws of the State of Delaware. No opinion is given herein as to the choice of law or internal substantive rules of law that any tribunal may apply to such transactions. In addition, to the extent that the Declaration of Trust or the Bylaws refer to, incorporate, or require compliance with the Investment Company Act of 1940, as amended (the "1940 Act"), or any other law or regulation applicable to the Trust, except for the Delaware Statutory Trust Act, we have assumed compliance by the Trust with the 1940 Act and such other laws and regulations.

We understand that all of the foregoing assumptions and limitations are acceptable to you.

Based upon and subject to the foregoing, it is our opinion that the Shares, when issued and sold in accordance with the Declaration of Trust, Bylaws, Resolutions, and Registration Statement, will be validly issued, fully paid, and nonassessable by the Trust.

This opinion is given as of the date hereof and we assume no obligation to update this opinion to reflect any changes in law or any other facts or circumstances which may hereafter come to our attention. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of our name in the Registration Statement. In rendering this opinion and giving this consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Commission thereunder.

Very truly yours,

/s/ Morgan, Lewis & Bockius LLP

## Ex-99.(J)

![image_0b.jpg](image_0b.jpg)

**CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

We hereby consent to the references to our firm in this Registration Statement on Form N-1A of Optimized Equity Income ETF, a series of Listed Funds Trust, under the heading "Other Service Providers" in the Prospectus and "Independent Registered Public Accounting Firm" in the Statement of Additional Information.

![cohensignature.jpg](cohensignature.jpg)

COHEN & COMPANY, LTD.

Philadelphia, Pennsylvania

October 16, 2025

![image_1a.jpg](image_1a.jpg)

## Ex-99.(M)(Ii)

**<u>APPENDIX A</u>**

<u>Designated Funds</u>

Alexis Practical Tactical ETF

Core Alternative ETF

Dividend Performers ETF

Fortuna Hedged Bitcoin ETF

Horizon Kinetics Blockchain Development ETF

Horizon Kinetics Energy and Remediation ETF

Horizon Kinetics Inflation Beneficiaries ETF

Horizon Kinetics Medical ETF

Horizon Kinetics SPAC Active ETF

Horizon Kinetics Japan Owner Operator ETF

Optimized Equity Income ETF

Overlay Shares Core Bond ETF

Overlay Shares Foreign Equity ETF

Overlay Shares Hedged Large Cap Equity ETF

Overlay Shares Large Cap Equity ETF

Overlay Shares Municipal Bond ETF

Overlay Shares Short Term Bond ETF

Overlay Shares Small Cap Equity ETF

Preferred-Plus ETF

Roundhill Ball Metaverse ETF

Roundhill Cannabis ETF

Roundhill Magnificent Seven ETF

Roundhill S&P Global Luxury ETF

Roundhill Sports Betting & iGaming ETF

Roundhill Video Games ETF

Spear Alpha ETF

STF Tactical Growth ETF

STF Tactical Growth & Income ETF

Swan Hedged Equity US Large Cap ETF

Teucrium Agricultural Strategy No K-1 ETF

Teucrium No K-1 Corn ETF

Teucrium 2x Daily Corn ETF

Teucrium No K-1 Wheat ETF

Teucrium 2x Daily Wheat ETF

Teucrium No K-1 Sugar ETF

Teucrium 2x Daily Sugar ETF

Teucrium No K-1 Soybean ETF

Teucrium 2x Daily Soybean ETF

Yields for You Strategy A ETF

Yields for You Strategy B ETF

Relative Strength Managed Volatility Strategy ETF

------

Teucrium -1x Daily Corn ETF

Teucrium -2x Daily Corn ETF

Teucrium -1x Daily Wheat ETF

Teucrium -2x Daily Wheat ETF

Teucrium -1x Daily Sugar ETF

Teucrium -2x Daily Sugar ETF

Teucrium -1x Daily Soybean ETF

Teucrium -2x Daily Soybean ETF

Teucrium 2x Long OKLO Daily ETF

Teucrium 2x Short OKLO Daily ETF

Teucrium 2x Long SMR Daily ETF

Teucrium 2x Short SMR Daily ETF

GlacierShares NASDAQ Iceland ETF

Teucrium 2x Long Daily XRP ETF

Teucrium 2x Short Daily XRP ETF

GlacierShares Arctic Circle ETF

21Shares FTSE Crypto 10 ex-BTC Index ETF

21Shares FYTSE Crypto 10 Index ETF

21Shares Active Crypto ETF

21Shares 2x Long Dogecoin ETF

21Shares 2x Long Sui ETF

AlphaDroid<sup>®</sup> Broad Markets Momentum ETF

AlphaDroid<sup>®</sup> Defensive Sector Rotation ETF

Wahed Dow Jones Islamic World ETF

Wahed FTSE USA Shariah ETF

<br>