# EDGAR Filing Document

**Accession Number:** 0001506213
**File Stem:** 0001580642-26-002927
**Filing Date:** 2026-5
**Character Count:** 1062655
**Document Hash:** ed10703c1958b3acfbf1a1b2fda16623
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001580642-26-002927.hdr.sgml**: 20260505

**ACCESSION NUMBER**: 0001580642-26-002927

**CONFORMED SUBMISSION TYPE**: 485BPOS

**PUBLIC DOCUMENT COUNT**: 33

**FILED AS OF DATE**: 20260505

**DATE AS OF CHANGE**: 20260505

**EFFECTIVENESS DATE**: 20260506

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Strategy Shares
- **CENTRAL INDEX KEY:** 0001506213

**ORGANIZATION NAME:**
- **EIN:** 000000000
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 0430

**FILING VALUES:**
- **FORM TYPE:** 485BPOS
- **SEC ACT:** 1940 Act
- **SEC FILE NUMBER:** 811-22497
- **FILM NUMBER:** 26941466

**BUSINESS ADDRESS:**
- **STREET 1:** C/O MFUND SERVICES LLC
- **STREET 2:** 36 NORTH NEW YORK AVENUE
- **CITY:** HUNTINGTON
- **STATE:** NY
- **ZIP:** 11743
- **BUSINESS PHONE:** 855-477-3837

**MAIL ADDRESS:**
- **STREET 1:** C/O MFUND SERVICES LLC
- **STREET 2:** 36 NORTH NEW YORK AVENUE
- **CITY:** HUNTINGTON
- **STATE:** NY
- **ZIP:** 11743

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Huntington Strategy Shares
- **DATE OF NAME CHANGE:** 20101119
**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Strategy Shares
- **CENTRAL INDEX KEY:** 0001506213

**ORGANIZATION NAME:**
- **EIN:** 000000000
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 0430

**FILING VALUES:**
- **FORM TYPE:** 485BPOS
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 333-170750
- **FILM NUMBER:** 26941465

**BUSINESS ADDRESS:**
- **STREET 1:** C/O MFUND SERVICES LLC
- **STREET 2:** 36 NORTH NEW YORK AVENUE
- **CITY:** HUNTINGTON
- **STATE:** NY
- **ZIP:** 11743
- **BUSINESS PHONE:** 855-477-3837

**MAIL ADDRESS:**
- **STREET 1:** C/O MFUND SERVICES LLC
- **STREET 2:** 36 NORTH NEW YORK AVENUE
- **CITY:** HUNTINGTON
- **STATE:** NY
- **ZIP:** 11743

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Huntington Strategy Shares
- **DATE OF NAME CHANGE:** 20101119

## Series and Classes Contracts Data

### Strategy Shares Gold Enhanced Yield ETF (Series ID: S000070448)

| Class ID   | Class Name                              | Ticker Symbol   |
|:---|:---|:---|
| C000223943 | Strategy Shares Gold Enhanced Yield ETF | GOLY            |

?xml version='1.0' encoding='ASCII'?

As filed May 5, 2026 Securities Act Registration No. 333-170750 <br> Investment Company Act Registration No. 811-22497

**SECURITIES AND EXCHANGE COMMISSION** 

**Washington, DC 20549**

**FORM N-1A** 

**REGISTRATION STATEMENT**

---

| |
|:---|
| ***UNDER***<br> ***THE SECURITIES ACT OF 1933*** |
| **Pre-Effective Amendment No.** |
| **Post-Effective Amendment No. 158** |

---

**REGISTRATION STATEMENT** 

---

| |
|:---|
| ***UNDER*** |
| **THE INVESTMENT COMPANY ACT OF 1940** |
| **Amendment No. 161** |

---

**STRATEGY SHARES**

**(Exact name of Registrant as Specified in Charter)** 

**36 North New York Avenue**

**Huntington, NY 11743**

**(Address of Principal Executive Offices)** 

**1-631-629-4237** 

**(Registrant's Telephone Number)** 

**The Corporation Trust Company**

**Corporate Trust Center**

**1209 Orange Street**

**Wilmington, DE 19801**

**(Name and address of Agent for service)**

**(Notices should be sent to the Agent for Service)**

***Copies to:***

**Michael P. O'Hare**

**Stradley Ronon Stevens & Young LLP**

**2005 Market Street, Suite 2600**

**Philadelphia, PA 19103-7018** 

It is proposed that this filing will become effective:

□ immediately
upon filing pursuant to paragraph (b)

⌧ On May 6, 2026 pursuant to paragraph (b)

□ 60
days after filing pursuant to paragraph (a)(i)

□ on
(date) pursuant to paragraph (a)(i)

□ 75
days after filing pursuant to paragraph (a)(ii)

□ on <u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u> pursuant
to paragraph (a)(ii) of Rule 485

If appropriate, check the following box:

□ This
post-effective amendment designates a new effective date for a previously filed post-effective amendment.

![(STRATEGY SHARES LOGO)](st001_v1.jpg)

**May 6, 2026**

**PROSPECTUS**

**Strategy Shares Gold Enhanced Yield ETF**

**Cboe Ticker: GOLY**

This Prospectus provides important information about the Fund that you should know before investing. Please read it carefully and keep it for future reference.

Neither the Securities and Exchange Commission nor the Commodity Futures Trading Commission has approved or disapproved these securities or determined if this Prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
| FUND SUMMARY – STRATEGY SHARES GOLD ENHANCED YIELD ETF | 3 |
| ADDITIONAL INFORMATION ABOUT THE FUND'S PRINCIPAL INVESTMENT STRATEGIES AND RELATED RISKS | 15 |
| SHAREHOLDER INFORMATION | 38 |
| DISTRIBUTION OF THE FUND | 41 |
| MANAGEMENT OF THE FUND | 41 |
| DIVIDENDS AND DISTRIBUTIONS | 42 |
| TAX CONSEQUENCES | 43 |
| FINANCIAL HIGHLIGHTS | 45 |
| PREMIUM/DISCOUNT INFORMATION | 46 |

---

**FUND SUMMARY – STRATEGY SHARES GOLD ENHANCED YIELD ETF**

**Investment Objective:** 

The Fund's investment objective is to seek income and long-term capital appreciation.

**Fees and Expenses:** 

This table describes the fees and expenses that you may pay if you buy, hold, and sell shares of the Fund. **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.**

&nbsp;&nbsp;**Shareholder Fees<br> (fees paid directly from your investment)**

---

| | |
|:---|:---|
| &nbsp;&nbsp;**Annual Fund Operating Expenses<br> (expenses that you pay each year as a percentage of the value of your investment)** |  |
| &nbsp;&nbsp;Management Fee<sup>(1)</sup> | 0.79% |
| &nbsp;&nbsp;Distribution and/or Service Fee (12b-1) Fees | 0.00% |
| &nbsp;&nbsp;Other Expenses | 0.00% |
| &nbsp;&nbsp;Acquired Fund Fees and Expenses<sup>(2) (3)</sup> | 0.11% |
| &nbsp;&nbsp;Total Annual Fund Operating Expenses | 0.90% |

---

<sup>(1)</sup> The management fee is structured as a "unified fee," out of which the Fund's investment adviser, Rational Advisors, Inc. (the "Advisor"), pays all routine expenses of the Fund, except for the Fund's management fee; payments under any 12b-1 plan; taxes; brokerage commissions and trading costs; interest (including borrowing costs and overdraft charges); short sale dividends and interest expenses; acquired fund fees and expenses; and non-routine or extraordinary expenses of the Fund (such as litigation or reorganizational costs), each of which is paid by the Fund.

<sup>(2)</sup> Acquired Fund Fees and Expenses are the indirect costs of investing in other investment companies. The total annual fund operating expenses in this fee table will not correlate to the expense ratio in the Fund's financial highlights because the financial statements include only the direct operating expenses incurred by the Fund, not the indirect costs of investing in other investment companies.

<sup>(3)</sup> 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 or hold all of your shares at the end of those periods. This Example does not reflect the effect of brokerage commissions or other transaction costs you pay in connection with the purchase or sale of Fund shares. The Example also assumes that your investment has a 5% return each year and that the Fund's operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be:

---

| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;**<u>1 Year</u>** | &nbsp;&nbsp;**<u>3 Years</u>** | &nbsp;&nbsp;**<u>5 Years</u>** | &nbsp;&nbsp;**<u>10 Years</u>** |
| &nbsp;&nbsp;$92 | &nbsp;&nbsp;$287 | &nbsp;&nbsp;$498 | &nbsp;&nbsp;$1108 |

---

**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 Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the Example, affect the Fund's performance. For the fiscal year ended April 30, 2025, the Fund's portfolio turnover rate was 35% of the average value of its portfolio.

**Principal Investment Strategy**

The Fund seeks to achieve its investment objective through its exposure to:

● corporate bonds, U.S. treasury securities and corporate bond exchange traded funds ("ETFs") (the "Bond Component");

● gold futures contracts (the "Gold Component"); and

● commodity futures contracts and put options on commodity futures contracts that provide long and short economic exposure to energy and precious metals (including gold) commodities (the "Commodity Basket Component").

The Fund seeks to gain exposure to gold and other commodity futures contracts, and put options on gold and other commodity futures contracts, by investing directly or indirectly through total return swaps. Such investments will be made indirectly through the Fund's Subsidiary (as described below). The Subsidiary will also hold cash and cash equivalents, such as U.S. Treasury securities, as collateral for the Fund's futures, put options, and total return swap investments.

*Bond Component*

The Bond Component of the Fund's portfolio seeks returns to generate income by investing in U.S. dollar-denominated, domestic and foreign corporate bonds, U.S. Treasury securities, and/or corporate bond ETFs. Corporate bonds that the Bond Component may hold include "Rule 144A" securities, which are subject to resale restrictions. The corporate bonds selected for investment by the Fund have remaining time to maturity of at least 18 months, and are rated no lower than investment grade (at least BBB- / Baa3) by S&P Global Ratings, or the equivalent by another nationally recognized statistical rating organization at the time of investment. The Fund will sell any bonds in its portfolio that have been downgraded to below investment grade. The Fund may invest in U.S. Treasury securities without restriction as to time to maturity. The Advisor uses quantitative and qualitative screening processes to select bonds for investment by the Fund.

The Advisor's quantitative screen focuses on credit metrics, including total leverage ratio (total debt/earnings before interest, taxes, depreciation and amortization ("EBITDA")), EBITDA interest coverage ratio (EBITDA/interest expense), and cash ratio (cash and equivalents/current liabilities). The Advisor's qualitative review involves an analysis of company fundamentals, including business model, competitive advantages, cyclicality of the underlying industry, and addressable market opportunity. The Advisor generally sells bonds if it believes the bonds no longer offer favorable risk-adjusted return potential.

The corporate bond ETFs that the Fund may invest in are designed to provide broad exposure to U.S. dollar-denominated investment grade corporate bonds issued by domestic and foreign corporate issuers. The ETFs selected for investment by the Fund have an average duration of at least 18 months, and have investment mandates that focus on U.S. dollar-denominated investment grade corporate bonds that are rated no lower than investment grade (at least BBB- / Baa3) by S&P Global Ratings, or the equivalent by another nationally recognized statistical ratings organization.

*Gold Component*

The Gold Component seeks capital appreciation. The Component seeks to track the performance of the near month gold futures contracts listed on the Chicago Mercantile Exchange. A near month gold futures contract is the futures contract that is closest to expiration. As the futures contracts approach their expiration dates, they are replaced by distant month gold futures contracts that are similar contracts that have a later expiration. This process is referred to as "rolling." The Fund achieves exposure to the near month gold futures by investing directly in gold futures contracts or indirectly through investment in over-the-counter total return swaps. The process of rolling futures contracts may subject the Fund to additional costs based on the difference in price of expiring and next-month futures contracts. To the extent that the Fund obtains exposure to gold futures contracts through a total return swap, it does not roll futures contracts or incur roll costs directly. The return of the underlying gold futures contracts delivered through the swap reflects these price differences, which may affect the Fund's performance.

*Commodity Basket Component*

The Commodity Basket Component seeks the returns generated from the purchase and sale of futures contracts and the sale of put options on energy and precious metals (including gold) commodity futures contracts by investing directly in such commodity futures contracts or indirectly through total return swaps to gain exposure to such positions. While the Commodity Basket Component may invest without restriction in futures and put options on energy and precious metals commodity futures, the Advisor expects that the Commodity Basket Component will predominantly write put options on gold futures contracts. The objectives of the Commodity Basket Component are to: (i) obtain exposure to the futures contracts of the commodities that the Advisor believes are undervalued, and to sell-short, or obtain exposure to, the futures contracts of the commodities that the Advisor believes are overvalued; and (ii) generate additional returns by collecting option premiums through the sale of put options on commodity futures contracts. The put writing strategy performs well when commodity futures contract prices remain stable or increase, but incurs losses when commodity futures contract prices decline below the put option strike price.

It is expected that the Fund will have approximately 100% market value exposure to the Bond Component, 100% notional exposure to the Gold Component and between 10% and 100% notional exposure to the Commodity Basket Component. For example, if the Fund has $100 in assets, then the Fund expects to achieve $100 of market value exposure to the Bond Component (akin to having $100 gross and net exposure to fixed income securities), $100 of notional exposure to the Gold Component (akin to having $100 gross and net exposure to gold), and $10 to $100 of notional exposure to the Commodity Basket Component (akin to having up to $100 of gross and net exposure to a Fund which invests in a commodities strategy). Futures contracts and over-the-counter total return swaps do not require up-front payments equal to the notional exposure represented by such instruments, which enables the Fund to obtain approximately 100% notional exposure to the Gold Component and up to 100% notional exposure to the Commodity Basket Component. The amount of exposure to the Commodity Basket Component is determined at the Adviser's discretion based on conditions in the energy and precious metals markets. Because the Fund will achieve such notional exposure to each of the Gold Component and the Commodity Basket Component through leverage, the Fund could sustain significant losses.

The Fund is classified as "non-diversified" for purposes of the Investment Company Act of 1940, as amended (the "1940 Act"), which means a relatively high percentage of the Fund's assets may be invested in the securities of a limited number of issuers.

The Fund actively trades its portfolio investments, which may lead to higher transaction costs that may affect the Fund's performance.

<u>Investments in Subsidiary</u> – The Advisor executes a portion of the Fund's strategy by investing up to 25% of the Fund's total assets in a wholly owned and controlled subsidiary (the "Subsidiary"). The Subsidiary invests the majority of its assets in futures contracts, put options on futures contracts, and over-the-counter total return swaps. The Subsidiary is subject to the same investment restrictions as the Fund, when viewed on a consolidated basis. The Subsidiary is SSGBI Fund Limited, a Cayman Islands company. The Subsidiary is advised by the Advisor.

<u>Distribution Policy</u> – In order to allow shareholders of the Fund to realize a predictable, but not assured, level of cash flow, the Fund has adopted a policy (which may be modified at any time by its Board of Trustees) to pay monthly distributions on Fund shares at a specific target rate to be determined at the discretion of management. Shareholders receiving periodic payments from the Fund may be under the impression that they are receiving net profits. However, all or a portion of a distribution may consist of a return of capital. Return of capital is the portion of distribution that is a return of your original investment dollars in the Fund. Shareholders should not assume that the source of a distribution from the Fund is net profit. For more information about the Fund's distribution policy, please turn to "Additional Information About the Fund's Principal Investment Strategies and Related Risks – Principal Investment Strategies –Distribution Policy and Goals" section in the Fund's Prospectus.

**Principal Investment Risks**

As with any ETF, there is no guarantee that the Fund will achieve its objective. Investment markets are unpredictable and there will be certain market conditions where the Fund will not meet its investment objective and will lose money. The Fund's net asset value, market price and returns will vary and you could lose money on your investment in the Fund, and those losses could be significant. An investment in the Fund is not a bank deposit and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency, nor is it a complete investment program.

The following summarizes the principal risks of investing in the Fund. These risks could adversely affect the net asset value, market price, total return and value of the Fund and your investment.

**Active Trading Risk.** The Fund may trade securities actively, which could increase its transaction costs (thereby lowering its performance) and could increase the amount of taxes you owe by generating short-term gains, which may be taxed at a higher rate. Under certain market conditions, the Fund's turnover may be very high and considerably higher than that of other funds.

**Authorized Participant Risk.** The Fund has a limited number of financial institutions that may act as Authorized Participants. An "Authorized Participant" is a participant in the Continuous Net Settlement System of the National Securities Clearing Corporation or the Depository Trust Company ("DTC") and that has executed a Participant Agreement with the Fund's distributor ("Distributor"). To the extent these Authorized Participants exit the business or are unable to process creation and/or redemption orders, and no other Authorized Participant is able to step forward to process creation and/or redemption orders, in either of these cases, shares of the Fund may trade like closed-end fund shares at a discount to NAV, and possibly face delisting by the CBOE BZX Exchange (the "Exchange"). These risks could cause intra-day bid/ask spreads for the Fund's shares to widen.

**Cash and Cash Equivalents Risk**. At times, the Fund may have significant investments in cash or cash equivalents. When a substantial portion of a portfolio is held in cash or cash equivalents, there is the risk that the value of the cash account, including interest, will not keep pace with inflation, thus reducing purchasing power over time. Additionally, in rising markets, holding cash or cash equivalents may adversely affect the Fund's performance, and the Fund may not achieve its investment objective.

**Cash Transactions Risk**. ETFs generally are able to make in-kind redemptions and avoid being taxed on gains on the distributed portfolio securities at the Fund level. Because the Fund may effect redemptions partly or entirely in cash, rather than in-kind, it may be required to sell portfolio securities in order to obtain the cash needed to distribute redemption proceeds. If the Fund recognizes gain on these sales, this generally will cause the Fund to recognize gain it might not otherwise have recognized, or to recognize such gain sooner than would otherwise be required if it were to distribute portfolio securities in-kind. The Fund generally intends to distribute these gains to shareholders to avoid being taxed on this gain at the Fund level and otherwise comply with the special tax rules that apply to it. This strategy may cause shareholders to be subject to tax on gains they would not otherwise be subject to, or at an earlier date than if they had made an investment in a different ETF.

**Changing Fixed Income Market Conditions Risk.** Fluctuations in the federal funds rate and equivalent foreign interest rates could adversely affect the value of the Fund's investments in fixed-income securities. Such fluctuations may expose fixed-income and related markets to heightened volatility and may reduce liquidity for certain Fund investments, which could cause the value of the Fund's investments and share price to decline. It is difficult to predict the impact of interest rate changes on various markets. In periods of rising interest rates, the yield (income from a fixed-income security held by the Fund over a stated period of time) of a fixed-income security may tend to be lower than prevailing market rates, and in periods of declining interest rates, the yield of a fixed-income security may tend to be higher than prevailing market rates. The NAV of the Fund can generally be expected to change as general levels of interest rates fluctuate. The value of fixed-income securities in the Fund's portfolio generally varies inversely with changes in interest rates. Prices of fixed-income securities with longer effective maturities are more sensitive to interest rate changes than those with shorter effective maturities.

**Commodity Risk.** Exposure to the commodities markets may subject the Fund to greater volatility than investments in traditional securities. Commodity prices may be influenced by unfavorable weather, animal and plant disease, geologic and environmental factors, as well as changes in government regulation, such as tariffs, embargoes or burdensome production rules and restrictions. The Commodity Basket Component will invest in energy and industrial metals/precious metals commodities. Please see "Energy Sector Risk", "Industrial Metals Risk" and "Precious Metals Risk" below.

**Commodity Tax Risk.** The tax treatment of commodity-linked derivative instruments may be adversely affected by changes in legislation, regulations or other legally binding authority. If, as a result of any such adverse action, the income of the Fund from certain commodity-linked derivatives was treated as non-qualifying income, the Fund might fail to qualify as a regulated investment company and be subject to federal income tax at the Fund level, and all distributions from earnings and profits, including any distribution of net tax-exempt income and net long-term capital gains, would be taxable to Fund shareholders as ordinary income. Should the Internal Revenue Service issue further guidance, or Congress enact legislation, that adversely affects the tax treatment of the Subsidiary (which guidance might be applied to the Fund retroactively), it could, among other consequences, limit the Fund's ability to pursue its investment strategy.

**Counterparty Risk.** The Fund may engage in transactions in securities and financial instruments that involve counterparties. Counterparty risk is the risk that a counterparty (the other party to a transaction or an agreement, or the party with whom the Fund executes transactions) to a transaction with the Fund may be unable or unwilling to make timely principal, interest or settlement payments, or otherwise honor its obligations.

**Credit Risk**. Credit risk is the risk that an issuer of a security will fail to pay principal and interest in a timely manner, reducing the Fund's total return. There is a risk that issuers will not make payments on fixed income securities held by the Fund, resulting in losses to the Fund. In addition, the credit quality of fixed income securities held by the Fund may be lowered if an issuer's financial condition changes. The issuer of a fixed income security may also default on its obligations.

○ *Futures Risk.* Investments in futures contracts involve leverage, which means a small percentage of assets invested in futures contracts can have a disproportionately large impact on the Fund. This risk could cause the Fund to lose more than the principal amount invested. In addition, futures contracts may become mispriced or improperly valued relative to the Advisor's expectations and may not produce the desired investment results. Additionally, changes in the value of futures contracts may not track or correlate perfectly with the underlying reference asset because of temporary, or even long-term, supply and demand imbalances, and because futures contracts do not pay dividends.

Unlike equities, which typically entitle the holder to a continuing stake in a corporation, futures contracts normally specify a certain date for settlement in cash based on the reference asset. As the futures contracts approach expiration, they may be replaced by similar contracts that have a later expiration. This process is referred to as "rolling." The actual realization of a potential roll cost will be dependent upon the difference in price of the near and distant contract. Because the margin requirement for futures contracts is less than the value of the assets underlying the futures contract, futures trading involves a degree of leverage. As a result, a relatively small price movement in a futures contract may result in immediate and substantial loss to the Fund, which could significantly adversely affect the Fund's performance.

○ *Leverage and Volatility Risk.* Derivative contracts ordinarily have leverage inherent in their terms, meaning that the Fund can obtain significant investment exposure in return for meeting a relatively small margin or other investment requirement. The low margin deposits normally required in trading derivatives permit a high degree of leverage. Accordingly, a relatively small price movement may result in an immediate and substantial loss to the Fund, potentially in excess of the amounts invested or borrowed. The use of leverage may also cause the Fund to liquidate portfolio positions when it would not be advantageous to do so in order to satisfy its obligations or to meet collateral segregation requirements. The use of leveraged derivatives can magnify the Fund's potential for gain or loss and, therefore, amplify the effects of market volatility on the Fund's share price.

○ *Liquidity Risk*: It is possible that particular derivative investments might be difficult to purchase or sell, possibly preventing the Fund from executing positions at an advantageous time or price, or possibly requiring the Fund to dispose of other investments at unfavorable times or prices in order to satisfy its obligations.

○ *Options Market Risk*. Markets for options and options on futures contracts may not always operate on a fair and orderly basis. At times, prices for options and options on futures contracts may not represent fair market value and prices may be subject to manipulation, which may be extreme under some circumstances. The dysfunction and manipulation of volatility and options markets may make it difficult for a fund to effectively implement its investment strategy and achieve its objectives, and could potentially lead to significant losses.

○ *Options Risk*. There are risks associated with the Fund's exposure to options. As a seller (writer) of a put option, the Fund will lose money if the value of the underlying reference instrument falls below (written put option) the respective option's strike price. The Fund's losses are potentially large in a written put transaction.

○ *Over-the-Counter ("OTC") Trading Risk.* Certain of the derivatives in which the Fund may invest may be traded (and privately negotiated) in the OTC market. While the OTC derivatives market is the primary trading venue for many derivatives, it is largely unregulated. As a result, and similar to other privately negotiated contracts, the Fund is subject to counterparty credit risk with respect to such derivative contracts.

○ *Total Return Swap Risk* Total return swaps are subject to tracking risk because they may not be perfect substitutes for the instruments they are intended to replace. Total return over the counter swaps are subject to counterparty default. Leverage inherent in derivatives will tend to magnify the Fund's losses. The Fund's use of swaps involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments, and exposes the Fund to the risks associated with derivative instruments described above. In a standard "swap" transaction, two parties agree to exchange the returns, differentials in rates of return or some other amount earned or realized on the "notional amount" of predetermined investments or instruments, which may be adjusted for an interest factor. Certain derivatives risks are heightened with respect to over-the-counter ("OTC") derivative instruments, like certain swap agreements, and may be greater during volatile market conditions. Such risks include the risk of leverage (i.e., the risk that an adverse change in the value of the underlying asset could result in the Fund sustaining a loss that is substantially greater than the amount invested in the derivative or the anticipated value of the underlying asset), counterparty risk (i.e., the risk of a counterparty's unwillingness or inability to perform its obligations, including as a result of bankruptcy), credit risk, and pricing risk (i.e., swaps may be difficult to value).

**Distribution Policy Risk.** Shareholders receiving periodic payments from the Fund may be under the impression that they are receiving net profits. However, all or a portion of a distribution may consist of a return of capital (i.e., from your original investment). Shareholders should not assume that the source of a distribution from the Fund is net profit. Any capital returned to investors through distributions will be distributed after payment of Fund fees and expenses. Shareholders should note that return of capital will reduce the tax basis of their shares and potentially increase the taxable gain, if any, upon disposition of their shares. For more information, please refer to the section of the Fund's prospectus entitled "Tax Consequences".

**Duration Risk.** Longer-term fixed-income securities may be more sensitive to interest rate changes, particularly in periods of rising interest rates. Effective duration estimates price changes for relatively small changes in rates. If rates rise significantly, effective duration may tend to understate the drop in a security's price. If rates drop significantly, effective duration may tend to overstate the rise in a security's price.

**Energy Sector Risk.** The Fund's exposure to the energy sector will result in the performance of the Fund being relatively corelated to, and affected by, developments in the energy sector, such as the possibility that government regulation will negatively impact companies in this sector. Energy entities are subject to the risks specific, but not limited, to the following:

○ Fluctuations in commodity prices;

○ Reduced volumes of natural gas or other energy commodities available for transporting, processing, storing or distributing;

○ New construction risk and acquisition risk, which can limit potential growth;

○ A sustained reduced demand for crude oil, natural gas and refined petroleum products resulting from a recession or an increase in market price or higher taxes;

○ Depletion of the natural gas reserves or other commodities, if not replaced;

○ Changes in the regulatory environment;

○ Extreme weather;

○ Rising interest rates, which could result in a higher cost of capital and drive investors into other investment opportunities; and

○ Threats of attack by terrorists.

**ETF Risk.** Like a mutual fund, the value of an ETF can fluctuate based on the prices of the securities owned by the ETF. Because the Fund may invest its assets in ETFs that have their own fees and expenses in addition to those charged directly by the Fund, the Fund may bear higher expenses than a fund that invests directly in individual securities. By investing in other ETFs, the Fund will be subject to the risks associated with the underlying investments of such ETFs. ETFs are also subject to the risks described under "ETF Structures Risk."

**ETF Structure Risks**. The Fund is structured as an ETF and, as a result, is subject to special risks, including:

○ *Not Individually Redeemable*. Shares are not individually redeemable and may be redeemed by the Fund at NAV only in large blocks known as "Creation Units." Fund shares are typically bought and sold in the secondary market, and investors typically pay brokerage commissions or other charges on these transactions.

○ *Trading Issues*. Trading in Shares on the Exchange may be halted due to market conditions or for reasons that, in the view of the Exchange, make trading in Shares inadvisable, such as extraordinary market volatility. There can be no assurance that Shares will continue to meet the listing requirements of the Exchange. An active trading market for the Fund's shares may not be developed or maintained. If the Fund's shares are traded outside a collateralized settlement system, the number of financial institutions that can act as authorized participants that can post collateral on an agency basis is limited, which may limit the market for the Fund's shares.

○ *Market Price Variance Risk*. The market prices of Shares will fluctuate in response to changes in NAV and supply and demand for Shares, and will include a "bid-ask spread" charged by the exchange specialists, market makers or other participants that trade the particular security. There may be times when the market price and the NAV vary significantly. This means that Shares may trade at a discount to NAV and the intra-day bid/ask spreads may widen.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ In
times of market stress, market makers may step away from their role market making in shares of ETFs and in executing trades, which can
lead to differences between the market value of Fund shares and the Fund's NAV, which could cause the intra-day bid/ask spread
of the Fund to widen.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ The
market price for the Fund's shares may deviate from the Fund's net asset value, particularly during times of market stress,
with the result that investors may pay significantly more or significantly less for Fund shares than the Fund's NAV, which is reflected
in the bid and ask price for Fund shares or in the closing price.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ When
all or a portion of an ETF's underlying securities trade in a market that is closed when the market for the Fund's shares
is open, there may be changes from the last quote of the closed market and the quote from the Fund's domestic trading day, which
could lead to differences between the market value of the Fund's shares and the Fund's NAV, which could cause the intra-day
bid/ask spread of the Fund to widen.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ In
stressed market conditions, the market for the Fund's shares may become less liquid in response to the deteriorating liquidity
of the Fund's portfolio. This adverse effect on the liquidity of the Fund's shares may, in turn, lead to differences between
the market value of the Fund's shares and the Fund's NAV, which could cause the intra-day bid/ask spread of the Fund to widen.

**Financial Markets Regulatory Risk.** Policy changes by the U.S. government or its regulatory agencies and political events within the U.S. and abroad may, among other things, affect investor and consumer confidence and increase volatility in the financial markets, perhaps suddenly and to a significant degree, which may adversely impact the Fund's operations, universe of potential investment options, and return potential.

**Fixed Income Risk.** The value of the Fund's investments in fixed income securities will fluctuate with changes in interest rates. Typically, a rise in interest rates causes a decline in the value of fixed income securities owned by the Fund. In general, the market price of fixed income securities with longer maturities will increase or decrease more in response to changes in interest rates than shorter-term securities. Other risk factors include credit risk (the risk that the debtor may default), extension risk (the risk that an issuer may exercise its right to repay principal on a fixed rate obligation held by the Fund later than expected), and prepayment risk (the risk that the debtor may pay its obligation early, reducing the amount of interest payments). These risks could affect the value of a particular investment by the Fund, possibly causing the Fund's share price and total return to be reduced and fluctuate more than other types of investments.

**Foreign Investment Risk**. Investments in foreign securities tend to be more volatile and less liquid than investments in U.S. securities because, among other things, they involve risks relating to political, social, and economic developments abroad, including economic sanctions, as well as risks resulting from differences between the regulations and reporting standards and practices to which U.S. and foreign issuers are subject. Investing in foreign securities includes trading related risks (e.g., government supervision and regulation of foreign securities and currency markets, trading systems and brokers may be less than in the U.S., and foreign securities may be subject to foreign governmental restrictions, such as exchange controls).

**Gold Risk.** The price of gold may be affected by several factors, including the global gold supply and demand and investors' expectations with respect to the rate of inflation. Developments affecting the value of gold may have a significant impact on the Fund. Gold markets have been, and will likely continue to be, subject to sharp price fluctuations, which may lead to significant price fluctuations in the shares of the Fund. In addition, it is possible that a shareholder may not realize his or her investment objective because the gold markets have historically experienced extended periods of flat or declining prices, in addition to sharp fluctuations. There is no assurance that gold will maintain its long-term value in terms of purchasing power in the future.

**Income Risk.** The Fund's distributions to shareholders may decline when prevailing interest rates fall, when the Fund experiences deterioration of the underlying debt securities it holds, or when the Fund realizes a loss upon the sale of a debt security.

**Industrial Metals Risk.** Risks of investing in industrial metals sector commodities include, in addition to other risks, substantial price fluctuations over short periods of time, imposition of import controls, increased competition, government regulation, disruptions in mining, storing, and refining of metals, and changes in industrial, governmental and commercial demand for certain metals.

**Interest Rate Risk.** Interest rate risk is the risk that bond prices overall, including the prices of securities held by the Fund, will decline over short or long periods of time due to rising interest rates. Bonds with longer maturities tend to be more sensitive to interest rates than bonds with shorter maturities. The maturity and effective duration of the Fund's investment portfolio may vary materially, from time to time, and there is no assurance that the Fund will achieve or maintain any particular target maturity or effective duration of its investment portfolio.

**Investment Style Risk.** The type of securities in which the Fund focuses may underperform other assets, asset classes, and/or the overall market.

**Issuer Specific Risk.** The performance of the Fund depends on the performance of the issuers of the individual securities in which the Fund invests. Poor performance by any issuer may cause the value of its securities, and the value of the Fund's shares, to decline. The value of a specific security can be more volatile than the market as a whole, and can perform differently from the value of the market as a whole.

**Management Risk.** The Advisor may not successfully implement the Fund's investment strategies and, as a result, the Fund may not meet its investment objective.

**Market Risk.** The value of securities in the Fund's portfolio will fluctuate and, as a result, the Fund's NAV or market price per share may decline suddenly or over a sustained period of time. Factors such as domestic and foreign economic growth rates and market conditions, interest rate levels, trading and tariff events and political events may adversely affect the securities markets.

**Non-Diversification Risk.** To the extent that the Fund holds securities of a smaller number of issuers, or invests a larger percentage of its assets in a single issuer, than a diversified portfolio, the value of the Fund, as compared to the value of a diversified portfolio, will generally be more volatile and more sensitive to the performance of any one of those issuers, and to economic, political, market or regulatory events affecting any one of those issuers.

**Precious Metals Sector Risk.** Prices of precious metals and of precious metal related securities have historically been volatile. Economic, financial and political factors can cause periods of volatility. Because precious metals and other commodities do not generate investment income, the return on such investments will be derived solely from the appreciation or depreciation of such investments. Changes in the production and sale of precious metals by governments or central banks, or other large holders, can be unpredictable and may also have a significant impact on the prices of precious metals.

**Regulatory Risk.** Changes in the laws or regulations of the United States, Cayman Islands, or other countries, including any changes to applicable tax laws and regulations, could impair the ability of the Fund to achieve its investment objective, and could increase the operating expenses of the Fund. The Fund and the Subsidiary are "commodity pools" under the U.S. Commodity Exchange Act (the "CEA"), and the Advisor is a "commodity pool operator" registered with and regulated by the CFTC.

**Rule 144A Securities Risk.** The Fund may invest in securities that are normally purchased or resold pursuant to Rule 144A under the Securities Act of 1933 (the "Securities Act"). Rule 144A securities are restricted securities that are not publicly traded and may be subject to legal restrictions on resale. Rule 144A securities are generally not traded on established markets, and the market for such securities is typically less active than the market for publicly traded securities. As a result, Rule 144A securities may be illiquid, difficult to value and subject to wide fluctuations in value. Delay or difficulty in selling such securities may result in a loss to the Fund.

**U.S. Government Obligations Risk.** U.S. Treasury obligations are backed by the "full faith and credit" of the U.S. government and generally have negligible credit risk. However, due to fluctuations in interest rates, the market value of such securities may vary during the period shareholders own shares of the Fund. Securities issued or guaranteed by federal agencies or authorities and U.S. government-sponsored instrumentalities or enterprises may not be backed by the full faith and credit of the U.S. government, which could affect the Fund's ability to recover should they default.

**Volatility Risk.** The Fund may have investments that appreciate or decrease significantly in value over short periods of time. This may cause the Fund's net asset value and market price per share to experience significant increases or declines in value over short periods of time; however, all investments, long- or short-term, are subject to risk of loss.

**Wholly Owned Subsidiary Risk.** By investing in the Subsidiary, the Fund is indirectly exposed to the commodities risks associated with the Subsidiary's investments in commodity-related instruments. There can be no assurance that the Subsidiary's investments will contribute to the Fund's returns. The Subsidiary is not registered under the 1940 Act and is not subject to all the investor protections of the 1940 Act. Changes in the laws of the United States and/or the Cayman Islands could result in the inability of the Fund and/or the Subsidiary to operate as described in this Prospectus, and could adversely affect the Fund, such as by reducing the Fund's investment returns.

For more information, please see the section of the Fund's Prospectus entitled "Additional Information About the Funds' Principal Investment Strategies and Related Risks."

**Performance:**

The bar chart and accompanying table shown below provide an indication of the risks of investing in the Fund by showing the total return of its shares for each full calendar year, and by showing how its average annual returns compare over time with those of a broad-based market index, as well as an additional index. How the Fund has performed in the past (before and after taxes) is not necessarily an indication of how it will perform in the future. Updated performance information is available at no cost at www.strategysharesetfs.com or by calling (855) 4SS-ETFS or (855) 477-3837.

Prior to January 5, 2025, the Fund was a passively managed ETF and sought to track the performance of its underlying index, which was designed to provide broad exposure to gold and corporate bonds. Effective January 5, 2025, the Fund changed its investment strategy and its name to Strategy Shares Gold Enhanced Yield ETF (formerly, Strategy Shares Gold-Hedged Bond ETF). Performance information for periods prior to January 5, 2025, does not reflect the Fund's current investment strategy; consequently, such performance information may be less pertinent for investors considering whether to purchase shares of the Fund, as the Fund's performance may have been different if the Fund's portfolio was managed under the current investment objective, strategies, and policies.

**Annual Total Returns**

![(BAR CHAT)](st002_v1.jpg)

During the period shown in the bar chart, the highest return for a quarter was 17.97% (quarter ended December 31, 2023), and the lowest return for a quarter was (14.70)% (quarter ended June 30, 2022).

**Average Annual Total Returns (For fiscal year or period ended December 31, 2025)**

---

| | | |
|:---|:---|:---|
| | &nbsp;&nbsp;**1 Year** | &nbsp;&nbsp;**Since Inception (May 17, 2021)** |
| &nbsp;&nbsp;&nbsp;&nbsp;Return Before Taxes | &nbsp;&nbsp;57.44% | &nbsp;&nbsp;11.88% |
| &nbsp;&nbsp;&nbsp;&nbsp;Return After Taxes on Distributions | &nbsp;&nbsp;52.25% | &nbsp;&nbsp;10.11% |
| &nbsp;&nbsp;&nbsp;&nbsp;Return After Taxes on Distributions and Sale of Fund Shares | &nbsp;&nbsp;33.54% | &nbsp;&nbsp;8.43% |
| &nbsp;&nbsp;Bloomberg U.S. Aggregate Bond Index\* (reflects no deduction for fees, expenses or taxes) | &nbsp;&nbsp;7.30% | &nbsp;&nbsp;0.21% |
| &nbsp;&nbsp;Bloomberg U.S. Corporate TR Index\* (reflects no deduction for fees, expenses or taxes) | &nbsp;&nbsp;7.77% | &nbsp;&nbsp;0.70% |

---

\* The Fund has changed its primary benchmark from the Bloomberg U.S. Corporate TR Index to the Bloomberg U.S. Aggregate Bond Index to comply with new regulatory requirements.

After-tax returns are calculated using the highest historical individual federal marginal income tax rate and do not reflect the impact of state and local taxes. Actual after-tax returns depend on a shareholder's tax situation and may differ from those shown. After-tax returns are not relevant for shareholders who hold Fund shares in tax-advantaged accounts or to shares held by non-taxable entities.

**Advisor:** Rational Advisors, Inc. is the Fund's investment advisor.

**Portfolio Managers:** David Miller, Chief Investment Officer and Senior Portfolio Manager of the Advisor, and Charles Ashley, Portfolio Manager of the Advisor, serve as the Fund's Portfolio Managers and are jointly and primarily responsible for the day-to-day management of the Fund. Messrs. Miller and Ashley have served the Fund in this capacity since it commenced operations in May 2021.

**Purchase and Sale of Fund Shares:** You may purchase and sell individual Fund shares at market prices on the Exchange through your financial institution on each day that the Exchange is open for business ("Business Day"). Because individual Fund shares trade at market prices rather than at their NAV, shares may trade at a price greater than NAV (premium) or less than NAV (discount). You may incur costs attributable to the difference between the highest price a buyer is willing to pay to purchase shares of the Fund (bid), and the lowest price a seller is willing to accept for shares of the Fund (ask), when buying or selling shares in the secondary market (the "bid-ask spread").

Recent information, including information on the Fund's NAV, market price, premiums and discounts, and bid-ask spreads, is available online at www.strategysharesetfs.com.

**Tax Information**: The Fund's distributions are taxable as ordinary income or capital gains, except when your investment is through a tax-advantaged account, such as an Individual Retirement Account (IRA) or if you are a tax-exempt investor. Distributions from a tax-advantaged account may be taxed as ordinary income when withdrawn from such account.

**Payments to Broker-Dealers and Other Financial Intermediaries:** If you purchase the Fund through a broker-dealer or other financial intermediary (such as a bank), the Advisor and its related companies may pay the intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary's website for more information.

**ADDITIONAL INFORMATION ABOUT THE FUND'S PRINCIPAL INVESTMENT STRATEGIES AND RELATED RISKS**

**INVESTMENT OBJECTIVE**

The Fund's investment objective is to seek income and long-term capital appreciation. The investment objective of the Fund is non-fundamental and may be changed by the Board of Trustees without shareholder approval. If the Board decides to change the Fund's investment objective, shareholders will be given 60 days' advance written notice.

**PRINCIPAL INVESTMENT STRATEGIES**

The Fund seeks to achieve its investment objective through its exposure to:

● corporate bonds, U.S. treasury securities and corporate bond ETFs (the "Bond Component");

● gold futures contracts (the "Gold Component"); and

● commodity futures contracts and put options on commodity futures contracts that provide long and short economic exposure to energy and precious metals (including gold) commodities (the "Commodity Basket Component").

The Fund seeks to gain exposure to gold and other commodity futures contracts, and put options on gold and other commodity futures contracts, by investing directly or indirectly through total return swaps. Such investments will be made indirectly through the Fund's Subsidiary (as described below). The Subsidiary will also hold cash and cash equivalents, such as U.S. Treasury securities, as collateral for the Fund's futures, put options, and total return swap investments.

*Bond Component*

The Bond Component of the Fund's portfolio seeks returns to generate income by investing in U.S. dollar-denominated, domestic and foreign corporate bonds, U.S. Treasury securities, and/or corporate bond ETFs. Corporate bonds that the Bond Component may hold include "Rule 144A" securities, which are subject to resale restrictions. The corporate bonds selected for investment by the Fund have remaining time to maturity of at least 18 months, and are rated no lower than investment grade (at least BBB- / Baa3) by S&P Global Ratings, or the equivalent by another nationally recognized statistical rating organization at the time of investment. The Fund will sell any bonds in its portfolio that have been downgraded to below investment grade. The Fund may invest in U.S. Treasury securities without restriction as to time to maturity. The Advisor uses quantitative and qualitative screening processes to select bonds for investment by the Fund.

The Advisor's quantitative screen focuses on credit metrics, including total leverage ratio (total debt/EBITDA)), EBITDA interest coverage ratio (EBITDA/interest expense), and cash ratio (cash and equivalents/current liabilities). The Advisor's qualitative review involves an analysis of company fundamentals, including business model, competitive advantages, cyclicality of the underlying industry, and addressable market opportunity. The Advisor generally sells bonds if it believes the bonds no longer offer favorable risk-adjusted return potential.

The corporate bond ETFs that the Fund may invest in are designed to provide broad exposure to U.S. dollar-denominated investment grade corporate bonds issued by domestic and foreign corporate issuers. The ETFs selected for investment by the Fund have an average duration of at least 18 months, and have investment mandates that focus on U.S. dollar-denominated investment grade corporate bonds that are rated no lower than investment grade (at least BBB- / Baa3) by S&P Global Ratings, or the equivalent by another nationally recognized statistical ratings organization.

*Gold Component*

The Gold Component seeks capital appreciation. The Component seeks to track the performance of the near month gold futures contracts listed on the Chicago Mercantile Exchange. A near month gold futures contract is the futures contract that is closest to expiration. As the futures contracts approach their expiration dates, they are replaced by distant month gold futures contracts that are similar contracts that have a later expiration. This process is referred to as "rolling." The Fund achieves exposure to the near month gold futures by investing directly in gold futures contracts or indirectly through investment in over-the-counter total return swaps. The process of rolling futures contracts may subject the Fund to additional costs based on the difference in price of expiring and next-month futures contracts. To the extent that the Fund obtains exposure to gold futures contracts through a total return swap, it does not roll futures contracts or incur roll costs directly. The return of the underlying gold futures contracts delivered through the swap reflects these price differences, which may affect the Fund's performance.

*Commodity Basket Component*

The Commodity Basket Component seeks the returns generated from the purchase and sale of futures contracts and the sale of put options on energy and precious metals (including gold) commodity futures contracts by investing directly in such commodity futures contracts or indirectly through total return swaps to gain exposure to such positions. While the Commodity Basket Component may invest without restriction in futures contracts and put options on energy and precious metals commodity futures contracts, the Advisor expects that the Commodity Basket Component will predominantly write put options on gold futures contracts. The objectives of the Commodity Basket Component are to: (i) obtain exposure to the futures contracts of the commodities that the Advisor believes are undervalued, and to sell-short, or obtain exposure to, the futures contracts of the commodities that the Advisor believes are overvalued; and (ii) generate additional returns by collecting option premiums through the sale of put options on commodity futures contracts. The put writing strategy performs well when commodity futures contract prices remain stable or increase, but incurs losses when commodity futures contract prices decline below the put option strike price.

It is expected that the Fund will have approximately 100% market value exposure to the Bond Component, 100% notional exposure to the Gold Component and between 10% and 100% notional exposure to the Commodity Basket Component. For example, if the Fund has $100 in assets, then the Fund expects to achieve $100 of market value exposure to the Bond Component (akin to having $100 gross and net exposure to fixed income securities), $100 of notional exposure to the Gold Component (akin to having $100 gross and net exposure to gold), and $10 to $100 of notional exposure to the Commodity Basket Component (akin to having up to $100 of gross and net exposure to a Fund which invests in a commodities strategy). Futures contracts and over-the-counter total return swaps do not require up-front payments equal to the notional exposure represented by such instruments, which enables the Fund to obtain approximately 100% notional exposure to the Gold Component and up to 100% notional exposure to the Commodity Basket Component. The amount of exposure to the Commodity Basket Component is determined at the Adviser's discretion based on conditions in the energy and precious metals markets. Because the Fund will achieve such notional exposure to each of the Gold Component and the Commodity Basket Component through leverage, the Fund could sustain significant losses.

The Fund is classified as "non-diversified" for purposes of the 1940 Act, which means a relatively high percentage of the Fund's assets may be invested in the securities of a limited number of issuers.

The Fund actively trades its portfolio investments, which may lead to higher transaction costs that may affect the Fund's performance.

<u>Investments in Subsidiary</u> – The Advisor executes a portion of the Fund's strategy by investing up to 25% of the Fund's total assets in the Subsidiary. The Subsidiary invests the majority of its assets in futures contracts, put options on futures contracts, and over-the-counter total return swaps. The Subsidiary is subject to the same investment restrictions as the Fund, when viewed on a consolidated basis. The Subsidiary is SSGBI Fund Limited, a Cayman Islands company. The Subsidiary is advised by the Advisor.

<u>Distribution Policy and Goals</u> – In order to allow shareholders of the Fund to realize a predictable, but not assured, level of cash flow, the Fund has adopted a policy (which may be modified at any time by its Board of Trustees) to pay monthly distributions (including any return of capital) on Fund shares at a specific target rate to be determined at the discretion of management. All income will be distributed monthly, regardless of whether such income will be treated as return of capital. The Fund generally distributes to shareholders substantially all of its net income (for example, interest and dividends) monthly, as well as substantially all of its net capital gains (that is, long-term capital gains from the sale of portfolio securities and short-term capital gains from both the sale of portfolio securities and option premium earned) annually. In addition, pursuant to its distribution policy, the Fund may make distributions that are treated as a return of capital. Return of capital is the portion of a distribution that is the return of your original investment dollars in the Fund. A return of capital is not taxable to a shareholder unless it exceeds a shareholder's tax basis in the shares. Returns of capital reduce a shareholder's tax cost (or "tax basis"). Once a shareholder's tax basis is reduced to zero, any further return of capital would be taxable. Shareholders receiving periodic payments from the Fund may be under the impression that they are receiving net profits. However, all or a portion of a distribution may consist of a return of capital (i.e., from your original investment). Shareholders should not assume that the source of a distribution from the Fund is net profit. Shareholders should note that return of capital will reduce the tax basis of their shares and potentially increase the taxable gain, if any, upon disposition of their shares. As required under the 1940 Act, the Fund will provide a notice to shareholders at the time of distribution when such distribution does not consist solely of net income. Additionally, each distribution payment will be accompanied by a written statement which discloses the estimated source or sources of each distribution. The IRS requires you to report these amounts, excluding returns of capital, on your income tax return for the year declared. The Fund will provide disclosures, with each monthly distribution, that estimate the percentages of the current and year-to-date distributions that represent: (1) net investment income; (2) capital gains; and (3) return of capital. At the end of the year, the Fund may be required under applicable law to re-characterize distributions made previously during that year among: (1) ordinary income; (2) capital gains; and (3) return of capital for tax purposes. An additional distribution may be made in December, and other additional distributions may be made with respect to a particular fiscal year in order to comply with applicable law. Distributions declared in December, if paid to shareholders by the end of January, are treated for federal income tax purposes as if received in December.

**PRINCIPAL INVESTMENT RISKS**

All ETFs carry a certain amount of risk. As with any ETF, there is no guarantee that the Fund will achieve its objective. Investment markets are unpredictable and there will be certain market conditions where the Fund will not meet its investment objective and will lose money. The Fund's net asset value, market price and returns will vary and you could lose money on your investment in the Fund, and those losses could be significant. An investment in the Fund is not a bank account and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency, nor is it a complete investment program. These risks affect the Fund directly, as well as through the Underlying Funds in which it may invest.

The following summarizes the principal risks of investing in the Fund. These risks could adversely affect the net asset value, market price, total return and value of the Fund and your investment. The risk descriptions below provide a more detailed explanation of the principal investment risks that correspond to the risks described in the Fund Summary section of the Prospectus.

**Active Trading Risk.** Active trading will cause the Fund to have an increased portfolio turnover rate, which is likely to generate shorter-term gains for its shareholders, which are taxed at a higher rate than longer-term gains. Actively trading portfolio securities increases the Fund's trading costs and may have an adverse impact on the Fund's performance.

**Authorized Participant Risk.** The Fund has a limited number of financial institutions that may act as Authorized Participants. An "Authorized Participant" is a participant in the Continuous Net Settlement System of the National Securities Clearing Corporation or the Depository Trust Company ("DTC") and that has executed a Participant

Agreement with the Fund's distributor ("Distributor"). To the extent these Authorized Participants exit the business or are unable to process creation and/or redemption orders, and no other Authorized Participant is able to step forward to process creation and/or redemption orders, in either of these cases, shares of the Fund may trade like closed-end fund shares at a discount to NAV, and possibly face delisting by the exchange. These risks could cause intraday bid/ask spreads for Fund shares to widen.

**Cash and Cash Equivalents Risk.** At times, the Fund may have significant investments in cash or cash equivalents. When a substantial portion of a portfolio is held in cash or cash equivalents, there is the risk that the value of the cash account, including interest, will not keep pace with inflation, thus reducing purchasing power over time. Additionally, in rising markets, holding cash or cash equivalents may adversely affect the Fund's performance, and the Fund may not achieve its investment objective.

**Cash Transactions Risk.** ETFs generally are able to make in-kind redemptions and avoid being taxed on gains on the distributed portfolio securities at the Fund level. Because the Fund may effect redemptions partly or entirely in cash, rather than in-kind, it may be required to sell portfolio securities in order to obtain the cash needed to distribute redemption proceeds. If the Fund recognizes gain on these sales, this generally will cause the Fund to recognize gain it might not otherwise have recognized, or to recognize such gain sooner than would otherwise be required if it were to distribute portfolio securities in-kind. The Fund generally intends to distribute these gains to shareholders to avoid being taxed on this gain at the Fund level and otherwise comply with the special tax rules that apply to it. This strategy may cause shareholders to be subject to tax on gains they would not otherwise be subject to, or at an earlier date than, if they had made an investment in a different ETF. Moreover, cash transactions may have to be carried out over several days if the securities market is relatively illiquid, and may involve considerable brokerage fees and taxes. These brokerage fees and taxes, which will be higher than if the Fund sold and redeemed its shares principally in-kind, could be imposed on the Fund, and thus decrease the Fund's NAV to the extent they are not offset by the creation and redemption transaction fees paid by purchasers and redeemers of Creation Units.

**Changing Fixed Income Market Conditions Risk.** Fluctuations in the federal funds rate and equivalent foreign interest rates could adversely affect the value of the Fund's investments in fixed-income securities. Such fluctuations may expose fixed-income and related markets to heightened volatility and may reduce liquidity for certain Fund investments, which could cause the value of the Fund's investments and share price to decline. It is difficult to predict the impact of interest rate changes on various markets.

In periods of rising interest rates, the yield (income from a fixed-income security held by the Fund over a stated period of time) of a fixed-income security may tend to be lower than prevailing market rates, and in periods of declining interest rates, the yield of a fixed-income security may tend to be higher than prevailing market rates. In addition, when interest rates are rising, the inflow of net new money to the Fund will likely be invested in portfolio instruments producing higher yields than the balance of the Fund's portfolio, thereby increasing the yield of the Fund. In periods of declining interest rates, the opposite can be true. The NAV of the Fund can generally be expected to change as general levels of interest rates fluctuate. The value of fixed-income securities in the Fund's portfolio generally varies inversely with changes in interest rates. Prices of fixed-income securities with longer effective maturities are more sensitive to interest rate changes than those with shorter effective maturities. In addition, decreases in fixed-income dealer market-making capacity may also potentially lead to heightened volatility and reduced liquidity in the fixed-income markets. Changes in interest rate policies could also result in extraordinary redemptions by Authorized Participants, which could potentially increase the Fund's portfolio turnover rate and transaction costs.

Global economic conditions have caused, and may continue to cause, fixed income instruments to experience unusual liquidity issues, increased price volatility and, in some cases, credit downgrades and increased likelihood of default. These events have reduced the willingness and ability of some lenders to extend credit, and have made it more difficult for borrowers to obtain financing on attractive terms, if at all. As a result, the values of many types of securities have been reduced.

**Commodity Risk.** The Fund's exposure to the commodities markets may subject the Fund to greater volatility than investments in traditional securities. The value of commodity-linked derivative instruments may be affected by

changes in overall market movements, commodity index volatility, changes in interest rates, or sectors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs, and international economic, political and regulatory developments. The Commodity Basket Component will invest in energy and industrial metals/precious metals commodities. Please see "Energy Sector Risk", "Industrial Metals Risk" and "Precious Metals Risk" below.

**Commodity Tax Risk.** The tax treatment of commodity-linked derivative instruments may be adversely affected by changes in legislation, regulations or other legally binding authority. If, as a result of any such adverse action, the income of the Fund from certain commodity-linked derivatives was treated as non-qualifying income, the Fund might fail to qualify as a regulated investment company and be subject to federal income tax at the Fund level, and all distributions from earnings and profits, including any distribution of net tax-exempt income and net long-term capital gains, would be taxable to Fund shareholders as ordinary income. Should the Internal Revenue Service issue further guidance, or Congress enact legislation, that adversely affects the tax treatment of the Subsidiary (which guidance might be applied to the Fund retroactively), it could, among other consequences, limit the Fund's ability to pursue its investment strategy.

**Counterparty Risk.** The Fund may engage in transactions in securities and financial instruments that involve counterparties. Counterparty risk is the risk that a counterparty (the other party to a transaction or an agreement, or the party with whom the Fund executes transactions) to a transaction with the Fund may be unable or unwilling to make timely principal, interest or settlement payments, or otherwise honor its obligations, and therefore delays or impairs the Fund's ability to recover its deposits with such counterparty. To limit the counterparty risk associated with such transactions, the Fund conducts business only with financial institutions judged by the Advisor to present acceptable credit risk.

**Credit Risk**. Credit risk is the risk that an issuer of a security will fail to pay principal and interest in a timely manner, reducing the Fund's total return. In addition, the credit quality of fixed income securities held by the Fund may be lowered if an issuer's financial condition changes. The issuer of a fixed income security may also default on its obligations.

**Derivatives Risk.** The Fund may use derivatives, including futures contracts and swaps. The Fund's use of derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. These risks include (i) the risk that the counterparty to a derivative transaction may not fulfill its contractual obligations; (ii) the risk of mispricing or improper valuation; and (iii) the risk that changes in the value of the derivative may not correlate perfectly with the underlying reference asset. Derivatives may also be less tax efficient and subject to changing government regulation that could impact the Fund's ability to use certain derivatives or their cost. In addition, changes in government regulation of derivative instruments could affect the character, timing and amount of the Fund's taxable income or gains, and may limit or prevent the Fund from using certain types of derivative instruments as a part of its investment strategy, which could make the investment strategy more costly to implement, or require the Fund to change its investment strategy. When a derivative is used for hedging, the change in value of the derivative may also not correlate specifically with the risk of the underlying asset being hedged. Derivative prices are highly volatile and may fluctuate substantially during a short period of time. Such prices are influenced by numerous factors that affect the markets, including, but not limited to, changing supply and demand relationships; government programs and policies; national and international political and economic events; changes in interest rates; and inflation and deflation. Trading derivative instruments involves risks different from, or possibly greater than, the risks associated with investing directly in securities including:

○ *Futures Risk.* The Fund's use of futures contracts involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments, and exposes the Fund to the risks associated with derivative instruments described above. These risks include (i) leverage risk (ii) the risk of mispricing or improper valuation; and (iii) the risk that changes in the value of the futures contract may not correlate perfectly with the underlying reference asset. Investments in futures contracts involve leverage, which means a small percentage of assets invested in futures can have a disproportionately large

impact on the Fund. This risk could cause the Fund to lose more than the principal amount invested. In addition, futures contracts may become mispriced or improperly valued relative to the Advisor's expectations and may not produce the desired investment results. Additionally, changes in the value of futures contracts may not track or correlate perfectly with the underlying reference asset because of temporary, or even long-term, supply and demand imbalances. Most U.S. commodity futures exchanges impose daily limits regulating the maximum amount above or below the previous day's settlement price which a futures contract price may fluctuate during a single day. During a single trading day, no trades may be executed at prices beyond the daily limit. Once the price of a particular futures contract has increased or decreased to the limit point, it may be difficult, costly or impossible to liquidate a position. It is also possible that an exchange or the CFTC, which regulates commodity futures exchanges, may suspend trading in a particular contract, order immediate settlement of a contract, or order that trading be for liquidation of open positions only.

○ Unlike equities, which typically entitle the holder to a continuing stake in a corporation, futures contracts normally specify a certain date for settlement in cash based on the reference asset. As the futures contracts approach expiration, they may be replaced by similar contracts that have a later expiration. This process is referred to as "rolling." The actual realization of a potential roll cost will be dependent upon the difference in price of the near and distant contract. Because the margin requirement for futures contracts is less than the value of the assets underlying the futures contract, futures trading involves a degree of leverage. As a result, a relatively small price movement in a futures contract may result in immediate and substantial loss to the Fund, which could significantly adversely affect the Fund's performance.

○ *Leverage and Volatility Risk:* Derivative contracts ordinarily have leverage inherent in their terms, meaning that the Fund can obtain significant investment exposure in return for meeting a relatively small margin or other investment requirement. The low margin deposits normally required in trading derivatives permit a high degree of leverage. Accordingly, a relatively small price movement may result in an immediate and substantial loss to the Fund, potentially in excess of the amounts invested or borrowed. The use of leverage may also cause the Fund to liquidate portfolio positions when it would not be advantageous to do so in order to satisfy its obligations or to meet collateral segregation requirements. The use of leveraged derivatives can magnify the Fund's potential for gain or loss and, therefore, amplify the effects of market volatility on the Fund's share price.

○ *Liquidity Risk*: It is possible that particular derivative investments might be difficult to purchase or sell, possibly preventing the Fund from executing positions at an advantageous time or price, or possibly requiring the Fund to dispose of other investments at unfavorable times or prices in order to satisfy its obligations.

○ *Options Market Risk*. Markets for options and options on futures contracts may not always operate on a fair and orderly basis. At times, prices for options and options on futures contracts may not represent fair market value and prices may be subject to manipulation, which may be extreme under some circumstances. The dysfunction and manipulation of volatility and options markets may make it difficult for a fund to effectively implement its investment strategy and achieve its objectives, and could potentially lead to significant losses.

○ *Options Risk*. There are risks associated with the Fund's exposure to options. As a seller (writer) of a put option, the Fund will lose money if the value of the underlying reference instrument falls below (written put option) the respective option's strike price. The Fund's losses are potentially large in a written put transaction.

○ *Over-the-Counter ("OTC") Trading Risk.* Certain of the derivatives in which the Fund may invest may be traded (and privately negotiated) in the OTC market. While the OTC derivatives market is the primary trading venue for many derivatives, it is largely unregulated. As a result, and similar to other privately negotiated contracts, the Fund is subject to counterparty credit risk with respect to such derivative contracts.

○ *Total Return Swap Risk.* The Fund's use of total return swaps involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments, and exposes the Fund to the risks associated with derivative instruments described herein. Certain derivatives

risks are heightened with respect to over-the-counter ("OTC") derivative instruments, like certain swap agreements, and may be greater during volatile market conditions. Such risks include the risk of leverage (i.e., the risk that an adverse change in the value of the underlying asset could result in the Fund sustaining a loss that is substantially greater than the amount invested in the derivative or the anticipated value of the underlying asset), counterparty risk (i.e., the risk of a counterparty's unwillingness or inability to perform its obligations, including as a result of bankruptcy), credit risk, and pricing risk (i.e., swaps may be difficult to value). Other heightened risks include the inability to close out a swap position because the trading market becomes illiquid (particularly in the OTC markets), or the availability of counterparties becomes limited for a period of time. In addition, the presence of speculators in a particular market could lead to price distortions. To the extent that the Fund is unable to close out a position because of market illiquidity, the Fund may not be able to prevent further losses of value in its holdings, and the Fund's liquidity may be impaired.

**Distribution Policy Risk.** The Fund pays monthly distributions on Fund shares at a specific target rate to be determined at the discretion of Fund management. Shareholders receiving periodic payments from the Fund may be under the impression that they are receiving net profits. However, all or a portion of a distribution may consist of a return of capital. Return of capital is the portion of a distribution that is a return of your original investment dollars in the Fund. Shareholders should not assume that the source of a distribution from the Fund is net profit. Any capital returned to investors through distributions will be distributed after payment of Fund fees and expenses. Shareholders should note that return of capital will reduce the tax basis of their shares and potentially increase the taxable gain, if any, upon disposition of their shares. The Fund will provide disclosures, with each monthly distribution, that estimate the percentages of the current and year-to-date distributions that represent: (1) net investment income; (2) capital gains; and (3) return of capital. At the end of the year, the Fund may be required under applicable law to re-characterize distributions made previously during that year among: (1) ordinary income; (2) capital gains; and (3) return of capital for tax purposes. For more information, please refer to the section of this prospectus entitled "Tax Consequences."

**Duration Risk.** Longer-term fixed-income securities may be more sensitive to interest rate changes, particularly in periods of rising interest rates. Effective duration estimates price changes for relatively small changes in rates. If rates rise significantly, effective duration may tend to understate the drop in a security's price. If rates drop significantly, effective duration may tend to overstate the rise in a security's price. Duration should not be confused with maturity. The maturity of a fixed income security is a measure of the amount of time left until the security "matures" or repays its face value. In contrast, duration measures the price sensitivity of a fixed income security to changes in interest rates rather than the amount of time remaining to maturity. Longer duration tends to result in greater volatility and a greater sensitivity to interest rate changes. For example, a five-year duration means that the fixed income security will decrease in value by 5% if interest rates rise 1%, and increase in value by 5% if interest rates fall 1%.

**Energy Sector Risk.** The Fund's exposure to the energy sector will result in the performance of the Fund being relatively corelated to, and affected by, developments in the energy sector, such as the possibility that government regulation will negatively impact companies in this sector. Energy entities are subject to the risks specific, but not limited, to the following:

○ Fluctuations in commodity prices;

○ Reduced volumes of natural gas or other energy commodities available for transporting, processing, storing or distributing;

○ New construction risk and acquisition risk, which can limit potential growth;

○ A sustained reduced demand for crude oil, natural gas and refined petroleum products resulting from a recession or an increase in market price or higher taxes;

○ Depletion of the natural gas reserves or other commodities, if not replaced;

○ Changes in the regulatory environment;

○ Extreme weather;

○ Rising interest rates, which could result in a higher cost of capital and drive investors into other investment opportunities; and

○ Threats of attack by terrorists.

**ETF Risk.** Like a mutual fund, the value of an ETF can fluctuate based on the prices of the securities owned by the ETF. ETFs are also subject to the risks described under "ETF Structures Risk". The ETFs in which the Fund invests are subject to investment advisory and other expenses, which will be indirectly paid by the Fund. As a result, the cost of investing in the Fund will be higher than the cost of investing directly in the ETF, and may be higher than other funds that invest directly in bonds. By investing in other ETFs, the Fund will be subject to the risks associated with the underlying investments of such ETFs. In addition, when the Fund invests in ETFs, there is a risk that the investment advisers of those ETFs may make investment decisions that are detrimental to the performance of the Fund. Each ETF is subject to its own specific risks.

**ETF Structure Risk.** The Fund is structured as an ETF and, as a result, is subject to special risks, including:

○ *Not Individually Redeemable*. Shares are not individually redeemable and may be redeemed by the Fund at NAV only in large blocks known as "Creation Units." Fund shares are typically bought and sold in the secondary market, and investors typically pay brokerage commissions or other charges on these transactions.

○ *Trading Issues*. Trading in shares on the Exchange may be halted due to market conditions or for reasons that, in the view of the Exchange, make trading in shares inadvisable, such as extraordinary market volatility. There can be no assurance that shares will continue to meet the listing requirements of the Exchange. An active trading market for the Fund's shares may not be developed or maintained. If the Fund's shares are traded outside a collateralized settlement system, the number of financial institutions that can act as authorized participants that can post collateral on an agency basis is limited, which may limit the market for the Fund's shares.

○ *Market Price Variance Risk*. Individual shares of the Fund that are listed for trading on the Exchange can be bought and sold in the secondary market at market prices. The market prices of shares will fluctuate in response to changes in NAV and supply and demand for shares. There may be times when the market price and the NAV vary significantly, and you may pay more than NAV when buying shares on the secondary market, and you may receive less than NAV when you sell those shares. The market price of shares, like the price of any exchange-traded security, includes a "bid-ask spread" charged by the exchange specialists, market makers or other participants that trade the particular security. In times of severe market disruption, the bid-ask spread often increases significantly. This means that shares may trade 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 Fund's investment results are measured based upon the daily NAV of the Fund over a period of time. Investors purchasing and selling shares in the secondary market may not experience investment results consistent with those experienced by those creating and redeeming directly with the Fund.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ In
times of market stress, market makers may step away from their role market making in shares of ETFs and in executing trades, which may
result in a significantly diminished trading market for the Fund's shares and can lead to differences between the market value
of Fund shares and the Fund's NAV, and wider bid-ask spreads.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ The
market price for the Fund's shares may deviate from the Fund's net asset value, particularly during times of market stress,
with the result that investors may pay significantly more or significantly less for Fund shares than the Fund's net asset value,
which is reflected in the bid and ask price for Fund shares or in the closing price.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ When
all or a portion of an ETF's underlying securities trade in a market that is closed when the market for the Fund's shares
is open, there may be changes from the last quote of the closed market and the quote

from the Fund's domestic trading day, which could lead to differences between the market value of the Fund's shares and the Fund's NAV, which could cause the intra-day bid/ask spread of the Fund to widen.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ In
stressed market conditions, the market for the Fund's shares may become less liquid in response to the deteriorating liquidity
of the Fund's portfolio. This adverse effect on the liquidity of the Fund's shares may, in turn, lead to differences between
the market value of the Fund's shares and the Fund's NAV, which could cause the intra-day bid/ask spread of the Fund to widen.
Because bid-ask spreads vary over time based on trading volume and market liquidity (including for the underlying securities held by
the Fund), spreads may widen if the Fund's shares have little trading volume and market liquidity. Conversely, the bid-ask spreads
will generally be narrower if the Fund's shares have more trading volume and market liquidity.

**Financial Markets Regulatory Risk.** Policy changes by the U.S. government or its regulatory agencies and political events within the U.S. and abroad may, among other things, affect investor and consumer confidence and increase volatility in the financial markets, perhaps suddenly and to a significant degree, which may adversely impact the Fund's operations, universe of potential investment options, and return potential.

**Fixed Income Risk**. The value of the Fund's investments in fixed income securities will fluctuate with changes in interest rates. Typically, a rise in interest rates causes a decline in the value of fixed income securities owned by the Fund. In general, the market price of fixed income securities with longer maturities will increase or decrease more in response to changes in interest rates than shorter-term securities. Other risk factors include credit risk (the risk that the debtor may default), extension risk (the risk that an issuer may exercise its right to repay principal on a fixed rate obligation held by the Fund later than expected), and prepayment risk (the risk that the debtor may pay its obligation early, reducing the amount of interest payments). Lowered credit ratings may cause a drop in a fixed income security's price and are associated with greater risk of default on interest and principal payments. Certain fixed income securities may be paid off early when the issuer can repay the principal prior to a security's maturity. If interest rates are falling, the Fund may have to reinvest the unanticipated proceeds at lower interest rates, resulting in a decline in the Fund's income. If interest rates rise, repayments of principal on certain fixed income securities may occur at a slower rate than expected, and the expected maturity of those securities could lengthen as a result, which reduces the Fund's ability to reinvest at higher rates. These risks could affect the value of a particular investment by the Fund, possibly causing the Fund's share price and total return to be reduced and fluctuate more than other types of investments.

**Foreign Investment Risk.** To the extent the Fund invests in foreign securities, the Fund could be subject to greater risks because the Fund's performance may depend on issues other than the performance of a particular company or U.S. market sector. Changes in foreign economies and political climates are more likely to affect the Fund than they would a mutual fund that invests exclusively in U.S. companies. The value of foreign securities is also affected by the value of the local currency relative to the U.S. dollar. There may also be less government supervision of foreign markets, resulting in non-uniform accounting practices and less publicly available information. The values of foreign investments may be affected by changes in exchange control regulations, application of foreign tax laws (including withholding tax), changes in governmental administration or economic or monetary policy (in this country or abroad), or changed circumstances in dealings between nations. In addition, foreign brokerage commissions, custody fees and other costs of investing in foreign securities are generally higher than in the United States. Investments in foreign issuers could be affected by other factors not present in the United States, including expropriation, armed conflict, confiscatory taxation, and potential difficulties in enforcing contractual obligations. As a result, the Fund may be exposed to greater risk and will be more dependent on the Advisor's ability to assess such risk than if the Fund invested solely in more developed countries.

**Gold Risk.** Gold markets are subject to sharp price fluctuations, which may result in losses if you sell your shares at a time when the price of gold is lower than it was when you made your investment in the Fund. Gold markets also have experienced extended periods of flat or declining prices. As a result, you may never experience a profit. In addition, investors should be aware that there is no assurance that gold will maintain its long-term value in terms

of purchasing power in the future. In the event that the price of gold declines, the Fund may experience losses.

Several factors may affect the price of gold, including: (i) global or regional political, economic or financial events and situations; (ii) global gold supply and demand, which is influenced by such factors as forward selling by gold producers, purchases made by gold producers to unwind gold hedge positions, central bank purchases and sales, and production and cost levels in major gold-producing countries, such as South Africa, the United States and Australia; (iii) investors' expectations with respect to the rate of inflation; (iv) interest rates; (v) currency exchange rates; and (vi) investment and trading activities of hedge funds and commodity funds.

**Income Risk.** The Fund's distributions to shareholders may decline when prevailing interest rates fall, when the Fund experiences deterioration of the underlying debt securities it holds, or when the Fund realizes a loss upon the sale of a debt security.

**Interest Rate Risk**. Interest rate risk is the risk that bond prices overall, including the prices of securities held by the Fund, will decline over short or long periods of time due to rising interest rates. Bonds with longer maturities tend to be more sensitive to interest rates than bonds with shorter maturities. For example, if interest rates go up by 1.0%, the price of a 4% coupon bond will decrease by approximately 1.0% for a bond with 1 year to maturity, and approximately 4.4% for a bond with 5 years to maturity. The maturity and effective duration of the Fund's investment portfolio may vary materially, from time to time, and there is no assurance that the Fund will achieve or maintain any particular target maturity or effective duration of its investment portfolio.

**Investment Style Risk.** The particular type of investments in which the Fund focuses may underperform other assets, asset classes and/or the overall market. Individual market segments, such as the large-cap U.S. equity market segment, tends to go through cycles of performing better or worse than other types of securities. These periods may last as long as several years. Additionally, a particular market segment could fall out of favor with investors, causing the Fund that focuses on that market segment to underperform those that favor other kinds of securities.

**Issuer Specific Risk.** The performance of the Fund depends on the performance of the issuers of the individual securities in which the Fund invests. Poor performance by any issuer may cause the value of its securities, and the value of the Fund's shares, to decline. The value of a specific security can be more volatile than the market as a whole, and can perform differently from the value of the market as a whole. The value of certain types of securities can be more volatile due to increased sensitivity to adverse issuer, political, regulatory, market, or economic developments. Market prices of securities in broad market segments may be adversely affected by a prominent issuer having experienced losses, lack of earnings, failure to meet the market's expectations with respect to new products or services, or even by factors wholly unrelated to the value or condition of the issuer, such as changes in interest rates.

**Management Risk.** The Advisor may not successfully implement the Fund's investment strategies and, as a result, the Fund may not meet its investment objective.

**Market Risk.** Overall market risks may also affect the value of the Fund. The market values of securities or other investments owned by the Fund will go up or down, sometimes rapidly or unpredictably. Factors such as economic growth and market conditions, interest rate levels, exchange rates and political events affect the securities markets. Changes in market conditions and interest rates generally do not have the same impact on all types of securities and instruments. Unexpected local, regional or global events and their aftermath, such as war; acts of terrorism; financial, political or social disruptions; natural, environmental or man-made disasters; the spread of infectious illnesses or other public health issues; recessions and depressions; or other tragedies, catastrophes and events could have a significant impact on the Fund and its investments, and could result in increased premiums or discounts to the Fund's NAV, which could cause the intra-day bid/ask spread of the Fund to widen, and may impair market liquidity, thereby increasing liquidity risk. Such events can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions, and the market in general, in ways that cannot necessarily be foreseen. The Fund could lose money over short periods due to short-term market movements and over longer periods during more prolonged market downturns. During a general market downturn, multiple asset

classes may be negatively affected. In times of severe market disruptions you could lose your entire investment.

**Non-Diversification Risk.** To the extent that the Fund holds securities of a smaller number of issuers, or invests a larger percentage of its assets in a single issuer, than a diversified portfolio, the value of the Fund, as compared to the value of a diversified portfolio, will generally be more volatile and more sensitive to the performance of any one of those issuers, and to economic, political, market or regulatory events affecting any one of those issuers.

**Precious Metals Sector Risk.** Prices of precious metals and of precious metal related securities have historically been volatile. Economic, financial and political factors can cause periods of volatility. Because precious metals and other commodities do not generate investment income, the return on such investments will be derived solely from the appreciation or depreciation of such investments. Changes in the production and sale of precious metals by governments or central banks, or other large holders, can be unpredictable and may also have a significant impact on the prices of precious metals.

**Regulatory Risk**. Regulatory authorities in the United States or other countries may adopt rules that restrict the ability of the Fund to fully implement its strategy, either generally or with respect to certain securities, industries or countries, which may impact the Fund's ability to fully implement its investment strategies. Regulators may interpret rules differently than the Fund or the mutual fund industry generally, and disputes over such interpretations can increase legal expenses incurred by the Fund. The Fund is also subject to regulation as a commodity pool under the CEA. The Fund may incur additional expenses as a result of its registration and regulatory obligations, and certain investments may be limited or restricted.

**Rule 144A Securities Risk.** The Fund may invest in securities that are normally purchased or resold pursuant to Rule 144A under the Securities Act. Rule 144A securities are restricted securities that are not publicly traded and may be subject to legal restrictions on resale. Rule 144A securities are generally not traded on established markets, and the market for such securities is typically less active than the market for publicly-traded securities. As a result, Rule 144A securities may be illiquid, difficult to value and subject to wide fluctuations in value. Delay or difficulty in selling such securities may result in a loss to the Fund.

**U.S. Government Obligations Risk.** U.S. Treasury obligations are backed by the "full faith and credit" of the U.S. government and generally have negligible credit risk. However, due to fluctuations in interest rates, the market value of such securities may vary during the period shareholders own shares of the Fund. Securities issued or guaranteed by federal agencies or authorities and U.S. government-sponsored instrumentalities or enterprises may not be backed by the full faith and credit of the U.S. government, which could affect the Fund's ability to recover should they default. No assurance can be given that the U.S. government will provide financial support to its agencies and authorities if it is not obligated by law to do so.

**Volatility Risk.** The Fund may have investments that appreciate or decrease significantly in value over short periods of time. This may cause the Fund's net asset value and market price per share to experience significant increases or declines in value over short periods of time; however, all investments, long- or short-term, are subject to risk of loss.

**Wholly Owned Subsidiary Risk.** The Subsidiary will not be registered under the 1940 Act and, unless otherwise noted in this Prospectus, will not be subject to all of the investor protections of the 1940 Act. Changes in the laws of the United States and/or the Cayman Islands, under which the Fund and the Subsidiary, respectively, are organized, could result in the inability of the Fund and/or Subsidiary to operate as described in this Prospectus, and could negatively affect the Fund and its shareholders. The Fund and the Subsidiary are "commodity pools" under the CEA, and the Advisor is a "commodity pool operator" registered with and regulated by the CFTC with respect to the Fund. As a result, additional CFTC-mandated disclosure, reporting, and recordkeeping obligations apply with respect to the Fund and the Subsidiary, and subject each to CFTC penalties if reporting was found to be deficient.

**NON-PRINCIPAL INVESTMENT RISKS**

Descriptions of non-principal investment risks are set forth below. These risks could adversely affect the net asset value, total return and value of the Fund and your investment.

**American Depositary Receipts ("ADRs") Risk.** ADRs, which are typically issued by a bank, are certificates that evidence ownership of shares of a foreign company and are alternatives to purchasing foreign securities directly in their national markets and currencies. ADRs are subject to the same risks as direct investment in foreign companies and involve risks that are not found in investments in U.S. companies. In addition to the risks of investing in foreign securities discussed below, there is no guarantee that an ADR issuer will continue to offer a particular ADR. As a result, the Fund may have difficulty selling the ADR, or selling them quickly and efficiently at the prices at which they have been valued. In a sponsored ADR arrangement, the foreign company assumes the obligation to pay some or all of the depositary's transaction fees. Under an unsponsored ADR arrangement, the foreign company assumes no obligations, and the depositary's transaction fees are paid directly by the ADR holders. Because unsponsored ADR arrangements are organized independently and without the cooperation of the foreign company, available information concerning the foreign company may not be as current as for sponsored ADRs, and voting rights with respect to the deposited securities are not passed through. ADRs may not track the price of the underlying foreign securities on which they are based, and their value may change materially at times when U.S. markets are not open for trading. Certain ADRs are not listed on an exchange and therefore may be considered to be illiquid. Because ADRs are denominated in US dollars, they are also subject to currency risk, as movements in the exchange rate of the local currency of the foreign issuer versus the US dollar are automatically reflected in the price of the ADR in US dollars. Therefore, even if the price of the foreign security does not change on its local market, if the exchange rate of the local currency relative to the US dollar declines, the ADR price would decline by a similar measure.

**ADR Currency Risk.** To establish a value for the shares, the issuer establishes a "conversion rate" equal to one share of an ADR for a certain number of shares of the stock of a foreign company. This "conversion rate" establishes a universal monetary relationship between the value of the ADR and the local currency of the foreign company stock. Although an ADR is priced in the US dollar, in order to preserve the uniformity of the established "conversion rate," movements in the exchange rate of the local currency versus the US dollar are automatically reflected in the price of the ADR in US dollars. Therefore, even if the price of the foreign security does not change on its market, if the exchange rate of the local currency relative to the US Dollar declines, the ADR price would decline by a similar measure.

**Affiliated Investment Company Risk**. The Fund may invest in affiliated underlying funds (the "Affiliated Funds"), unaffiliated underlying funds, or a combination of both. The Advisor, therefore, is subject to conflicts of interest in allocating the Fund's assets among the underlying funds. The Advisor will receive more revenue to the extent it selects an Affiliated Fund rather than an unaffiliated fund for inclusion in the Fund's portfolio. In addition, the Advisor may have an incentive to allocate the Fund's assets to those Affiliated Funds for which the net advisory fees payable to the Advisor are higher than the fees payable by other Affiliated Funds.

**Asset-Backed Securities Risk.** Asset-backed securities may be subject to prepayment risk. If interest rates fall, the underlying debt may be repaid ahead of schedule, reducing the value of the Fund's investments. As a result, the Fund may reinvest these early payments at lower interest rates, thereby reducing the Fund's income. Asset-backed securities are also subject to extension risk. If interest rates rise, there may be fewer prepayments, which would cause the average bond maturity to rise, increasing the potential for the Fund to lose money and causing the price of the asset-backed securities, and the Fund's net asset value per share, to fall. The prices of asset-backed securities may decrease more than prices of other fixed-income securities when interest rates rise. The value of asset-backed securities may be significantly affected by changes in interest rates, the market's perception of issuers, and the creditworthiness of the parties involved. The ability of the Fund to successfully utilize these instruments may depend on the ability of the Advisor to forecast interest rates and other economic factors correctly. The Advisor's assessment, or a rating agency's assessment, of borrower credit quality, default rates and loss rates may prove to be overly optimistic. These securities may have a structure that makes their reaction to interest rate changes and other factors difficult to predict, making their value highly volatile. The more senior security classes are generally entitled to receive payment before

the subordinate classes if the cash flow generated by the underlying assets is not sufficient to pay all investors. Asset-backed securities may be secured by pools of loans, such as student loans, automobile loans, equipment leases, and credit card receivables. The credit risk on such securities is affected by borrowers or lessees defaulting on their payments. The values of assets underlying asset-backed securities may decline and, therefore, may not be adequate to cover underlying investors. Possible legislation in the area of credit cards and other loans that may collateralize the securities in which the Fund may invest could negatively impact the value of the Fund's investments. To the extent the Fund focuses its investments in particular types of asset-backed securities, the Fund may be more susceptible to risk factors affecting such types of securities.

**Bank Loans Risk.** The market for bank loans may not be highly liquid and the Fund may have difficulty selling them. These investments expose the Fund to the credit risk of both the financial institution and the underlying borrower. Bank loans settle on a delayed basis, potentially leading to the sale proceeds of such loans not being available to meet redemptions for a substantial period of time after the sale of the bank loans. Certain bank loans may not be considered "securities" under the federal securities laws and purchasers, such as the Fund, therefore may not be entitled to rely on the protections of such laws, including anti-fraud provisions.

**Capacity Risk.** The markets and securities in which the Fund invests may, at times, have limited capacity, and the Advisor may not be able to allocate as much of the Fund's assets to a particular investment or type of investment as it desires. Under such conditions, the execution of the Fund's strategy may be affected and the Fund may not achieve its investment objective. In addition, the Fund may not be able to purchase or sell securities at favorable market prices.

**Collateralized Debt Obligations ("CDOs") and Collateralized Loan Obligations ("CLOs") Risk.** CDOs and CLOs are securities backed by an underlying portfolio of debt and loan obligations, respectively. CDOs and CLOs issue classes, or "tranches," that vary in risk and yield and may experience substantial losses due to actual defaults, decrease of market value due to collateral defaults and removal of subordinate tranches, market anticipation of defaults, and investor aversion to CDO and CLO securities as a class. The risks of investing in CDOs and CLOs depend largely on the tranche invested in and the type of the underlying debts and loans in the tranche of the CDO or CLO, respectively, in which the Fund invests. The risks of investing in CDOs and CLOs depend largely on the tranche held by the Fund and the types of underlying debts and loans in such tranche of the CDO or CLO, respectively. The risks of CDOs and CLOs will be greater if the Fund invests in CDOs and CLOs that hold debt or loans of uncreditworthy borrowers, or if the Fund holds subordinate tranches of the CDO or CLO that absorb losses from the defaults before senior tranches. CDOs and CLOs are subject to additional risks, including, but not limited to, interest rate risk and credit risk.

**Collateralized Bond Obligation Risk.** The pool of securities underlying collateralized bond obligations is typically separated in groupings called tranches representing different degrees of credit quality. The higher quality tranches have greater degrees of protection and pay lower interest rates. The lower quality tranches carry greater risk and pay higher interest rates.

**Collateralized Mortgage Obligations Risk.** Collateralized mortgage obligations are subject to credit risk because underlying loan borrowers may default. Collateralized mortgage obligations default rates tend to be sensitive to overall economic conditions and to localized property vacancy rates and prices. Borrower default rates may be significantly higher than estimated. Certain individual securities may be more sensitive to default rates because payments may be subordinated to other securities of the same issuer. The Advisor's assessment, or a rating agency's assessment, of borrower credit quality, default rates and loss rates may prove to be overly optimistic. Additionally, collateralized mortgage obligations are subject to prepayment risk because the underlying loans held by the issuers may be paid off prior to maturity at faster or slower rates than expected. The value of these securities may go down as a result of changes in prepayment rates on the underlying mortgages or loans. During periods of declining interest rates, prepayment rates usually increase and the Fund may have to reinvest prepayment proceeds at a lower interest rate; conversely, during periods of rising interest rates, prepayment rates usually decrease. Collateralized mortgage obligations may be less susceptible to this risk because payment priorities within the collateralized mortgage obligations may have the effect of a prepayment lock out period.

**Conflict of Interest - Advisor Risk.** The Advisor, and other individuals associated with the Advisor, may have compensation and/or other arrangements that may be in conflict to the interests of the Fund.

**Conflict of Interest - Portfolio Manager Risk.** Actual or apparent conflicts of interest may arise when a portfolio manager has day-to-day management responsibilities with respect to more than one fund or other accounts. More specifically, portfolio managers who manage multiple funds are presented with the following potential conflicts:

○ The management of multiple accounts may result in a portfolio manager devoting unequal time and attention to the management of each account. The management of multiple funds and accounts also may give rise to potential conflicts of interest if the funds and accounts have different objectives, benchmarks, time horizons, and fees, as the portfolio manager must allocate his time and investment ideas across multiple funds and accounts.

○ With respect to securities transactions for the Fund, the Advisor determines which broker to use to execute each order, consistent with the duty to seek best execution of the transaction. The portfolio manager may execute transactions for another fund or account that may adversely impact the value of securities held by the Fund. Securities selected for funds or accounts other than the Fund may outperform the securities selected for the Fund.

○ The appearance of a conflict of interest may arise where the Advisor has an incentive, such as a performance-based management fee. The management of personal accounts may give rise to potential conflicts of interest; there is no assurance that the Fund's code of ethics will adequately address such conflicts. One of the portfolio manager's numerous responsibilities is to assist in the sale of Fund shares. Because the portfolio manager's compensation is indirectly linked to the sale of Fund shares, they may have an incentive to devote time to marketing efforts designed to increase sales of Fund shares.

○ The Advisor has adopted a code of ethics that, among other things, permits personal trading by employees under conditions where it has been determined that such trades would not adversely impact client accounts. Nevertheless, the management of personal accounts may give rise to potential conflicts of interest, and there is no assurance that these codes of ethics will adequately address such conflicts.

**Convertible Securities Risk**. Convertible bonds are hybrid securities that have characteristics of both bonds and common stocks and are subject to fixed income security risks and conversion value-related equity risk. Convertible bonds are similar to other fixed-income securities because they usually pay a fixed interest rate and are obligated to repay principal on a given date in the future. The market value of fixed-income securities tends to decline as interest rates increase. Convertible bonds are particularly sensitive to changes in interest rates when their conversion to equity feature is small relative to the interest and principal value of the bond. Convertible issuers may not be able to make principal and interest payments on the bond as they become due. Convertible bonds may also be subject to prepayment or redemption risk. If a convertible bond is called for redemption, the Fund will be required to surrender the security for redemption and convert it into the issuing company's common stock or cash at a time that may be unfavorable to the Fund. Convertible bonds have characteristics similar to common stocks, especially when their conversion value is greater than the interest and principal value of the bond. If a convertible security's investment value is greater than its conversion value, its price will likely increase when interest rates fall and decrease when interest rates rise. If the conversion value exceeds the investment value, the price of the convertible security will tend to fluctuate directly with the price of the underlying equity security. The price of equity securities may rise or fall because of economic or political changes. Stock prices in general may decline over short or even extended periods of time. Market prices of equity securities in broad market segments may be adversely affected by a prominent issuer having experienced losses or by the lack of earnings, or such an issuer's failure to meet the market's expectations with respect to new products or services, or even by factors wholly unrelated to the value or condition of the issuer, such as changes in interest rates. When a convertible bond's value is more closely tied to its conversion to stock feature, it is sensitive to the underlying stock's price.

**Credit Default Swap Risk.** Credit default swaps ("CDS") are typically two-party financial contracts that transfer credit exposure between the two parties. Under a typical CDS, one party (the "seller") receives pre-determined periodic payments from the other party (the "buyer"). The seller agrees to make compensating specific payments to the buyer if a negative credit event occurs, such as the bankruptcy or default by the issuer of the underlying debt instrument. The use of CDS involves investment techniques and risks different from those associated with ordinary portfolio security transactions, such as potentially heightened counterparty, concentration, and exposure risks.

**Credit Risk (for Floating Rate Loans).** Credit risk is the risk that the issuer of a security and other instrument will not be able to make principal and interest payments when due. The value of the Fund's shares, and the Fund's ability to pay dividends, is dependent upon the performance of the assets in its portfolio. Prices of the Fund's investments can fall if the actual or perceived financial health of the borrowers on, or issuers of, such investments deteriorate, whether because of broad economic or issuer-specific reasons. In severe cases, the borrower or issuer could be late in paying interest or principal, or could fail to pay altogether.

In the event a borrower fails to pay scheduled interest or principal payments on an investment held by the Fund, the Fund will experience a reduction in its income and a decline in the market value of such investment. This will likely reduce the amount of dividends paid by the Fund, and likely lead to a decline in the net asset value and market price of the Fund's shares.

The Fund may invest in floating rate loans that are senior in the capital structure of the borrower or issuer, and that are secured with specific collateral. Loans that are senior and secured generally involve less risk than unsecured or subordinated debt and equity instruments of the same borrower because the payment of principal and interest on senior loans is an obligation of the borrower that, in most instances, takes precedence over the payment of dividends or the return of capital to the borrower's shareholders, and payments to bond holders, and because of the collateral supporting the repayment of the debt instrument. However, the value of the collateral may not equal the Fund's investment when the debt instrument is acquired or may decline below the principal amount of the debt instrument subsequent to the Fund's investment. Also, to the extent that collateral consists of stocks of the borrower, or its subsidiaries or affiliates, the Fund bears the risk that the stocks may decline in value, be relatively illiquid, or may lose all or substantially all of their value, causing the Fund's investment to be undercollateralized. Therefore, the liquidation of the collateral underlying a floating rate loan in which the Fund has invested may not satisfy the borrower's obligation to the Fund in the event of non-payment of scheduled interest or principal, and the collateral may not be able to be readily liquidated.

In the event of the bankruptcy of a borrower or issuer, the Fund could experience delays and limitations on its ability to realize the benefits of the collateral securing the Fund's investment. Among the risks involved in a bankruptcy are assertions that the pledge of collateral to secure a loan constitutes a fraudulent conveyance or preferential transfer that would have the effect of nullifying or subordinating the Fund's rights to the collateral.

The floating rate debt in which a fund may invest may be generally rated lower than investment-grade credit quality (i.e., rated lower than "Baa3" by Moody's Investors Service, Inc. ("Moody's") or "BBB-" by Standard & Poor's Ratings Services ("S&P")), or have been made to borrowers who have issued debt securities that are rated lower than investment-grade in quality or, if unrated, would be rated lower than investment-grade credit quality. A fund's investments in lower than investment-grade floating rate loans will generally be rated at the time of purchase between "B3" and "Ba1" by Moody's, "B-" and "BB+" by S&P, or, if not rated, would be of similar credit quality. Investment decisions for the Fund will be based largely on the credit analysis performed by the Advisor, and not entirely on rating agency evaluation. This analysis may be difficult to perform. Information about a loan and its borrower generally is not in the public domain. Many borrowers have not issued securities to the public and are not subject to reporting requirements under federal securities laws. Generally, however, borrowers are required to provide financial information to lenders, and information may be available from other loan market participants or agents that originate or administer loans.

**Cybersecurity Risk.** The computer systems, networks and devices used by the Fund and its service providers to carry out routine business operations employ a variety of protections designed to prevent damage or interruption

from computer viruses, network failures, computer and telecommunication failures, infiltration by unauthorized persons, and security breaches. Despite the various protections utilized by the Fund and its service providers, systems, networks or devices potentially can be breached. The Fund and its shareholders could be negatively impacted as a result of a cybersecurity breach.

Cybersecurity breaches can include unauthorized access to systems, networks, or devices; infection from computer viruses or other malicious software code; and attacks that shut down, disable, slow, or otherwise disrupt operations, business processes, or website access or functionality. Cybersecurity breaches may cause disruptions and impact the Fund's business operations, potentially resulting in: financial losses; interference with the Fund's ability to calculate its NAV; impediments to trading; the inability of the Fund, the Advisor and other service providers to transact business; violations of applicable privacy and other laws; regulatory fines, penalties, reputational damage, reimbursement or other compensation costs, or additional compliance costs; as well as the inadvertent release of confidential information.

Similar adverse consequences could result from cybersecurity breaches affecting issuers of securities in which the Fund invests; counterparties with which the Fund engages in transactions; governmental and other regulatory authorities; exchange and other financial market operators, such as banks, brokers, dealers, insurance companies, and other financial institutions (including financial intermediaries and service providers for the Fund's shareholders); and other parties. In addition, substantial costs may be incurred by these entities in order to prevent any cybersecurity breaches in the future.

**Dividend Yield Risk.** While the Fund may hold securities of companies that have historically paid a dividend, those companies may reduce or discontinue their dividends, thus reducing the yield of the Fund. Lower priced securities in the Fund may be more susceptible to these risks. Past dividend payments are not a guarantee of future dividend payments. Also, the market return of high dividend yield securities, in certain market conditions, may be worse than the market return of other investment strategies or the overall stock market.

**Exchange Traded Note ("ETN") Risk.** Similar to ETFs, owning an ETN generally reflects the risks of owning the assets that comprise the underlying market benchmark or strategy that the ETN is designed to reflect. ETNs also are subject to issuer and fixed income risk. In addition, ETNs are subject to counterparty risk, which is the risk that the broker-dealer or bank that issues the notes will not fulfill its contractual obligation to complete the transaction with the Fund. ETNs constitute general unsecured contractual obligations of the banks or broker-dealers that issue them, and the Fund is relying on the creditworthiness of such banks or broker-dealers. ETNs that are linked to market volatility are subject to default risk of the issuer; may not provide an effective hedge as historical correlation trends between the reference volatility index or measure and other asset classes may not continue or may reverse, limiting or eliminating any potential hedging effect; may become mispriced or improperly valued when compared to expectations, and may not produce the desired investment results; may have tracking risk if the ETN does not move in step with its reference index; and may become illiquid.

**Extension Risk.** Extension risk is the risk that if interest rates rise, repayments of principal on certain debt securities, including, but not limited to, floating rate loans and mortgage-related securities, may occur at a slower rate than expected, and the expected maturity of those securities could lengthen as a result. Securities that are subject to extension risk generally have a greater potential for loss when prevailing interest rates rise, which could cause their values to fall sharply.

**Financials Sector Focus*.*** Companies operating in the financials sector are subject to extensive government regulation, can be subject to relatively rapid change due to increasingly blurred distinctions between service segments, and can be significantly affected by availability and cost of capital funds, changes in interest rates, the rate of corporate and consumer debt defaults, and price competition.

**Floating Rate Loans Risk.** The Fund may invest in floating rate loans that are senior in the capital structure of the borrower or issuer, and that are secured with specific collateral. Loans that are senior and secured generally involve less risk than unsecured or subordinated debt and equity instruments of the same borrower because the payment of principal and interest on senior loans is an obligation of the borrower that, in most instances, takes precedence over

the payment of dividends or the return of capital to the borrower's shareholders, and payments to bond holders, and because of the collateral supporting the repayment of the debt instrument. However, the value of the collateral may not equal the Fund's investment when the debt instrument is acquired or may decline below the principal amount of the debt instrument subsequent to the Fund's investment. Also, to the extent that collateral consists of stocks of the borrower, or its subsidiaries or affiliates, the Fund bears the risk that the stocks may decline in value, be relatively illiquid, or may lose all or substantially all of their value, causing the Fund's investment to be under-collateralized. Therefore, the liquidation of the collateral underlying a floating rate loan in which the Fund has invested may not satisfy the borrower's obligation to the Fund in the event of non-payment of scheduled interest or principal, and the collateral may not be able to be readily liquidated.

In the event of the bankruptcy of a borrower or issuer, the Fund could experience delays and limitations on its ability to realize the benefits of the collateral securing the Fund's investment. Among the risks involved in a bankruptcy are assertions that the pledge of collateral to secure a loan constitutes a fraudulent conveyance or preferential transfer that would have the effect of nullifying or subordinating the Fund's rights to the collateral.

Floating rate loans are also subject to interest rate risk arising from changes in short-term market interest rates. If short-term market interest rates fall, the yield on the Fund's shares will also fall. Conversely, when short-term market interest rates rise, because of the lag between changes in such short-term rates and the resetting of the floating rates on the floating rate debt in the Fund's portfolio, the impact of rising rates will be delayed to the extent of such lag. The impact of market interest rate changes on the Fund's yield will also be affected by whether, and the extent to which, the floating rate debt in the Fund's portfolio is subject to floors on the base rate on which interest is calculated for such loans. So long as the base rate for a loan remains under the base rate floor, changes in short-term interest rates will not affect the yield on such loans. In addition, to the extent that the interest rate spreads on floating rate debt in the Fund's portfolio experience a general decline, the yield on the Fund's shares will fall and the value of the Fund's assets may decrease, which will cause the Fund's net asset value to decrease.

The floating rate debt in which a fund may invest may be generally rated lower than investment-grade credit quality (i.e., rated lower than "Baa3" by Moody's Investors Service, Inc. ("Moody's") or "BBB-" by S&P Global Ratings ("S&P")), or have been made to borrowers who have issued debt securities that are rated lower than investment-grade in quality or, if unrated, would be rated lower than investment-grade credit quality. Investment decisions for the Fund will be based largely on the credit analysis performed by the Advisor, and not entirely on rating agency evaluation. This analysis may be difficult to perform. Information about a loan and its borrower generally is not in the public domain. Many borrowers have not issued securities to the public and are not subject to reporting requirements under federal securities laws. Generally, however, borrowers are required to provide financial information to lenders, and information may be available from other loan market participants or agents that originate or administer loans.

**Foreign Exchanges Risk.** Neither existing CFTC regulations nor regulations of any other U.S. governmental agency apply to derivative transactions on foreign markets. Some of these foreign markets, in contrast to U.S. exchanges, are so-called "principals' markets" in which performance is the responsibility only of the individual counterparty with whom the trader has entered into a commodity interest transaction and not of the exchange or clearing corporation. In these kinds of markets, there is risk of bankruptcy or other failure or refusal to perform by the counterparty.

**Foreign Currency Risk.** Currency trading risks include market risk, credit risk and country risk. Market risk results from adverse changes in exchange rates in the currencies a fund is long or short. Credit risk results because a currency-trade counterparty may default. Country risk arises because a government may interfere with transactions in its currency.

**Forwards Risk.** Forward contracts are a type of derivative contract whereby a fund may agree to buy or sell a certain commodity or a country or region's currency at a specific price on a specific date, usually 30, 60, or 90 days in the future. These contracts are subject to the risk of political and economic factors applicable to such commodity or the countries issuing the underlying currencies and may fall in value due to foreign market downswings or foreign

currency value fluctuations. Forward contracts are individually negotiated and privately traded, so they are dependent upon the creditworthiness of the counterparty and subject to counterparty risk. The Fund's investment or hedging strategies may not achieve their objective.

**Geographic Focus Risk.** The Fund may be particularly susceptible to economic, political, regulatory or other events or conditions affecting countries within the specific geographic regions in which the Fund invests. Currency devaluations could occur in countries that have not yet experienced currency devaluation to date, or could continue to occur in countries that have already experienced such devaluations. As a result, the Fund's net asset value or market price may be more volatile than a more geographically diversified fund.

**Index-Linked Derivative Securities Risk.** If the derivative is linked to the performance of an index, it will generally be subject to the risks associated with changes in that index.

**Industrial Metals Risk.** Risks of investing in industrial metals sector commodities include, in addition to other risks, substantial price fluctuations over short periods of time, imposition of import controls, increased competition, government regulation, disruptions in mining, storing, and refining of metals, and changes in industrial, governmental and commercial demand for certain metals.

**Inflation-Indexed Bond Risk.** Inflation-indexed bonds are fixed income securities whose principal values are periodically adjusted according to a measure of inflation. If the index measuring inflation falls, the principal value of inflation-indexed bonds will be adjusted downward, and consequently the interest payable on these securities (calculated with respect to a smaller principal amount) will be reduced. Repayment of the original bond principal upon maturity (as adjusted for inflation) is guaranteed in the case of U.S. Treasury inflation indexed bonds. For bonds that do not provide a similar guarantee, the adjusted principal value of the bond repaid at maturity may be less than the original principal. With regard to municipal inflation-indexed bonds and certain corporate inflation-indexed bonds, the inflation adjustment is reflected in the semi-annual coupon payment. As a result, the principal value of municipal inflation-indexed bonds and such corporate inflation indexed bonds does not adjust according to the rate of inflation. The value of inflation-indexed bonds is expected to change in response to changes in real interest rates. Real interest rates are tied to the relationship between nominal interest rates and the rate of inflation. If nominal interest rates increase at a faster rate than inflation, real interest rates may rise, leading to a decrease in value of inflation-indexed bonds. Inflation-indexed bonds may cause a potential cash flow mismatch to investors, because an increase in the principal amount of an inflation-indexed bond will be treated as interest income currently subject to tax at ordinary income rates even though investors will not receive repayment of principal until maturity. If the Fund invests in such bonds, it will be required to distribute such interest income in order to qualify for treatment as a regulated investment company and eliminate the Fund-level tax, without a corresponding receipt of cash, and therefore may be required to dispose of portfolio securities at a time when it may not be desirable.

**Inflation Protected Securities Risk.** Inflation-protected debt securities tend to react to changes in real interest rates. Real interest rates represent nominal (stated) interest rates reduced by the expected impact of inflation. In general, the price of an inflation-protected debt security can fall when real interest rates rise, and can rise when real interest rates fall. Interest payments on inflation-protected debt securities can be unpredictable and will vary as the principal and/or interest is adjusted for inflation.

**Litigation Risk**. The Fund may be named in a lawsuit despite no wrongdoing by the Fund, its Advisor or any other service provider to the Fund. The defense of a lawsuit may detrimentally impact the Fund and its shareholders, including incurring legal defense costs, regulatory costs and increased insurance premiums.

**Loan Risk.** Investments in bank loans may subject the Fund to heightened credit risks because such loans tend to be highly leveraged and potentially more susceptible to the risks of interest deferral, default and/or bankruptcy. Senior floating rate loans are often rated below investment grade, but may also be unrated. The risks associated with these loans can be similar to the risks of below investment grade fixed income instruments. An economic downturn would generally lead to a higher non-payment rate, and a senior floating rate loan may lose significant market value before a default occurs. Moreover, any specific collateral used to secure a senior floating rate loan may decline in value or become illiquid, which would adversely affect the loan's value. Unlike the securities markets, there is no

central clearinghouse for loan trades, and the loan market has not established enforceable settlement standards or remedies for failure to settle. Therefore, portfolio transactions in loans may have uncertain settlement time periods. Senior floating rate loans are subject to a number of risks described elsewhere in this Prospectus, including liquidity risk and the risk of investing in below-investment grade fixed income instruments.

**Market Volatility-Linked ETFs Risk**. ETFs that are linked to market volatility generally have the risks associated with investing in futures contracts.

**MLP and MLP-Related Securities Risk**. Investments in MLPs and MLP-related securities involve risks different from those of investing in common stock, including risks related to limited control and limited rights to vote on matters affecting the MLP or MLP-related security, risks related to potential conflicts of interest between an MLP and the MLP's general partner, cash flow risks, dilution risks (which could occur if the MLP raises capital and then invests it in projects whose return fails to exceed the cost of capital raised), and risks related to the general partner's limited call right. MLPs and MLP-related securities are generally considered interest-rate sensitive investments. During periods of interest rate volatility, these investments may not provide attractive returns. Depending on the state of interest rates in general, the use of MLPs or MLP-related securities could enhance or harm the overall performance of the Fund.

MLPs do not pay U.S. federal income tax at the partnership level, subject to the application of certain partnership audit rules. Instead, each partner is allocated a share of the partnership's income, gains, losses, deductions and expenses. A change in current tax law or in the underlying business mix of a given MLP could result in an MLP being treated as a corporation for U.S. federal income tax purposes, which would result in such MLP being required to pay U.S. federal income tax on its taxable income. The classification of an MLP as a corporation for U.S. federal income tax purposes would have the effect of reducing the amount of cash available for distribution by the MLP. Thus, if any of the MLPs owned by the Fund were treated as corporations for U.S. federal income tax purposes, it could result in a reduction of the value of your investment in the Fund and lower income, as compared to an MLP that is not taxed as a corporation.

**Mortgage-Backed Securities Risk.** Mortgage-backed securities represent participating interests in pools of residential mortgage loans, some of which are guaranteed by the U.S. government, its agencies or instrumentalities. However, the guarantee of these types of securities relates to the principal and interest payments and not the market value of such securities. In addition, the guarantee only relates to the mortgage-backed securities held by the Fund and not the purchase of shares of the Fund.

Mortgage-backed securities do not have a fixed maturity, and their expected maturities may vary when interest rates rise or fall. An increased rate of prepayments on the Fund's mortgage-backed securities will result in an unforeseen loss of interest income to the Fund, as the Fund may be required to reinvest assets at a lower interest rate. A decreased rate of prepayments lengthens the expected maturity of a mortgage-backed security, causing the price of the mortgage-backed securities and the Fund's net asset value per share to fall, and making the mortgage-backed securities more sensitive to interest rate changes. The prices of mortgage-backed securities may decrease more than prices of other fixed-income securities when interest rates rise. An unexpectedly high rate of defaults on the mortgages held by a mortgage pool will adversely affect the value of mortgage-backed securities, and will result in losses to the Fund. The liquidity of mortgage-backed securities, and particularly non-agency non-investment grade mortgage-backed securities, may change over time. Mortgage-backed securities and other securities issued by participants in housing and commercial real estate finance, as well as other real estate-related markets, have experienced extraordinary weakness and volatility in certain years.

Mortgage-backed securities issued or guaranteed by private issuers are also known as "non-agency mortgage-backed securities." Non-agency mortgage-backed securities are not subject to the same underwriting requirements as those with government or government-sponsored entity guarantees and, therefore, mortgage loans underlying privately issued mortgage-related securities may have less favorable collateral, higher credit risk or other underwriting characteristics, and wider variances in interest rate, term, size, purpose and borrower characteristics.

The market for non-agency mortgage-backed securities is smaller and less liquid than the market for government-issued mortgage-backed securities.

Lower-quality notes, such as those considered "sub-prime," are more likely to default than those considered "prime" by a rating evaluation agency or service provider. An economic downturn or period of rising interest rates could adversely affect the market for sub-prime notes and reduce the Fund's ability to sell these securities. The lack of a liquid market for these securities could decrease the Fund's share price. Additionally, borrowers may seek bankruptcy protection, which would delay resolution of security holder claims and may eliminate or materially reduce liquidity.

**Municipal Bond Risk.** The value of municipal bonds that depend on a specific revenue source or general revenue source to fund their payment obligations may fluctuate as a result of changes in the cash flows generated by the revenue source(s), or changes in the priority of the municipal obligation to receive the cash flows generated by the revenue source(s). In addition, changes in federal tax laws or the activity of an issuer may adversely affect the tax-exempt status of municipal bonds.

There is no guarantee that a municipality will be able to pay interest or repay principal. In addition, the ability of an issuer to make payments or repay interest may be affected by litigation or bankruptcy. In the event of such an issuer's bankruptcy, the Fund could experience delays in collecting principal and interest, and may not, in all circumstances, be able to collect all principal and interest to which it is entitled. To enforce its rights in the event of a default in the payment of interest or repayment of principal, or both, a debt holder may, in some instances, take possession of, and manage, the assets securing the issuer's obligations on such securities, which may increase the Fund's operating expenses. Any income derived from the Fund's ownership or operation of such assets may not be tax-exempt. Municipal bonds are generally subject to interest rate, credit and market risk.

Because many municipal bonds are issued to finance similar projects (such as those relating to education, health care, housing, transportation, and utilities), conditions in those sectors may affect the overall municipal securities market. In addition, changes in the financial condition of an individual municipal issuer can affect the overall municipal market. Municipal bonds backed by current or anticipated revenues from a specific project or specific assets can be negatively affected by the discontinuance of the supporting taxation or the inability to collect revenues for the specific project or specific assets. Municipal bonds are subject to the risk that the Internal Revenue Service (the "IRS") may determine that an issuer has not complied with applicable tax requirements and that interest from the municipal bond is taxable, which may result in a significant decline in the value of the security. Municipal bonds may be less liquid than taxable bonds and there may be less publicly available information on the financial condition of municipal bond issuers than for issuers of other securities, and the investment performance of the Fund may, therefore, be more dependent on the analytical abilities of the Advisor than if the Fund held other types of investments. The secondary market for municipal bonds also tends to be less well-developed or liquid than many other securities markets, a by-product of lower capital commitments to the asset class by the dealer community, which may adversely affect the Fund's ability to sell municipal bonds at attractive prices or value municipal bonds.

**Preferred Stock Risk.** The value of preferred stocks will fluctuate with changes in interest rates. Typically, a rise in interest rates causes a decline in the value of preferred stock. Preferred stocks are also subject to credit risk, which is the possibility that an issuer of preferred stock will fail to make its dividend payments. Preferred stock prices tend to move more slowly upwards than common stock prices. In an issuer bankruptcy, preferred stockholders are subordinate to the claims of debtholders and may receive little or no recovery.

**Prepayment Risk.** The Fund may invest in debt securities that may be paid off early when the issuer of a debt security can repay the principal prior to a security's maturity. If interest rates are falling, the Fund may have to reinvest the unanticipated proceeds at lower interest rates, resulting in a decline in the Fund's income.

**Real Estate and REIT Risk**. The Fund is subject to the risks of the real estate market as a whole, such as taxation, regulations and economic and political factors that negatively impact the real estate market and the direct ownership of real estate. These may include decreases in real estate values, overbuilding, rising operating costs, interest rates,

and property taxes. In addition, some real estate related investments are not fully diversified and are subject to the risks associated with financing a limited number of projects.

Investing in REITs involves certain unique risks in addition to those associated with the real estate sector generally. REITs whose underlying properties are concentrated in a particular industry or region are also subject to risks affecting such industries and regions. REITs (especially mortgage REITs) are also subject to interest rate risks. By investing in REITs through the Fund, a shareholder will bear expenses of the REITs in addition to Fund expenses. An entity that fails to qualify as a REIT would be subject to a corporate level tax, would not be entitled to a deduction for dividends paid to its shareholders, and would not pass through to its shareholders the character of income earned by the entity.

**Repurchase and Reverse Repurchase Agreements Risk.** The Fund may enter into repurchase agreements in which it purchases a security (known as the "underlying security") from a securities dealer or bank. In the event of a bankruptcy or other default by the seller of a repurchase agreement, the Fund could experience delays in liquidating the underlying security. The Fund may also experience losses in the event of a decline in the value of the underlying security while the Fund is seeking to enforce its rights under the repurchase agreement. Reverse repurchase agreements involve the sale of securities held by the Fund with an agreement to repurchase the securities at an agreed-upon price, date and interest payment, and involve the risk that (i) the other party may fail to return the securities in a timely manner, or at all, and (ii) the market value of assets that are required to be repurchased decline below the purchase price of the asset that has to be sold, resulting in losses to the Fund.

**Restricted Securities Risk.** The Fund may hold securities that are restricted as to resale under the U.S. federal securities laws. There can be no assurance that a trading market will exist at any time for any particular restricted security. Limitations on the resale of these securities may prevent the Fund from disposing of them promptly at reasonable prices, or at all. The Fund may have to bear the expense of registering the securities for resale and the risk of substantial delays in effecting the registration. Also, restricted securities may be difficult to value because market quotations may not be readily available, and the values of restricted securities may have significant volatility.

**Security Risk**. The value of the Fund may decrease in response to the activities and financial prospects of an individual security in the Fund's portfolio. The net asset value or market price of the Fund will fluctuate based on changes in the value of the securities in which the Fund invests. The Fund may invest in securities that may be more volatile and carry more risk than some other forms of investment. The price of securities may rise or fall because of economic or political changes. Security prices in general may decline over short or even extended periods of time. Market prices of securities in broad market segments may be adversely affected by a prominent issuer having experienced losses, lack of earnings, failure to meet the market's expectations with respect to new products or services, or even by factors wholly unrelated to the value or condition of the issuer, such as changes in interest rates.

**Short Selling Risk**. If a security or other instrument sold short increases in price, the Fund may have to cover its short position at a higher price than the short sale price, resulting in a loss. The Fund may have substantial short security positions and must borrow those securities to make delivery to the buyer. The Fund may not be able to borrow a security that it needs to deliver, or it may not be able to close out a short position at an acceptable price and may have to sell related long positions before it had intended to do so. Thus, the Fund may not be able to successfully implement its short sale strategy due to limited availability of desired securities or for other reasons.

The Fund also may be required to pay a commission and other transaction costs, which would increase the cost of the security sold short. The amount of any gain will be decreased, and the amount of any loss increased, by the amount of the commission, dividends, interest or expenses the Fund may be required to pay in connection with the short sale.

Until the Fund replaces a borrowed security, it is required to maintain a segregated account of cash or liquid assets with a broker or custodian to cover the Fund's short position. Generally, securities held in a segregated account cannot be sold unless they are replaced with other liquid assets. A fund's ability to access the pledged collateral

may also be impaired in the event the broker fails to comply with the terms of the contract. In such instances, a fund may not be able to substitute or sell the pledged collateral. This may limit a fund's investment flexibility and may cause the fund to miss favorable trading opportunities due to a lack of sufficient cash or readily marketable securities. This may also affect a fund's ability to meet redemption requests or other current obligations. This requirement may also cause a fund to realize losses on offsetting or terminated derivative contracts or special transactions.

Because losses on short sales arise from increases in the value of the security sold short, such losses are theoretically unlimited. By contrast, a loss on a long position arises from decreases in the value of the security and is limited by the fact that a security's value cannot go below zero.

**Sovereign Debt Risk.** The issuer of foreign debt or the governmental authorities that control the repayment of the debt may be unable or unwilling to repay principal or interest when due, and the Fund may have limited recourse in the event of a default. The market prices of sovereign debt, and the Fund's net asset value, may be more volatile than prices of U.S. debt obligations.

**Structured Note Risk**. The Fund may seek investment exposure to sectors through structured notes that may be exchange traded or may trade in the over-the-counter market. These notes are typically issued by banks or brokerage firms and have interest and/or principal payments which are linked to changes in the price level of certain assets or to the price performance of certain indices. The value of a structured note will be influenced by time to maturity, level of supply and demand for this type of note, interest rate and market volatility, changes in the issuer's credit quality rating, and economic, legal, political and other events that affect the industry, and adverse changes in the index or reference asset to which the payments are linked. In addition, there may be a lag between a change in the value of the underlying reference asset and the value of the structured note. Structured notes may also be subject to counterparty risk. The Fund may also be exposed to increased transaction costs when it seeks to sell such notes in the secondary market.

**Sub-Prime Mortgage Risk.** Lower-quality notes, such as those considered "sub-prime," are more likely to default than those considered "prime" by a rating evaluation agency or service provider. An economic downturn or period of rising interest rates could adversely affect the market for sub-prime notes and reduce the Fund's ability to sell these securities. The lack of a liquid market for these securities could decrease the Fund's share price. Additionally, borrowers may seek bankruptcy protection, which would delay resolution of security holder claims and may eliminate or materially reduce liquidity.

**Swaps Risk.** The Fund's use of total return swaps involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments, and exposes the Fund to the risks associated with derivative instruments described herein. Certain derivatives risks are heightened with respect to over-the-counter ("OTC") derivative instruments, like certain swap agreements, and may be greater during volatile market conditions. Such risks include the risk of leverage (i.e., the risk that an adverse change in the value of the underlying asset could result in the Fund sustaining a loss that is substantially greater than the amount invested in the derivative or the anticipated value of the underlying asset), counterparty risk (i.e., the risk of a counterparty's unwillingness or inability to perform its obligations, including as a result of bankruptcy), credit risk, and pricing risk (i.e., swaps may be difficult to value). Other heightened risks include the inability to close out a swap position because the trading market becomes illiquid (particularly in the OTC markets) or the availability of counterparties becomes limited for a period of time. In addition, the presence of speculators in a particular market could lead to price distortions. To the extent that the Fund is unable to close out a position because of market illiquidity, the Fund may not be able to prevent further losses of value in its holdings, and the Fund's liquidity may be impaired.

**Underlying Fund Risk.** Other investment companies, including mutual funds, ETFs and closed-end funds ("Underlying Funds"), in which the Fund invests are subject to investment advisory and other expenses, which will be indirectly paid by the Fund. As a result, the cost of investing in the Fund will be higher than the cost of investing directly in the Underlying Funds, and may be higher than other mutual funds that invest directly in stocks and bonds. In addition, when the Fund invests in Underlying Funds, there is a risk that the investment advisers of those Underlying Funds may make investment decisions that are detrimental to the performance of the Fund. Each of the

Underlying Funds are subject to its own specific risks. Additional risks of investing in the Underlying Funds are described below:

○ *Business Development Companies ("BDC") Risk*. BDCs may carry risks similar to those of a private equity or venture capital fund. BDC securities are not redeemable at the option of the shareholder and they may trade in the market at a discount to their net asset value. A BDC is a form of investment company that is required to invest at least 70% of its total assets in securities (typically debt) of private companies, thinly traded U.S. public companies, or short-term high quality debt securities. The BDCs held by the Fund may leverage their portfolios through borrowings or the issuance of preferred stock. While leverage often serves to increase the yield of a BDC, this leverage also subjects a BDC to increased risks, including the likelihood of increased volatility and the possibility that a BDC's common share income will fall if the dividend rate of the preferred shares or the interest rate on any borrowings rises. A significant portion of a BDC's investments are recorded at fair value, as determined by its board of directors, which may create uncertainty as to the value of the BDC's investments. Non-traded BDCs are illiquid and it may not be possible to redeem shares without paying a substantial penalty, or at all. Publicly-traded BDCs usually trade at a discount to their net asset value because they invest in unlisted securities and have limited access to capital markets. BDCs are subject to high failure rates among the companies in which they invest, and federal securities laws impose restraints upon the organization and operations of BDCs that can limit or negatively impact the performance of a BDC. However, the Fund does not believe it would be liable for the actions of any entity in which it invests and that only its investment is at risk. Also, BDCs may engage in certain principal and joint transactions that a mutual fund or closed-end fund may not without an exemptive order from the SEC.

○ *Closed-End Fund Risk*. Closed-end funds are subject to management risk because the adviser to the underlying closed-end fund may be unsuccessful in meeting the fund's investment objective. Closed-end funds may trade at a discount or premium to their net asset value, and may trade at a larger discount or smaller premium subsequent to purchase by the Fund. Since closed-end funds trade on exchanges, a fund may also incur brokerage expenses and commissions when it buys or sells closed-end fund shares.

○ *ETF Tracking Risk*. Index-based or "passive" ETFs, which seek to track the performance of an underlying index, will not be able to replicate exactly the performance of the indices they track because the total return generated by the securities will be reduced by transaction costs incurred in adjusting the actual balance of the securities. In addition, passive ETFs will incur expenses not incurred by their applicable indices. Certain securities comprising the indices tracked by the passive ETFs may, from time to time, temporarily be unavailable, which may further impede the ETFs' ability to track their applicable indices.

○ *Inverse Correlation Risk*. Underlying Funds that are inverse funds should lose value as the index or security tracked by such fund's benchmark increases in value; a result that is the opposite from traditional mutual funds. Successful use of inverse funds requires that the fund's adviser correctly predict short term market movements. If the Fund invests in an inverse fund and markets rise, the Fund could lose money. Inverse funds may also employ leverage such that their returns are more than one times that of their benchmark.

○ *Inverse ETF and ETN Risk*. Investing in inverse ETFs and ETNs may result in increased volatility due to the ETF's or ETN's possible use of short sales of securities and derivatives, such as futures contracts. The use of leverage by an ETF or ETN increases risk to the Fund. The more the Fund invests in leveraged instruments, the more the leverage will magnify any gains or losses on those investments. During periods of increased volatility, inverse ETFs and ETNs may not perform in the manner they are designed.

○ *Management Risk*. When the Fund invests in Underlying Funds, there is a risk that the investment advisers of those Underlying Funds may make investment decisions that are detrimental to the performance of the Fund.

○ *Mutual Fund Risk.* Mutual funds are subject to management risk because the adviser to the mutual fund may be unsuccessful in meeting the fund's investment objective, and may temporarily pursue strategies which are

inconsistent with the investment objective of the Fund.

○ *Leveraged ETF Risk*. Leveraged ETFs will amplify losses because they are designed to produce returns that are a multiple of the index to which they are linked. Most leveraged ETFs "reset" daily. Due to the effect of compounding, their performance over longer periods of time can differ significantly from the performance of their underlying index or benchmark during the same period of time.

○ *Net Asset Value and Market Price Risk.* The market value of ETF shares may differ from their net asset value. This difference in price may be due to the fact that the supply and demand in the market for fund shares at any point in time is not always identical to the supply and demand in the market for the underlying basket of securities. Accordingly, there may be times when shares trade at a premium or discount to net asset value.

**Regulation under the Commodity Exchange Act**

The Advisor is registered as a CPO under the CEA and the rules of the CFTC, and is subject to CFTC regulation with respect to the Fund and the Subsidiary. The CFTC has adopted rules regarding the disclosure, reporting and recordkeeping requirements that apply with respect to the Fund as a result of the Advisor's registration as a CPO. Generally, these rules allow for substituted compliance with CFTC disclosure and shareholder reporting requirements, based on the Advisor's compliance with comparable SEC requirements. This means that, for most of the CFTC's disclosure and shareholder reporting requirements applicable to the Advisor as the Fund's CPO, the Advisor's compliance with SEC disclosure and shareholder reporting requirements will be deemed to fulfill the Advisor's CFTC compliance obligations. However, as a result of CFTC regulation with respect to the Fund and the Subsidiary, the Fund may incur additional compliance and other expenses.

**SHAREHOLDER INFORMATION**

**Purchasing and Selling Fund Shares on the Secondary Market**

<u>General</u>. Most investors will buy and sell shares of the Fund in secondary market transactions through their financial institution at market price. Shares of the Fund will be listed for trading in the secondary market on the Exchange. The Exchange is currently open for business each day, other than weekends and the following national holidays: New Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Juneteenth National Independence Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day.

The Fund's shares trade on the Exchange under the following symbol:

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| | |
|:---|:---|
| **<u>Fund</u>** | **<u>Symbol</u>** |
| Strategy Shares Gold Enhanced Yield ETF | GOLY |

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Shares of the Fund can be bought and sold throughout the trading day at their market price like other publicly traded equity securities. If you purchase shares of the Fund in the secondary market, there is no minimum investment. While shares of the Fund will typically be purchased and sold in the secondary market in "round lots" of 100 shares, your financial institution may permit you to purchase or sell shares in smaller "odd-lots" at no per-share price differential. When purchasing or selling Fund shares through your financial institution, you will pay customary brokerage commissions and charges, and you may pay some or all of the spread between the bid and offer price in the secondary market. The market price of Fund shares may be below (a discount), at, or above (a premium) their most recently calculated NAV, and can be affected by market forces of supply and demand for the Fund's shares, the prices of the Fund's portfolio securities, economic conditions, and other factors.

**Purchasing Shares from and Redeeming Shares with the Fund**

<u>General</u>. On each Business Day, you may purchase shares directly from the Fund, and you may tender shares for redemption directly to the Fund, in a Creation Unit or multiples thereof. Each Creation Unit is currently comprised of 10,000 shares. The number of shares comprising a Creation Unit may change over time. Once "created," shares of the Fund will generally trade in the secondary market in amounts less than a Creation Unit (see "Shareholder Information – Purchasing and Selling Fund Shares on the Secondary Market").

To purchase or redeem Creation Units of the Fund, you must be an Authorized Participant, or you must purchase or redeem the shares through a financial institution that is an Authorized Participant. The Distributor will provide a list of Authorized Participants upon request.

The Fund processes orders for the purchase and redemption of Creation Units at the NAV next calculated after an order has been received in proper form by the Distributor.

The Fund may effect all or a portion of its purchase and/or redemption orders of Creation Units in cash. Except where the purchase or redemption will include cash, investors will generally be required to purchase Creation Units by making an in-kind deposit of specified instruments ("Deposit Instruments"), and shareholders redeeming Creation Units will generally receive an in-kind transfer of specified instruments ("Redemption Instruments"). The name and quantities of the instruments that constitute the Fund's Deposit Instruments, and the names and quantities of the instruments that constitute the Fund's Redemption Instruments, will be specified by the Fund each day, and these instruments are referred to, in the case of either a purchase or a redemption, as the "Creation Basket." If there is a difference between the net asset value attributable to a Creation Unit and the aggregate market value of the Creation Basket exchanged for the Creation Unit, the party conveying instruments with the lower value will also pay to the other an amount in cash equal to that difference.

The Fund generally does not offer or sell its shares outside of the U.S. Also, the Fund reserves the right to reject any purchase request at any time, for any reason, and without notice.

Additional information regarding the purchase and redemption of the Fund's Creation Units may be found in the "Purchase and Redemption of Creation Units" section of the SAI.

<u>Continuous Offering</u>. Because new shares may be created and issued on an ongoing basis during the life of the Fund, a "distribution," as such term is used in the Securities Act, may be occurring. Broker-dealers and other persons are cautioned that some activities on their part may, depending on the circumstances, result in their being deemed participants in a distribution in a manner that could render them statutory underwriters, and subject to the prospectus delivery and liability provisions of the 1933 Act. Any determination of whether one is an underwriter must take into account all the relevant facts and circumstances of each particular case.

**Broker-dealers should also note that dealers who are not "underwriters," but are participating in a distribution (as compared to ordinary secondary market transactions), and thus dealing with shares that are part of an "unsold allotment" within the meaning of Section 4(3)(C) of the 1933 Act, would be unable to take advantage of the prospectus delivery exemption provided by Section 4(3) of the 1933 Act. For delivery of prospectuses to exchange members, the prospectus delivery mechanism of Rule 153 under the 1933 Act is available only with respect to transactions on a national securities exchange.**

**Book Entry**

Shares are held in book-entry form, which means that no stock certificates are issued. The DTC, or its nominee, will be the record owner or registered owner of all outstanding shares of the Fund, and is recognized as the owner of all such shares. Your beneficial interest in the shares of the Fund will be reflected on the records of the DTC or its participants. Participants in the DTC include securities brokers and dealers, banks, trust companies, clearing corporations and other institutions that directly or indirectly maintain a custodial relationship with the DTC. As a

beneficial owner of shares of the Fund, you are not entitled to receive physical delivery of stock certificates or to have shares of the Fund registered in your name, and you are not considered a registered owner of those shares. Therefore, to exercise any right as an owner of Fund shares, you must rely on the procedures of the DTC and its participants. These procedures are the same as those that apply to any other stocks that you hold in book entry or "street name" form through your financial institution.

**Calculation of Net Asset Value**

The Fund's NAV is determined by dividing the total value of the Fund's portfolio investments and other assets, less any liabilities, by the total number of shares outstanding as of the close of regular trading on the Exchange (normally 4:00 p.m., Eastern Time) on each day that the Exchange is open for business. Since the Fund may invest a portion of its investment portfolio in foreign securities that trade on weekends or other days that the Fund does not price its shares, the NAV of the Fund may change on days when shareholders will not be able to purchase or redeem Creation Units.

In computing the NAV for the Fund, current market value is used to value portfolio securities with respect to which market quotations are readily available, except short-term investments with remaining maturities of 60 days or less, which are valued at amortized cost. Pursuant to Board-approved policies, the Fund relies on certain security pricing services to provide current market value of securities.

Securities for which market quotations are not readily available are valued at their "fair value" pursuant to Board-approved procedures. Market quotations may not be readily available if: (1) a portfolio security is not traded in a public market or the principal market in which the security trades is closed; (2) trading in a portfolio security is suspended and not resumed prior to the normal market close; (3) a portfolio security is not traded in significant volume for a substantial period; (4) the value of a portfolio security has been materially affected by events occurring after the close of the market on which the security is principally traded; or (5) the Advisor determines that the quotation or price for a portfolio security provided by an independent pricing source is inaccurate. The securities of smaller companies in which the Fund may invest may be susceptible to fair valuation since these securities may be thinly traded and less liquid than their larger counterparts. Similarly, the Fund's investments in foreign securities, if any, are more likely to require a fair value determination because, among other things, events may occur between the closure of the foreign market and the time that the Fund calculates its NAV that affect the reported market value of these securities.

There can be no assurance that the Fund could purchase or sell a portfolio security at the price used to calculate the Fund's NAV. In the case of fair valued portfolio securities, lack of information and uncertainty as to the significance of information may lead to a conclusion that a prior valuation is the best indication of a portfolio security's present value. Fair valuations generally remain unchanged until new information becomes available. Consequently, changes in the fair valuation of portfolio securities may be less frequent and of greater magnitude than changes in the price of portfolio securities valued at their last sale price by an independent pricing service, or based on market quotations. Fair valuation determinations often involve the consideration of a number of subjective factors, and the fair value price may be higher or lower than a readily available market quotation. Use of fair value prices and certain current market valuations could result in a difference between the prices used to calculate the Fund's NAV and the prices used by the underlying Index, which, in turn, could result in a difference between the Fund's performance and the performance of the underlying Index, and introduce tracking error.

**Frequent Purchases and Sales of Fund Shares**

The Board has not adopted policies and procedures with respect to frequent purchases and sales of Fund shares. Frequent purchases and sales of the Fund's shares in the secondary market are not expected to subject the Fund to the harmful effects of market timing and excessive trading, such as dilution, the disruption of portfolio management, an increase in portfolio trading costs, and/or the realization of capital gains, since these transactions do not involve the Fund directly. It is not anticipated that these effects will materialize as a result of the issuance and redemption

of Creation Units by the Fund, since these transactions will generally be processed on an in-kind basis (that is for a basket of portfolio securities and not for cash). Transaction fees will be imposed on purchases and redemptions of Creation Units, which are intended to offset custodial and other costs to the Fund incurred in processing the transactions in-kind. To the extent that the Fund permits the purchase or redemption of Creation Units, in part or wholly, in cash, higher transaction fees will be imposed, which are intended to offset the Fund's increased trading costs to purchase or redeem portfolio securities in connection with these transactions.

**Portfolio Holdings Information**

A description of the Fund's policies and procedures with respect to the disclosure of portfolio securities is available in the SAI.

**DISTRIBUTION OF THE FUND**

The Fund has adopted, but has yet to implement, a Rule 12b-1 Distribution Plan ("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.

No 12b-1 fees are currently paid by the Fund, and there are no plans to impose these fees. However, in the event 12b-1 fees are charged in the future, because the fees are paid out of the Fund's assets, over time these fees will increase the cost of your investment and may cost you more than certain other types of sales charges.

**Additional Payments to Financial Intermediaries**

The Advisor and its affiliates may pay, out of their own profits and reasonable resources, amounts (including items of material value) to certain financial intermediaries for the sale of Fund shares or related services. The amounts of these payments could be significant, and may create an incentive for the financial intermediaries or their employees or associated persons to recommend or sell Fund shares to you. These payments are not reflected in the fees and expenses listed in the fee table section of this Prospectus because they are not paid by the Fund.

These payments are negotiated and may be based on such factors as the number or value of Fund shares that the financial intermediary sells or may sell; the value of client assets invested; or the type and nature of services or support furnished by the financial intermediary. These payments may be in addition to payments made by the Fund to a financial intermediary under the Plan, if implemented. Ask your financial intermediary for information about any payments it receives from the Advisor, their affiliates, or the Fund, and any services the financial intermediary provides to the Fund. The SAI contains additional information on the types of additional payments that may be paid.

**MANAGEMENT OF THE FUND**

**Investment Advisor**

Rational Advisors, Inc. has been retained by the Trust under a Management Agreement to act as the investment advisor to the Fund, subject to the authority of the Board of Trustees. Management of mutual funds is currently its primary business. The Advisor is under common control with Catalyst Capital Advisors, LLC ("Catalyst") and AlphaCentric Advisors LLC, the investment advisors of other funds in the same group of investment companies, also known as a "Fund Complex." The Advisor oversees the day-to-day investment decisions for the Fund and continuously reviews, supervises and administers the Fund's investment program. MFund Services LLC, an affiliate of the Advisor, provides the Fund with management and legal administrative support and compliance services. The address of the Advisor is 207 Calle del Parque, AM Tower, Floor 7, Suite 2, San Juan, PR 00912-3242.

A discussion of the Trustees' review and approval of the Advisor's investment advisory agreement with the Trust is available in the Fund's annual report to shareholders for the fiscal period ended April 30, 2025.

**Portfolio Managers**

David Miller and Charles Ashley are jointly and primarily responsible for the day-to-day management of the Fund. Mr. Miller is the Lead Portfolio Manager of the Fund.

**David Miller**, Co-Owner, Chief Investment Officer, and Senior Portfolio Manager of the Advisor since 2016, has served as a Portfolio Manager of the Fund since 2021. He is the Chief Investment Officer of the Advisor and Catalyst, an affiliate of the Advisor, since 2016 and 2006, respectively. He co-founded Catalyst in 2006, and is responsible for the day-to-day management of several funds managed by Catalyst. Mr. Miller is also a member of Catalyst International Advisors LLC since 2019, Insights Media LLC since 2019, and Catalyst Insurance Corporation II from 2018 to 2021. He received a BS in Economics from the University of Pennsylvania, Wharton School and an MBA in Finance from the University of Michigan, Ross School of Business.

**Charles Ashley**, Portfolio Manager of the Advisor since 2019 and Catalyst since November 2017, has served as a Portfolio Manager of the Fund since 2021. Mr. Ashley joined Rational in February 2016 as a senior analyst to provide investment research and assist with the day-to-day management of several mutual funds. Mr. Ashley has an MBA from the University of Michigan, Ross School of Business and a B. A. from the Michigan State University, Eli Broad College of Business.

The SAI provides additional information about the portfolio managers' compensation, management of other accounts, and ownership of securities in the Fund.

**Manager-of-Managers Order**

An affiliate of the Advisor has received an exemptive order (the "Order") from the SEC that permits the Advisor, with the Trust's Board of Trustees' approval, to enter into, or materially amend, sub-advisory agreements with one or more sub-advisers who are not affiliated with the Advisor without obtaining shareholder approval. Shareholders will be notified if and when a new sub-adviser is employed by the Advisor within 90 days of such change.

**Fees Paid to Advisor**

As full compensation for its services to the Fund, the Advisor receives monthly compensation from the Fund at the annual rate of 0.79% of the Fund's average daily net assets. In consideration of the fees paid with respect to the Fund, the Adviser has agreed to pay all routine expenses of the Fund (including, without limitation, transfer agent fees, administrative fees and expenses, custodian fees, legal fees, accounting fees, any other expenses (including clerical expenses) of issue, sale, repurchase or redemption of shares, expenses of registering or qualifying shares for sale, transfer taxes, all expenses of preparing the Trust's registration statement and prospectus for the Fund, and the cost of printing and delivering to shareholders prospectuses and reports), except for the Fund's management fee; payments under any 12b-1 plan; taxes; brokerage commissions and trading costs; interest (including borrowing costs and overdraft charges); short sale dividends and interest expenses; acquired fund fees and expenses; and non-routine or extraordinary expenses of the Fund (such as litigation or reorganizational costs), each of which is paid by the Fund.

**DIVIDENDS AND DISTRIBUTIONS**

**Distributions.** The Fund does not offer a dividend reinvestment service to facilitate the reinvestment of distributions into additional Fund shares. The Fund intends to declare dividends on investment income, if any, monthly. The Fund also intends to make distributions of net capital gains, if any, at least annually. Dividends and capital gains distributions will be paid in cash.

Please refer to the section headings "Additional Information About the Fund's Principal Investment Strategies and Related Risks – Principal Investment Strategies –Distribution Policy and Goals" and "Additional Information About

the Fund's Principal Investment Strategies and Related Risks – Principal Investment Risks" for a detailed description of the Fund's distribution policy and tax consequences.

**Dividend Reinvestment Services.** If you hold Fund shares through a broker that offers a dividend reinvestment service, you may elect to reinvest dividends and capital gains distributed by the Fund in additional shares of the Fund. Contact your broker to determine whether a reinvestment service is available, and to discuss any related charges associated with the use of the reinvestment service.

As with all ETFs, reinvestment of dividend and capital gains distributions in additional shares of the Fund will occur after the ex-dividend date (the date when a distribution of dividends or capital gains is deducted from the price of the Fund's shares). The exact number of days depends on your broker. During that time, the amount of your distribution will not be invested in the Fund, and therefore will not share in the Fund's income, gains, and losses. A shareholder will have an adjusted basis in the additional shares of the Fund acquired through a reinvest service equal to the amount of the reinvested distribution, and the holding for the new shares shall commence on the day after such shares are credited to the shareholder's account.

**TAX CONSEQUENCES**

There are many important tax consequences associated with investment in the Fund offered by this Prospectus. The following is a brief summary of certain federal income tax consequences relating to an investment in the Fund. It is not a substitute for personal tax advice. You may also be subject to state and local tax on the Fund's distributions and the sale of Fund shares. Consult your personal tax adviser about the potential tax consequences of your investment in the Fund under all applicable tax laws. For more information, please see the SAI section "Taxes."

**Taxation of Distributions.** The Fund is treated as a separate entity for Federal tax purposes. The Fund intends to qualify as a "regulated investment company" ("RIC") for U.S. federal income tax purposes. If the Fund qualifies as a RIC, and satisfies certain distribution requirements, it will not be required to pay U.S. federal income taxes on income and gains it distributes to its shareholders.

The Fund intends to distribute substantially all of its net investment income (including net realized capital gains and tax-exempt interest income, if any) to its shareholders at least annually. Generally, distributions are subject to federal income tax for the year in which they are paid. Distributions paid in January, but declared by the Fund in October, November or December of the previous year, may be taxable to shareholders in the previous year.

Generally, you are required to pay federal income tax on any dividends and other distributions, including capital gains distributions received, that are paid from the Fund's current and accumulated earnings and profits. This applies whether dividends and other distributions are received in cash or as additional shares. Distributions in excess of the Fund's current and accumulated earnings and profits are treated as a tax-free return of capital to the extent of your basis in the Shares and as capital gain thereafter. A written statement will accompany any such distribution informing you that the distribution is a return of capital. If you hold Fund shares in a tax-qualified retirement account, you generally will not be subject to federal taxation on Fund distributions until you begin receiving distributions from your retirement account.

Distributions paid out of the Fund's income and net short-term gains, if any, are taxable as ordinary income or qualified dividend income. Distributions representing long-term capital gains, if any, will be taxable to you as long-term capital gains no matter how long you have held the shares. Distributions are taxable to you even if they are paid from income or gains earned by the Fund before your investment (and thus were included in the price paid).

Individuals, trusts and estates whose income exceeds certain threshold amounts will be subject to a 3.8% Medicare contribution tax on "net investment income." Net investment income includes any ordinary dividends and capital gain distributions from the Fund, as well as any capital gains recognized on the sale or exchange of Fund shares.

Distributions of investment income designated by the Fund as derived from "qualified dividend income" (income

from taxable domestic corporations and certain qualified corporations) will be taxed at the rate applicable to long-term capital gains, provided holding period and other requirements are met at both the shareholder and Fund level. Long-term capital gain distributions paid to certain high-income taxpayers are subject to a regular tax rate of 20%. High income taxpayers, for this purpose, are defined, in 2025 as individuals and married couples filing jointly whose taxable income exceeds $533,400 and $600,050, respectively, per year.

**Foreign Securities.** The Fund may be subject to foreign withholding taxes on income it earns from investing in foreign securities, which may reduce the return on such investments.

**Backup Withholding.** If you fail to furnish the Fund with your correct and certified Social Security or Taxpayer Identification Number, the Fund may be required to withhold federal income tax (backup withholding) from dividends, capital gain distributions, and redemptions. You are urged to read the additional information concerning withholding provided in the SAI.

**Non-U.S. Investors.** If you are not a citizen or permanent resident of the U.S., the Fund's ordinary income dividends will generally be subject to a 30% U.S. withholding tax, unless a lower treaty rate applies or such income is effectively connected with a U.S. trade or business. The Fund may, under certain circumstances, designate all or a portion of a dividend as an "interest-related dividend" that if received by a nonresident alien or foreign entity generally would be exempt from the 30% U.S. withholding tax, provided that certain other requirements are met. The Fund may also, under certain circumstances, designate all or a portion of a dividend as a "short-term capital gain dividend," which, if received by a nonresident alien or foreign entity, generally would be exempt from the 30% U.S. withholding tax, unless the foreign person is a nonresident alien individual present in the U.S. for a period or periods aggregating 183 days or more during the taxable year.

**Taxes on Exchange-Listed Sales and Cash Redemptions of Creation Units.** You will recognize a taxable gain or loss upon the sale of the Fund's shares in the secondary market and upon the cash redemption of the Fund's Creation Unit. Currently, any capital gain or loss realized from the sale of the Fund's shares for cash will generally be treated as long-term capital gain or loss if those shares have been held for more than one year and as short-term capital gain or loss if those shares have been held for one year or less. Any capital loss arising from the sale or disposition of the Fund's shares held for six months or less will be treated as long-term capital loss to the extent of the amount of capital gain dividends received, or undistributed capital gain deemed received, with respect to the shares. All or a portion of any loss recognized upon the disposition of the Fund's shares may be disallowed under "wash sale" rules if other shares of the Fund are purchased (whether through reinvestment of distributions or otherwise) within 30 days before or after the disposition. If disallowed, the loss will be reflected in an adjustment to the basis of the shares that you acquired.

**Taxes on In-Kind Purchases and Redemptions of Creation Units.** An Authorized Participant who exchanges securities or securities and cash for a Creation Unit will generally recognize a gain or loss equal to the difference between the market value of the Creation Unit at the time of purchase (plus any cash received by the Authorized Participant as part of the issue) and the exchanger's aggregate basis in the securities surrendered and the amount of any cash paid for the Creation Unit. An Authorized Participant who exchanges a Creation Unit for securities or securities and cash will generally recognize a gain or loss equal to the difference between the exchanger's basis in the Creation Unit (plus any cash paid by the Authorized Participant as part of the redemption) and the aggregate market value of the securities and cash received for the Creation Unit. The Internal Revenue Service, however, may assert that a loss realized upon an exchange of primarily securities for a Creation Unit cannot be deducted currently under the rules governing "wash sales," or on the basis that there has been no significant change in economic position. Persons exchanging securities should consult their own tax adviser with respect to whether wash sale rules apply and when a loss might be deductible. Under current federal tax laws, any capital gain or loss realized upon redemption of a Creation Unit is generally treated as long-term capital gain or loss if the shares have been held for more than one year and as short-term capital gain or loss if the shares have been held for one year or less. If you purchase or redeem Creation Units, you will be sent a confirmation statement showing how many Creation Units of the Fund you purchased or sold and at what price.

If the Fund redeems Creation Units in cash, it may recognize more capital gains than it will if it redeems Creation Units in-kind.

**FINANCIAL HIGHLIGHTS**

**Strategy Shares Gold Enhanced Yield ETF (GOLY)**

The financial highlights table below is intended to help you understand the Fund's financial performance since its inception. Certain information reflects financial results for a single share. The total returns in the table represent the rate that an investor would have earned (or lost) on an investment in the Fund (assuming reinvestment of all dividends and other distributions). This information has been derived from the Fund's financial statements, which have been audited by Cohen & Company, Ltd., the Fund's independent registered public accounting firm, whose report, along with the Fund's financial statements, is included in the Fund's Annual Report for the fiscal year ended April 30, 2025. The information for the six-month period ended October 31, 2025, is unaudited and is derived from the Fund's financial statements included in the Fund's most recent Semi-Annual Report. The Fund's Annual and Semi-Annual Reports are available upon request.

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| | | | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Net Asset** **<br> Value, <br> beginning <br> of period** | **Net** **<br> investment <br> income <br> (loss)<sup>(a)</sup>** | **Net** **<br> realized <br> and <br> unrealized <br> gains <br> (losses)** | **Total from** **<br> investment <br> activities** | **Distributions** **<br> from net <br> investment <br> income** | **Distributions** **<br> from Return <br> of Capital** | **Total** **<br> distributions** | **Net** **<br> Asset <br> Value, <br> end of <br> period** | **Total** **<br> return at <br> Net <br> Asset <br> Value<sup>(b)(c)</sup>** | **Ratio of** **<br> Net <br> Expenses <br> to <br> Average <br> Net <br> Assets<sup>(d)</sup>** | **Ratio of** **<br> Gross <br> Expenses <br> to <br> Average <br> Net <br> Assets<sup>(d)(e)</sup>** | **Ratio of** **<br> Net <br> Investment <br> Income <br> (Loss) to <br> Average <br> Net <br> Assets<sup>(d)</sup>** | **Net** **<br> Assets at <br> end of <br> period <br> (000's)** | **Portfolio** **<br> turnover<sup>(b)(i)</sup>** |
| **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** | **Gold Enhanced Yield ETF\*** |
| Six months ended October 31, 2025 (Unaudited) | $28.82 | 0.57 | 5.12 | 5.69 | (1.23) |  | (1.23) | $33.28 | 20.31% | 0.78% | 0.78% | 3.60% | $122152 | 9% |
| Year Ended April 30, 2025 | $21.59 | 0.92 | 7.42 | 8.34 | (1.11) |  | (1.11) | $28.82 | 39.59% | 0.78% | 0.78% | 3.59% | $33145 | 35% |
| Year Ended April 30, 2024 | $21.07 | 0.55 | 0.63<sup>(h)</sup> | 1.18 | (0.56) | (0.10) | (0.66) | $21.59 | 5.91% | 0.79% | 0.79% | 2.77% | $3239 | 12% |
| Year Ended April 30, 2023 | $21.61 | 0.51 | (0.54) | (0.03) | (0.51) | (0.00)<sup>(g)</sup> | (0.51) | $21.07 | 0.09% | 0.79% | 0.79% | 2.61% | $14747 | 11% |
| May 17, 2021<sup>(f)</sup> through April 30, 2022 | $25.00 | 0.28 | (3.22) | (2.94) | (0.45) |  | (0.45) | $21.61 | (11.94)% | 0.78% | 0.78% | 1.24% | $15129 | –% |

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<sup>(a)</sup> Calculated using the average shares method.

<sup>(b)</sup> Not annualized for periods less than one year.

<sup>(c)</sup> Net asset value total return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all distributions, including dividends and return of capital, at net asset value during the period, if any, and redemption on the last day of the period at net asset value. This percentage is not an indication of the performance of a shareholder's investment in the Fund based on market value due to differences between the market price of the shares and the net asset value per share of the Fund.

<sup>(d)</sup> Annualized for periods less than one year.

<sup>(e)</sup> Certain fees were waived and/or reimbursed. If such waivers/reimbursements had not occurred, the ratios would have been as indicated.

<sup>(f)</sup> Commencement of operations.

<sup>(g)</sup> Amount is less than ($0.005).

<sup>(h)</sup> The amount of net realized and unrealized gain on investments per share does not accord with the amounts in the Statements of Operations due to the timing of shareholder subscriptions and redemptions relative to fluctuating net asset values during the year.

<sup>(i)</sup> Portfolio turnover increases/decreases due to change within the portfolio holdings during the period.

\* Statement has been consolidated.

**PREMIUM/DISCOUNT INFORMATION**

The Fund's daily NAV, and information showing the number of days the market price of the Fund's shares was greater (at a premium) and less (at a discount) than the Fund's NAV for the most recently completed calendar year, and the most recently completed calendar quarters since that year (or the life of the Fund, if shorter), is available at www.strategysharesetfs.com.

More information about the Fund is available free of charge, upon request, including the following:

**Annual and Semi-Annual Reports**

Additional information about the Fund's investments is available in the Fund's annual and semi-annual reports to shareholders and Form N-CSR filed with the SEC. In the Fund's annual report, 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.

**Statement of Additional Information (SAI)**

The SAI provides more detailed information about the Fund and its policies. A current SAI is on file with the SEC and is incorporated by reference into (considered a legal part of) this Prospectus.

**Rational Advisors, Inc.** is the Advisor to the Fund.

**Foreside Fund Services, LLC** is the Distributor.

To obtain the SAI, Annual Report, Semi-Annual Report and other information without charge, and to make inquiries:

**Call**

(855) 4SS-ETFS or (855) 477-3837

**Write**

Strategy Shares, 36 North New York Avenue, Huntington, New York 11743

**Log on the Internet**

You may also access Fund information, including copies of the most current SAI and annual and semi-annual reports, information on the Fund's NAV, market price, premiums and discounts, and bid-ask spreads, at www.strategysharesetfs.com. Reports and other information about the Fund are available on the EDGAR Database on the SEC's website at www.sec.gov.

**Contact the SEC**

You may request Fund information from the SEC by e-mail at publicinfo@sec.gov. A duplicating fee will apply.

Investment Company Act of 1940 No. 811-22497

![(LOGO)](st003_v1.jpg)

36 North New York Avenue

Huntington, NY 11743

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| | |
|:---|:---|
| **<u>Series of the Trust</u>** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**<u>Cboe BZX Exchange, Inc. Ticker Symbol</u>** |
| Strategy Shares Gold Enhanced Yield ETF | &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;GOLY |

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**STATEMENT OF ADDITIONAL INFORMATION**

This Statement of Additional Information ("SAI") contains information that may be of interest to investors in Strategy Shares Gold Enhanced Yield ETF (the "Fund"), a series of Strategy Shares (the "Trust"), but that is not included in the Fund's prospectus, dated May 6, 2026 (the "Prospectus"). This SAI is not a prospectus and is only authorized for distribution when accompanied or preceded by the Prospectus. This SAI should be read together with the Prospectus. This SAI incorporates by reference the audited financial statements and Report of Independent Registered Public Accounting Firm in the Fund's [Annual Report](https://www.sec.gov/ix?doc=/Archives/edgar/data/0001506213/000158064225004098/strategyshares_n-csr.htm) for the fiscal year ended April 30, 2025 and the Fund's [Semi-Annual Report](https://www.sec.gov/Archives/edgar/data/810695/000158064223004766/rational_ncsrs.htm) to shareholders for the fiscal period ended October 31, 2025. Investors may obtain a free copy of the Prospectus by writing the Trust at 36 North New York Avenue, Huntington, NY 11743, or by telephoning toll free 800-253-0412. This SAI is also available on the Fund's website at <u>www.strategysharesetfs.com</u>.

**May 6, 2026**

*****TABLE OF CONTENTS*****

---

| | |
|:---|:---|
| ***DEFINITIONS*** | ***1*** |
| ***OVERVIEW OF THE TRUST*** | ***2*** |
| ***EXCHANGE LISTING AND TRADING*** | ***2*** |
| ***INVESTMENT PRACTICES*** | ***3*** |
| ***INVESTMENT RISKS*** | ***18*** |
| ***INVESTMENT RESTRICTIONS*** | ***27*** |
| ***MANAGEMENT*** | ***29*** |
| ***SERVICE PROVIDERS*** | ***35*** |
| ***SUPPLEMENTAL PAYMENTS TO FINANCIAL INTERMEDIARIES*** | ***39*** |
| ***PURCHASE AND REDEMPTION OF CREATION UNITS*** | ***39*** |
| ***BROKERAGE TRANSACTIONS*** | ***48*** |
| ***ADDITIONAL INFORMATION ABOUT THE TRUST*** | ***49*** |
| ***FEES PAID FOR SERVICES*** | ***49*** |
| ***PRINCIPAL HOLDERS OF SECURITIES*** | ***50*** |
| ***BOOK ENTRY ONLY SYSTEM*** | ***50*** |
| ***VOTING PROXIES OF FUND PORTFOLIO SECURITIES*** | ***51*** |
| ***PORTFOLIO HOLDINGS DISCLOSURE PRACTICES*** | ***51*** |
| ***ORGANIZATION AND MANAGEMENT OF WHOLLY OWNED SUBSIDIARY*** | ***52*** |
| ***CODE OF ETHICS*** | ***52*** |
| ***PORTFOLIO TURNOVER*** | ***53*** |
| ***DETERMINATION OF NET ASSET VALUE*** | ***53*** |
| ***TAXES*** | ***53*** |
| ***DIVIDENDS AND DISTRIBUTIONS*** | ***62*** |
| ***FINANCIAL STATEMENTS*** | ***62*** |
| ***APPENDIX 1*** | ***63*** |
| ***APPENDIX 2*** | ***66*** |

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**DEFINITIONS**

For convenience, we will use the following defined terms throughout this SAI.

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| | |
|:---|:---|
| Defined Term | &nbsp;&nbsp;Definition |
| Advisor | &nbsp;&nbsp;Rational Advisors, Inc. |
| Advisers Act | &nbsp;&nbsp;Investment Advisers Act of 1940, as amended. |
| Authorized Participant | &nbsp;&nbsp;An entity that has entered a Participant Agreement with the Distributor that has been accepted by the Custodian with respect to the offer and sale of the Fund's Creation Units and is either a participant in the CNS System or is a DTC Participant. |
| Board | &nbsp;&nbsp;Board of Trustees of the Trust. |
| Business Day | &nbsp;&nbsp;Any day that the Exchange is open for business. As of the date of this SAI, the Exchange observes the following holidays: New Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Juneteenth National Independence Day, Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. |
| Citi | &nbsp;&nbsp;Citi Fund Services Ohio, Inc., the financial administrator, fund accountant, and transfer agent of the Trust. |
| CNS System | &nbsp;&nbsp;Continuous Net Settlement System of the NSCC. |
| CNS Participant | &nbsp;&nbsp;An entity that participates in the CNS System. |
| Code | &nbsp;&nbsp;Internal Revenue Code of 1986, as amended. |
| Creation Unit | &nbsp;&nbsp;Block of 10,000 Fund shares. |
| Custodian | &nbsp;&nbsp;Citibank, N.A. |
| Distributor | &nbsp;&nbsp;Foreside Fund Services, LLC. |
| DTC | &nbsp;&nbsp;Depository Trust Company. |
| DTC Participant | &nbsp;&nbsp;An entity for which DTC holds securities and which has access to the DTC system. |
| ETF | &nbsp;&nbsp;Exchange-traded fund. |
| Exchange | &nbsp;&nbsp;Cboe BZX Exchange, Inc. |
| Fund | &nbsp;&nbsp;Strategy Shares Gold Enhanced Yield ETF. |
| Independent Trustees | &nbsp;&nbsp;Trustees who are not "interested persons" of the Trust, as defined in the 1940 Act. |
| Interested Trustees | &nbsp;&nbsp;Trustees who are "interested persons" of the Trust, as defined in the 1940 Act. |
| NAV | &nbsp;&nbsp;Net asset value. |
| NRSRO | &nbsp;&nbsp;Nationally Recognized Statistical Ratings Organization, such as Moody's Investors Service ("Moody's") or S&P Global Ratings ("S&P"). |
| NSCC | &nbsp;&nbsp;National Securities Clearing Corporation, a clearing agency registered with the SEC. |
| SEC | &nbsp;&nbsp;U.S. Securities and Exchange Commission. |
| Subsidiary | &nbsp;&nbsp;SSGBI Fund Limited, a Cayman Islands company. |
| Transfer Agent | &nbsp;&nbsp;Citi. |
| 1933 Act | &nbsp;&nbsp;The Securities Act of 1933, as amended. |
| 1934 Act | &nbsp;&nbsp;The Securities Exchange Act of 1934, as amended. |
| 1940 Act | &nbsp;&nbsp;The Investment Company Act of 1940, as amended. |

---

**OVERVIEW OF THE TRUST**

The Trust was organized on September 7, 2010 as a Delaware statutory trust and is registered under the 1940 Act as an open-end management investment company.

The Declaration of Trust permits the Trust to issue an unlimited number of shares of beneficial interest in one or more series representing interests in separate portfolios of securities. The Declaration of Trust also permits the Trust to offer two or more classes of shares. Currently, the Trust offers its shares in several separate series. The Fund is a diversified exchange-traded series of the Trust and seeks income and long-term capital appreciation. The Fund commenced operations on May 17, 2021. Additional series may be created from time to time.

The Fund only offers, sells, and redeems shares on a continuous basis at NAV in large aggregations or "Creation Units." The Fund's shares are not individually redeemable.

Currently, the Fund's Creation Unit is comprised of 10,000 shares. Under the Declaration of Trust, the Board has the unrestricted right and power to alter the number of shares of the Fund that constitute a Creation Unit. Therefore, in the event of a termination of the Fund, the Board, in its sole discretion, could determine to permit the Fund's shares to be individually redeemable. In such circumstances, the Trust might elect to pay cash redemptions to all shareholders with an "in-kind" election for shareholders owning in excess of a certain stated minimum amount.

Generally, the Fund sells and redeems Creation Units on an in-kind basis. Except for the circumstances specified in this SAI (see "Cash Transactions - Generally" and "Custom Transactions" below), investors will generally be required to purchase Creation Units by making an in-kind deposit of specified instruments ("Deposit Instruments"), and shareholders redeeming their shares will generally receive an in-kind transfer of specified instruments ("Redemption Instruments"). The names and quantities of the instruments that constitute the Deposit Instruments, and the names and quantities of the instruments that constitute the Redemption Instruments, will be specified by the Fund each day, and these instruments are referred to, in the case of either a purchase or a redemption, as the "Creation Basket." If there is a difference between the NAV of a Creation Unit and the aggregate market value of the Creation Basket exchanged for a Creation Unit, the party conveying instruments with the lower value will also pay to the other an amount in cash equal to that difference ("Cash Amount").

The Fund may impose a transaction fee in connection with the purchase and redemption of its Creation Units. Such fees will be limited in accordance with the requirements of the SEC applicable to management investment companies offering redeemable securities.

Once "created," the Fund's shares trade in the secondary market at market prices that change throughout the day.

**EXCHANGE LISTING AND TRADING**

Shares of the Fund are approved for listing and trading on the Exchange, subject to notice of issuance, and will be available for purchase and sale through a broker-dealer at market price on each day that the Exchange is open for business. The market price of the Fund's shares may trade below, at, or above the most recently calculated NAV per share of the Fund. As is the case of other publicly traded securities, your purchase or sale of Fund shares in the secondary market will be subject to brokerage commissions, which will be based on negotiated commission rates at customary levels.

There can be no assurance that the requirements of the Exchange necessary to maintain the listing of shares of the Fund will continue to be met. The Exchange maintains certain listing standards and requires listed companies like the Fund to continue to comply with such standards while their shares are available for trading on the Exchange. The Exchange may, but is not required to, remove the shares of the Fund from listing if: (1) following the initial twelve-month period beginning upon the commencement of trading of the shares, there are fewer than 50 beneficial holders of the shares for at least 30 consecutive trading days; (2) the Fund is no longer eligible to operate in reliance on Rule 6c-11 under the 1940 Act; (3) the Fund fails to meet certain continued listing standards of the Exchange; or (4) such other event shall occur or condition exists that, in the opinion of the Exchange, makes further dealings on the Exchange inadvisable. In addition, the Exchange will remove the shares from listing and trading upon termination of the Trust or the Fund.

The base and trading currencies of the Fund is the U.S. dollar. The base currency is the currency in which the Fund's NAV is calculated, and the trading currency is the currency in which shares of the Fund are listed and traded on the Exchange.

The Trust reserves the right to adjust the share price of the Fund in the future to 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.

**INVESTMENT PRACTICES**

The Prospectus discusses the Fund's principal investment strategies. Below you will find more details about the types of investments and investment practices permitted by the Fund, including those which are not part of the Fund's principal investment strategy. These investment practices affect the Fund directly, as well as through the underlying ETFs in which it invests.

**EQUITY SECURITIES**

Equity securities include both foreign and domestic common stocks, preferred stocks, exchange-traded funds, other business organizations, real estate investment trusts, and other securities which the Advisor believes have equity characteristics.

**Common Stock**

Common stock is a type of equity security which represents an ownership interest in a corporation (including real estate investment trusts ("REITs") discussed below) and the right to a portion of the assets of the corporation in the event of liquidation. This right, however, is subordinate to that of preferred stockholders and any creditors, including holders of debt issued by a corporation. Owners of common stock are generally entitled to vote on important matters. A corporation may pay dividends on common stock.

**Preferred Stock**

Preferred stock is a type of equity security which represents an ownership interest in a corporation and the right to a portion of the assets of the corporation in the event of liquidation. This right, however, is subordinate to that of any creditors, including holders of debt issued by the corporation. Owners of preferred stock ordinarily do not have voting rights, but are entitled to dividends at a specified rate if the corporation has the financial ability to pay such dividends.

**Exchange-Traded Funds**

ETFs are traded on stock exchanges or on the over-the-counter market at their market price. Certain ETFs track the performance of a designated index or benchmark and invest in the securities comprising that index or benchmark. Other ETFs do not attempt to track the performance of an index and hold portfolio securities that are actively managed by their investment advisor. ETFs generally issue and redeem shares in creation units (large aggregations of shares) at their NAV per share, generally in exchange for: (1) a portfolio of securities that correspond pro rata to the securities comprising the product's investment portfolio; and/or (2) a specified amount of cash.

Generally, shares of ETFs are not individually redeemable. To redeem, the Fund must accumulate enough shares to reconstitute a creation unit of the ETF. The liquidity of small holdings of an ETF, therefore, will depend upon the existence of a secondary market.

**Interests in Other Business Organizations**

Entities such as limited partnerships, limited liability companies, and companies organized outside the U.S. (see "Foreign Securities" below) may issue securities comparable to common or preferred stock. Limited partnerships are partnerships consisting of one or more general partners, by whom the business is conducted, and one or more limited partners, who contribute capital to the partnership. Limited liability companies frequently consist of one or more managing members, by whom the business is conducted, and other members, who contribute capital to the company. Limited partners and members of limited liability companies generally are not liable for the debts of the partnership or limited liability company beyond their capital contributions or commitments. Limited partners and non-managing members are not involved in the day-to-day management of the partnership or limited liability company. They receive income and capital gains from the partnership or limited liability company in accordance with the terms established in the partnership or operating agreement. Typical limited

partnerships and limited liability companies are involved in real estate, oil and gas, and equipment leasing, but they also finance movies, research and development, and other projects.

For an organization classified as a partnership under the Code (including most limited partnerships and limited liabilities companies), each item of income, gain, loss, deduction, and credit is not taxed at the partnership level, but flows through with the same character to the partners or members. This allows the partnership to avoid double taxation.

A master limited partnership ("MLP") is a publicly traded limited partnership or limited liability company. MLPs combine the tax advantages of a partnership with the liquidity of a publicly traded security. MLPs must limit their operations to avoid being taxed as corporations under the Code.

**REITs**

REITs, or real estate investment trusts, are pooled investment vehicles which invest primarily in income producing real estate or real estate related loans or interests. REITs are generally classified as equity REITs, mortgage REITs, or a combination of equity and mortgage REITs. Equity REITs invest the majority of their assets directly in real property and derive income primarily from the collection of rents. Equity REITs can also realize capital gains by selling property that has appreciated in value. Mortgage REITs invest the majority of their assets in real estate mortgages and derive income from the collection of interest payments. The real property and mortgages serving as investment vehicles for REITs may be either residential or commercial in nature. Similar to investment companies, REITs are not taxed on income distributed to shareholders, provided they comply with several requirements of the Code. Such tax requirements may limit a REIT's ability to respond to changes in the commercial real estate market.

**FIXED INCOME SECURITIES**

Fixed income securities include convertible securities (other than preferred stock), corporate debt securities, money market instruments, U.S. Government securities, and zero-coupon securities, which provide a stream of fixed payments to the holder.

**Convertible Securities**

Convertible securities include certain fixed income securities that may be exchanged or converted into a predetermined number of shares of an issuer's underlying common stock at the option of the holder during a specified period. Convertible securities may take the form of convertible preferred stock, convertible bonds or debentures, units consisting of "usable" bonds and warrants, or a combination of the features of several of these securities. The investment characteristics of each convertible security vary widely, which allows convertible securities to be employed for a variety of investment strategies. The Fund will exchange or convert the convertible securities held in its portfolio into shares of the underlying common stock when, in the Advisor's opinion, the investment characteristics of the underlying common stock will assist the Fund in achieving its investment objective. Otherwise, the Fund may hold or trade convertible securities.

**Corporate Debt Securities (Including Bonds, Notes, and Debentures)**

Corporate debt includes any obligation of a corporation to repay a borrowed amount at maturity and, usually, to pay the holder interest at specific intervals. Corporate debt can have a long or short maturity and is often rated by one or more NRSROs. See Appendix 1 to this SAI for a description of these ratings.

The credit risk of an issuer's debt security may vary based on its priority for repayment. For example, higher ranking (senior) debt securities have a higher priority than lower ranking (subordinated) securities. This means that the issuer might not make payments on subordinated securities while continuing to make payments on senior securities. In addition, in the event of bankruptcy, holders of senior securities may receive amounts otherwise payable to the holders of subordinated securities. Some subordinated securities, such as trust preferred and capital securities notes, also permit the issuer to defer payments under certain circumstances. For example, insurance companies issue securities known as surplus notes that permit the insurance company to defer any payment that would reduce its capital below regulatory requirements.

**Money Market Instruments**

Except where otherwise noted, the Fund may, pending investment or for liquidity purposes, invest its assets in money market instruments.

**Bank Obligations.** Bank obligations are short-term obligations issued by U.S. and foreign banks, including bankers' acceptances, certificates of deposit, time deposits, and similar securities.

Bankers' acceptances are negotiable drafts or bills of exchange typically drawn by an importer or exporter to pay for specific merchandise that are "accepted" by a bank, meaning, in effect, that the issuing bank unconditionally agrees to pay the face value of the instrument on maturity. Investments in bankers' acceptances will be limited to those guaranteed by domestic and foreign banks having, at the time of investment, total assets of $1 billion or more (as of the date of the institution's most recently published financial statements).

Certificates of deposit and time deposits represent funds deposited in a commercial bank or a savings and loan association for a definite period of time and earn a specified return.

Investments in certificates of deposit and time deposits may include Eurodollar Certificates of Deposit, which are U.S. dollar denominated certificates of deposit issued by offices of foreign and domestic banks located outside the U.S., Yankee Certificates of Deposit, which are certificates of deposit issued by a U.S. branch of a foreign bank denominated in U.S. dollars and held in the U.S., Eurodollar Time Deposits, which are U.S. dollar denominated deposits in a foreign branch of a U.S. bank or a foreign bank, and Canadian Time Deposits, which are U.S. dollar denominated certificates of deposit issued by Canadian offices of major Canadian banks. All investments in certificates of deposit and time deposits will be limited to those (a) of domestic and foreign banks and savings and loan associations which, at the time of investment, have total assets of $1 billion or more (as of the date of the institution's most recently published financial statements), or (b) the principal amount of which is insured by the Federal Deposit Insurance Corporation.

**Commercial Paper and Variable Amount Master Demand Notes.** Commercial paper (including Section 4(2) commercial paper) consists of unsecured promissory notes issued by corporations normally having maturities of 270 days or less and rates of return which are fixed. These investments may include Canadian Commercial Paper, which is U.S. dollar denominated commercial paper issued by a Canadian corporation or a Canadian counterpart of a U.S. corporation, and europaper, which is

U.S. dollar denominated commercial paper of a foreign issuer.

Variable amount master demand notes are unsecured demand notes that permit the indebtedness thereunder to vary and provide for periodic adjustments in the interest rate according to the terms of the instrument. Because master demand notes are direct lending arrangements between the Fund and the issuer, they are not normally traded. Although there is no secondary market in the notes, the Fund may demand payment of principal and accrued interest at any time. A variable amount master demand note will be deemed to have a maturity equal to the longer of the period of time remaining until the next readjustment of its interest rate or the period of time remaining until the principal amount can be recovered from the issuer through demand.

**Variable Rate Demand Notes.** Variable rate demand notes ("VRDNs") are unsecured, direct lending arrangements between the Fund, as the lender, and a corporation, financial institution, government agency, municipality or other entity.

VRDNs have interest rates which float, or which are adjusted at regular intervals ranging from daily to annually. Although VRDNs are not generally traded, the Fund may demand payment of principal and accrued interest according to its arrangement with the borrower (usually upon no more than seven days' notice). VRDNs are, therefore, treated as maturing on the later of the next interest adjustment or the date on which the Fund may next demand payment. Some VRDNs are backed by bank letters of credit.

The Fund may only invest in VRDNs which satisfy its credit requirements for commercial paper.

**Other Money Market Instruments.** These instruments may include: obligations (certificates of deposit, time deposits, bank master notes, and bankers' acceptances) of thrift institutions and savings and loans, provided that such institutions have total assets of $1 billion or more as shown on their last published financial statements at the time of investment; short-term corporate obligations rated within the three highest rating categories by an NRSRO (e.g., at least A by S&P or A by Moody's) at the time of investment, or, if not rated, determined by the Advisor to be of comparable quality; general obligations issued by the U.S. Government and backed by its full faith and credit, and obligations issued or guaranteed as to principal and interest by agencies or instrumentalities of the U.S. Government (e.g., obligations issued by Farmers Home Administration, Government National Mortgage Association, Federal Farm Credit Bank, and Federal Housing Administration); receipts, including Treasury Receipts, Treasury Income Growth Receipts, and Certificates of Accrual on Treasuries; repurchase agreements involving such obligations; money market funds; and foreign commercial paper.

**U.S. Government Securities**

U.S. Government securities are securities that are either issued or guaranteed as to payment of principal and interest by the U.S. Government, its agencies or instrumentalities. U.S. Government securities are limited to direct obligations of the U.S. Treasury, such as bills, notes, and bonds of the U.S. Treasury, and notes, bonds, and discount notes of U.S. Government agencies or instrumentalities, including certain mortgage securities.

Agency securities are issued or guaranteed by a federal agency or other government sponsored entity ("GSE") acting under federal authority. Some GSE securities are supported by the full faith and credit of the U.S. Government and some GSE securities are not. GSE securities backed by the full faith and credit of the U.S. Government include securities issued by the Government National Mortgage Association, Small Business Administration, Farm Credit System Financial Assistance Corporation, Farmers Home Administration, Federal Financing Bank, General Services Administration, Department of Housing and Urban Development, Export-Import Bank, Overseas Private Investment Corporation, and Washington Metropolitan Area Transit Authority Bonds.

GSE securities which are not backed by the full faith and credit of the U.S. Government, but receive support through federal subsidies, loans or other benefits, include securities issued by the Federal Home Loan Bank System, Federal Home Loan Mortgage Corporation, Federal National Mortgage Association and Tennessee Valley Authority.

Certain other GSE securities are not backed by the full faith and credit of the U.S. Government and have no explicit financial support, including securities issued by the Farm Credit System Financing Corporation, and Resolution Funding Corporation.

Investors regard agency securities as having low credit risks, but not as low as Treasury securities. The Fund treats mortgage-backed securities guaranteed by a GSE as if issued or guaranteed by a federal agency. Although such a guarantee protects against credit risks, it does not reduce market and prepayment risks.

From time to time, uncertainty regarding the status of negotiations in the U.S. Government to increase the statutory debt limit, commonly called the "debt ceiling," could increase the risk that the U.S. Government may default on payments on certain U.S. Government securities, cause the credit rating of the U.S. Government to be downgraded, increase volatility in the stock and bond markets, result in higher interest rates, reduce prices of U.S. Treasury securities, and/or increase the costs of various kinds of debt. If the Fund holds securities of a U.S. Government-sponsored entity that is negatively impacted by legislative or regulatory action, is unable to meet its obligations, or its creditworthiness declines, the performance of the Fund will be adversely impacted.

**Zero Coupon Securities**

Zero-coupon securities are debt obligations which are generally issued at a discount, are payable in full at maturity, and do not provide for current payments of interest prior to maturity. Zero-coupon securities usually trade at a deep discount from their face or par value and are subject to greater market value fluctuations from changing interest rates than debt obligations of comparable maturities which make current distributions of interest. As a result, the NAV of shares of the Fund investing in zero-coupon securities may fluctuate over a greater range than shares of other investment companies investing in securities making current distributions of interest and having similar maturities.

Zero-coupon securities may include U.S. Treasury bills issued directly by the U.S. Treasury or other short-term debt obligations, and longer-term bonds or notes and their unmatured interest coupons which have been separated by their holder, typically a custodian bank or investment brokerage firm. A number of securities firms and banks have stripped the interest coupons from the underlying principal (the "corpus") of U.S. Treasury securities and resold them in custodial receipt programs with a number of different names, including TIGRS and CATS. The underlying U.S. Treasury bonds and notes themselves are held in book-entry form at the Federal Reserve Bank or, in the case of bearer securities (i.e., unregistered securities that are owned ostensibly by the bearer or holder thereof), in trust on behalf of the owners thereof.

In addition, the U.S. Treasury has facilitated transfers of ownership of zero-coupon securities by accounting separately for the beneficial ownership of particular interest coupons and corpus payments on U.S. Treasury securities through the Federal Reserve book-entry record-keeping system. The Federal Reserve program, as established by the U.S. Treasury Department, is known as "STRIPS," or "Separate Trading of Registered Interest and Principal of Securities." Under the STRIPS program, the Fund will be able to have its beneficial ownership of U.S. Treasury zero-coupon securities recorded directly in the book-

entry record-keeping system in lieu of having to hold certificates or other evidence of ownership of the underlying U.S. Treasury securities.

When debt obligations have been stripped of their unmatured interest coupons by the holder, the stripped coupons are sold separately. The principal or corpus is sold at a deep discount because the buyer receives only the right to receive a future fixed payment on the security and does not receive any rights to periodic cash interest payments. Once stripped or separated, the corpus and coupons may be sold separately. Typically, the coupons are sold separately or grouped with other coupons with like maturity dates, and sold in such bundled form. Purchasers of stripped obligations acquire, in effect, discount obligations that are economically identical to the zero-coupon securities issued directly by the obligor.

**FOREIGN SECURITIES (including Emerging Markets Securities)**

Generally, foreign securities are those securities which are issued by companies organized outside the U.S. and principally traded in foreign markets ("Foreign Companies"). This includes equity and fixed income securities of Foreign Companies and obligations of foreign branches of U.S. banks and foreign or U.S. branches of foreign banks, including European Certificates of Deposit, European Time Deposits, Canadian Time Deposits, Canadian Yankee Bonds, Canadian Certificates of Deposit, investments in Canadian Commercial Paper, and europaper. In addition, the Fund may invest in depositary receipts. The Fund may also invest in securities issued or guaranteed by Foreign Companies or foreign governments, their political subdivisions, agencies or instrumentalities, and obligations of supranational entities, such as the World Bank and the Asian Development Bank.

Since foreign securities are normally denominated and traded in foreign currencies, the value of the Fund's assets invested in such securities may be affected favorably or unfavorably by currency exchange rates and exchange control regulation. Although foreign exchange dealers do not charge a fee for currency conversion, they do realize a profit based on the difference (the "spread") between prices at which they buy and sell various currencies. Thus, a dealer may offer to sell a foreign currency to the Fund at one rate, while offering a lesser rate of exchange should the Fund desire to resell that currency to the dealer. For additional information, see "Foreign Currency Transactions" below.

The Fund may also invest in securities of emerging market issuers. A nation's economy that is progressing toward becoming advanced, as shown by some liquidity in local debt and equity markets and the existence of some form of market exchange and regulatory body, is considered to be an emerging market.

Emerging markets generally do not have the level of market efficiency and strict standards in accounting and securities regulation to be on par with advanced economies (such as the United States, Europe and Japan), but emerging markets will typically have a physical financial infrastructure, including banks, a stock exchange and a unified currency. Emerging markets may be sought by investors for the prospect of high returns, as they often experience faster economic growth, as measured by GDP. Investments in emerging markets may involve greater risk due to political instability, domestic infrastructure problems, currency volatility, and limited equity opportunities. Also, local stock exchanges may not offer liquid markets for outside investors.

Some emerging market countries may have fixed or managed currencies that are not free-floating against the U.S. dollar. Further, certain currencies may not be traded internationally. Certain of these currencies have experienced a steady devaluation relative to the U.S. dollar. Any devaluation in the currencies in which the Fund's securities are denominated may have a detrimental impact on the Fund.

The taxation systems at the federal, regional and local levels in developing or emerging market countries may be less transparent and inconsistently enforced, and subject to sudden change. Developing or emerging market countries may also have a higher degree of corruption and fraud than developed market countries, as well as counterparties and financial institutions with less financial sophistication, creditworthiness and/or resources. Emerging markets countries may have less developed legal systems allowing for enforcement of private property rights and/or redress for injuries to private property, such as bankruptcy. The ability to bring and enforce actions in developing or emerging market countries, or to obtain information needed to pursue or enforce such actions, may be limited, and shareholder claims may be difficult or impossible to pursue.

Some countries with emerging securities markets have experienced substantial, and in some periods, extremely high, rates of inflation for many years. Inflation and rapid fluctuation in inflation rates have had, and may continue to have, negative effects on the economies and securities markets of certain countries. Moreover, the economies of some countries may differ favorably

or unfavorably from the U.S. economy in such respects as the rate of growth of gross domestic product, the rate of inflation, capital reinvestment, resource self-sufficiency, number and depth of industries forming the economy's base, governmental controls and investment restrictions that are subject to political change, and balance of payments position. Further, there may be greater difficulties or restrictions with respect to investments made in emerging market countries. Emerging markets typically have substantially less volume than U.S. markets. In addition, securities in many such markets are less liquid, and their prices often are more volatile, than securities of comparable U.S. companies. Such markets often have different clearance and settlement procedures for securities transactions, and in some markets there have been times when settlements have been unable to keep pace with the volume of transactions, making it difficult to conduct transactions. Delays in settlement could result in temporary periods when assets may be uninvested. Settlement problems in emerging markets countries also could cause the Fund to miss attractive investment opportunities. Satisfactory custodial services may not be available in some emerging markets countries, which may result in the Fund incurring additional costs and delays in the transportation and custody of such securities. Emerging securities markets may also be subject to unexpected market closures.

Emerging market countries may also have less stringent regulatory, disclosure, financial reporting, accounting, auditing and recordkeeping standards than companies in more developed countries and, as a result, the nature and quality of such information may vary. Information about such companies may be less available and reliable and, therefore, the ability to conduct adequate due diligence in developing or emerging markets may be limited, which can impede the Fund's ability to evaluate such companies. In addition, certain developing or emerging market countries may impose material limitations on Public Company Accounting Oversight Board ("PCAOB") inspection, investigation and enforcement capabilities that hinder the PCAOB's ability to engage in independent oversight or inspection of accounting firms located or operating in certain developing or emerging markets. There is no guarantee that the quality of financial reporting, or the audits conducted by audit firms of developing or emerging market issuers, meet PCAOB standards.

For more information regarding the risks associated with investing in emerging markets, please see "Emerging Markets Risk" below.

**Depositary Receipts**

American Depositary Receipts ("ADRs") are securities, typically issued by a U.S. financial institution (a "depositary"), that evidence ownership interests in a security or a pool of securities issued by a foreign issuer and deposited with the depositary. ADRs include American Depositary Shares and New York Shares. European Depositary Receipts ("EDRs"), which are sometimes referred to as Continental Depositary Receipts ("CDRs"), are securities, typically issued by a non-U.S. financial institution, that evidence ownership interests in a security or a pool of securities issued by either a U.S. or foreign issuer. Global Depositary Receipts ("GDRs") are issued globally and evidence a similar ownership arrangement. Generally, ADRs are designed for trading in the U.S. securities markets, EDRs are designed for trading in European securities markets, and GDRs are designed for trading in non-U.S. securities markets. The Fund will only invest in ADRs, EDRs, CDRs, and GDRs available for investment through "sponsored facilities." A sponsored facility is established jointly by the issuer of the security underlying the receipt and a depositary.

**Foreign Government Securities**

Foreign government securities generally consist of fixed income securities supported by national, state or provincial governments, or similar political subdivisions. Foreign government securities also include debt obligations of supranational entities, such as international organizations designed or supported by governmental entities to promote economic reconstruction or development, international banking institutions, and related government agencies. Examples of these include, but are not limited to, the International Bank for Reconstruction and Development (the "World Bank"), the Asian Development Bank, the European Investment Bank, and the Inter-American Development Bank.

Foreign government securities also include fixed income securities of quasi-governmental agencies that are either issued by entities owned by a national, state or equivalent government or are obligations of a political unit that are not backed by the national government's full faith and credit.

**Foreign Currency Transactions**

Foreign currency transactions include purchasing and selling foreign currencies, entering into forward or futures contracts to purchase or sell foreign currencies (see "Forward Foreign Currency Contracts and Foreign Currency Futures Contracts" below), and purchasing and selling options on foreign currencies (see "Foreign Currency Options" below). Foreign currency transactions may be used to hedge against uncertainty in the level of future foreign currency exchange rates and to increase current return.

Purchases and sales of foreign currencies on a spot basis are used to increase current return. They are also used in connection with both "transaction hedging" and "position hedging." Transaction hedging involves entering into foreign currency transactions with respect to specific receivables or payables generally arising in connection with the purchase or sale of portfolio securities. Transaction hedging is used to "lock in" the U.S. dollar price of a security to be purchased or sold, or the U.S. dollar equivalent of a dividend or interest payment in a foreign currency. The goal is to protect against a possible loss resulting from an adverse change in the relationship between the U.S. dollar and the applicable foreign currency during the period between the date on which the security is purchased or sold, or on which the dividend or interest payment is declared, and the date on which such payments are made or received.

Position hedging involves entering into foreign currency transactions either to protect against: (1) a decline in the value of a foreign currency in which a security held or to be sold is denominated; or (2) an increase in the value of a foreign currency in which a security to be purchased is denominated. In connection with position hedging, the Fund may purchase put or call options on foreign currency and foreign currency futures contracts, and buy or sell forward contracts and foreign currency futures contracts.

Neither transaction hedging nor position hedging eliminates fluctuations in the underlying prices of the securities that the Fund owns or intends to purchase or sell. They simply establish a rate of exchange that can be achieved at some future point in time. Additionally, although these techniques tend to minimize the risk of loss due to a decline in the value of the hedged currency, they also tend to limit any potential gain that might result from the increase in the value of such currency.

Hedging transactions are subject to correlation risk due to the fact that the amounts of foreign currency exchange transactions and the value of the portfolio securities involved will not generally be perfectly matched. This is because the future value of such securities in foreign currencies will change as a consequence of market movements in the values of those securities between the dates the currency exchange transactions are entered into and the dates they mature.

**DERIVATIVE CONTRACTS**

Derivative contracts are financial instruments that require payments based upon changes in the values of designated (or underlying) securities, currencies, commodities, financial indices or other assets. Some derivative contracts (such as futures, forwards and options) require payments relating to a future trade involving the underlying asset. Other derivative contracts (such as swaps) require payments relating to the income or returns from the underlying asset. The other party to a derivative contract is referred to as a counterparty.

Depending upon how the Fund uses derivative contracts, and the relationships between the market value of a derivative contract and the underlying asset, derivative contracts may increase or decrease the Fund's exposure to interest rate and currency risks, among other risks, and may also expose the Fund to liquidity and leverage risks. Over-the-counter ("OTC") contracts also expose the Fund to credit risks in the event that a counterparty defaults on the contract.

**Options on Equities, Fixed Income Securities, and Stock Indices**

A call option gives the purchaser of the option the right to buy a security at a stated price from the writer (seller) of the option. A put option gives the purchaser of the option the right to sell a security at a stated price to the writer (seller) of the option. In a covered call option and during the option period, the writer owns the security (or a comparable security sufficient to satisfy securities exchange requirements) which may be sold pursuant to the option. In a covered put option, the writer holds cash and/or short-term debt instruments in an amount equal to the exercise price of the option. In addition, a call or put will be considered covered if and to the extent that some or all of the risk of the option has been offset by another position. The Fund may write combinations of covered puts and calls on the same underlying security. In general, the Fund may write options in an attempt to increase returns or purchase options for hedging purposes.

The premium received from writing a put or call option increases the Fund's return on the underlying security in the event that the option expires unexercised or is closed out at a profit. The amount of the premium reflects, among other things, the relationship between the exercise price and the current market value of the underlying security, the volatility of the underlying security, the amount of time remaining until expiration, current interest rates, and the effect of supply and demand in the options market and in the market for the underlying security. A put option locks in the price at which the Fund may sell a security it holds, thus hedging against market declines. Such protection is provided during the life of the put option since the Fund, as holder of the option, is able to sell the underlying security at the option's exercise price regardless of any decline in the underlying security's market price. A call option locks in the price at which the Fund may purchase a security, thus hedging against an increase in the market price of a security.

By writing a call option, the Fund limits its opportunity to profit from any increase in the market value of the underlying security above the exercise price of the option, but continues to bear the risk of a decline in the value of the underlying security. By writing a put option, the Fund assumes the risk that it may be required to purchase the underlying security for an exercise price higher than its then current market value, resulting in a potential capital loss unless the security subsequently appreciates in value.

The Fund may terminate an option that it has written prior to its expiration by entering into a closing purchase transaction, in which it purchases an offsetting option. The Fund realizes a profit or loss from a closing transaction if the cost of the transaction (option premium plus transaction costs) is less or more than the premium received from writing the option. Because increases in the market price of a call option generally reflect increases in the market price of the security underlying the option, any loss resulting from a closing purchase transaction may be offset in whole or in part by unrealized appreciation of the underlying security owned by the Fund.

In order for a put option to be profitable, the value of the underlying security/index must decline sufficiently below the exercise price to cover the premium and transaction costs. By using put options in this manner, the Fund will reduce any profit it might otherwise have realized from appreciation of the underlying security/index by the premium paid for the put option and by transaction costs.

In order for a call option to be profitable, the market price of the underlying security/index must rise sufficiently above the exercise price to cover the premium and transaction costs. The successful use of options depends on the ability of the Advisor to forecast interest rates and market movements. For example, if the Fund were to write a call option based on the Advisor's expectation that the price of the underlying security will fall, but the price rises instead, the Fund could be required to sell the security upon exercise at a price below the current market price. Similarly, if the Fund were to write a put option based on the Advisor's expectations that the value of the underlying security will rise, but the price falls instead, the Fund could be required to purchase the security upon exercise at a price higher than the current market price.

**Foreign Currency Options**

Options on foreign currencies operate similarly to options on securities and are traded primarily in the over-the-counter market ("OTC options"), although options on foreign currencies may also be listed on several exchanges. Options will be purchased or written only when the Advisor believes that a liquid secondary market exists for such options. There can be no assurance that a liquid secondary market will exist for a particular option at any specific time. Options on foreign currencies are affected by all of those factors which influence exchange rates and investments generally.

Purchases and sales of options may be used to increase current return. They are also used in connection with hedging transactions. (See "Foreign Currency Transactions" above).

Writing covered call options on currencies may offset some of the costs of hedging against fluctuations in currency exchange rates. For transaction hedging purposes, the Fund may also purchase exchange-listed and OTC put and call options on foreign currency futures contracts and on foreign currencies. The purchase of a put option on a futures contract gives the Fund the right to assume a short position in the futures contract until expiration of the option. The purchase of a call option on a futures contract gives the Fund the right to assume a long position in the futures contract until the expiration of the option.

The value of a foreign currency option is dependent upon the value of the foreign currency and the U.S. dollar, and may have no relationship to the investment merits of a foreign security. Because foreign currency transactions occurring in the interbank market involve substantially larger amounts than those that may be involved in the use of foreign currency options, investors

may be disadvantaged by having to deal in an odd lot market (generally consisting of transactions of less than $1 million) for the underlying foreign currencies at prices that are less favorable than for round lots.

There is no systematic reporting of last sale information for foreign currencies, and there is no regulatory requirement that quotations available through dealers or other market sources be firm or revised on a timely basis. Available quotation information is generally representative of very large transactions in the interbank market and thus may not reflect relatively smaller transactions (less than $1 million) where rates may be less favorable. The interbank market in foreign currencies is a global, around-the-clock market. To the extent that the U.S. options markets are closed while the markets for the underlying currencies remain open, significant price and rate movements may take place in the underlying markets that cannot be reflected in the U.S. options markets. Options contracts are generally valued at the mean of the bid and ask price as reported on the highest-volume exchange (in terms of the number of option contracts traded for that issue) on which such options are traded.

**Futures Contracts and Options on Futures Contracts**

A futures contract is a binding contractual commitment which, if held to maturity, will result in an obligation to make or accept delivery of a security at a specified future time and price. By purchasing futures contracts (assuming a "long" position), the Fund will legally obligate itself to accept the future delivery of the underlying security and pay the agreed price. By selling futures contracts (assuming a "short" position), the Fund will legally obligate itself to make the future delivery of the security against payment of the agreed price. Positions taken in the futures markets are not normally held to maturity, but are instead liquidated through offsetting transactions, which may result in a profit or a loss. While futures positions taken by the Fund will usually be liquidated in this manner, the Fund may instead make or take delivery of the underlying securities whenever it appears economically advantageous to the Fund to do so. Futures contracts in the U.S. have been designed by exchanges that have been designated "contract markets" by the CFTC and must be executed through a futures commission merchant ("FCM"), which is a brokerage firm that is a member of the relevant contract market. Each exchange guarantees performance of the contracts as between the clearing members of the exchange, thereby reducing the risk of counterparty default. Futures contracts may also be entered into on certain exempt markets, including exempt boards of trade and electronic trading facilities, available to certain market participants. Because all transactions in the futures market are made, offset or fulfilled by an FCM through a clearinghouse associated with the exchange on which the contracts are traded, the Fund will incur brokerage fees when it buys or sells futures contracts. A clearing corporation associated with the exchange on which futures are traded assumes responsibility for such closing transactions and guarantees that the Fund's sale and purchase obligations under closed-out positions will be performed at the termination of the contract. Futures contracts are considered to be commodity contracts.

The Fund may purchase and write put and call options on futures contracts, as they become available. Such options are similar to options on securities, except that options on futures contracts give the purchaser the right, in return for the premium paid, to assume a position in a futures contract (a long position if the option is a call and a short position if the option is a put) at a specified exercise price at any time during the period of the option. As with options on securities, the holder or writer of an option may terminate its position by selling or purchasing an option of the same series. There is no guarantee that such closing transactions can be effected. The Fund will be required to deposit initial margin and variation margin with respect to put and call options on futures contracts written by it pursuant to brokers' requirements, and, in addition, net option premiums received will be included as initial margin deposits. See "Margin Payments" below. Compared to the purchase or sale of futures contracts, the purchase of call or put options on futures contracts involves less potential risk to the Fund because the maximum amount at risk is the premium paid for the options plus transactions costs. However, there may be circumstances when the purchases of call or put options on a futures contract would result in a loss to the Fund when the purchase or sale of the futures contracts would not, such as when there is no movement in the prices of debt securities. The writing of a put or call option on a futures contract involves risks similar to those risks relating to the purchase or sale of futures contracts.

Futures contracts and options thereon may also be used for non-hedging purposes, including to seek to increase liquidity, provide efficient portfolio management, broaden investment opportunities, implement a tax or cash management strategy, gain exposure to a particular security or segment of the market, modify the effective duration of the Fund's portfolio investments, and/or enhance total return. However these instruments are used, their successful use is not assured and will depend upon, among other factors, the Advisor's ability to predict and understand relevant market movements.

**Margin Payments.** When the Fund purchases or sells a futures contract, it is required to deposit with the Custodian an amount of cash, U.S. Treasury bills, or other permissible collateral equal to a small percentage of the amount of the futures contract. This amount is known as "initial margin." The nature of initial margin is different from that of margin in security transactions in that it does not involve borrowing money to finance transactions. Rather, initial margin is similar to a performance bond or

good faith deposit that is returned to the Fund upon termination of the contract, assuming the Fund satisfies its contractual obligations.

Subsequent payments to and from the broker occur on a daily basis in a process known as "marking to market." These payments are called "variation margin," and are made as the value of the underlying futures contract fluctuates. For example, when the Fund sells a futures contract and the price of the underlying security rises above the delivery price, the Fund's position declines in value. The Fund then pays a broker a variation margin payment equal to the difference between the delivery price of the futures contract and the market price of the securities underlying the futures contract. Conversely, if the price of the underlying security falls below the delivery price of the contract, the Fund's futures position increases in value. The broker then must make a variation margin payment equal to the difference between the delivery price of the futures contract and the market price of the security underlying the futures contract.

When the Fund terminates a position in a futures contract, a final determination of variation margin is made, additional cash is paid by or to the Fund, and the Fund realizes a loss or gain. Such closing transactions involve additional commission costs.

**Liquidity risks.** Positions in futures contracts may be closed out only on an exchange or board of trade which provides a secondary market for such futures contracts. Although the Fund intends to purchase or sell futures contracts only on exchanges or boards of trade where there appears to be an active secondary market, there is no assurance that a liquid secondary market on an exchange or board of trade will exist for any particular contract or at any particular time. If there is not a liquid secondary market at a particular time, it may not be possible to close a futures position at such time and, in the event of adverse price movements, the Fund would continue to be required to make daily cash payments of variation margin. However, in the event financial futures contracts are used to hedge portfolio securities, such securities will not generally be sold until the financial futures contracts can be terminated. In such circumstances, an increase in the price of the portfolio securities, if any, may partially or completely offset losses on the financial futures contracts.

In addition to the risks that apply to all options transactions, there are several special risks relating to options on futures contracts. The ability to establish and close out positions in such options will be subject to the development and maintenance of a liquid secondary market. It is not certain that such a market will develop. Although the Fund generally will purchase only those options for which there appears to be an active secondary market, there is no assurance that a liquid secondary market on an exchange will exist for any particular option or at any particular time. In the event no such market exists for particular options, it might not be possible to effect closing transactions in such options, with the result that the Fund would have to exercise the options in order to realize any profit.

**Hedging risks.** There are several risks in connection with the use by the Fund of futures contracts and related options as a hedging device. One risk arises because of the imperfect correlation between movements in the prices of the futures contracts and options and movements in the prices of the securities which are the subject of the hedge. The Advisor or Sub-Advisor will, however, attempt to reduce this risk by purchasing and selling, to the extent possible, futures contracts and related options on securities and indices the movements of which will, in its judgment, correlate closely with movements in the prices of the portfolio securities sought to be hedged.

Successful use of futures contracts and options by the Fund for hedging purposes is also subject to the Advisor's ability to predict correctly movements in the direction of the market. It is possible that, where the Fund has purchased puts on futures contracts to hedge its portfolio against a decline in the market, the securities or index on which the puts are purchased may increase in value and the value of securities held in the portfolio may decline. If this occurred, the Fund would lose money on the puts and also experience a decline in value in its portfolio securities. In addition, the prices of futures contracts, for a number of reasons, may not correlate perfectly with movements in the underlying securities or index due to certain market distortions. First, all participants in the futures market are subject to margin deposit requirements. Such requirements may cause investors to close futures contracts through offsetting transactions which could distort the normal relationship between the underlying security or index and futures markets. Second, the margin requirements in the futures markets are less onerous than margin requirements in the securities markets in general, and as a result the futures markets may attract more speculators than the securities markets do. Increased participation by speculators in the futures markets may also cause temporary price distortions. Due to the possibility of price distortion, even a correct forecast of general market trends by the Advisor may still not result in a successful hedging transaction over a very short time period.

**Other risks.** The Fund will incur brokerage fees in connection with its futures and options transactions. In addition, while futures contracts and options on futures contracts will be purchased and sold to reduce certain risks, those transactions

themselves entail certain other risks. Thus, while the Fund may benefit from the use of futures and related options, unanticipated changes in interest rates or asset price movements may result in a poorer overall performance for the Fund than if it had not entered into any futures contracts or options transactions. Moreover, in the event of an imperfect correlation between the futures position and the portfolio position which is intended to be protected, the desired protection may not be obtained, and the Fund may be exposed to risk of loss.

**Index Futures Contracts and Options on Index Futures Contracts**

A stock index futures contract is a contract to buy or sell units of a stock index at a specified future date at a price agreed upon when the contract is made. A debt index futures contract is a contract to buy or sell units of a specified debt index at a specified future date at a price agreed upon when the contract is made. A unit is the current value of the index.

The following example illustrates generally the manner in which index futures contracts operate. The Standard & Poor's 100 Stock Index ("S&P 100") is composed of 100 selected common stocks, most of which are listed on the New York Stock Exchange ("NYSE"). The S&P 100 assigns relative weightings to the common stocks included in the Index, and the Index fluctuates with changes in the market values of those common stocks. In the case of the S&P 100, contracts are to buy or sell 100 units. Thus, if the value of the S&P 100 were $180, one contract would be worth $18,000 (100 units x $180). The stock index futures contract specifies that no delivery of the actual stocks making up the index will take place. Instead, settlement in cash must occur upon the termination of the contract, with the settlement being the difference between the contract price and the actual level of the stock index at the expiration of the contract. For example, if the Fund enters into a futures contract to buy 100 units of the S&P 100 at a specified future date at a contract price of $180, and the S&P 100 is at $184 on that future date, the Fund will gain $400 (100 units x gain of $4).

If the Fund enters into a futures contract to sell 100 units of the stock index at a specified future date at a contract price of $180, and the S&P 100 is at $182 on that future date, the Fund will lose $200 (100 units x loss of $2). The Fund may purchase or sell futures contracts with respect to any stock index. Positions in index futures contracts may be closed out only on an exchange or board of trade which provides a secondary market for such futures contracts. Purchases and sales of index futures contracts may be used to hedge an investment. To hedge an investment successfully, however, the Fund must invest in futures contracts with respect to indices or sub-indices the movements of which will have a significant correlation with movements in the prices of the Fund's securities.

Options on index futures contracts are similar to options on securities, except that options on index futures contracts give the purchaser the right, in return for the premium paid, to assume a position in an index futures contract (a long position if the option is a call and a short position if the option is a put) at a specified exercise price at any time during the period of the option. Upon exercise of the option, the holder assumes the underlying futures position and receives a variation margin payment of cash or securities approximating the increase in the value of the holder's option position. If an option is exercised on the last trading day prior to the expiration date of the option, the settlement is made entirely in cash based on the difference between the exercise price of the option and the closing level of the index on which the futures contract is based on the expiration date. Purchasers of options who fail to exercise their options prior to the exercise date suffer a loss of the premium paid. As an alternative to purchasing call and put options on index futures contracts, the Fund may purchase put and call options on the underlying indices themselves to the extent that such options are traded on national securities exchanges. Index options are similar to options on individual securities in that the purchaser of an index call option acquires the right to buy, and the writer undertakes the obligation to sell, an index at a stated exercise price during the term of the option. Instead of giving the right to take or make actual delivery of securities, the holder of an index option has the right to receive a cash "exercise settlement amount." This amount is equal to the amount by which the fixed exercise price of the option exceeds (in the case of a put) or is less than (in the case of a call) the closing value of the underlying index on the date of the exercise, multiplied by a fixed "index multiplier." The Fund will enter into an option position only if there appears to be a liquid secondary market for such options.

The aggregate premium paid on all options on stock indices will not exceed 20% of the Fund's total assets.

**Forward Foreign Currency Contracts and Foreign Currency Futures Contracts**

A forward foreign currency contract involves an obligation to purchase or sell a specific currency at a future date, which may be any fixed number of days from the date of the contract as agreed by the parties, at a price set at the time of the contract. In the case of a cancelable forward contract, the holder has the unilateral right to cancel the contract at maturity by paying a specified

fee. The contracts are traded in the interbank market conducted directly between currency traders (usually large commercial banks) and their customers. A forward contract generally has no deposit requirement, and no commissions are charged at any stage for trades; however, the market for forward contracts includes a "bid-ask spread" charged by the currency traders, commercial banks or other participants that trade forward contacts.

A foreign currency futures contract is a standardized contract for the future delivery of a specified amount of a foreign currency at a future date at a price set at the time of the contract. Foreign currency futures contracts traded in the U.S. are designed by and traded on exchanges regulated by the CFTC, such as the Chicago Mercantile Exchange.

Forward foreign currency contracts differ from foreign currency futures contracts in certain respects. For example, the maturity date of a forward contract may be any fixed number of days from the date of the contract agreed upon by the parties, rather than a predetermined date in a given month. Forward contracts may be in any amounts agreed upon by the parties rather than predetermined amounts. Also, forward foreign currency contracts are traded directly between currency traders so that no intermediary is required. A forward contract generally requires no margin or other deposit.

At the maturity of a forward or futures contract, the Fund may either accept or make delivery of the currency specified in the contract, or at or prior to maturity enter into a closing transaction involving the purchase or sale of an offsetting contract. Closing transactions with respect to forward contracts are usually effected with the currency trader who is a party to the original forward contract. Closing transactions with respect to futures contracts are effected on a commodities exchange; a clearing corporation associated with the exchange assumes responsibility for closing out such contracts.

Forward foreign currency contracts and foreign currency futures contracts can be used to increase current return. They are also used in connection with both "transaction hedging" and "position hedging." (See "Foreign Currency Transactions" above).

**Swap Agreements**

The Fund may enter into interest rate, index, asset and currency exchange rate swap agreements in an attempt to obtain a particular desired return at a lower cost to the Fund than if it had been invested directly in an instrument that yielded that desired return. Generally, swap agreements are contracts between the Fund and another party (the swap counterparty) involving the exchange of payments on specified terms over periods ranging from a few weeks to more than one year. A swap agreement may be negotiated bilaterally and traded OTC between the two parties (for an uncleared swap) or, in some instances, must be transacted through an FCM and cleared through a clearinghouse that serves as a central counterparty (for a cleared swap).

In a standard "swap" transaction, two parties agree to exchange the returns (or differentials in rates of returns) earned or realized on particular predetermined investments or instruments. The gross returns to be exchanged or "swapped" between the parties are calculated with respect to a "notional amount," i.e., the return on or increase in value of a particular dollar amount invested at a particular interest rate, in a particular foreign currency, in a particular asset, or in a "basket" of securities representing a particular index. The "notional amount" of the swap agreement is only a fictive basis on which to calculate the obligations the parties to a swap agreement have agreed to exchange. The Fund's obligations (or rights) under a swap agreement will generally be equal only to the amount to be paid or received under the agreement based on the relative values of the positions held by each party to the agreement (the "net amount"). The Fund's obligations under a swap agreement will be accrued daily (offset against any amounts owing to the Fund).

In an uncleared swap, the swap counterparty is typically a brokerage firm, bank or other financial institution. During the term of an uncleared swap, the Fund is required to pledge to the swap counterparty, from time to time, an amount of cash and/or other assets equal to the total net amount (if any) that would be payable by the Fund to the counterparty if all outstanding swaps between the parties were terminated on the date in question, including any early termination payments. Periodically, changes in the amount pledged are made to recognize changes in value of the contract resulting from, among other things, interest on the notional value of the contract, market value changes in the underlying investment, and/or dividends paid by the issuer of the underlying instrument. Likewise, the counterparty may be required to pledge cash or other assets to cover its obligations to the Fund. However, the amount pledged may not always be equal to or more than the amount due to the other party. Therefore, if a counterparty defaults in its obligations to the Fund, the amount pledged by the counterparty and available to the Fund may not be sufficient to cover all the amounts due to the Fund, and the Fund may sustain a loss.

Certain standardized swaps are, and others are eventually expected to be, subject to mandatory central clearing and exchange-

trading. In a cleared swap, the Fund's ultimate counterparty is a central clearinghouse rather than a brokerage firm, bank or other financial institution. Cleared swaps are submitted for clearing through each party's FCM, which must be a member of the clearinghouse that serves as the central counterparty. When the Fund enters into a cleared swap, it must deliver to the central counterparty (via the FCM) an amount referred to as "initial margin." Initial margin requirements are determined by the central counterparty, and are typically calculated as an amount equal to the volatility in market value of the cleared swap over a fixed period, but an FCM may require additional initial margin above the amount required by the central counterparty. During the term of the swap agreement, a "variation margin" amount may also be required to be paid by the Fund, or may be received by the Fund, in accordance with margin controls set for such accounts. If the value of the Fund's cleared swap declines, the Fund will be required to make additional "variation margin" payments to the FCM to settle the change in value. Conversely, if the market value of the Fund's position increases, the FCM will post additional "variation margin" to the Fund's account. At the conclusion of the term of the swap agreement, if the Fund has a loss equal to or greater than the margin amount, the margin amount is paid to the FCM along with any loss in excess of the margin amount. If the Fund has a loss of less than the margin amount, the excess margin is returned to the Fund. If the Fund has a gain, the full margin amount and the amount of the gain is paid to the Fund. Central clearing is intended to reduce counterparty credit risk and increase liquidity, but central clearing does not eliminate these risks and may involve additional costs and risks not involved with uncleared swaps.

Whether the Fund's use of swap agreements enhance the Fund's total return will depend on the Advisor's ability to correctly predict whether certain types of investments are likely to produce greater returns than other investments. Because they are two-party contracts and may have terms of greater than seven days, swap agreements may be considered to be illiquid. Moreover, the Fund bears the risk of loss of the amount expected to be received under a swap agreement in the event of the default or bankruptcy of a swap agreement counterparty. The Advisor or sub-advisor, if any, will cause the Fund to enter into swap agreements only with counterparties that would be eligible for consideration as repurchase agreement counterparties under the Fund's repurchase agreement guidelines.

**Regulation under the Commodity Exchange Act**

The Advisor is registered as a commodity pool operator ("CPO") under the Commodity Exchange Act ("CEA") and the rules of the CFTC and is subject to CFTC regulation with respect to the Fund and the Subsidiary. The CFTC has adopted rules regarding the disclosure, reporting and recordkeeping requirements that apply with respect to the Fund as a result of the Advisor's registration as a CPO. Generally, these rules allow for substituted compliance with CFTC disclosure and shareholder reporting requirements, based on the Advisor's compliance with comparable SEC requirements. This means that for most of the CFTC's disclosure and shareholder reporting requirements applicable to the Advisor as the Fund's CPO, the Advisor's compliance with SEC disclosure and shareholder reporting requirements will be deemed to fulfill the Advisor's CFTC compliance obligations. However, as a result of CFTC regulation with respect to the Fund and the Subsidiary, the Fund may incur additional compliance and other expenses.

**OTHER TRANSACTIONS/INVESTMENTS**

**Exchange-Traded Notes**

The Fund may invest in exchange-traded notes ("ETNs"). ETNs are generally notes representing the debt of the issuer, usually a financial institution. ETNs combine both aspects of bonds and ETFs. An ETN's returns are based on the performance of one or more underlying assets, reference rate or indexes, minus fees and expenses. Similar to ETFs, ETNs are listed on an exchange and traded in the secondary market. However, unlike an ETF, an ETN can be held until the ETN's maturity, at which time the issuer will pay a return linked to the performance of the specific asset, index or rate ("reference instrument") to which the ETN is linked minus certain fees. Unlike regular bonds, ETNs do not make periodic interest payments, and principal is not protected.

The value of an ETN may be influenced by, among other things, time to maturity, level of supply and demand for the ETN, volatility and lack of liquidity in underlying markets, changes in the applicable interest rates, the performance of the reference instrument, changes in the issuer's credit rating, and economic, legal, political, or geographic events that affect the reference instrument. ETNs also incur certain expenses not incurred by their applicable reference instrument. Some ETNs that use leverage can, at times, be relatively illiquid and, thus, they may be difficult to purchase or sell at a fair price. Levered ETNs are subject to the same risk as other instruments that use leverage in any form. While leverage allows for greater potential return, the potential for loss is also greater. Finally, additional losses may be incurred if the investment loses value because, in addition to the money lost on the investment, the loan still needs to be repaid.

**Other Investment Company Securities**

The Fund may invest in securities of other investment companies ("Acquired Funds"), including ETFs and traditional mutual funds, as an efficient means of carrying out its investment policies and managing their uninvested cash.

The Fund's shareholders indirectly bear the expenses of the Acquired Funds in which the Fund invests. Except under exemptive rules or relief from the SEC, including Rule 12d1-4 discussed below, the Fund may not invest more than 10% of its total assets at any one time in the shares of Acquired Funds, 5% of its total assets in the shares of any one Acquired Fund, or own more than 3% of the shares of any one Acquired Fund. When the Fund invests in the shares of Acquired Funds, investment advisory and other fees will apply, and the investment's yield will be reduced accordingly.

Rule 12d1-4 under the 1940 Act allows a fund to acquire the securities of another investment company in excess of the limitations imposed by Section 12 of the 1940 Act without obtaining an exemptive order from the SEC, subject to certain terms and conditions. Among other conditions, the rule generally requires that, prior to acquiring the securities of another fund in reliance on the rule, the acquiring fund must enter into a fund of funds investment agreement with the acquired fund.

Rule 12d1-4 also is designed to limit the use of complex fund structures. Under Rule 12d1-4, an acquired fund is prohibited from purchasing or otherwise acquiring the securities of another investment company or private fund if, immediately after the purchase, the securities of investment companies and private funds owned by the acquired fund have an aggregate value in excess of 10% of the value of the acquired fund's total assets, subject to certain limited exceptions.

In addition to Rule 12d1-4, the 1940 Act and related rules provide other exemptions from these restrictions. For example, these limitations do not apply to investments by the Fund in investment companies that are money market funds, including money market funds that have the Advisor or an affiliate of the Advisor as an investment adviser.

**Repurchase Agreements**

Repurchase agreements are agreements through which banks, broker-dealers, and other financial institutions approved by the Trustees, sell securities (usually U.S. Government securities) to the Fund and agree to repurchase those securities at a specified price and time (usually not more than seven days from the original sale). The seller's obligation to pay the repurchase price is secured by the securities to be repurchased. These securities are required to be held by the Fund, the Custodian, or a third-party custodian. In order to protect the Fund's interest, collateral securities must have a value of at least 100% of the resale price at all times. (The seller must provide additional collateral in the event that this condition is not met). In general, the Advisor will require collateral securities to have a value of at least 102% of the resale price at the time the repurchase agreement is made. The collateral is marked to market on a daily basis, thus enabling the Advisor to determine when to request additional collateral from the seller.

If a seller defaults on its repurchase obligation, the Fund could realize a loss on the sale of the underlying securities to the extent that the proceeds of the sale (including accrued interest) are less than the resale price. In addition, even though the U.S. Bankruptcy Code provides protection to the Fund if the seller becomes bankrupt or insolvent, the Fund may suffer losses in such event.

**Reverse Repurchase Agreements**

The Fund may borrow funds for temporary purposes by entering into reverse repurchase agreements, provided such action is consistent with the Fund's investment objective and fundamental investment restrictions. As a matter of non-fundamental policy, each Fund intends to limit total borrowings under reverse repurchase agreements to no more than 10% of the value of its total assets. Pursuant to a reverse repurchase agreement, the Fund will sell portfolio securities to financial institutions, such as banks or to broker-dealers, and agree to repurchase the securities at a mutually agreed-upon date and price. The Fund intends to enter into reverse repurchase agreements only to avoid otherwise selling securities during unfavorable market conditions to meet redemptions. Reverse repurchase agreements involve the risk that the market value of the securities sold by the Fund may decline below the price at which the Fund is obligated to repurchase the securities. Reverse repurchase agreements and certain other financing transactions that involve a future payment obligation are subject to Rule 18f-4 under the 1940 Act.

**Restricted and Illiquid Securities**

Generally, an "illiquid security" or "illiquid investment" is 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. Illiquid investments generally include investments for which no market exists or which are legally restricted as to their transfer (such as those issued pursuant to an exemption from the registration requirements of the federal securities laws). Restricted securities are generally sold in privately negotiated transactions, pursuant to an exemption from registration under the 1933 Act. If registration of a security previously acquired in a private transaction is required, the Fund, as the holder of the security, may be obligated to pay all or part of the registration expense, and a considerable period may elapse between the time it decides to seek registration and the time it will be permitted to sell a security under an effective registration statement. If, during such a period, adverse market conditions were to develop, the Fund might obtain a less favorable price than prevailed when it decided to seek registration of the security. To the extent it is determined that there is a liquid institutional or other market for certain restricted securities, the Fund would consider them to be liquid securities. An example is a restricted security that may be freely transferred among qualified institutional buyers pursuant to Rule 144A under the 1933 Act, and for which a liquid institutional market has developed. Rule 144A securities may be subject, however, to a greater possibility of becoming illiquid than securities that have been registered with the SEC.

The following factors may be taken into account in determining whether a restricted security is properly considered a liquid security: (i) the frequency of trades and quotes for the security; (ii) the number of dealers willing to buy or sell the security and the number of other potential buyers; (iii) any dealer undertakings to make a market in the security; and (iv) the nature of the security and of the marketplace trades (e.g., any demand, put or tender features, the method of soliciting offers, the mechanics and other requirements for transfer, and the ability to assign or offset the rights and obligations of the security). The nature of the security and its trading includes the time needed to sell the security, the method of soliciting offers to purchase or sell the security, and the mechanics of transferring the security, including the role of parties, such as foreign or

U.S. custodians, sub-custodians, currency exchange brokers, and depositories.

The sale of illiquid investments often requires more time and results in higher brokerage charges or dealer discounts and other selling expenses than the sale of investments eligible for trading on national securities exchanges or in the OTC markets. Illiquid investments often sell at a price lower than similar investments that are not subject to restrictions on resale.

The risk to the Fund in holding illiquid investments is that they may be more difficult to sell if the Fund wants to dispose of the investment in response to adverse developments or in order to raise money for redemptions or other investment opportunities. Illiquid trading conditions may also make it more difficult for the Fund to realize an investment's fair value.

The Fund may also be unable to achieve its desired level of exposure to a certain investment, issuer, or sector due to overall limitations on its ability to invest in illiquid investments and the difficulty in purchasing such 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. Because illiquid investments may not be readily marketable, the portfolio managers and/or investment personnel may not be able to dispose of them in a timely manner. As a result, the Fund may be forced to hold illiquid investments while their price depreciates. Depreciation in the price of illiquid investments may cause the net asset value or market price of the Fund to decline.

**Securities Lending**

In order to generate additional income, the Fund may lend its portfolio securities on a short-term basis to certain brokers, dealers or other financial institutions. In determining whether to lend to a particular broker, dealer or financial institution, the Advisor will consider all relevant facts and circumstances, including the size, creditworthiness and reputation of the borrower. Any loans made will be continuously secured by collateral in cash at least equal to 100% of the value of the securities on loan for the Fund. The Fund may lend up to 33 ⅓% of its total assets. Such loans must be fully collateralized by cash or U.S. government obligations and marked to market daily. Although the loan is fully collateralized, if the borrower defaults, the Fund could lose money.

While portfolio securities are on loan, the borrower will pay to the lending Fund any dividends or interest received on the securities. In addition, the Fund retains all or a portion of the interest received on investment of the collateral or receives a fee from the borrower. Although voting rights, or rights to consent, with respect to the loaned securities pass to the borrower, the lending Fund retains the right to call the loans at any time on reasonable notice, and it will do so to enable the Fund to exercise voting rights on any matters materially affecting the investment. The Fund may also call such loans in order to sell the securities.

One of the risks in lending portfolio securities, as with other extensions of credit, is the possible delay in recovery of the securities or possible loss of rights in the collateral should the borrower fail financially. There is also the risk that, when lending portfolio securities, the securities may not be available to the Fund on a timely basis, and the Fund may, therefore, lose the opportunity to sell the securities at a desirable price. In addition, in the event that a borrower of securities would file for bankruptcy or become insolvent, disposition of the securities may be delayed pending court action.

**When-issued and Delayed Delivery Transactions**

When-issued securities are securities purchased for delivery beyond the normal settlement date at a stated price and yield, and thereby involve risk that the yield obtained in the transaction will be less than that available in the market when the delivery takes place, or that the seller will fail to complete the transaction. In addition, because of delayed settlement, the Fund may pay more than market value on the settlement date. The Advisor may choose to dispose of a commitment prior to settlement. The Fund will not pay for such securities or start earning interest on them until they are received.

The Fund does not intend to engage in when-issued and delayed delivery transactions unless it can physically settle the transaction within 35 days of its trade date.

**INVESTMENT RISKS**

The Prospectus discusses the Fund's principal investment risks. Below you will find more detail about the risks associated with the types of investments and investment practices permitted by the Fund, including those which are not principal investment risks of the Fund.

**EQUITY SECURITIES RISK**

**General Risk**

Equity risk is the risk that stock prices will fall quickly and dramatically over short or extended periods of time. Stock markets tend to move in cycles, with periods of rising prices and periods of falling prices. Often, dramatic movements in prices occur in response to the overall market environment or reports of a company's earnings, economic statistics, or other factors that affect an issuer's profitability. The price of equity securities can decline and reduce the value of a fund investing in equities. Stock markets are volatile.

To the extent that the Fund invests in smaller capitalization stocks, it may be subject to greater risks than those associated with investment in larger, more established companies. Smaller companies tend to have limited product lines, markets, or financial resources and may be dependent on a small management group. Smaller company stocks may be subject to more abrupt or erratic price movements, for reasons such as lower trading volumes, greater sensitivity to changing conditions, and less certain growth prospects. Additionally, there are fewer market makers for these stocks, and wider spreads between quoted bid and ask prices in the over-the-counter market for these stocks. Small cap stocks also tend to be subject to greater liquidity risk, particularly during periods of market disruption, and there is often less publicly available information concerning these securities. A fund that invests in high-quality or "blue chip" equity securities, or securities of established companies with large market capitalizations (which generally have strong financial characteristics), can also be negatively impacted by overall market and economic conditions.

**Exchange-Traded Funds Risk**

ETFs generally present the same primary risks as an investment in a conventional fund (e.g., one that is not exchange traded) that has the same investment objectives, strategies, and policies. The price of an ETF can fluctuate up or down, and the Fund could

lose money investing in the ETF if the prices of the securities owned by the ETF go down. In addition, an investment in an ETF may be subject to the following risks that do not apply to conventional funds: (1) the market price of the ETF's shares may trade above or below their NAV; (2) an active trading market for the ETF's shares may not develop or be maintained; or (3) trading of the ETF's shares may be halted if the listing exchange's officials deem such action appropriate, the shares are delisted from the exchange, or the activation of market-wide "circuit breakers" (which are tied to large decreases in stock prices) halts stock trading generally.

**Market Price Variance Risk (ETFs).** ETFs are listed for trading on a securities exchange and can be bought and sold in the secondary market at market prices. The market prices of ETF shares will fluctuate in response to changes in their respective NAVs and supply and demand for their shares. Differences between secondary market prices and the NAV for an ETF's shares may be due largely to supply and demand forces in the secondary market, which forces may not be the same as those influencing prices for securities or instruments held by the Fund at a particular time. There may, however, be times when the market price and the NAV vary significantly, and an investor may pay more than NAV when buying ETF shares on the secondary market, and receive less than NAV when it sells those ETF shares. The market price of ETF shares includes a "bid-ask spread" charged by the lead market maker, market makers or other participants that trade ETF shares. In times of severe market disruption, the bid-ask spread often increases significantly. This means that an ETF's shares may trade at a discount to NAV, and the discount is likely to be greatest when the price of the ETF's shares is falling fastest, which may be the time that investors most want to sell the ETF's shares. An ETF's investment results are measured based upon the daily NAV of the ETF. Accordingly, the Fund purchasing and selling ETFs in the secondary market may not experience investment results consistent with those purchasing from and redeeming Creation Units with an ETF directly.

**Securities Linked to the Real Estate Market and REIT Risk**

Investing in securities of companies in the real estate industry subjects the Fund to the risks associated with the direct ownership of real estate. These risks include:

● declines in the value of real estate;

● risks related to local, regional, and national economic conditions;

● possible lack of availability of mortgage funds;

● overbuilding;

● extended vacancies of properties;

● increased competition;

● increases in property taxes and operating expenses;

● change in zoning laws;

● losses due to costs resulting from the clean-up of environmental problems;

● liability to third parties for damages resulting from environmental problems;

● casualty or condemnation losses;

● limitations on rents;

● changes in neighborhood values and the appeal of properties to tenants; and

● changes in interest rates.

Securities of companies in the real estate industry include equity REITs and mortgage REITs. 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-liquidations. In addition, equity and mortgage REITs could possibly fail to qualify for tax free pass-through of income under the Code, or to maintain their exemptions from registration under the 1940 Act. The above factors may also adversely affect a borrower's or a lessee's ability to meet its obligations to the REIT. In the event of a 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.

In addition, even the larger REITs in the industry tend to be small to medium-sized companies in relation to the equity markets as a whole. See "Small and Medium Size Company Risk" (below) for a discussion of the risks associated with investments in these companies.

**Small and Medium Size Company Risk**

Companies that are small or unseasoned (e.g., less than three years of operating history) are more likely than larger or established companies to fail or not to accomplish their goals. As a result, the value of their securities could decline significantly. These companies are less likely to survive since they are often dependent upon a small number of products and may have limited financial resources and a small management group. Small or unseasoned companies often have a greater degree of change in earnings and business prospects than larger or established companies, resulting in more volatility in the price of their securities. The securities of small or unseasoned companies may have limited marketability. This factor could cause the value of the Fund's investments to decrease if it needs to sell such securities when there are few interested buyers. Small or unseasoned companies usually have fewer outstanding shares than larger or established companies. Therefore, it may be more difficult to buy or sell large amounts of these shares without unfavorably impacting the price of the security. There may be less publicly available information about small or unseasoned companies. Therefore, when making a decision to purchase a security for the Fund, the Advisor may not be aware of problems associated with the company issuing the security. Investments in the securities of medium-sized companies present risks similar to those associated with small or unseasoned companies, although to a lesser degree due to the larger size of the companies.

**FOREIGN SECURITIES RISK**

**General Risk**

Compared with investing in the U.S., investing in foreign markets involves a greater degree and variety of risk. Investors in international or foreign markets may face delayed settlements, currency controls, and adverse economic developments, as well as higher overall transaction costs. Foreign governments may expropriate assets, impose capital or currency controls, impose punitive taxes, impose limits on ownership, or nationalize a company or industry. Any of these actions could have a severe effect on security prices and impair the Fund's ability to bring its capital or income back to the U.S. The value of foreign securities may be affected by incomplete, less frequent or inaccurate financial information about their issuers, social upheavals or political actions, ranging from tax code changes to governmental collapse. Foreign Companies may also receive less coverage than U.S. companies by market analysts and the financial press. In addition, foreign countries may lack uniform accounting, auditing, and financial reporting standards or regulatory requirements comparable to those applicable to U.S. companies.

The securities of some Foreign Companies are less liquid and, at times, more volatile than securities of comparable U.S. companies. Foreign brokerage commissions and other fees are also generally higher than in the U.S.

In addition, with respect to certain foreign countries, there is a possibility of nationalization or expropriation of assets, confiscatory taxation, political or financial instability, and diplomatic developments which could affect the value of investments in those countries. In certain countries, legal remedies available to investors may be more limited than those available with respect to investments in the U.S. or other countries. The laws of some foreign countries may limit the Fund's ability to invest in securities of certain issuers located in those countries. Special tax considerations apply to foreign securities.

**ADRs and Domestically Traded Foreign Securities Risk**

Because the Fund may invest in ADRs and other domestically traded securities of Foreign Companies, the Fund's share prices may be more affected by foreign economic and political conditions, taxation policies, and accounting and auditing standards than if the Fund did not invest in such securities.

**Currency Risk**

Exchange rates for currencies fluctuate daily. Fluctuations in the U.S. dollar's value versus other currencies may erode or reverse gains from investments denominated in foreign currencies or widen losses. The combination of currency risk and market risk tends to make securities traded in foreign markets more volatile than securities traded exclusively in the U.S. Foreign securities are normally denominated and traded in foreign currencies. As a result, the value of the Fund's foreign investments and the value of its shares may be affected favorably or unfavorably by changes in currency exchange rates relative to the U.S. dollar. The combination of currency risk and market risk tends to make securities traded in foreign markets more volatile than securities traded exclusively in the U.S. Exchange rate fluctuations also may impair an issuer's ability to repay U.S. dollar denominated debt, thereby increasing credit risk of such debt.

**Foreign Custodial Services and Related Investment Costs Risk**

Foreign custodial services and other costs relating to investment in international securities markets are generally more expensive than in the U.S. Foreign markets have settlement and clearance procedures that differ from those in the U.S. Foreign settlement procedures and trade regulations also may involve certain risks, such as delays in payment or delivery of securities, or in the recovery of the Fund's assets held abroad. In certain markets, particularly emerging markets, there have been times when settlements have been unable to keep pace with the volume of securities transactions, making it difficult to conduct such transactions. Inability of the Fund to make intended securities purchases due to settlement problems could cause the Fund to miss attractive investment opportunities. Inability to dispose of a portfolio security caused by settlement problems could result in losses to the Fund due to a subsequent decline in value of the portfolio security. In addition, security settlement and clearance procedures in some emerging market countries may not fully protect the Fund against loss or theft of its assets.

Certain foreign companies may be subject to sanctions, embargoes, or other governmental actions that may impair or otherwise limit the ability to invest in, receive, hold or sell the securities of such companies. These factors may affect the value of investments in those companies. In addition, certain companies may operate in, or have dealings with, countries that the U.S. Government has identified as state sponsors of terrorism. As a result, such companies may be subject to specific constraints or regulations under U.S. law and, additionally, may be subject to negative investor perception, either of which could adversely affect such companies' performance.

**Emerging Markets Risk**

Investing in emerging market securities involves risks which are in addition to the usual risks inherent in foreign investments. Some emerging market countries may have fixed or managed currencies that are not free-floating against the U.S. dollar. Further, certain currencies may not be traded internationally. Certain of these currencies have experienced a steady devaluation relative to the U.S. dollar. Any devaluation in the currencies in which the Fund's securities are denominated may have a detrimental impact on the Fund.

Some countries with emerging securities markets have experienced substantial, and in some periods, extremely high, rates of inflation for many years. Inflation and rapid fluctuation in inflation rates have had, and may continue to have, negative effects on the economies and securities markets of certain countries. Moreover, the economies of some countries may differ favorably or unfavorably from the U.S. economy in such respects as the rate of growth of gross domestic product, the rate of inflation, capital reinvestment, resource self-sufficiency, number and depth of industries forming the economy's base, governmental controls, investment restrictions that are subject to political change, and balance of payments position. Further, there may be greater difficulties or restrictions with respect to investments made in emerging market countries.

Emerging markets typically have substantially less volume than U.S. markets. In addition, securities in many such markets are less liquid, and their prices often are more volatile, than securities of comparable U.S. companies. Such markets often have different clearance and settlement procedures for securities transactions, and in some markets there have been times when settlements have been unable to keep pace with the volume of transactions, making it difficult to conduct transactions. Delays in settlement could result in temporary periods when assets may not be invested. Settlement problems in emerging market countries also could cause the Fund to miss attractive investment opportunities. Satisfactory custodial services may not be available in some emerging market countries, which may result in the Fund incurring additional costs and delays in the transportation and custody of such securities.

**FIXED INCOME SECURITIES RISK**

**Counterparty Credit Risk**

The value of the Fund's investments may be adversely affected if a security's credit rating is downgraded; an issuer of an investment held by the Fund fails to pay an obligation on a timely basis, otherwise defaults, or is perceived by other investors to be less creditworthy; or a counterparty to a derivatives or other transaction with the Fund files for bankruptcy, becomes insolvent, or otherwise becomes unable or unwilling to honor its obligation to the Fund.

**Credit Risk**

Credit risk is the possibility that an issuer may default on a security by failing to pay interest or principal when due. If an issuer defaults, the Fund will lose money.

Many fixed income securities receive credit ratings from services such as S&P and Moody's. These services assign ratings to securities by assessing the likelihood of issuer default. Lower credit ratings correspond to higher credit risk. If a security has not received a rating, the Fund must rely entirely upon the Advisor's credit assessment.

Fixed income securities generally compensate for greater credit risk by paying interest at a higher rate. The difference between the yield of a security and the yield of a U.S. Treasury security with a comparable maturity (the spread) measures the additional interest paid for risk. Spreads may increase generally in response to adverse economic or market conditions. A security's spread may also increase if the security's rating is lowered, or the security is perceived to have an increased credit risk. An increase in the spread will cause the price of the security to decline.

**Interest Rate Risk**

Prices of fixed income securities rise and fall in response to changes in the interest rate paid by similar securities. Generally, when interest rates rise, prices of fixed income securities fall. However, market factors, such as the demand for particular fixed income securities, may cause the price of certain fixed income securities to fall while the prices of other securities rise or remain unchanged. Interest rate changes have a greater effect on the price of fixed income securities with longer durations. Duration measures the price sensitivity of a fixed income security to changes in interest rates.

Changing interest rates may have unpredictable effects on markets, may result in heightened market volatility and increased redemptions, and may detract from the Fund's performance to the extent the Fund is exposed to such interest rates and/or volatility. An increase in prevailing interest rates typically causes the value of existing debt securities to fall, and often has a greater impact on longer-duration debt securities and higher quality debt securities. A general rise in interest rates may cause investors to move out of fixed income securities on a large scale, which could adversely affect the price and liquidity of fixed income securities, and could also result in increased redemptions for the Fund. During periods when inflation rates are high or rising, the Fund may be subject to a greater risk of rising interest rates.

In a low or negative interest rate environment, debt securities may trade at, or be issued with, negative yields, which means the purchaser of the security may receive at maturity less than the total amount invested. In addition, in a negative interest rate environment, if a bank charges negative interest, instead of receiving interest on deposits, a depositor must pay the bank fees to keep money with the bank. To the extent the Fund holds a negatively yielding debt security or has a bank deposit with a negative interest rate, the Fund would generate a negative return on that investment. Cash positions may also subject the Fund to increased counterparty risk to the Fund's bank. Debt market conditions are highly unpredictable, and some parts of the market are subject to dislocations.

If low or negative interest rates become more prevalent in the market and/or if low or negative interest rates persist for a sustained period of time, some investors may seek to reallocate assets to other income-producing assets. This may cause the price of such higher yielding instruments to rise, could further reduce the value of instruments with a negative yield, and may limit the Fund's ability to locate fixed income instruments containing the desired risk/return profile. Changing interest rates, including rates that fall below zero, could have unpredictable effects on the markets and may expose fixed income markets to heightened volatility, increased redemptions, and potential illiquidity. As the federal funds rate rises, interest rates across the financial system also may rise. To the extent interest rates increase substantially and/or rapidly, the Funds may be subject to significant losses.

**ETN Investment Risk**

Because the return on the ETN is dependent on the issuer's ability or willingness to meet its obligations, the value of the ETN may change due to a change in the issuer's credit rating, despite no change in the underlying reference instrument. The market value of ETN shares may differ from the value of the reference instrument.

This difference in price may be due to the fact that the supply and demand in the market for ETN shares at any point in time is not always identical to the supply and demand in the market for the assets underlying the reference instrument that the ETN seeks to track.

There may be restrictions on the Fund's right to redeem its investment in an ETN, which are generally meant to be held until maturity. The Fund's decision to sell its ETN holdings may be limited by the availability of a secondary market. An investor in an ETN could lose some or all of the amount invested.

**DERIVATIVE CONTRACTS RISK**

**General Risk**

The use of derivative contracts involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. First, changes in the value of the derivative contracts in which the Fund invests may not be correlated with changes in the value of the underlying asset or, if they are correlated, may move in the opposite direction than originally anticipated. Second, while some strategies involving derivatives may reduce the risk of loss, they may also reduce potential gains or, in some cases, result in losses by offsetting favorable price movements in portfolio holdings. Third, there is a risk that derivative contracts may be mispriced or improperly valued and, as a result, the Fund may need to make increased cash payments to the counterparty. Fourth, derivative contracts may cause the Fund to realize increased ordinary income or short-term capital gains (which are treated as ordinary income for Federal income tax purposes) and, as a result, may increase taxable distributions to shareholders. Fifth, a common provision in OTC derivative contracts permits the counterparty to terminate any such contract between it and the Fund if the value of the Fund's total net assets declines below a specified level over a given time period. Factors that may contribute to such a decline (which usually must be substantial) include significant shareholder redemptions and/or a marked decrease in the market value of the Fund's investments. Any such termination of the Fund's OTC derivative contracts may adversely affect the Fund (for example, by increasing losses and/or costs, and/or preventing the Fund from fully implementing its investment strategies). Finally, derivative contracts may also involve other risks described in this SAI, such as stock market, interest rate, credit, currency, liquidity and leverage risks.

When a derivative is used as a hedge against an offsetting position that the Fund also holds, any loss generated by that derivative will be substantially offset by the gains on the hedged security, and vice versa. To the extent the Fund uses a derivative security for purposes other than as a hedge, or if the Fund hedges imperfectly, the Fund is directly exposed to the risks of that derivative or other instrument, and any loss generated by that derivative or other instrument will not be offset by a gain.

The Fund's use of derivatives involves risks different from, or possibly greater than, the risks associated with investing directly in securities and other traditional investments. These risks include (i) the risk that the counterparty to a derivative transaction may not fulfill its contractual obligations; (ii) the risk of mispricing or improper valuation; and (iii) the risk that changes in the value of the derivative may not correlate perfectly with the underlying asset, rate or index. Derivative prices are highly volatile and may fluctuate substantially during a short period of time. Such prices are influenced by numerous factors that affect the markets, including, but not limited to: changing supply and demand relationships; government programs and policies; national and international political and economic events; changes in interest rates; and inflation and deflation. Derivative contracts ordinarily have leverage inherent in their terms. The low margin deposits normally required in trading derivatives, including futures contracts, permit a high degree of leverage. Accordingly, a relatively small price movement may result in an immediate and substantial loss to the Fund. The use of leverage may also cause the Fund to liquidate portfolio positions when it would not be advantageous to do so in order to satisfy its obligations or to meet collateral segregations requirements. The use of leveraged derivatives can magnify the Fund's potential for loss and, therefore, amplify the effects of market volatility on the Fund's share price.

**Options Risk**

When the Fund purchases an option, it runs the risk that it will lose its entire investment in the option in a relatively short period of time, unless the Fund exercises the option or enters into a closing sale transaction with respect to the option during the life of the option. If the price of the underlying security does not rise (in the case of a call) or fall (in the case of a put) to an extent sufficient to cover the option premium and transaction costs, the Fund will lose part or all of its investment in the option. This contrasts with an investment by the Fund in the underlying security, since the Fund will not lose any of its investment in such security if the price does not change.

The use of options also involves the risk of imperfect correlation between movements in option prices and movements in the value of the underlying securities.

The effective use of options also depends on the Fund's ability to terminate option positions at times when the Advisor deems it desirable to do so. Although the Fund will take an option position only if the Advisor believes there is a liquid secondary market for the option, there is no assurance that the Fund will be able to effect closing transactions at any particular time or at an acceptable price.

The Fund generally expects that its options transactions will be conducted on recognized exchanges. In certain instances, however, the Fund may purchase and sell options in the OTC markets. The Fund's ability to terminate options in the OTC market may be more limited than for exchange-traded options, and may also involve the risk that securities dealers participating in such transactions would be unable to meet their obligations to the Fund.

The Fund will, however, engage in OTC market transactions only when appropriate exchange-traded transactions are unavailable and when, in the opinion of the Advisor, the pricing mechanism and liquidity of the OTC market is satisfactory, and the participants are responsible parties likely to meet their contractual obligations.

If a secondary trading market in options were to become unavailable, the Fund could no longer engage in closing transactions. Lack of investor interest might adversely affect the liquidity of the market for particular options or series of options. A market may discontinue trading of a particular option or options generally. In addition, a market could become temporarily unavailable if unusual events, such as volume in excess of trading or clearing capability, were to interrupt its normal operations.

A market may at times find it necessary to impose restrictions on particular types of options transactions, such as opening transactions. For example, if an underlying security ceases to meet qualifications imposed by the market or the Options Clearing Corporation, new series of options on that security will no longer be opened to replace expiring series, and opening transactions in existing series may be prohibited. If an options market were to become unavailable, the Fund, as a holder of an option, would be able to realize profits or limit losses only by exercising the option, and the Fund, as option writer, would remain obligated under the option until expiration.

Disruptions in the markets for the securities underlying options purchased or sold by the Fund could result in losses on the options. If trading is interrupted in an underlying security, the trading of options on that security is normally halted as well. As a result, the Fund, as purchaser or writer of an option, will be unable to close out its positions until options trading resumes, and it may be faced with considerable losses if trading in the security reopens at a substantially different price. In addition, the Options Clearing Corporation or other options markets may impose exercise restrictions. If a prohibition on exercise is imposed at the time when trading in the option has also been halted, the Fund, as a purchaser or writer of an option, will be locked into its position until one of the two restrictions has been lifted. If the Options Clearing Corporation were to determine that the available supply of an underlying security appears insufficient to permit delivery by the writers of all outstanding calls in the event of exercise, it may prohibit indefinitely the exercise of put options by holders who would be unable to deliver the underlying interest. The Fund, as holder of such a put option, could lose its entire investment if the prohibition remained in effect until the put option's expiration and the Fund was unable either to acquire the underlying security or to sell the put option in the market.

Special risks are presented by internationally-traded options. Because of time differences between the U.S. and various foreign countries, and because different holidays are observed in different countries, foreign options markets may be open for trading during hours or on days when U.S. markets are closed. As a result, option premium may not reflect the current prices of the underlying interest in the U.S. An exchange-listed option may be closed out only on an exchange which provides a secondary market for an option of the same series. There is no assurance that a liquid secondary market on an exchange will exist for any particular option or at any particular time. If no secondary market were to exist, it would be impossible to enter into a closing transaction to close out an option position. As a result, the Fund may be forced to continue to hold, or to purchase at a fixed price, a security on which it has sold an option at a time when the Advisor believes it is inadvisable to do so.

Higher than anticipated trading activity or order flow, or other unforeseen events, might cause the Options Clearing Corporation or an exchange to institute special trading procedures or restrictions that might restrict the Fund's use of options. The exchanges have established limitations on the maximum number of calls and puts of each class that may be held or written by an investor or group of investors acting in concert. It is possible that the Trust and other clients of the Advisor may be considered such a group. These position limits may restrict the Trust's ability to purchase or sell options on particular securities. Options that are not traded on national securities exchanges may be closed out only with the other party to the option transaction. For that reason, it may be more difficult to close out unlisted options than listed options. Furthermore, unlisted options are not subject to the protection afforded purchasers of listed options by the Options Clearing Corporation.

**Liquidity Risk**

Positions in futures contracts may be closed out only on an exchange or board of trade which provides a secondary market for such futures. Although the Fund intends to purchase or sell futures only on exchanges or boards of trade where there appears to

be an active secondary market, there is no assurance that a liquid secondary market on an exchange or board of trade will exist for any particular contract or at any particular time. If there is not a liquid secondary market at a particular time, it may not be possible to close a futures position at such time and, in the event of adverse price movements, the Fund would continue to be required to make daily cash payments of variation margin. However, in the event financial futures are used to hedge portfolio securities, such securities will not generally be sold until the financial futures can be terminated. In such circumstances, an increase in the price of the portfolio securities, if any, may partially or completely offset losses on the financial futures. In addition to the risks that apply to all options transactions, there are several special risks relating to options on futures contracts. The ability to establish and close out positions in such options will be subject to the development and maintenance of a liquid secondary market. It is not certain that such a market will develop. Although the Fund generally will purchase only those options for which there appears to be an active secondary market, there is no assurance that a liquid secondary market on an exchange will exist for any particular option or at any particular time. In the event no such market exists for particular options, it might not be possible to effect closing transactions in such options, with the result that the Fund would have to exercise the options in order to realize any profit.

**Hedging Risk**

There are several risks in connection with the use by the Fund of futures contracts and related options as a hedging device. One risk arises because of the imperfect correlation between movements in the prices of the futures contracts and options and movements in the prices of securities that are the subject of the hedge. The Advisor will, however, attempt to reduce this risk by purchasing and selling, to the extent possible, futures contracts and related options on securities and indices the movements of which will, in its judgment, correlate closely with movements in the prices of the portfolio securities sought to be hedged.

Successful use of futures contracts and options by the Fund for hedging purposes is also subject to the Advisor's ability to predict correctly movements in the direction of the market. It is possible that, where the Fund has purchased puts on futures contracts to hedge its portfolio against a decline in the market, the securities or index on which the puts are purchased may increase in value, and the value of securities held in the portfolio may decline. If this occurred, the Fund would lose money on the puts, and also experience a decline in value in its portfolio securities. In addition, the prices of futures contracts, for a number of reasons, may not correlate perfectly with movements in the underlying securities or index due to certain market distortions. First, all participants in the futures market are subject to margin deposit requirements. Such requirements may cause investors to close the futures contracts through offsetting transactions, which could distort the normal relationship between the underlying security or index and futures markets. Second, the margin requirements in the futures markets are less onerous than margin requirements in the securities markets in general, and as a result the futures markets may attract more speculators than the securities markets do. Increased participation by speculators in the futures markets may also cause temporary price distortions. Due to the possibility of price distortion, even a correct forecast of general market trends by the Advisor may still not result in a successful hedging transaction over a very short time period.

**Other Risks**

The Fund will incur brokerage fees in connection with their futures and options transactions. In addition, while futures contracts and options on futures will be purchased and sold to reduce certain risks, those transactions themselves entail certain other risks. Thus, while the Fund may benefit from the use of futures contracts and related options, unanticipated changes in interest rates, stock price movements, or other factors affecting the underlying security's price movements may result in a poorer overall performance for the Fund than if it had not entered into any futures contracts or options transactions. Moreover, in the event of an imperfect correlation between the futures position and the portfolio position that is intended to be protected, the desired protection may not be obtained, and the Fund may be exposed to risk of loss.

**Futures Risk**

The Fund's use of futures contracts is subject to the risks associated with derivative instruments generally. In addition, a purchase or sale of a futures contract may result in losses to the Fund in excess of the amount that the Fund delivered as initial margin. Because of the relatively low margin deposits required, futures trading involves a high degree of leverage; as a result, a relatively small price movement in a futures contract may result in immediate and substantial loss, or gain, to the Fund. In addition, if the Fund has insufficient cash to meet daily variation margin requirements or close out a futures position, it may have to sell securities from its portfolio at a time when it may be disadvantageous to do so. There is also a risk of loss by the Fund of the initial and variation margin deposits in the event of bankruptcy of the FCM with which the Fund has an open position in a futures contract.

**Forward Foreign Currency and Foreign Currency Futures Contracts Risk**

Among the risks of using foreign currency futures contracts is the fact that positions in these contracts (and any related options) may be closed out only on an exchange or board of trade which provides a secondary market. Although it is intended that the Fund using foreign currency futures contracts and related options will only purchase or sell them on exchanges or boards of trade where there appears to be an active secondary market, there is no assurance that a secondary market on an exchange or board of trade will exist for any particular contract or option or at any particular time. In such event, it may not be possible to close a futures contract or related option position and, in the event of adverse price movements, the Fund would continue to be required to make daily cash payments of variation margin on its futures positions.

In addition, it is impossible to forecast with precision the market value of a security at the expiration or maturity of a forward or futures contract. Accordingly, it may be necessary to purchase additional foreign currency on the spot market (and bear the expense of such purchase) if the market value of the security being hedged is less than the amount of foreign currency the Fund is obligated to deliver, and if a decision is made to sell the security and make delivery of the foreign currency. Conversely, it may be necessary to sell on the spot market some of the foreign currency received upon the sale of the hedged portfolio security if the market value of such security exceeds the amount of foreign currency the Fund is obligated to deliver.

**Swaps**

The Fund may use swaps to enhance returns and manage risk. The use of swap transactions is a highly specialized activity, which involves investment techniques and risks different from those associated with ordinary portfolio securities transactions. With uncleared swaps, the Fund is subject to the risk that a counterparty will be unable or will refuse to perform under such agreement, including because of the counterparty's bankruptcy or insolvency. If a counterparty's creditworthiness declines, the value of a swap agreement would likely decline, potentially resulting in losses. In unusual or extreme market conditions, a counterparty's creditworthiness and ability to perform may deteriorate rapidly, and the availability of suitable replacement counterparties may become limited. Central clearing is designed to reduce counterparty credit risk and increase liquidity compared to uncleared swaps because central clearing interposes the central clearinghouse as the counterparty to each participant's swap, but it does not eliminate those risks completely. There is also a risk of loss by the Fund of the initial and variation margin deposits in the event of bankruptcy of the FCM with which the Fund has an open position, or the central counterparty in a swap contract. Credit risk of cleared swap participants is concentrated in a few clearinghouses, and the consequences of insolvency of a clearinghouse are not clear.

**Regulatory Risk**

The regulation of derivatives is a rapidly changing area of law and is subject to modification by government and judicial action. In addition, the SEC, CFTC and the exchanges are authorized to take extraordinary actions in the event of a market emergency, including, for example, the implementation or reduction of speculative position limits, the implementation of higher margin requirements, the establishment of daily price limits and the suspension of trading.

It is not possible to predict fully the effects of current or future regulation. However, it is possible that developments in government regulation of various types of derivative instruments, such as speculative position limits on certain types of derivatives, or limits or restrictions on the counterparties with which the Fund engages in derivative transactions, may limit or prevent the Fund from using or limiting the Fund's use of these instruments effectively as a part of its investment strategy, and could adversely affect the Fund's ability to achieve its investment objective. The Trust will continue to monitor developments in the area. New requirements, even if not directly applicable to the Fund, may increase the cost of the Fund's investments and cost of doing business.

**OTHER TRANSACTIONS/INVESTMENT RISKS**

**Digital Assets Futures Risk**

The Fund would be indirectly exposed to risks of investing in digital assets through its investments in digital asset futures contracts, such as Bitcoin and/or Ethereum. In addition to the risks of futures contracts generally, the markets for digital asset futures contracts have additional unique risks. The markets for digital asset futures contracts may be less developed, less liquid and more volatile than more established futures markets. Digital assets, such as Bitcoin and Ethereum, are technological

innovations with a limited history and, while the markets for Bitcoin and Ethereum futures contracts markets have grown substantially since they commenced trading, there can be no assurance that this volume and growth will continue.

Digital asset futures contracts may be subject to larger collateral requirements and have exposure limits imposed by brokers and exchanges. These limits may impact the Fund's ability to achieve its desired exposure. As with other futures markets, during periods of high volatility or illiquidity, it may be difficult to execute a trade at a specific price when there is a relatively small volume of buy and sell orders in a market. A materially adverse development in one or more of the factors that influences the liquidity of the market for digital assets futures may cause the market to become illiquid, for short or long periods. In such markets, the Fund's subsidiary (through which such Fund would purchase digital asset futures contracts) may not be able to buy and sell digital asset futures contracts quickly (or at all) or at the desired price. Such market illiquidity may cause losses for the Fund.

The price of digital asset futures contracts is based on the expected price of the respective digital asset on certain digital asset exchanges on the expiration date of the digital asset futures contracts. Digital asset futures prices reflect the price of the respective digital asset on certain digital asset exchanges only, and not cash markets. The liquidity of markets for digital asset futures depends on, among other things: the supply and demand for the digital asset; the adoption of the digital asset for commercial uses; the anticipated increase of investments in, and investment products related to, the digital asset by retail and institutional investors; speculative interest in the digital asset and/or futures contracts on the digital asset and investment products related to the digital asset; regulatory or other restrictions on investors' ability to invest in digital asset futures contracts; and the potential ability to hedge against the price of a digital asset with the related digital asset futures contracts (and vice versa).

**Government Intervention and Extreme Volatility Risk**

In the past, instability in the financial markets led the U.S. Government and other governments to take a number of unprecedented actions designed to support certain financial institutions and segments of the financial markets that experienced extreme volatility, and in some cases lack of liquidity. Federal, state, and other governments, their regulatory agencies, or self-regulatory organizations could take actions that affect the regulation of the instruments in which the Fund invests, or the issuers of such instruments, in ways that are unforeseeable. Legislation or regulation may also change the way in which the Fund itself is regulated. Such legislation or regulation could limit or preclude the Fund's ability to achieve its investment objective.

Reduced liquidity in credit and fixed-income markets may adversely affect many issuers worldwide. Reduced liquidity may result in less money being available to purchase raw materials, goods and services from emerging markets, which may, in turn, bring down the prices of these economic staples. It may also result in emerging market issuers having more difficulty obtaining financing, which may, in turn, cause a decline in their stock prices. If they arise, these issues may have an adverse effect on the Fund.

**Leverage Risk**

Leverage risk is created when an investment exposes the Fund to a level of risk that exceeds the amount invested. Changes in the value of such an investment magnify the Fund's risk of loss and potential for gain.

Some transactions may give rise to a form of leverage. These transactions may include, among others, derivatives and reverse repurchase agreements, and may expose the Fund to greater risk and increase its costs. When transactions create leverage, adverse changes in the value or level of the underlying asset, reference rate or index can result in a loss substantially greater than the amount invested in the derivatives or other instruments themselves. Certain transactions have the potential for unlimited loss, regardless of the size of the initial investments. Increases and decreases in the value of the securities held by the Fund, and therefore in the Fund's NAV, will be magnified when the Fund uses leverage because leverage tends to increase the Fund's exposure to market risk, interest rate risk or other risks by, in effect, increasing assets available for investment.

**INVESTMENT RESTRICTIONS**

**FUNDAMENTAL INVESTMENT RESTRICTIONS**

The Fund has adopted the following fundamental investment restrictions that may not be changed without approval by a

"majority of the outstanding shares" of the Fund which, as used in this SAI, means the vote of the lesser of (a) 67% or more of the shares of the Fund represented at a meeting, if the holders of more than 50% of the outstanding shares of the Fund are present or represented by proxy, or (b) more than 50% of the outstanding shares of the Fund.

The Fund:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) May
 not invest 25% or more of its total assets in a particular industry or group of industries,
 except that the Fund may concentrate its investments in a particular industry or group of
 industries to the extent that its underlying index concentrates in an industry or group of
 industries. This limitation is not applicable to investments in obligations issued or guaranteed
 by the U.S. government, its agencies and instrumentalities.\*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) May
 not issue senior securities, except to the extent permitted by the 1940 Act, or any rules,
 exemptions or interpretations thereunder that may be adopted, granted or issued by the SEC,
 and as may be amended from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) May
 not borrow money, except to the extent permitted by the 1940 Act, or any rules, exemptions
 or interpretations thereunder that may be adopted, granted or issued by the SEC, and as may
 be amended from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) May
 not purchase or sell commodities, except to the extent permitted by the 1940 Act, or any
 rules, exemptions or interpretations thereunder that may be adopted, granted or issued by
 the SEC, and as may be amended from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) May
 not purchase or sell real estate, unless acquired as a result of ownership of securities
 or other instruments, except to the extent permitted by the 1940 Act, or any rules, exemptions
 or interpretations thereunder that may be adopted, granted or issued by the SEC, and as may
 be amended from time to time. This restriction does not prevent the Fund from (i) investing
 in issuers that invest, deal, or otherwise engage in transactions in real estate or interests
 therein, or investing in securities that are secured by real estate or interests therein,
 or (ii) making, purchasing or selling real estate mortgage loans.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) May
 not act as an underwriter, except to the extent the Fund may be deemed to be an underwriter
 when disposing of securities it owns or when selling its own shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) May
 not make loans, except to the extent permitted by the 1940 Act, or any rules, exemptions
 or interpretations thereunder that may be adopted, granted or issued by the SEC, and as may
 be amended from time to time. This limitation does not apply to (i) the lending of portfolio
 securities, (ii) the purchase of debt securities, other debt instruments, loan participations
 and/or engaging in direct corporate loans in accordance with its investment goals and policies,
 and (iii) repurchase agreements, to the extent the entry into a repurchase agreement is deemed
 to be a loan.

\* Prior to January 6, 2025, the Fund was a passively managed ETF and sought to track the performance of its underlying index, which was designed to provide broad exposure to gold and corporate bonds (the "Gold Index"). The policy to not concentrate included an exception that the Fund could concentrate to the extent of the Gold Index. As of January 6, 2025, the Fund is actively managed and no longer tracks the Gold Index. Therefore, the exception to the policy to not concentrate is no longer applicable.

If a restriction on the Fund's investments is adhered to at the time an investment is made, a subsequent change in the percentage of Fund assets invested in certain securities or other instruments resulting from changes in the value of the Fund's total assets will not be considered a violation of the restriction, with the exception of the Fund's limitations on borrowing, as described herein or unless otherwise noted herein.

With respect to the Fund's fundamental restriction on concentration, to the extent sufficient information is reasonably available, the Fund will consider the investments of underlying investment companies when determining its compliance with this policy.

Under the 1940 Act, and the rules, regulations, and interpretations thereunder, a "diversified company," as to 75% of its total assets, may not purchase securities of any issuer (other than obligations of, or guaranteed by, the U.S. Government, its agencies or its instrumentalities, and securities of other investment companies) if, as a result, more than 5% of the value of its total assets would be invested in the securities of such issuer or more than 10% of the issuer's voting securities would be held by the Fund. The 1940 Act limits the ability of investment companies to lend money and to underwrite securities. The 1940 Act currently prohibits an open-end fund from issuing senior securities, as defined in the 1940 Act, except under very limited circumstances.

With respect to the Fund's fundamental restriction on borrowing, the 1940 Act limits the Fund's ability to borrow money, except that the Fund may borrow from any bank provided that immediately after any such borrowing there is an asset coverage of at least 300% for all borrowings by the Fund, and provided further that in the event that such asset coverage shall at any time fall below 300%, the Fund shall, within three days thereafter, or such longer period as the SEC may prescribe by rules and regulations, reduce the amount of its borrowings to such an extent that the asset coverage of such borrowing shall be at least 300%.

In addition to borrowings that are subject to 300% asset coverage and are considered by the SEC to be permitted "senior securities," the Fund is also permitted under the 1940 Act to borrow for temporary purposes in an amount not exceeding 5% of the value of its total assets at the time when the loan is made. A loan will be presumed to be for temporary purposes if it is repaid within 60 days and is not extended or renewed.

*Regulatory Compliance.* The Fund may follow non-fundamental operational policies that are more restrictive than its fundamental investment limitations, as set forth in the Prospectus and this SAI, in order to comply with applicable laws and regulations, including the provisions of and regulations under the 1940 Act. The Fund may change these operational policies to reflect changes in the laws and regulations without the approval of its shareholders.

**NON-FUNDAMENTAL INVESTMENT RESTRICTIONS**

The Fund's investment objective is non-fundamental and may be changed by the Board without shareholder approval upon 60 days' prior written notice to the Fund's shareholders.

The Fund has adopted the following non-fundamental investment restriction, which may be changed by the Board without the approval of the Fund's shareholders. Any changes in the Fund's non-fundamental limitations will be communicated to the Fund's shareholders prior to effectiveness. The Fund:

● May not invest in any other investment company or company relying on Section 3(c)(1) or 3(c)(7) of the 1940 Act in excess of the limitations contained in Section 12(d)(1)(A) of the 1940 Act, except to the extent permitted by exemptive relief from the SEC permitting the Fund to purchase shares of other investment companies for short-term cash management purposes.

**MANAGEMENT**

**Trustees and Officers**

The following tables provide information about the Board and the senior officers of the Trust. The Board is composed of three Trustees, two of whom are not "interested persons" of the Trust, as that term is defined in the 1940 Act (each, an "Independent Trustee" and, collectively, the "Independent Trustees"). Each Trustee oversees all portfolios of the Trust and serves for an indefinite term (subject to mandatory retirement provisions). Information about each Trustee is provided below and includes each person's: name, address, age (as of the date of the Fund's most recent fiscal year end), present position(s) held with the Trust, principal occupations for the past five years, and total compensation received as a Trustee for the most recent fiscal year. Unless otherwise noted, the business address of each person listed below is c/o Strategy Shares, 36 North New York Avenue, Huntington, NY 11743. Unless otherwise noted, each officer is elected annually by the Board. Each Trustee and several officers also serve in the same capacity for Mutual Fund and Variable Insurance Trust, an investment company whose series are managed by the Advisor. Collectively, series of the Trust, Mutual Fund and Variable Insurance Trust, and Mutual Fund Series Trust advised by the Advisor, Catalyst Capital Advisors LLC, and/or AlphaCentric Advisors LLC, and Catalyst/Perini Strategic Income Fund, constitute the "Fund Complex."

**Independent Trustees Background**

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;<br>**Name, Address<br> and Age** | &nbsp;&nbsp;<br>**Position<br> with the<br> Trust** | &nbsp;&nbsp;<br> **Term of<br> Office and<br> Length of**<br> **Time<br> Served\*** | &nbsp;&nbsp;<br> **Principal**<br> **Occupation(s)**<br> **During Past 5 Years** | &nbsp;&nbsp;**Number of<br> Portfolios in<br> Fund<br> Complex<br> Overseen by**<br> **Trustee** | &nbsp;&nbsp;<br>**Other Directorships<br> Held by Trustee** |
| &nbsp;&nbsp;Tobias Caldwell<br> Year of Birth: 1967 | &nbsp;&nbsp;Chairman of the Board and Trustee | &nbsp;&nbsp;Since 2016 | &nbsp;&nbsp;Manager, Genovese Family Enterprises, LLC (and affiliates, family office) 1999-present, Managing Member, Bear Properties, LLC (real estate firm) 2006-present.<br>| &nbsp;&nbsp;37 | &nbsp;&nbsp;Chairman of the Board, Mutual Fund and Variable Insurance Trust since 2016; Lead independent Trustee and Chairman of Audit Committee, Mutual Fund Series Trust since 2006; Trustee of IDX Funds Trust (formerly, M3Sixty Funds Trust) since 2016; Chairman of the Board, Catalyst/Perini Strategic Income Fund since April 2024; Chairman of the Board, AlphaCentric Prime Meridian Income Fund from 2018 to August 2023. |
| &nbsp;&nbsp;Stephen P.<br> Lachenauer<br> Year of Birth: 1967 | &nbsp;&nbsp;Trustee and Chair of the Audit, Risk and Compliance, and Investment Committees | &nbsp;&nbsp;Trustee and Chair of the Audit and Risk and Compliance Committees since 2016; Chair of<br> Investment Committee since 2020 | &nbsp;&nbsp;Attorney, private practice, since 2010. | &nbsp;&nbsp;37 | &nbsp;&nbsp;Trustee and Chair of the Audit and Risk and Compliance Committees since 2016, and Chair of the Investment Committee since November 2020, Mutual Fund and Variable Insurance Trust; Trustee and Chair of the Audit and Risk and Compliance Committees from 2018 to 2023, and Chair of the Investment Committee from 2020 to 2023, AlphaCentric Prime Meridian Income Fund; Trustee, Mutual Fund Series Trust since April 2022; Trustee and Chairman of the Audit<br> Committee, Catalyst/Perini Strategic Income Fund since April 2024.<br>|

---

\* The term of office of each Trustee is indefinite.

**Interested Trustee Background**

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;**Name, Address <br> and Age** | &nbsp;&nbsp;**Position with <br> the Trust** | &nbsp;&nbsp;**Term of <br> Office and<br> Length of <br> Time <br> Served\*** | &nbsp;&nbsp;**Principal <br> Occupation(s) During <br> Past 5 Years** | &nbsp;&nbsp;**Number of <br> Portfolios <br> in Fund <br> Complex <br> Overseen <br> by Trustee** | &nbsp;&nbsp;**Other Directorships<br> Held by Trustee** |
| &nbsp;&nbsp;Donald McIntosh\*\*<br> Year of Birth: 1967<br>| Trustee | Since 2016 | &nbsp;&nbsp;Internal Audit Supervisor, Santander Bank since 2021; Commercial Banking Business Control Officer, Santander Bank, 2017-2021.<br>| 12 | Trustee, Mutual Fund and Variable Insurance Trust since 2016; Trustee, AlphaCentric Prime Meridian Income Fund 2018 to 2023. |

---

\* The term of office of each Trustee is indefinite.

\*\* Mr. McIntosh is considered an interested person of the funds in the Fund Complex by reason of a financial connection between certain of his family members and management personnel of the Advisor.

**Officers\***

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;<br> **Name, Address,**<br> **Year of Birth** | &nbsp;&nbsp;**Position(s) <br> Held with <br> Trust** | &nbsp;&nbsp;**Term and <br> Length Served** | &nbsp;&nbsp;<br> **Principal Occupation(s) During Past 5 Years** |
| &nbsp;&nbsp;Michael Schoonover<br> 207 Calle del Parque,<br> AM Tower, <br> Floor 7, Suite 2, <br> San Juan, PR 00912-3242 <br> Year of Birth: 1983 | &nbsp;&nbsp;President | &nbsp;&nbsp;Since 2022 | &nbsp;&nbsp;Vice President of the Trust, 2018-2021; Chief Operating Officer ("COO"), Catalyst Capital Advisors LLC and Rational Advisors, Inc. since 2017; Portfolio Manager, Catalyst Capital Advisors LLC, 2013 – May 2021; President, MFund Distributors LLC since January 2020; COO, Catalyst International Advisors LLC since 2019; COO, Insights Media LLC since 2019; COO, MFund Management LLC since 2019; COO, AlphaCentric Advisors LLC since January 2021. |
| &nbsp;&nbsp;Thomas Hamel <br> Year of Birth: 1969 | &nbsp;&nbsp;Vice President | &nbsp;&nbsp;Since 2024 | &nbsp;&nbsp;Vice President, Mutual Fund Series Trust and Catalyst/Perini Strategic Income Fund, 2024 – Present; Managing Director, Head of Investment Operations, Catalyst Capital Advisors LLC, AlphaCentric Advisors LLC and Rational Advisors, Inc. since January 2024; COO, Head of Investment Operations & Accounting, Captain Technologies, 2020 - 2024; Head of Client & Investment Operations, Aksia LLC, 2009 –2020. |
| &nbsp;&nbsp;Alex Merino <br> 207 Calle del Parque,<br> AM Tower, <br> Floor 7, Suite 2, <br> San Juan, PR 00912-3242 <br> Year of Birth: 1985 | &nbsp;&nbsp;Vice President | &nbsp;&nbsp;Since 2022 | &nbsp;&nbsp;Investment Operations Manager, MFund Management LLC since 2022; Investment Operations Analyst, MFund Management LLC, 2020—2021; Tax Senior Associate, PwC Asset & Wealth Management NY Metro, 2016—2019. |
| &nbsp;&nbsp;James Szilagyi <br> Year of Birth: 1963 | &nbsp;&nbsp; Treasurer | &nbsp;&nbsp; Since 2016 | &nbsp;&nbsp; Product Manager, Rational Advisors, Inc. since 2016. |
| &nbsp;&nbsp;Frederick J. Schmidt<br> Year of Birth: 1959 | &nbsp;&nbsp; Chief Compliance Officer | &nbsp;&nbsp; Since 2016 | &nbsp;&nbsp;Director of Compliance Services, MFund Services LLC since 2015. |
| &nbsp;&nbsp;Jennifer A. Bailey <br> Year of Birth: 1968 | &nbsp;&nbsp;Secretary | &nbsp;&nbsp;Since 2016 | &nbsp;&nbsp;Director of Legal Services, MFund Services LLC since 2012. |

---

\* Officers do not receive any compensation from the Trust.

**Compensation of the Board**

The Trustees are paid a quarterly retainer, and receive compensation for each committee meeting, telephonic Board meeting, and special in-person Board meeting attended. Officers receive no compensation from the Trust. The Trust reimburses each of the Trustees for travel and other expenses incurred in connection with attendance at such meetings. The Trust has no retirement or pension plans.

The following table describes the compensation that the Fund and the Fund Complex paid to the Trustees of the Trust during the fiscal year ended April 30, 2025.

---

| | | |
|:---|:---|:---|
| <br> **Name of Trustee** | <br> **Compensation from the Fund** | **Compensation**<br> **from the Fund Complex** |
| Tobias Caldwell | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$6385 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$237898 |
| Stephen Lachenauer | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$6669 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$207143 |
| Donald McIntosh | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$3985 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;$44554 <sup>1</sup> |

---

*<sup>1</sup>* *Does not include compensation from Mutual Fund Series Trust or Catalyst/Perini Strategic Income Fund, of which he does not serve on the Board.*

 

**TRUSTEE OWNERSHIP OF SHARES IN THE FUND**

**AND IN THE FUND COMPLEX AS OF DECEMBER 31, 2025**

---

| | | |
|:---|:---|:---|
| <br> **Name of Trustee** | &nbsp;&nbsp;<br> **Dollar Range of Shares<br> Owned in the Fund** | &nbsp;&nbsp;**Dollar Range of Shares**<br> **Owned in all Registered Investment** <br> **Companies Overseen by Trustee** <br> **in Family of Investment Companies** |
| Tobias Caldwell |  | &nbsp;&nbsp;Over $100,000 |
| Stephen Lachenauer |  | &nbsp;&nbsp;$50001 - $100000 |
| Donald McIntosh |  | &nbsp;&nbsp;None<sup>1</sup> |

---

*<sup>1</sup>* *Does not include ownership of shares in Mutual Fund Series Trust, of which he does not serve on the Board.*

As of December 31, 2025, none of the Trustees (including their immediate family members) owned, beneficially or of record, securities of the Advisor or the Distributor, or any entity directly or indirectly controlling, controlled by, or under common control with, the Advisor or Distributor.

**Qualifications and Experience of the Trustees**

The following provides an overview of the considerations that led the Board to conclude that each individual serving as a Trustee of the Trust should so serve. Generally, no one factor was decisive in the original selection of an individual to join the Board. Among the factors the Board considered when concluding that an individual should serve on the Board were the following: (1) the individual's business and professional experience and accomplishments; (2) the individual's prior experience serving on the boards of public companies, and other complex enterprises and organizations; and (3) how the individual's skills, experience, and attributes would contribute to an appropriate mix of relevant skills and experience on the Board.

In respect of each current Trustee, the individual's substantial professional accomplishments and prior experience, including, in some cases, in fields related to the operations of the Trust, were a significant factor in the determination that the individual should serve as a Trustee of the Trust.

In addition to the information set forth above, the following sets forth additional information about the qualifications and experience of each of the Trustees that lead to the conclusion that each Trustee should serve as Trustee of the Trust.

**Tobias Caldwell**

Mr. Caldwell is the manager of a real estate investment firm. Mr. Caldwell has served on the boards of mutual funds for approximately twenty years. His experience in the real estate and investment industries provides the Board with an additional perspective and understanding of investment strategies used by advisors to the Fund. Mr. Caldwell also serves as a Trustee of other registered investment companies in the Fund Complex.

**Stephen Lachenauer**

Mr. Lachenauer has been an attorney in private practice for over fifteen years, providing advice and counsel to small businesses and individuals on business and financial matters. Mr. Lachenauer's previous experience at large law firms and as an attorney at a large investment bank provides the Board with knowledge of financial and investment regulatory matters. Mr. Lachenauer also serves as a Trustee of other registered investment companies in the Fund Complex.

**Donald McIntosh**

Mr. McIntosh is a Business Control & Risk Management Officer for a large international financial services company, and he has many years of credit analysis and loan servicing experience. Mr. McIntosh's experience in evaluating companies' financial condition provides the Board with knowledge about investment strategies used by the advisors to the Fund. Mr. McIntosh also serves as a Trustee of other registered investment companies in the Fund Complex.

**Board Structure**

The Board is responsible for overseeing the management and operations of the Trust. The Board consists of three Trustees, two of whom are Independent Trustees. The Chairperson of the Trust, Tobias Caldwell, is an Independent Trustee.

The Board holds four regular meetings each year to consider and address matters involving the Fund. The Board also may hold special meetings to address matters arising between regular meetings. In addition, the Trustees regularly meet outside the presence of management and are advised by independent legal counsel. These meetings may take place in-person or by telephone.

The Board reviews its structure regularly and believes that its leadership structure, including two Independent Trustees, is appropriate and in the best interests of the Trust, given its specific characteristics. The Board also believes its leadership structure facilitates the orderly and efficient flow of information to the Trustees from Trust management.

When considering potential nominees to fill vacancies on the Board, and as part of its annual self-evaluation, the Board

reviews the mix of skills and other relevant experiences of the Trustees.

**Committees of the Board**

The Board has three standing committees, the Audit Committee, the Risk and Compliance Committee, and the Investment Committee.

**Audit Committee.** The Audit Committee is currently comprised of Mr. Caldwell and Mr. Lachenauer. The primary function of the Audit Committee is to assist the full Board in fulfilling its oversight responsibilities to the shareholders and the investment community relating to fund accounting, reporting practices and the quality and integrity of the financial reports. To satisfy these responsibilities, the Audit Committee reviews with the independent auditors the audit plan and results and recommendations following independent audits, reviews the performance of the independent auditors and recommends engagement or discharge of the auditors to the full Board, reviews the independence of the independent auditors, reviews the adequacy of the Fund's internal controls, and prepares and submits Committee meeting minutes and supporting documentation to the full Board. The Audit Committee met four times during the fiscal year ended April 30, 2025.

**Risk and Compliance Committee.** The Risk and Compliance Committee is comprised of each of the Trustees. The Risk and Compliance Committee is responsible for general oversight of the Trust's compliance with the legal and regulatory requirements of the Trust's operations. The Risk and Compliance Committee also serves as a means to provide feedback and guidance to the Trust's Chief Compliance Officer ("CCO"), and assists the Board in identifying and managing risks. The Risk and Compliance Committee met four times during the fiscal year ended April 30, 2025.

**Investment Committee.** The Investment Committee is comprised of each of the Trustees. The primary purpose of the Investment Committee is to oversee and guide the process by which the Board evaluates the investment performance of each of the Trust's series. The Investment Committee also considers and evaluates each investment advisor or sub-advisor (including unaffiliated sub-advisors), or portfolio manager framework for identifying, prioritizing, and managing investment risk. The Investment Committee met twice during the fiscal year ended April 30, 2025.

**Board Oversight of Risk**

An integral part of the Board's overall responsibility for overseeing the management and operations of the Trust is the Board's oversight of the risk management of the Trust's investment programs and business affairs. The Fund is subject to a number of risks, such as investment risk, valuation risk, risk of operational failure or lack of business continuity, and legal, compliance and regulatory risk. The Fund, the Advisor, and other service providers to the Trust have implemented various processes, procedures, and controls to identify risks to the Fund, to lessen the probability of their occurrence, and to mitigate any adverse effect should they occur. Different processes, procedures, and controls are employed with respect to different types of risks.

The Board exercises oversight of the risk management process through the Risk and Compliance Committee, and through oversight by the Board itself. The Board holds four regular meetings each year to consider and address matters involving the Fund.

In addition to adopting, and periodically reviewing, policies and procedures designed to address risks to the Fund, the Board requires management of the Advisor and the Trust, including the Trust's Chief Compliance Officer ("CCO"), to report to the Board and the Risk and Compliance Committee of the Board on a variety of matters, including matters relating to risk management, at regular and special meetings. The Board and the Audit Committee receive regular reports from the Trust's independent public accountants on internal control and financial reporting matters. On at least a quarterly basis, the Independent Trustees meet with the Trust's CCO, including outside the presence of management, to discuss issues related to compliance. Furthermore, the Board receives a quarterly report from the Trust's CCO regarding the operation of the compliance policies and procedures of the Trust and its primary service providers. The Board monitors the Fund's investment policies and procedures, as well as valuation of the Fund's securities. The Board also receives quarterly reports from the Advisor on the investments and securities trading of the Fund, including its investment performance and asset weightings compared to appropriate benchmarks, as well as reports regarding the valuation of the Fund's securities. The Board also receives reports from the Trust's primary service providers regarding their operations as they relate to the Fund.

The Board also considers liquidity risk management issues as part of its general oversight responsibilities, and oversees the Fund's liquidity risk through, among other things, receiving periodic reporting and presentations by the Liquidity Risk Management ("LRM") Program Administrator that address liquidity matters. As required by Rule 22e-4 under the 1940 Act,

the Board, including a majority of the Independent Trustees, has approved the Trust's LRM Program, which is reasonably designed to assess and manage the Trust's liquidity risk, and has appointed the LRM Program Administrator that is responsible for administering the LRM Program. The Board also reviews, no less frequently than annually, a written report prepared by the LRM Program Administrator that addresses, among other items, the operation of the program and assesses its adequacy and effectiveness of implementation.

**SERVICE PROVIDERS**

**INVESTMENT ADVISORY SERVICES**

**Investment Advisor**

Rational Advisors, Inc has been retained by the Trust under a Management Agreement to act as the investment advisor to the Fund, subject to the authority of the Board. The Advisor (formerly a wholly owned subsidiary of Huntington National Bank and known as Huntington Asset Advisors, Inc.) was organized under the laws of Ohio in 2001. The Advisor oversees the day-to-day investment decisions for the Fund and continuously reviews, supervises, and administers the Fund's investment programs. The address of the Advisor is 207 Calle del Parque, AM Tower, Floor 7, Suite 2, San Juan, PR 00912-3242. The Advisor is under common control with Catalyst Capital Advisors LLC and AlphaCentric Advisors LLC, the investment advisors of other funds in the same group of investment companies, also known as a "fund complex," and MFund Services LLC, which provides management and legal support and compliance services to the Funds. The Management Agreement provides that the Advisor will provide the Fund with investment advice and supervision, and will continuously furnish an investment program for the Fund consistent with the investment objectives and policies of the Fund. The Advisor is responsible for the payment of the salaries and expenses of all of its personnel, office rent and the expenses of providing investment advisory and related clerical expenses.

Under the terms of the Management Agreement, the Advisor manages the investment of the assets of the Fund in conformity with the investment objective and policies of the Fund. It is the responsibility of the Advisor to make investment decisions for the Fund and to provide continuous supervision of the investment portfolio of the Fund.

As full compensation for its services to the Fund, the Advisor receives monthly compensation from the Fund at the annual rate of 0.79% of the Fund's average daily net assets. In consideration of the fees paid with respect to the Fund, the Advisor has agreed to pay all routine expenses of the Fund (including, without limitation, transfer agent fees, administrative fees and expenses, custodian fees, legal fees, accounting fees, any other expenses (including clerical expenses) of issue, sale, repurchase or redemption of shares, expenses of registering or qualifying shares for sale, transfer taxes, all expenses of preparing the Trust's registration statement and prospectus for the Fund, and the cost of printing and delivering to shareholders prospectuses and reports), except the Fund's management fee; taxes; brokerage commissions and trading costs; interest (including borrowing costs and overdraft charges); short sale dividends and interest expenses; acquired fund fees and expenses; and non-routine or extraordinary expenses of the Fund (such as litigation or reorganizational costs), each of which is paid by the Fund. For the fiscal years ended April 30, 2023, April 30, 2024, and April 30, 2025, and for the six-month period ended October 31, 2025, the Fund paid $108,857, $77,007, $91,916, and $223,787, respectively, to the Advisor pursuant to the Management Agreement.

The Management Agreement with the Fund continues in effect for an initial two-year term and then from year to year as long as its continuation is approved at least annually by the Board, including a majority of the Trustees who are not "interested persons," or by the shareholders of the Fund. The Management Agreement may be terminated at any time upon 60 days' written notice by the Fund or by a majority vote of the outstanding shares, or 90 days' written notice by the Advisor, and will terminate automatically upon assignment. A discussion of the matters considered by the Board in connection with the approval of the Management Agreement is available in the Fund's Annual Report to shareholders filed on Form N-CSR for the fiscal period ended April 30, 2025.

The Management Agreement provides that the Advisor shall not be liable for any error of judgment or mistake of law, or for any loss suffered by the Trust, in connection with the performance of its duties, except a loss resulting from a breach of fiduciary duty with respect to the receipt of compensation for services, or a loss resulting from willful misfeasance, bad faith, or gross negligence on the part of the Advisor in the performance of its duties, or from reckless disregard of its duties and obligations thereunder.

**From time to time, the Advisor may use a portion of its reasonable resources and profits to pay for certain administrative services provided by financial institutions for Shares of the Fund.**

**ADDITIONAL INFORMATION REGARDING PORTFOLIO MANAGERS**

David Miller and Charles Ashley are the Fund's portfolio managers and are jointly and primarily responsible for the day-to-day management of the Fund.

**Other Accounts Under Management**

As of January 31, 2026, the number of, and total assets in, all other registered investment companies, other pooled investment vehicles, and other accounts overseen by the Fund's portfolio managers were as follows:

---

| | |
|:---|:---|
| **David Miller** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Number of Other Accounts Managed/Total Assets** |
| Registered Investment Companies | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10 / $1,164 million |
| Other Pooled Investment Vehicles | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1 / $9.4 million |
| Other Accounts | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0 / $0 |

---

---

| | |
|:---|:---|
| **Charles Ashley** | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Number of Other Accounts Managed/Total Assets** |
| Registered Investment Companies | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9 / $1,154 million |
| Other Pooled Investment Vehicles | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1 / $9.4 million |
| Other Accounts | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0 / $0 |

---

Of the accounts above, the following are subject to performance-based fees:

---

| | |
|:---|:---|
| **Other Accounts Managed**<br> **By David Miller**  | **Total Number of Other Accounts <br> Managed/**<br> **Total Assets** |
| Registered Investment Companies | 0/$0 |
| Other Pooled Investment Vehicles | 1 / $9.4 million |
| Other Accounts | 0/$0 |

---

---

| | |
|:---|:---|
| **Other Accounts Managed**<br> **By Charles Ashley**  | **Total Number of Other Accounts <br> Managed/**<br> **Total Assets** |
| Registered Investment Companies | 0/$0 |
| Other Pooled Investment Vehicles | 1 / $9.4 million |
| Other Accounts | 0/$0 |

---

**Ownership of Fund Shares**

The table below shows the portfolio managers' ownership of the Fund's shares as of January 31, 2026.

---

| | |
|:---|:---|
| &nbsp;&nbsp;**Portfolio Manager** | &nbsp;&nbsp;**Dollar Range of Equity Securities in the <br> Fund** |
| &nbsp;&nbsp;David Miller | &nbsp;&nbsp;None |
| &nbsp;&nbsp;Charles Ashley | &nbsp;&nbsp;None |

---

**Compensation**

Mr. Miller's compensation from the Advisor is based on a percentage of the overall profits of the Advisor. He is also entitled to a portion of the proceeds if the Advisor sells all or a portion of the Advisor's business. He also participates in the Advisor's pension plan. Mr. Ashley's compensation from the Advisor is a fixed base salary and a discretionary bonus based on the discretion of the Advisor.

**Conflicts of Interest**

Actual or apparent conflicts of interest may arise when a portfolio manager has day-to-day management responsibilities with respect to more than one fund or other accounts. The management of multiple accounts may result in a portfolio manager devoting unequal time and attention to the management of each account. The management of multiple funds and accounts also may give rise to potential conflicts of interest if the funds and accounts have different objectives, benchmarks, time horizons, and fees, as the portfolio manager must allocate his time and investment ideas across multiple funds and accounts.

With respect to securities transactions for the Fund, the Advisor determines which broker to use to execute each order, consistent with the duty to seek best execution of the transaction. The portfolio manager may execute transactions for another fund or account that may adversely impact the value of securities held by the Fund. Securities selected for funds or accounts other than the Fund may outperform the securities selected for the Fund.

The appearance of a conflict of interest may arise where the Advisor has an incentive, such as a performance-based management fee. The management of personal accounts may give rise to potential conflicts of interest; there is no assurance that the Fund's code of ethics will adequately address such conflicts. One of the portfolio manager's numerous responsibilities is to assist in the sale of Fund shares. Because the portfolio manager's compensation is indirectly linked to the sale of Fund shares, they may have an incentive to devote time to marketing efforts designed to increase sales of Fund shares. The Fund has adopted a code of ethics that, among other things, permits personal trading by employees under conditions where it has been determined that such trades would not adversely impact client accounts. Nevertheless, the management of personal accounts may give rise to potential conflicts of interest, and there is no assurance that these codes of ethics will adequately address such conflicts.

The Fund may invest in affiliated funds advised by the Advisor. The Advisor is subject to conflicts of interest in allocating the Fund's assets among the affiliated funds. The Advisor will receive more revenue when it selects an affiliated fund rather than an unaffiliated fund for inclusion in the Fund's portfolio. This conflict may provide an incentive for the Advisor to invest Fund assets in affiliated funds that perform less well than unaffiliated funds. The Advisor may have an incentive to allocate the Fund's assets to those affiliated funds for which the net advisory fees payable to the Advisor are higher than the fees payable by other affiliated funds.

The Advisor and the Fund have each adopted certain compliance procedures which are designed to address these types of conflicts. However, there is no guarantee that such procedures will detect each and every situation in which a conflict arises.

**DISTRIBUTION SERVICES**

**Distributor**

Foreside Fund Services, LLC, located at Three Canal Plaza, Suite 100, Portland, Maine 04101, serves as the distributor ("Distributor") in connection with the continuous offering of the Fund's shares. The Distributor is a broker-dealer registered with the SEC under the 1934 Act and a member of the Financial Industry Regulatory Authority. The Trust offers Shares of the Fund for sale through the Distributor in Creation Units. The Distributor will not accept purchase or sell orders in quantities less than Creation Units. The Distributor will deliver a Prospectus to Authorized Participants that purchase Creation Units and will maintain records of Creation Unit orders placed and confirmations furnished by it. Pursuant to a Distribution Services Agreement, the Advisor pays the Distributor for distribution-related services.

**Rule 12b-1 Plan**

The Trust has adopted, but has yet to implement, a Rule 12b-1 Distribution Plan (the "Plan"). Under the Plan, the Fund is authorized to pay an amount up to 0.25% of its average annual daily net assets for certain distribution-related services.

The Plan is designed to compensate financial intermediaries (including the Advisor and its affiliates) for activities principally intended to result in the sale of Fund shares, such as advertising and marketing of shares (including printing and disseminating prospectuses and sales literature to prospective shareholders and financial intermediaries), and providing incentives to financial intermediaries to sell shares. The Plan is also designed to cover the cost of administrative services performed in conjunction with the sale of shares, including, but not limited to, shareholder services, recordkeeping services, and educational services, as well as the costs of implementing and operating the Plan. In accordance with the Plan, the Distributor may enter into agreements with financial intermediaries and dealers to provide these distribution and distribution-related services with respect to the Fund.

The Plan could benefit the Fund by helping the Fund attract and retain assets, thus providing securities and cash for orderly portfolio management.

Under the Plan, the Fund may compensate a financial intermediary more or less than its actual marketing and administrative expenses. In no event will the Fund pay for any expenses of a financial intermediary that exceed the maximum Plan fee.

No distribution fees are currently charged to the Fund, and there are no plans to impose these fees. To the extent that the Plan is implemented in the future, the Prospectus will be updated to reflect the implementation, and the implementation will also be disclosed on the Fund's website. The Board will pre-approve the implementation of the Plan.

**FINANCIAL ADMINISTRATION, TRANSFER AGENCY, AND FUND ACCOUNTING SERVICES**

Pursuant to a Services Agreement with Citi, located at 4400 Easton Commons, Suite 200, Columbus, Ohio, 43219, Citi provides financial administration, transfer agency, and fund accounting services to the Trust. As financial administrator, Citi performs certain services on behalf of the Trust, including, but not limited to: (1) preparing the Trust's periodic financial reports on forms prescribed by the SEC, and filing those reports with the SEC upon review and approval of the Trust and Trust counsel; (2) calculating Fund expenses and making required disbursements; (3) calculating Fund performance data; and (4) providing certain compliance support services.

As fund accountant, Citi maintains certain financial records of the Trust and provides accounting services to the Fund that include the daily calculation of the Fund's NAV. Citi also performs certain other services on behalf of the Trust, including providing financial information for the Trust's federal and state tax returns and financial reports required to be filed with the SEC. As Transfer Agent, Citi issues shares of the Fund in Creation Units to fill purchase orders for Fund shares, maintains records of the issuance and redemption of the Fund's shares, and acts as the Fund's dividend disbursing agent.

For the financial administration and fund accounting services provided to the Trust, the Trust has agreed to pay an annual fee equal to 0.04% of the aggregate net assets of the Fund, subject to certain breakpoints and minimum fee requirements.

*Support Services Agreement.* Citi has entered into a Support Services Agreement with the Advisor pursuant to which it prepares and provides facts sheets for the Fund and certain information required by the Advisor to determine the Fund's Creation Basket and estimated Cash Amount for each Business Day.

**MANAGEMENT AND LEGAL ADMINISTRATION SERVICES**

MFund Services LLC ("MFund"), located at 36 North New York Avenue, Huntington, NY 11743, provides the Fund with various management and legal administrative services. For these services, the Fund pays MFund an annual asset-based fee equal to 0.03% up to the first $1 billion of the net assets of the Fund, and 0.02% thereafter, subject to a $30,000 minimum annual fee. In addition, the Fund reimburses MFund for any reasonable out-of-pocket expenses incurred in the performance of its duties under the Management Services Agreement. Jerry Szilagyi is the managing member of MFund, and the President and controlling member of the Advisor.

**Compliance Services**

Pursuant to a Compliance Services Agreement, MFund provides chief compliance officer services to the Trust and each of its series. For these services, MFund receives compensation for chief compliance officer services at the contractual rate of $1,200/month for the first series of the Trust, $400 for each additional series, $400 for each advisor, plus 0.0025% of the assets of each series per calendar year. In addition, MFund is reimbursed for any reasonable out-of-pocket expenses incurred in the performance of its duties under the Compliance Services Agreement. Jerry Szilagyi is the managing member of MFund, and President and controlling member of the Advisor.

**OTHER SERVICE PROVIDERS**

**Custodian**

Pursuant to a Custodial and Agency Services Agreement with the Trust, Citibank, N.A. ("Citibank"), located at 388 Greenwich Street, New York, NY 10048, serves as Custodian for the Fund and safeguards and holds the Fund's cash and securities, settles the Fund's securities transactions, and collects income on Fund investments. Under the agreement, Citibank also: (1)

provides data required by the Advisor to determine the Fund's Creation Basket and estimated Cash Amount for each Business Day (this service is paid for by the Advisor directly pursuant to the Support Services Agreement between Citi and the Advisor (see "Support Services Agreement" above)); (2) monitors the settlement of securities comprising the Creation Basket and any cash in connection with the purchase and redemption of Creation Units, and requests the issuance of related Creation Units; (3) deposits securities comprising the Creation Basket and/or cash received from Authorized Participants in connection with purchases of Creation Units into the Fund's custody and cash accounts; (4) disburses securities comprising the Creation Basket and/or cash from the Fund's custody and cash accounts to Authorized Participants in connection with the redemptions of Creation Units; and (5) performs certain other related services, (See "Purchase and Redemption of Creation Units" below).

**Independent Registered Public Accounting Firm**

The Fund's independent registered public accounting firm is Cohen & Company, Ltd., 8101 East Prentice Ave., Suite 750, Greenwood Village, CO 80111. Shareholders will receive annual financial statements, together with the report of the Independent Registered Public Accounting Firm, and semiannual unaudited financial statements of the Fund. Cohen & Company, Ltd. will report on the Fund's annual financial statements and review certain regulatory reports. Cohen & Co Advisory, LLC, an affiliate of Cohen & Company, Ltd., provides and performs other professional accounting, tax, and advisory services when engaged to do so by the Fund.

**Legal Counsel**

Stradley Ronon Stevens & Young, LLP, 2005 Market Street, Suite 2600, Philadelphia, PA 19103-7018, serves as counsel for the Trust and the Independent Trustees.

**SUPPLEMENTAL PAYMENTS TO FINANCIAL INTERMEDIARIES**

Financial intermediaries that promote the sale of Fund shares may be paid fees out of the assets of the Advisor and their affiliates (but not out of Fund assets).

Financial intermediaries who solicit the sale of Fund shares may receive fees for providing distribution-related, recordkeeping or shareholder services, such as sponsoring sales, providing sales literature, conducting training seminars for employees, and engineering sales-related computer software programs and systems. Also, these financial intermediaries may be paid cash or promotional incentives, such as reimbursement of certain expenses relating to attendance at informational meetings about the Fund or other special events at recreational-type facilities, or items of material value. These payments will be based upon the amount of Fund shares the financial intermediary sells, or may sell, and/or upon the type and nature of sales or marketing support furnished by the financial intermediary.

From time to time, the Advisor, and their affiliates, at their expense, may provide additional compensation to financial intermediaries that sell, or arrange for the sale of, Fund shares. Such compensation may include financial assistance to financial intermediaries that enable the Advisor and its affiliates to participate in or present at conferences or seminars, sales or training programs for invited employees, client and investor events, and other financial intermediary-sponsored events.

The Advisor and its affiliates also may hold or sponsor, at their expense, sales events, conferences, and programs for employees or associated persons of financial intermediaries in order to facilitate the sale of Fund shares, and may pay the travel and lodging expenses of attendees. The Advisor and its affiliates also may provide, at their expense, meals and entertainment in conjunction with meetings with these financial intermediaries. Other compensation may be offered to the extent not prohibited by applicable laws, regulations, or the rules of any self-regulatory agency, such as FINRA.

**PURCHASE AND REDEMPTION OF CREATION UNITS**

The Fund only offers and redeems its shares in Creation Units. The Fund will offer and sell Creation Units through the Distributor on a continuous basis, without a sales load (but subject to transaction fees), at the NAV per share next determined after an order in proper form is received by the Distributor. The NAV of the Fund is expected to be determined as of the close of regular trading on the Exchange (ordinarily 4:00 p.m., Eastern Time) on each Business Day ("NAV Calculation Time"). The Fund will sell and redeem Creation Units only on a Business Day.

The Trust generally does not offer its shares outside of the U.S.

**IN-KIND TRANSACTIONS - GENERALLY**

In order to keep costs low and permit the Fund to be as fully invested as possible, shares of the Fund will be purchased and redeemed in Creation Units and generally on an in-kind basis. Accordingly, except where the purchase or redemption will include cash under the circumstances described in this SAI (see "Cash Transactions – Generally" below), investors will generally be required to purchase Creation Units by making an in-kind deposit of Deposit Instruments, and shareholders redeeming their shares will generally receive an in-kind transfer of Redemption Instruments. The names and quantities of the instruments that constitute the Deposit Instruments, and the names and quantities of the instruments that constitute the Redemption Instruments, will be specified by the Fund each day, and these instruments may be referred to, in the case of either a purchase or a redemption, as the "Creation Basket." In addition, under normal circumstances, the Creation Basket will generally correspond pro rata to the securities, assets or other positions held by the Fund on a Trade Date + 1 ("T+1") settlement basis (including cash positions), except:<sup>1</sup>

● in the case of bonds , for minor differences when it is impossible to break up bonds beyond certain minimum sizes needed for transfer and settlement;

● for minor differences, when rounding is necessary to eliminate fractional shares or lots that are not tradable round lots;<sup>2</sup>

● positions that cannot be transferred in-kind will be excluded from the Creation Basket;<sup>3</sup>

● to the extent the Fund determines, on a given Business Day, to use a representative sampling of the Fund's portfolio;<sup>4</sup> or

● for temporary periods, to effect changes in the Fund's portfolio as a result of the rebalancing of its Underlying Index (any such change, a "Rebalancing").

If there is a difference between the NAV attributable to a Creation Unit and the aggregate market value of the Creation Basket exchanged for the Creation Unit (the "Difference"), the party conveying instruments with the lower value will also pay to the other cash equal in value to the Difference.

Each Business Day, before the open of trading on the Exchange (ordinarily 9:30 a.m., Eastern Time), the Fund will cause to be published through the NSCC the names and quantities of the instruments comprising the Creation Basket (based on Fund portfolio information as of the end of the prior Business Day), as well as the estimated Cash Amount (if any, effective through and including the previous Business Day), for that day.

**CASH TRANSACTIONS – GENERALLY**

Purchases and redemptions of Creation Units may be made, in whole or in part, on a cash basis, rather than in kind, under certain circumstances, including:

● to the extent there is a Cash Amount;

● if, on a given Business Day, the Fund announces before the open of trading that all purchases, all redemptions, or all purchases and redemptions on that day will be made entirely in cash;

● if, upon receiving a purchase or redemption order from an Authorized Participant, the Fund determines to require the purchase or redemption, as applicable, to be made entirely in cash;

● if, on a given Business Day, the Fund requires all Authorized Participants purchasing or redeeming Fund shares on that day to deposit or receive (as applicable) cash in lieu of some or all of the Deposit Instruments or Redemption Instruments, respectively, solely because: (i) such instruments are not eligible for transfer through either the Clearing Process (defined below) or DTC Process; or (ii) in the case of the Fund holding foreign instruments, such instruments are not eligible for trading due to local trading restrictions, local restrictions on securities transfers or other similar circumstances; or

● if the Fund permits an Authorized Participant to deposit or receive (as applicable) cash in lieu of some or all of the Deposit Instruments or Redemption Instruments, respectively, solely because: (i) such instruments are, in the case of the purchase of a Creation Unit, not available in sufficient quantity; (ii) such instruments are not eligible for

trading by an Authorized Participant or the investor on whose behalf the Authorized Participant is acting; or (iii) a holder of shares of the Fund holding foreign instruments would be subject to unfavorable income tax treatment if the holder receives redemption proceeds in kind.

**CUSTOM TRANSACTIONS**

Under certain circumstances, the Fund may utilize custom Creation Baskets, including (i) all cash baskets; (ii) baskets that substitute cash in lieu of certain securities that would otherwise be included in the Fund's Creation Basket; (iii) a basket that is different from the initial basket used in transactions on the same Business Day; or (iv) a non-representative basket that consists of a selection of instruments that are already included in the Fund's portfolio holdings (each, a "Custom Order"). Custom Orders typically clear outside the Continuous Net Settlement System of the NSCC (the "Clearing Process") and, therefore, like other orders outside the Clearing Process, may need to be transmitted early on the relevant Business Day to be effectuated at that day's NAV. Custom Orders may be required to be received by the Distributor by 3:00 p.m., Eastern Time, to be effectuated based on the Fund's NAV on that Business Day. A Custom Order may be placed when, for example, an Authorized Participant cannot transact in a security in the in-kind Creation Basket, and therefore has additional cash included in a Creation Basket in lieu of such security.

Persons placing or effectuating custom orders should be mindful of time deadlines imposed by intermediaries, which may impact the successful processing of such orders.

Shares of the Fund will only be issued against full payment, as further described in the Prospectus and this SAI.

<sup>1</sup> The portfolio used for this purpose will be the same portfolio used to calculate the Fund's NAV for that Business Day.

<sup>2</sup> A tradable round lot for a security will be the standard unit of trading in that particular type of security in its primary market.

<sup>3</sup> This includes instruments that can be transferred in-kind only with the consent of the counterparty to the extent the Fund does not intend to seek such consents.

<sup>4</sup> The Fund may only use sampling for this purpose if the sample: (i) is designed to generate performance that is highly correlated to the performance of the Fund's portfolio; and (ii) consists entirely of instruments that are already included in the Fund's portfolio.

**PROCEDURES FOR PURCHASE OF CREATION UNITS**

All orders to purchase Creation Units must be placed with the Distributor by or through an Authorized Participant. An Authorized Participant is a broker-dealer or other participant in the Clearing Process or a DTC Participant and, in each case, must have an executed agreement with the Distributor with respect to the creations and redemption of the Fund's Creation Units ("Participant Agreement"). The Participant Agreement must also be accepted by the Transfer Agent.

An investor does not have to be an Authorized Participant, but must place an order to purchase or redeem Creation Units through an Authorized Participant. All shares of the Fund purchased through the creation process will be entered on the records of DTC in the name of Cede & Co. for the account of the applicable DTC Participant.

There may be a limited number of Authorized Participants at any one point in time, and only certain of these entities may be eligible to purchase and transmit non-U.S. instruments comprising a Creation Basket. To the extent that your financial institution is not an Authorized Participant, you may have to purchase Creation Units directly through an Authorized Participant or indirectly through your financial institution. If you opt to purchase Creation Units indirectly through your financial institution, you may incur additional transaction fees.

An order to purchase Creation Units of the Fund must be transmitted to the Distributor on a Business Day and received in proper form no later than the NAV Calculation Time (no later than 3:00 p.m., Eastern Time, for Custom Orders if required by the Distributor) in order for the purchase order to be processed at the NAV of the Fund's shares calculated on the date of transmittal ("Transmittal Date"). An order to purchase the Fund's Creation Units is considered to be in "proper form" if all procedures set forth in the Participant Agreement are properly followed. On Business Days that the Exchange closes early, the Fund may require an order for the purchase of Creation Units to be submitted earlier during the day. An Authorized Participant must deliver a Custom Order to the Distributor sufficiently in advance of the NAV Calculation Time in order to help ensure that the order is affected at the NAV calculated on that date.

Orders must be transmitted by the Authorized Participant to the Distributor by telephone or other transmission method acceptable to the Distributor pursuant to the procedures set forth in the applicable Participant Agreement. All orders to

purchase Creation Units must be submitted consistent with the processing requirements set forth in the applicable Participant Agreement (see "Placement of Creation Orders Outside the Clearing Process" and "Placement of Creation Orders Using the Clearing Process" below).

An investor must place orders to purchase the Fund's Creation Units in the form required by the Authorized Participant. An Authorized Participant may require an investor to make certain representations or enter into agreements with respect to the placement of an order to purchase the Fund's shares (e.g., to provide for payments of cash, when required).

Severe economic or market disruptions or changes, or telephone or other communication failure, may impede the ability to reach the Distributor or an Authorized Participant. If an investor is submitting an order to purchase Creation Units through an Authorized Participant, the investor should ensure that an appropriate amount of time is provided for submission of such order by the Authorized Participant to the Distributor prior to the NAV Calculation Time.

All questions as to the composition of Deposit Instruments and the amount of any 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 Authorized Participant shall be solely responsible for any loss, liability, cost, and expense (including reasonable attorneys' fees) incurred by the Fund or the Distributor related to the cancellation of an order to purchase or redeem Creation Units.

**Placement of Purchase Orders Outside the Clearing Process**

To settle a purchase order outside the Clearing Process, the Authorized Participant must instruct the transfer of the relevant Deposit Instruments and/or any applicable cash in a timely fashion so as to ensure the timely delivery of the Deposit Instruments and/or any cash on the Settlement Date. The "Settlement Date" for the Fund is generally the second Business Day after an order to purchase or redeem shares is received by the Distributor.

A purchase order shall be deemed received on the Transmittal Date if the order is received by the Distributor in proper form no later than the NAV Calculation Time on the Transmittal Date (no later than 3:00 p.m., Eastern Time, for Custom Orders if required by the Distributor). Purchase orders received on time on the Transmittal Date will be processed at the NAV calculated on the Transmittal Date.

The delivery of any Deposit Instruments must be made by 12:00 p.m., Eastern Time, on the Settlement Date. Any cash, including the applicable transaction fee (see "Transaction Fees on Purchases of Creation Units" below), shall be payable by 2:00 p.m., Eastern Time, on the Settlement Date. If the Custodian does not receive the Deposit Instruments and/or the applicable cash by the designated times on the Settlement Date, the purchase order may be cancelled. A canceled order may be resubmitted the following Business Day based on the Creation Basket and estimated Cash Amount for that Business Day. The delivery of Creation Units will take place no later than the Settlement Date.

Generally, an Authorized Participant shall deliver cash and any Deposit Instruments that are U.S. government or U.S. government agency securities to the Fund through the Federal Reserve System. An Authorized Participant may deliver Deposit Instruments that are DTC eligible domestic equity or fixed income securities through the DTC manual clearing process ("DTC Process"). Shares of the Fund shall settle and clear through the DTC Process. The DTC Process involves the manual line-by-line transfer of multiple securities. Because the DTC Process involves the movement of multiple securities, while the Clearing Process (see below) involves the movement of one unitary basket that automatically processes the movement of numerous securities, the DTC will charge the Fund more than the NSCC to settle a purchase of Creation Units.

Foreign securities cannot currently be processed through either the Clearing Process or the DTC Process. With respect to foreign Deposit Instruments, once a purchase order for Creation Units has been placed with the Distributor, the Distributor will inform the Advisor and the Custodian. The Custodian will then inform the appropriate sub-custodians, as applicable. The Authorized Participant must then timely deliver the relevant Deposit Instruments and/or any cash, including the transaction fee, to the Fund's account maintained with the relevant local custodian(s) by the Settlement Date. If applicable, the sub-custodians will confirm to the Custodian that the Deposit Instruments and/or any applicable cash have been delivered, and the Custodian will notify the Advisor of the same.

After the Distributor has received a purchase order and the Custodian has received delivery of the Deposit Instruments and/or any applicable cash, including the transaction fee, delivery of the appropriate number of Fund shares will be made to the book-entry account designated by the Authorized Participant. Except as provided herein, a Creation Unit of the Fund will not be issued until the transfer of good title to the Trust of any Deposit Instruments has been completed and/or the applicable cash has been received.

**Placement of Purchase Orders Using the Clearing Process**

Authorized Participants that are CNS Participants will be able to use the Clearing Process to purchase the Fund's Creation Units when Deposit Instruments are limited to DTC eligible domestic equity and fixed income securities and a Cash Amount or an all-cash payment. Under certain circumstances, a CNS Participant that tenders a Custom Order to purchase the Fund's Creation Units will be required to process the order outside the Clearing Process because the Clearing Process can only handle non-conforming deposits in specified situations. Additionally, Creation Units created in advance of receipt by the Custodian of all or a portion of the Deposit Instruments must be processed outside the Clearing Process (see "Additional Purchase Procedures" below).

The Clearing System has been specifically enhanced to affect purchases and redemptions of ETF securities, such as the Fund's shares. The Clearing Process simplifies the settlement and delivery process by transferring a basket of securities between two parties and treating all of the securities that comprise the basket as a single position. By contrast, the DTC Process, which is available to all Authorized Participants, involves a manual line-by-line movement of each security position. To the extent that the Clearing Process is available for use, the Participant Agreement will authorize the Distributor to transmit through the Custodian to the NSCC, on behalf of the CNS Participant, applicable trade instructions as are necessary to effect a purchase order for the Fund's Creation Units. Pursuant to the trade instruction, the Authorized Participant agrees to deliver the Deposit Instruments and/or any cash (including the transaction fee) to the Fund, together with such additional information as may be required by the Distributor.

An order to purchase Creation Units through the Clearing Process is deemed received on the Transmittal Date if such order is received by the Distributor in proper form no later than the NAV Calculation Time on the Transmittal Date (no later than 3:00 p.m., Eastern Time, for Custom Orders if required by the Distributor); and these Creation Units will be priced at Transmittal Date NAV. The delivery of any Deposit Instruments must be made by 12:00 p.m., Eastern Time, on the Settlement Date. Any cash, including the applicable transaction fee (see "Transaction Fees on Purchases of Creation Units" below), shall be payable by 2:00 p.m., Eastern Time, on the Settlement Date. If the Custodian does not receive the Deposit Instruments and/or the applicable cash by the designated times on the Settlement Date, the purchase order may be cancelled. A canceled order may be resubmitted the following Business Day based on the Creation Basket and estimated Cash Amount for that Business Day. The delivery of Creation Units will take place no later than the Settlement Date.

After the Distributor has received a purchase order and the Custodian has received delivery of the Deposit Instruments and/or any applicable cash, including the transaction fee, delivery of the appropriate number of Fund shares will be made to the book-entry account designated by the Authorized Participant. Except as provided herein, a Creation Unit of the Fund will not be issued until the transfer of good title to the Trust of any Deposit Instruments has been completed and/or the applicable cash has been received.

**Rejection of Purchase Orders**

The Distributor may reject a purchase order for Creation Units if the order is not submitted in proper form consistent with the requirements set forth in the Participant Agreement.

The SEC has expressed the view that a suspension of creations that impairs the arbitrage mechanism applicable to the trading of ETF shares in the secondary market is inconsistent with Rule 6c-11 under the 1940 Act. The SEC's position does not prohibit the suspension or rejection of creations in all instances. The Trust reserves the right, to the extent consistent with the provisions of Rule 6c-11 under the 1940 Act and the SEC's position, to reject an order for Creation Units transmitted to it by the Distributor in respect to the Fund, including instances in which: (1) the order is not in proper form; (2) the securities delivered do not conform with the Deposit Instruments for the relevant date; (3) an investor, upon obtaining the shares ordered, would own 80% or more of the currently outstanding shares of the Fund; (4) the acceptance of the Deposit Instruments and/or any applicable cash would, in the opinion of counsel to the Trust, be unlawful; (5) the acceptance or receipt of the order for a Creation Unit would, in the opinion of counsel to the Trust, be unlawful; or (6) in the event that circumstances outside the control of the Fund, the Custodian, the Transfer Agent, and/or the Advisor make it for all practical purposes not feasible to process creation orders.

Examples of such circumstances include natural disasters 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, the DTC, the NSCC, the Federal Reserve System, or any other participant in the creation process, and other extraordinary events. The Distributor shall notify an Authorized Participant of the rejection of any 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 Deposit Instruments and/or any cash, nor shall any 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.

**Additional Purchase Procedures**

Creation Units may be issued to an Authorized Participant in advance of receipt by the Trust of all or a portion of the applicable Deposit Instruments, provided that the Authorized Participant deposits an initial deposit of cash with the Trust having a value greater than the NAV of the requisite Fund shares on the date the order is received. In addition to available Deposit Instruments, cash must be deposited in an amount equal to the sum of the Cash Amount plus 115% of the market value of the Deposit Instruments not delivered ("Additional Cash Deposit").

An order will be deemed received on the Transmittal Date if: (1) the order is received by the Distributor in proper form no later than the NAV Calculation Time on that date (no later than 3:00 p.m., Eastern Time, for Custom Orders if required by the Distributor); and (2) federal funds equal to the sum of the Cash Amount, the Additional Cash Deposit, and the applicable transaction fee are received by the Custodian by 12:00 p.m., Eastern Time, on the Business Day following the Transmittal Date.

Pending delivery of the undelivered Deposit Instruments, the Authorized Participant shall be required to deposit additional cash, as needed, to maintain the Additional Cash Deposit at an amount equal to 115% of the value of undelivered Deposit Instruments, which shall be marked to market daily by the Fund until the outstanding securities are received. Under these circumstances, the shares of the Fund shall be delivered no later than the Settlement Date.

If an order is not received in proper form by the NAV Calculation Time on the Transmittal Date (no later than 3:00 p.m., Eastern Time, for Custom Orders if required by the Distributor) or the required cash deposit is not timely received on the Settlement Date by the Custodian, then the order may be cancelled or deemed not received, and the Authorized Participant effecting the transaction will be liable to the Fund for any losses resulting therefrom.

To the extent that the undelivered Deposit Instruments are not received by 12:00 p.m., Eastern Time, on the Settlement Date, the Fund may utilize the Additional Cash Deposit to buy the missing Deposit Instruments at any time, and the Authorized Participant effecting the transaction will be liable to the Fund for the costs incurred by the Fund in connection with such purchases and any shortfall between the cost to the Fund of purchasing such securities and the value of the Additional Cash Deposit. Costs to purchase the outstanding Deposit Instruments shall include, but not be limited to, any applicable transaction fee imposed by the Fund in connection with the purchase of the undelivered Deposit Instruments, the amount by which the actual purchase price of the undelivered Deposit Instruments exceeds the Additional Cash Deposit or the market value of such Deposit Instruments on the day the purchase order was received by the Distributor, plus the brokerage and related transaction costs associated with such purchases. The Fund will return the remaining Additional Cash Deposit once the undelivered Deposit Instruments are received by the Custodian or purchased by and deposited into the Fund.

The Participant Agreement may contain further information relating to this collateral process.

**Transaction Fees on Purchases of Creation Units**

The Fund charges a transaction fee, which is intended to cover the transfer and other transactional costs it incurs to issue Creation Units. A per transaction fee charge will be charged by the Fund ("Standard Charge"), regardless of the number of Creation Units purchased. The Fund reserves the right to charge additional transactions fees of up to three (3) times the Standard Charge for: (1) purchase orders processed outside the Clearing Process; (2) purchase orders involving cash in lieu amounts; and (3) cash purchases ("Additional Charges"). The Fund also reserves the right to adjust the Standard Charge and/or the Additional Charges at any time in order to ensure that the Fund is able to continue to recoup the costs it actually incurs to issue Creation Units. Authorized Participants are responsible for paying the costs to transfer Deposit Instruments to the Fund. Authorized Participants may also charge investors a fee to purchase Creation Units on their behalf.

The Standard Charge and maximum transaction fee for the Fund are $250 and $1,000, respectively. An investor purchasing

Creation Units outside the Clearing Process may be required to pay higher transaction fees than if the purchase is processed through the Clearing Process.

**Risks of Purchasing Creation Units**

The proposed method by which the Fund's Creation Units will be purchased and traded may raise certain issues under applicable securities laws. Because new Creation Units of the Fund's shares may be issued and sold on an ongoing basis, a "distribution" of that Fund's shares may be occurring at any time. Certain activities that a shareholder performs as a dealer may, depending on the circumstances, result in their being deemed participants in a distribution in a manner which could render them statutory underwriters and subject them to the prospectus delivery and liability provisions of the 1933 Act.

For example, a shareholder could be deemed a statutory underwriter if it takes Creation Units from the Fund, breaks them down into the constituent shares, and sells the shares directly to customers. A shareholder may also be deemed to be a statutory underwriter if the shareholder chooses to couple the purchase of a supply of new shares of the Fund with an active selling effort involving solicitation of secondary market demand for the shares.

Whether a person is an underwriter depends on all the facts and circumstances pertaining to that person's activities, and the examples set forth here are not intended to depict all circumstances under which a shareholder may be deemed to be a statutory underwriter.

Dealers who are not "underwriters," but are participating in a distribution (as opposed to ordinary secondary market transactions), and thus dealing with the Fund's shares as part of an "unsold allotment" within the meaning of Section 4(3)(C) of the 1933 Act, will be unable to rely on the prospectus-delivery exemption provided by Section 4(3) of the 1933 Act.

**Pursuant to Rule 153 under the 1933 Act, a prospectus delivery obligation under Section 5(b)(2) of the 1933 Act owed to a member of the Exchange in connection with a sale on the Exchange is satisfied by the fact that a Prospectus is available at the Exchange upon request. This prospectus delivery mechanism is only available with respect to transactions on the Exchange.**

**REDEMPTION OF CREATION UNITS**

Redemption requests must be placed by or through an Authorized Participant. Shares of the Fund may only be redeemed in Creation Units, except upon liquidation of the Fund. To redeem shares with the Fund, an investor must accumulate enough shares of that Fund to constitute one or more Creation Units. An investor may accumulate the shares necessary to comprise a Creation Unit of the Fund on the Exchange. However, there is no assurance that there will be sufficient liquidity in the market to enable the purchase of a sufficient number of shares of the Fund to complete a Creation Unit. An investor should expect to incur brokerage commissions and other costs to purchase the required number of shares to complete a Creation Unit.

Creation Units of the Fund may be redeemed on any Business Day at their NAV next calculated after a redemption request in proper form is received by the Distributor. A redemption request is considered to be in "proper form" if all procedures set forth in the Participant Agreement are properly followed.

The redemption of the Fund's Creation Units will be subject to compliance with applicable federal and state securities laws. An Authorized Participant that is not a "qualified institutional buyer" or "QIB," as such term is defined in Rule 144A of the 1933 Act, will not be able to receive Redemption Instruments that are restricted securities eligible for resale under Rule 144A. An Authorized Participant may be required by the Fund to provide a written confirmation with respect to QIB status in order to receive Redemption Instruments. An Authorized Participant may request a redeeming investor on whose behalf it is acting to enter into agreements outlining the terms under which cash must be substituted for one or more Redemption Instruments in order to comply with applicable securities laws and other legal restrictions relevant to the investor.

All orders to redeem Creation Units of the Fund must be received by the Distributor in proper form no later than the NAV Calculation Time on a Business Day (no later than 3:00 p.m., Eastern Time, for orders involving cash in lieu requests by Authorized Participants if required by the Distributor) in order to receive the NAV calculated on that date ("Transmittal Date"). On Business Days that the Exchange closes early, the Fund may require orders for the redemption of a Creation Unit(s) to be submitted earlier during the day. An Authorized Participant must deliver a Custom Order to the Distributor sufficiently in advance of the NAV Calculation Time in order to help ensure that the order is affected at the NAV calculated on the Transmittal Date.

An investor redeeming the Fund's Creation Units should submit the redemption order in the form required by the Authorized Participant selected to process the transaction. An investor intending to redeem the Fund's Creation Units should allow sufficient time to permit a timely submission of the redemption request to the Distributor and transfer of the Creation Units to the Fund.

There may be a limited number of Authorized Participants at any one point in time and only certain of these entities may be eligible to receive foreign securities on your behalf as part of the in-kind redemption process. To the extent that your financial institution is not an Authorized Participant, you may redeem Creation Units directly through an Authorized Participant or indirectly through your financial institution. If you opt to redeem Creation Units indirectly through your financial institution, you may incur additional transaction fees. You should also allow additional time to effect redemptions through your financial intermediary if the financial intermediary is not an Authorized Participant.

Although the Settlement Date for the redemption of Fund shares is generally the second Business Day after an order to redeem shares is received by the Distributor, the Settlement Date may be up to seven days after the Transmittal Date.

**Placement of Redemption Orders Outside the Clearing Process**

An order to redeem Creation Units is deemed received by the Distributor on the Transmittal Date if: (1) the order is received by the Distributor in proper form no later than the NAV Calculation Time (no later than 3:00 p.m., Eastern Time, for orders involving cash in lieu requests by Authorized Participants if required by the Distributor) on the Transmittal Date; (2) the order is accompanied or followed by the delivery of the requisite Creation Units, which delivery must be made through the DTC to the Custodian no later than 12:00 p.m., Eastern Time, on the Settlement Date; and (3) the order is accompanied or followed by the delivery of any Cash Amount and the applicable transaction fee to the Custodian through the Federal Reserve System no later than 2:00 p.m., Eastern Time, on the Settlement Date.

After a redemption request is received by the Distributor, the Custodian shall initiate procedures for the transfer of the Redemption Instruments and any Cash Amount, less any transaction fee, which is expected to be delivered by the Settlement Date.

The value of the Redemption Instruments and any Cash Amount will be calculated in accordance with the Trust's procedures for calculation of the Fund's NAV, as summarized in the Prospectus and this SAI. Therefore, if a redemption in proper form is submitted to the Distributor by an Authorized Participant no later than the NAV Calculation Time on the Transmittal Date (no later than 3:00 p.m., Eastern Time, for orders involving cash in lieu requests from Authorized Participants if required by the Distributor), and the requisite number of Fund shares are timely delivered to the Custodian no later than 12:00 P.M., Eastern Time, on the Settlement Date, then the value of the Redemption Instruments and any Cash Amount will be determined by the Fund Accountant as of the Transmittal Date. If a redemption order is submitted to the Distributor on the Transmission Date no later than the NAV Calculation Time on the Transmittal Date (no later than to 3:00 p.m., Eastern Time, for orders involving cash in lieu requests by Authorized Participants if required by the Distributor), but either: (1) the requisite number of shares of Fund shares are not timely delivered, or (2) the redemption order is not submitted in proper form, then the redemption order will not be deemed received as of the Transmittal Date. In such case, the value of the Redemption Instruments and any Cash Amount will be computed as of the Business Day that an order in proper form is received by the Distributor.

**Placement of Redemption Orders Using the Clearing Process**

Shareholders redeeming Creation Units pursuant to Custom Orders may be required to settle their redemptions outside of the Clearing Process. Redemptions of Creation Units in advance of receipt by the Custodian of all Fund shares (see "Additional Redemption Procedures" below) must be processed outside of the Clearing Process.

An order to redeem Creation Units using the Clearing Process is deemed received on the Transmittal Date if such order is received by the Distributor in proper form no later than the NAV Calculation Time on such Transmittal Date. An order deemed received after the NAV Calculation Time on the Transmittal date (after 3:00 p.m., Eastern Time, for orders involving cash in lieu requests from Authorized Participants if required by the Distributor) will be affected at the NAV calculated on the next Business Day. The Redemption Instruments and any Cash Amount, less the transaction fee, will be transmitted by the Settlement Date.

If a redemption order is submitted to the Distributor no later than the NAV Calculation Time on the Transmittal Date (no later than to 3:00 p.m., Eastern Time, for orders involving cash in lieu requests by Authorized Participants if required by the Distributor), but either: (1) the requisite number of shares of Fund shares are not timely delivered, or (2) the redemption order is not submitted in proper form, then the redemption order will not be deemed received as of the Transmittal Date. In such case, the value of the Redemption Instruments and any Cash Amount will be computed as of the Business Day that an order in proper form is received by the Distributor.

**Additional Redemption Procedures**

Creations Units may be redeemed in advance of receipt by the Trust of all or a portion of Fund shares, provided that the Authorized Participant deposits an initial deposit of cash with the Trust in an amount equal to the sum of any Cash Amount plus 115% of the market value of the missing Fund shares not delivered ("Redemption Deposit").

An order will be deemed received on the Transmittal Date if: (1) the Distributor received the order in proper form no later than the NAV Calculation Time on that date (no later than 3:00 p.m., Eastern Time, if required by the Distributor); and (2) the federal funds equal to the sum of any Cash Amount, the Redemption Deposit, and the applicable transaction fee are received by the Custodian by 12:00 p.m., Eastern Time, on the Business Day following the Transmittal Date. Pending delivery of the undelivered Fund shares, the Authorized Participant shall be required to deposit additional cash, as needed, to maintain the Redemption Deposit at an amount equal to 115% of the value of undelivered Fund shares, which shall be marked to market daily by the Fund until the outstanding shares are delivered. Under these circumstances, the Redemption Instruments, and any Cash Amount, less the applicable transaction fee, shall be delivered no later than the Settlement Date.

If an order is not received in proper form by the NAV Calculation Time on the Transmittal Date (no later than 3:00 p.m., Eastern Time, if required by the Distributor), or the required cash deposit is not timely received on the next Business Day following the date the order was received by the Distributor, then the order may be cancelled and deemed not received, and the Authorized Participant affecting the transaction will be liable to the Fund for any losses resulting therefrom.

To the extent that the undelivered Fund shares are not received by 12:00 p.m., Eastern Time, the Fund may use the Redemption Deposit to purchase the undelivered shares at any time, and the Authorized Participant shall be liable to the Fund for the costs incurred by the Fund in connection with such purchases and any shortfall between the cost to the Fund to acquire the shares and the value of the Redemption Deposit. Costs to purchase the outstanding Fund shares shall include, but not be limited to, the amount by which the actual purchase price of the undelivered Fund shares exceeds the Redemption Deposit or the market value of such shares on the day the purchase order was received by the Distributor, plus the brokerage and related transaction costs associated with such purchases. The Fund will return the remaining Redemption Deposit once the undelivered shares are received by the Custodian.

The Participant Agreement may contain further information relating to this collateral process.

**Transaction Fees on Redemptions of Creation Units**

The Fund charges a transaction fee, which is intended to cover the transfer and other transactional costs it incurs to redeem Creation Units. A transaction fee will be charged by the Fund to Authorized Participants per redemption ("Standard Redemption Fee"). The Fund reserves the right to charge additional transactions fees not to exceed three (3) times the Standard Redemption Fee for: (1) orders processed outside of the Clearing Process; (2) orders involving cash in lieu amounts; and (3) cash redemptions ("Additional Redemption Charges"). The Fund also reserves the right to adjust the Standard Charge and/or the Additional Redemption Charges at any time in order to ensure that the Fund is able to continue to recoup the costs it actually incurs to issue Creation Units. Authorized Participants are responsible for paying the costs to transfer the Redemption Instruments from the Fund. Authorized Participants may charge investors a fee to redeem Creation Units on their behalf.

The standard transaction fee and maximum transaction fee for the Fund are $250 and $1,000, respectively.

**Suspension of Redemption Rights**

The right of redemption may be suspended with respect to the Fund for: (1) any period during which the Exchange is closed (other than customary weekends and holidays); (2) any period during which trading on the Exchange is suspended or restricted; (3) any period during which an emergency exists as a result of which disposal of Fund shares or determination of the Fund's

NAV is not reasonably practicable; or (4) such other periods as the SEC may permit.

**BROKERAGE TRANSACTIONS**

While changes to the Fund's investment portfolio will generally be implemented through the issuance and redemption of the Fund's Creation Units in exchange for a Creation Basket, there may be occasions wherein the Advisor will purchase or sell securities directly on behalf of the Fund. To the extent that the Fund issues or redeems Creation Units partly or solely for cash, the Advisor may have to execute portfolio transactions on behalf of the Fund. The Fund paid $0 in brokerage commissions for the three fiscal years ended April 30, 2023, April 30, 2024, and April 30, 2025, and for the six-month period ended October 31, 2025.

**TRADE ALLOCATION**

Investment decisions for the Fund and other clients of the Advisor are made with a view to achieving their respective investment objectives and after consideration of such factors as their current holdings, availability of cash for investment, and the size of their investments generally.

A security may be bought or sold by the Advisor for only one client or in different amounts and at different times for more than one, but less than all, clients. Likewise, a particular security may be bought for one or more clients when one or more other clients are selling the security. In addition, purchases or sales of the same security may be made for two or more clients of the Advisor on the same day. To the extent that multiple clients are purchasing or selling a specific security at the same time, such transactions will be allocated among the clients in a manner believed by the Advisor to be equitable to each. In some cases, this procedure could have an adverse effect on the price or amount of the securities purchased or sold by the Fund. Purchase and sale orders for the Fund may be combined with those of other clients of the Advisor in the interest of achieving the most favorable net results for the Fund.

**BROKERAGE ALLOCATION**

The Advisor may place orders for the purchase and sale of portfolio securities for the Fund through numerous brokers and dealers. In so doing, it uses its best efforts to obtain for the Fund the best price and execution available. In seeking the best price and execution, the Advisor, having in mind the Fund's best interests, considers all factors it deems relevant, including, by way of illustration, price, the size of the transaction, the nature of the market for the security, the amount of the commission, the timing of the transaction taking into account market prices and trends, the reputation, experience, and financial stability of the broker-dealer involved, and the quality of service rendered by the broker-dealer in other transactions.

Transactions on U.S. stock exchanges and other agency transactions involve the payment by the Fund of negotiated brokerage commissions. Such commissions vary among brokers. Also, a particular broker may charge different commissions according to such factors as the difficulty and size of the transaction. Transactions in foreign securities often involve the payment of fixed brokerage commissions, which are generally higher than those in the U.S. There is generally no stated commission in the case of securities traded in the over-the-counter markets, but the price paid by the Fund usually includes an undisclosed dealer commission or mark-up. Purchases and sales of fixed income securities (for instance, money market instruments and bonds, notes, and bills) usually are principal transactions. In a principal transaction, the party from whom the Fund purchases, or to whom the Fund sells, is acting on its own behalf (and not as the agent of some other party, such as its customers). These securities normally are purchased directly from the issuer or from an underwriter or market maker for the securities. The prices of securities purchased from dealers serving as market makers reflect the spread between the bid and ask price. In underwritten offerings, the price paid by the Fund includes a disclosed, fixed commission or discount retained by the underwriter or dealer.

**SOFT DOLLAR PRACTICES**

It has for many years been a common practice in the investment advisory business for advisors of investment companies and other institutional investors to receive research, statistical, and quotation services from broker-dealers that execute portfolio transactions for their clients. Consistent with this practice, the Advisor may receive research, statistical, and quotation services from broker-dealers with which it places the Fund's portfolio transactions. These services, which in some cases may also be purchased for cash, include general economic and security market reviews, industry and company reviews, evaluations of securities, and recommendations as to the purchase and sale of securities. Some of these services are of value to the Advisor

and its affiliates in advising various of its clients (including the Fund), although not all of these services are necessarily useful and of value in managing the Fund. The investment advisory fee paid by the Fund to the Advisor is not reduced because the Advisor and its affiliates receive such services.

As permitted by Section 28(e) of the 1934 Act and by the Trust's Management Agreement with the Advisor, the Advisor may cause the Fund to pay a broker-dealer that provides the brokerage and research services described above an amount of disclosed commission for effecting a securities transaction for the Fund in excess of the commission which another broker-dealer may charge for effecting that transaction. The Advisor's authority to cause the Fund to pay any such greater commissions is also subject to such policies as the Trustees may adopt from time to time.

**ADDITIONAL INFORMATION ABOUT THE TRUST**

**SHAREHOLDER RIGHTS**

All shareholders are entitled to one vote for the Fund share held on the record date for any action requiring a vote by the shareholders. Shareholders of the Trust will vote in the aggregate and not by series, except as otherwise expressly required by law or when the Trustees determine that the matter to be voted upon affects only the interests of the shareholders of a particular series of the Trust.

Each share of the Fund represents a pro rata interest in the assets of the Fund. Fund shares have no preemptive, exchange, subscription or conversion rights, and there are no restrictions on the transfer of Fund shares. The Fund share participates pro rata in all dividends and distributions of the Fund and in the net distributable assets upon liquidation.

The Trust is not required to hold annual meetings of shareholders for the purpose of electing Trustees, except that (1) the Trust is required to hold a shareholder meeting for the election of Trustees at such time as less than a majority of the Trustees holding office have been elected by shareholders, and (2) if, as a result of a vacancy on the Board, less than two-thirds of the Trustees holding office have been elected by the shareholders, that vacancy may only be filled by a vote of the shareholders. Except as set forth above, a Trustee may continue to hold office and may appoint successor Trustees. The Declaration of Trust provides a process for the bringing of derivative actions by shareholders for claims beyond the process otherwise required by law. This derivative actions process is intended to permit legitimate inquiries and claims, while avoiding the time, expense, distraction, and other harm that can be caused to the Fund or its shareholders as a result of spurious shareholder demands and derivative actions. Prior to bringing a derivative action, a pre-suit demand by the complaining shareholder must first be made on the Board of Trustees, unless such action is excused because a majority of the members of the Board have a material personal financial interest in the action at issue. Following receipt of the demand, the Trustees must be afforded a reasonable amount of time to investigate and consider the demand.

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

The rights of shareholders cannot be modified without a majority vote of the Shareholders.

**FEES PAID FOR SERVICES**

As described above under "Service Providers—Investment Advisory Services—Investment Advisor," the Advisor receives compensation from the Fund at the annual rate of 0.79% of the Fund's average daily net assets. In consideration of such fees, the Advisor pays all routine expenses of the Fund. The following table shows the amounts that the Advisor paid to the Fund's other service providers for administration, transfer agency, and compliance services for the fiscal years ended April 30, 2023, April 30, 2024 and April 30, 2025, and for the six-month period ended October 31, 2025.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;**Fiscal Year Ended<br> April 30, 2023** | &nbsp;&nbsp;**Fiscal Year Ended<br> April 30, 2024** | &nbsp;&nbsp;**Fiscal Year Ended<br> April 30, 2025** | &nbsp;&nbsp;**Six-Month Period<br> Ended<br> October 31, 2025** |
| &nbsp;&nbsp;Management Fee Paid | &nbsp;&nbsp;$108857 | &nbsp;&nbsp;$77007 | &nbsp;&nbsp;$91916 | &nbsp;&nbsp;$223787 |
| &nbsp;&nbsp;Administration Fee and Fund Accounting Fee Paid to Citi | &nbsp;&nbsp;$60387 | &nbsp;&nbsp;$82537 | &nbsp;&nbsp;— | &nbsp;&nbsp;— |
| &nbsp;&nbsp;Management and Legal Administration Fee Paid to MFund | &nbsp;&nbsp;$30000 | &nbsp;&nbsp;$30000 | &nbsp;&nbsp;— | &nbsp;&nbsp;— |
| &nbsp;&nbsp;Compliance Services Fees Paid to MFund | &nbsp;&nbsp;$8219 | &nbsp;&nbsp;$9557 | &nbsp;&nbsp;— | &nbsp;&nbsp;— |

---

**PRINCIPAL HOLDERS OF SECURITIES**

From time to time, certain shareholders, including Authorized Participants, may own, of record, beneficially, or both, more than 25% of the Fund's shares, and those shareholders may be able to control the outcome of a shareholder vote.

As of April 24, 2026, the Trustees and officers of the Trust in the aggregate owned less than 1% of the outstanding shares of beneficial interest of the Fund.

Although the Trust does not have information concerning the beneficial ownership of shares held in the names of the Depository Trust Company (DTC) participants, as of April 24, 2026, the name, address and percentage ownership of each DTC participant that owned of record 5% or more of the outstanding shares of the Fund were as follows:

---

| | |
|:---|:---|
| &nbsp;&nbsp;Shareholder Name and Address | &nbsp;&nbsp;Percentage Owned |
| &nbsp;&nbsp;Cede & Co.<br> 55 Water Street, 25<sup>th</sup> Floor <br> New York, NY, 10041 | &nbsp;&nbsp;100% |

---

**BOOK ENTRY ONLY SYSTEM**

The information below supplements disclosure in the Prospectus regarding the book entry system. This information should be read in conjunction with the disclosure included in the Prospectus.

DTC acts as securities depositary for the Fund's shares. Shares of the Fund are represented by securities registered in the name of DTC or its nominee, Cede & Co., and deposited with, or on behalf of, DTC. Generally, certificates will not be issued for shares.

DTC is a limited-purpose trust company that was created to hold securities of 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 Exchange and FINRA. Access to the DTC system is also 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 the Fund's shares is limited to DTC Participants, Indirect Participants, and persons holding interests through DTC Participants and Indirect Participants. Ownership of beneficial interests in the Fund's shares (owners of such beneficial interests are referred to herein as "Beneficial Owners") is shown on, and the transfer of ownership is affected 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 the Fund's shares. The Trust recognizes DTC or its nominee as the record owner of the Fund's shares for all purposes. Beneficial Owners of the Fund's shares are not entitled to have Fund 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 a holder of the Fund's shares.

Conveyance of all notices, statements, and other communications to Beneficial Owners is affected as follows. DTC will make available to the Trust upon request and for a fee a listing of the Fund's shares held by each DTC Participant. The Trust shall

obtain from each such DTC Participant the number of Beneficial Owners holding the Fund's 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 the Fund's 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 the Fund's 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 the Fund's 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 the Fund's shares, unless the Trust makes other arrangements with respect thereto satisfactory to the Exchange. The DTC Participants' rules and policies are made publicly available through its website at <u>www.dtcc.com</u>.

**VOTING PROXIES OF FUND PORTFOLIO SECURITIES**

The Board has delegated responsibilities for decisions regarding proxy voting for securities held by the Fund to the Advisor. The Advisor may further delegate such proxy voting to a third-party proxy voting service provider. The Advisor will vote such proxies in accordance with its proxy policies and procedures. In some instances, the Advisor may be asked to cast a proxy vote that presents a conflict between its interests and the interests of the Fund's shareholders. In such a case, the Trust's policy requires that the Advisor abstain from making a voting decision and forward all necessary proxy voting materials to the Trust to enable the Board to make a voting decision. When the Board is required to make a proxy voting decision, only the Trustees without a conflict of interest regarding the security in question or the matter to be voted upon shall be permitted to participate in the decision of how the Fund's vote will be cast. The Advisor has developed a detailed proxy voting policy that has been approved by the Board. A copy of the proxy voting policy and procedures is attached hereto as Appendix 2.

Information on how the Fund voted proxies for the most recent year ended June 30 relating to portfolio securities is available without charge, upon request, by calling (800) 253-0412 or on the SEC's Internet site at <u>www.sec.gov</u>. In addition, a copy of the Fund's proxy voting policies and procedures is also available by calling (855) 4SS-ETFS or (855) 477-3837, and will be sent within three business days of receipt of a request.

**PORTFOLIO HOLDINGS DISCLOSURE PRACTICES**

The Board has adopted policies and procedures for the public and nonpublic disclosure of the Fund's portfolio securities.

Each day the Fund is open for business, before the opening of regular trading on the Exchange, the Fund will publicly disclose on the Fund's website at <u>www.strategysharesetfs.com</u> the Fund's full portfolio holdings that will form the basis of the next calculation of current NAV, which are based on the Fund's portfolio holdings as of the close of business on the prior Business Day. In addition, each Business Day, a portfolio composition file, which displays the names and quantities of the instruments comprising the Creation Basket(s), as well as the estimated Cash Amount (if any), for that day, is publicly disseminated prior to the opening of the Exchange via the NSCC.

In addition, as a general matter, no information concerning the portfolio holdings of the Fund may be disclosed to any unaffiliated third party, except (1) to service providers that require such information in the course of performing their duties (for example, the Fund's custodian, administrator, the Advisor, any sub-advisor, independent public accountants, attorneys, officers and trustees) and are subject to a duty of confidentiality, including a duty not to trade on non-public information, and (2) pursuant to certain exceptions that serve a legitimate business purpose. These exceptions may include: (1) disclosure of portfolio holdings only after such information has been publicly disclosed on the Fund's website, in marketing materials or through filings with the SEC, as described below, and (2) to third-party vendors, that (a) agree to not distribute the portfolio holdings or results of the analysis to third parties, other departments or persons who are likely to use the information for purposes of purchasing or selling the Fund before the portfolio holdings or results of the analysis become publicly available; and (b) sign a written confidentiality agreement. The confidentiality agreement must provide, but is not limited to, that the recipient of the portfolio holdings information agrees to limit access to the portfolio holdings information to its employees who, on a need to know basis, are (1) authorized to have access to the portfolio holdings information, and (2) subject to confidentiality obligations, including duties not to trade on non-public information, no less restrictive than the confidentiality obligations contained in the confidentiality agreement.

The Fund's portfolio holdings are currently disclosed to the public through filings with the SEC. The Fund's discloses portfolio holdings by mailing the annual and semi-annual reports to shareholders approximately two months after the end of the fiscal year and semi-annual period, respectively. In addition, the Fund's portfolio holdings are publicly available on the SEC's EDGAR website in the Fund's reports on Form N-CSR two months after the end of each semi-annual period and on Form N-PORT two months after each quarter. Neither the Fund nor the Advisor may enter into any arrangement providing for the disclosure of non-public portfolio holding information for the receipt of compensation or benefit of any kind. Any exceptions to the policies and procedures may only be made by the consent of the Trust's chief compliance officer upon a determination that such disclosure serves a legitimate business purpose and is in the best interests of the Fund, and will be reported to the Board at the Board's next regularly scheduled meeting.

**ORGANIZATION AND MANAGEMENT OF WHOLLY OWNED SUBSIDIARY**

The Fund may invest up to 25% of its total assets in its Subsidiary. It is expected that the Subsidiary will invest primarily in commodities and other futures contracts.

The Subsidiary is a company organized under the laws of the Cayman Islands. The registered office of the Subsidiary is located at Walkers Corporate Limited, 190 Elgin Avenue, George Town, Grand Cayman KY1-9008, Cayman Islands. The Subsidiary's affairs are overseen by a board of directors.

<u>Directors</u>. Each of the Independent Trustees also serves as a Director of the Subsidiary.

The Subsidiary has entered into a separate contract with the Advisor for the management of the Subsidiary's portfolio, without compensation. The contract between the Advisor and the Subsidiary complies with the provisions of the 1940 Act relating to investment advisory contracts. The Subsidiary has also entered into arrangements with the Trust's custodian to serve as the Subsidiary's custodian, and with Citi to serve as the Subsidiary's transfer agent, fund accountant and administrator. The Subsidiary will comply with the provisions relating to affiliated transactions and custody set forth in Section 17 of the 1940 Act and the rules thereunder. The Subsidiary has adopted compliance policies and procedures that are substantially similar to the policies and procedures adopted by the Fund. The Trust's CCO oversees implementation of the Subsidiary's policies and procedures, and makes periodic reports to the Board regarding the Subsidiary's compliance with its policies and procedures.

The Subsidiary does not pay a fee to the Advisor or Citi for their services. The Subsidiary will bear the fees and expenses incurred in connection with the custody services that it receives. The Fund expects that the expenses borne by the Subsidiary will not be material in relation to the value of the Fund's assets.

**CODE OF ETHICS**

The Trust, the Advisor, and the Distributor have adopted codes of ethics under Rule 17j-1(c) of the 1940 Act. The purpose of each code is to avoid potential conflicts of interest and to prevent fraud, deception or misconduct with respect to the Fund. Such codes of ethics permit personnel covered by the codes to invest in securities that may be purchased or held by the Fund, subject to the restrictions of the codes. The codes are filed as exhibits to the Trust's registration statement.

**PORTFOLIO TURNOVER**

The portfolio turnover rate of the Fund is defined by the SEC as the ratio of the lesser of annual sales or purchases to the monthly average value of the portfolio, excluding from both the numerator and the denominator securities with maturities at the time of acquisition of one year or less. Portfolio turnover generally involves some expense to the Fund, including brokerage commissions or dealer mark-ups and other transactions costs on the sale of securities and reinvestment in other securities. During the fiscal years ended April 30, 2023, April 30, 2024, and April 30, 2025, and for the six-month period ended October 31, 2025, the Fund's portfolio turnover rates were 11%, 12%, 35%, and 9% of the average value of its portfolio, respectively.

**DETERMINATION OF NET ASSET VALUE**

The Fund calculates its NAV per share as of the close of the Exchange (normally 4:00 p.m., Eastern Time) on each Business Day. The NAV per share is calculated by dividing the value of the net assets of the Fund (e.g., value of total assets less total liabilities) by the total number of shares outstanding.

To calculate the Fund's NAV per share, the Trust follows valuation procedures approved by the Board. Pursuant to these procedures, the Trust relies on certain security pricing services to provide current market values for the Fund's portfolio securities. These security pricing services value equity securities (including foreign equity securities) traded on a securities exchange at the last reported sales price on the principal exchange. Equity securities quoted by NASDAQ are valued at the NASDAQ Official Closing Price. If there is no reported sale on the principal exchange and in the case of over-the-counter securities, equity securities are valued at a bid price estimated by the security pricing service. Debt securities traded on a national securities exchange or in the over-the-counter market are valued at the last reported sales price on the principal exchange. If there is no reported sale on the principal exchange, and for all other debt securities, including zero-coupon securities, debt securities are valued at a bid price estimated by the security pricing service. Foreign securities quoted in foreign currencies are translated into U.S. dollars at the foreign exchange rate in effect as of the close of the Exchange (generally 4:00 p.m., Eastern Time) on the day the value of the foreign security is determined.

Options contracts are generally valued at the mean of the bid and ask price as reported on the highest-volume exchange (in terms of the number of option contracts traded for that issue) on which such options are traded. Short-term investments with remaining maturities of 60 days or less at the time of purchase may be valued at amortized cost. Investments in other open-end investment companies are valued at NAV (except ETFs, which are valued consistent with the pricing process for equity securities). In certain limited circumstances, such as when a security's closing price versus the prior day's closing price exceeds a defined variance tolerance, or when a security's closing price is unchanged as compared to the prior day's closing price, a financial intermediary's good faith determination of the fair value of a security or option may be used instead of its current market value, even if the security's market price is readily available.

In cases where market prices for portfolio securities are not readily available, a Pricing Committee established and appointed by the Trustees determines in good faith, subject to Trust procedures, the fair value of portfolio securities held by the Fund.

**TAXES**

The following information is a summary of certain key federal income tax considerations affecting the Fund and its shareholders, and is in addition to the information provided in the Prospectus. No attempt has been made to present a complete explanation of the federal, state, local or foreign tax treatment of the Fund, or the tax implications to its shareholders. The discussions here and in the Prospectus are not intended as substitutes for careful tax planning.

**FEDERAL INCOME TAXATION**

The Fund is treated as a separate corporation for federal income tax purposes. The Fund has elected to be treated, and intends to qualify each year, as a regulated investment company (a "RIC") under Subchapter M of the Code. Qualification as a RIC requires, among other things, that the Fund:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) derive
 in each taxable year at least 90% of its gross income from: (a) dividends, interest, payments
 with respect to certain securities loans, and gains from the sales or other disposition of
 stock, securities or foreign currencies, or other income (including, but not limited to,
 gain from options,

futures contracts, and forward contracts) derived with respect to its business of investing in such stock, securities or foreign currencies; and (b) net income derived from interests in certain publicly traded partnerships that are treated as partnerships for U.S. federal income tax purposes, and that derive less than 90% of their gross income from the items described in (a) above (each, a "Qualified Publicly Traded Partnership" or "QPTP"); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) diversify
 its holdings so that, at the end of each quarter of each taxable year: (a) at least 50% of
 the value of the Fund's total assets is represented by (I) cash and cash items, U.S.
 Government securities, the securities of other regulated investment companies, and (II) other
 securities, with such other securities limited, in respect of any one issuer, to an amount
 not greater than 5% of the value of the Fund's total assets, and not more than 10%
 of the outstanding voting securities of such issuer, and (b) not more than 25% of the value
 of the Fund's total assets is invested in the securities (other than U.S. Government
 securities and the securities of other regulated investment companies) of (I) any one issuer,
 (II) any two or more issuers that the Fund controls, and that are determined to be engaged
 in the same or similar trades or businesses, or related trades or businesses, or (III) any
 one or more Qualified Publicly Traded Partnerships.

As a RIC, the Fund will not be subject to federal income tax on its "net investment income" (i.e., its investment company taxable income, as that term is defined in the Code, determined without regard to the deduction for dividends paid) and "net capital gain" (the excess of the Fund's net long-term capital gain over net short-term capital loss), if any, that it distributes in each taxable year to its shareholders, provided that it distributes at least 90% of the sum of its investment company taxable income for such taxable year and its net tax-exempt interest income for such taxable year. However, the Fund will be subject to federal corporate income tax (currently at a rate of 21%) on any undistributed income, other than tax-exempt income.

If the Fund were to fail to qualify as a regulated investment company accorded special tax treatment in any taxable year, the Fund would be subject to tax on its income at corporate rates, and all distributions from earnings and profits, including any distribution of net tax-exempt income and net long-term capital gains, would be taxable to shareholders as ordinary income. In addition, the Fund could be required to recognize net unrealized gains, pay substantial taxes and interest, and make substantial distributions before requalifying as a regulated investment company that is accorded special tax treatment.

If the Fund fails to distribute in a calendar year substantially all of its ordinary income for such year and substantially all of its net capital gains for the year ending October 31 (or later, if the Fund is permitted so to elect and so elects), plus any retained amount from the prior year, the Fund will be subject to a 4% excise tax on the under-distributed amounts. A dividend paid to shareholders by the Fund in January is generally deemed to have been paid by the Fund on December 31 of the preceding year if the dividend was declared and payable to shareholders of record on a date in October, November or December of that preceding year. The Fund intends generally to make distributions sufficient to avoid imposition of the 4% excise tax, although there can be no assurance that it will be able to do so.

**FUND DISTRIBUTIONS**

Distributions from the Fund (other than exempt-interest dividends, as discussed below) will be taxable to shareholders as ordinary income to the extent derived from the Fund's investment income and net short-term gains. Distributions of net capital gains (that is, the excess of net gains from capital assets held more than one year over net losses from capital assets held by the Fund for not more than one year) will be taxable to shareholders as such, regardless of how long a shareholder has held the shares in the Fund. Distributions are taxable to shareholders even if they are paid from income or gains earned by the Fund before a shareholder's investment (and thus were included in the price the shareholder paid). Distributions from capital gains are generally made after applying any available capital loss carryovers. Distributions reinvested in additional shares of the Fund through a dividend reinvestment service will be taxable to the same extent as if the distributions had been received in cash.

Individuals, trusts, and estates whose income exceeds certain threshold amounts will be subject to a 3.8% Medicare contribution tax on "net investment income." Net investment income includes any ordinary dividends and capital gain distributions from the Fund, as well as any capital gains recognized on the sale or exchange of Fund shares.

Distributions of investment income properly designated by the Fund as derived from "qualified dividend income" are taxed at the rates applicable to long-term capital gains. Long-term capital gain distributions paid to certain high-income taxpayers will be subject to a regular tax rate of 20%. High income taxpayers, for this purpose, are defined, in 2025, as individuals and

married couples filing jointly whose taxable income exceeds $533,400 and $600,050, respectively, per year.

In order for some portion of the dividends received by the Fund shareholder to be "qualified dividend income," the Fund must meet holding period and other requirements with respect to some portion of the dividend-paying stocks in its portfolio, and the shareholder must meet holding period and other requirements with respect to the Fund's shares. Generally, dividends paid by REITs do not qualify for the lower tax rates that apply to certain other "qualified investment income." A dividend will not be treated as qualified dividend income (at either the Fund or shareholder level): (1) if the dividend is received with respect to any share of stock held for fewer than 61 days during the 120-day period beginning on the date that is 60 days before the date on which such share becomes ex-dividend with respect to such dividend (or, in the case of certain preferred stock, 91 days during the 180-day period beginning 90 days before such date); (2) to the extent that the recipient is under an obligation (whether pursuant to a short sale or otherwise) to make related payments with respect to positions in substantially similar or related property; (3) if the recipient elects to have the dividend income treated as investment income for purposes of the limitation on deductibility of investment interest, or (4) if the dividend is received from a foreign corporation that is (a) not eligible for the benefits of a comprehensive income tax treaty with the U.S. (with the exception of dividends paid on stock of such a foreign corporation readily tradable on an established securities market in the U.S.), or (b) treated as a foreign personal holding company, foreign investment company, or passive foreign investment company.

In general, distributions of investment income designated by the Fund as derived from qualified dividend income will be treated as qualified dividend income by non-corporate taxpayers, provided the shareholder meets the holding period and other requirements described above with respect to the Fund's shares. If the aggregate qualified dividends received by the Fund during any taxable year are 95% or more of its gross income, then 100% of the Fund's dividends (other than properly designated capital gain dividends) will be eligible to be treated as qualified dividend income. For this purpose, the only gain included in the term "gross income" is the excess of net short-term capital gain over net long-term capital loss.

Dividends of net investment income received by corporate shareholders of the Fund will qualify for the 50% dividends received deduction generally available to corporations to the extent of the amount of qualifying dividends received by the Fund from domestic corporations for the taxable year. A dividend received by the Fund will not be treated as a qualifying dividend: (1) if the stock on which the dividend is paid is considered to be "debt-financed" (generally, acquired with borrowed funds); (2) if it has been received with respect to any share of stock that the Fund has held for less than 46 days (91 days in the case of certain preferred stock) during the 90-day period beginning on the date that is 45 days before the date on which such share becomes ex-dividend with respect to such dividend (during the 180-day period beginning 90 days before such date in the case of certain preferred stock); or (3) to the extent that the Fund is under an obligation (pursuant to a short sale or otherwise) to make related payments with respect to positions in substantially similar or related property. Moreover, the dividends received deduction may be disallowed or reduced: (1) if the corporate shareholder fails to satisfy the foregoing requirements with respect to its shares of the Fund; or (2) by application of the Code.

If the Fund distributes amounts in excess of the Fund's "earnings and profits" (which provide a measure of the Fund's dividend paying capacity for tax purposes), such excess distributions to shareholders will be treated as a return of capital to the extent of a shareholder's basis in his or her shares, and thereafter as gain from the sale or exchange of a capital asset. A return of capital is not taxable to a shareholder, but has the effect of reducing the shareholder's basis in the relevant shares, thus reducing any loss or increasing any gain on a subsequent taxable disposition by a shareholder of his or her shares. However, because the Fund's expenses attributable to earning tax exempt income do not reduce the Fund's current earnings and profits, a portion of any distribution in excess of the Fund's net tax exempt and taxable income may be considered paid out of the Fund's earnings and profits, and may therefore be treated as a taxable dividend (even though that portion economically represents a return of the Fund's capital).

Dividends and distributions on the Fund's shares are generally subject to federal income tax, as described herein, to the extent they do not exceed the Fund's realized income and gains, even though such dividends and distributions may economically represent a return of a particular shareholder's investment. Such distributions are likely to occur in respect of shares purchased at a time when the Fund's NAV reflects gains that are either unrealized or realized but not distributed.

**Investments in Commodities**

The Fund invests in derivatives, financially-linked instruments, and the stock of its Subsidiary to gain exposure to the commodity markets. This strategy may cause the Fund to realize more ordinary income than would be the case if the Fund invested directly in commodities. Also, these commodity-linked investments, and the income earned thereon, must be taken into account by the Fund in complying with the Distribution and Income Requirements and the Asset Diversification Test, as described below.

*Distribution Requirement.* The Fund anticipates that the Subsidiary will distribute the "Subpart F" income earned by the

Subsidiary each year, which the Fund will treat as qualifying income. The Fund intends to distribute the Subsidiary's income each year in satisfaction of the Fund's Distribution Requirement. The Subsidiary will be classified for federal income tax purposes as a controlled foreign corporation ("CFC") with respect to the Fund. As such, the Fund will be required to include in its gross income each year amounts earned by the Subsidiary during that year (Subpart F income), whether or not such earnings are distributed by the Subsidiary to the Fund (deemed inclusions). Treasury Regulations also permit the Fund to treat deemed inclusions as satisfying the Income Requirement (described below), even if the Subsidiary does not make a distribution of such income. Consequently, the Fund and the Subsidiary reserve the right to rely on deemed inclusions being treated as qualifying income to the Fund consistent with recently released Treasury Regulations. Subpart F income will be distributed by the Fund to shareholders each year as ordinary income and will not be qualified dividend income eligible for taxation at long-term capital gain rates. However, the Fund and the Subsidiary reserve the right to rely on deemed inclusions in satisfaction of the Fund's Distribution Requirement. The Subsidiary likely will also be classified as a PFIC, as defined below in "Foreign Tax Credit," but the CFC rules supersede the PFIC rules.

*Income Requirement.* As described above, the Fund must derive at least 90% of its gross income from qualifying sources to qualify as a regulated investment company. Gains from the disposition of commodities, including precious metals, are not considered qualifying income for purposes of satisfying the Income Requirement. See "Tax Treatment of Portfolio Transactions Investments in commodities — structured notes, corporate subsidiary and certain ETFs." Also, the IRS has issued a revenue ruling which holds that income derived from commodity-linked swaps is not qualifying income under Subchapter M of the Code. As a result, the Fund's ability to directly invest in commodity-linked swaps as part of its investment strategy is limited to a maximum of 10% of its gross income. The IRS has issued a number of private letter rulings, which indicate that income from a fund's investment in certain commodity-linked notes and a wholly owned foreign subsidiary that invests in commodity-linked derivatives, such as the Subsidiary, constitutes qualifying income. However, in September 2016, the IRS announced that it will no longer issue private letter rulings on questions relating to the treatment of a corporation as a regulated investment company that require a determination of whether a financial instrument or position is a security under section 2(a)(36) of the 1940 Act. (A financial instrument or position that constitutes a security under section 2(a)(36) of the 1940 Act generates qualifying income for a corporation taxed as a regulated investment company.) This caused the IRS to revoke the portion of any rulings that required such a determination, some of which were revoked prospectively and others of which were revoked retroactively as of a date agreed upon with the IRS. In addition, a RIC may gain exposure to commodities through investment in a Qualified Publicly Traded Partnership, such as an exchange-traded fund or ETF that is classified as a partnership and that invests in commodities, or through investment in a wholly-owned subsidiary that is treated as a controlled foreign corporation for federal income tax purposes. Applicable regulations treat "Subpart F" income (defined in Section 951 of the Code to include passive income, such as income from commodity-linked derivatives) as qualifying income, even if a foreign corporation, such as the Subsidiary, does not make a distribution of such income. If a distribution is made, such income will be treated as a dividend by the Fund to the extent that, under applicable provisions of the Code, there is a distribution out of the earnings and profits of the foreign corporation attributable to the distribution. The Fund anticipates that its Subsidiary will distribute the "Subpart F" income earned by the Subsidiary each year, which the Fund will treat as dividend income to the extent attributable to the earnings and profits of the foreign corporation and, therefore, as qualifying income to the Fund.

Accordingly, the extent to which the Fund invests in commodities or commodity-linked derivatives may be limited by the Income Requirement, which the Fund must continue to satisfy to maintain its status as a RIC. The tax treatment of the Fund and its shareholders in the event the Fund fails to qualify as a RIC is described above.

*Asset Diversification Test.* For the purposes of the Asset Diversification Test, the Fund's investment in the Subsidiary would be considered a security of one issuer. Accordingly, the Fund intends to limit its investment in the Subsidiary to no more than 25% of the value of the Fund's total assets in order to satisfy the Asset Diversification Test.

*Taxation of the Subsidiary.* On the basis of current law and practice, the Subsidiary will not be liable for income tax in the Cayman Islands. Distributions by the Subsidiary to the Fund will not be subject to withholding tax in the Cayman Islands. In addition, the Subsidiary's investment in commodity-linked derivatives and other assets held as collateral are anticipated to qualify for a safe harbor under Code Section 864(b) so that the Subsidiary will not be treated as conducting a U.S. trade or business. Thus, the Subsidiary should not be subject to U.S. federal income tax on a net basis. However, if certain of the Subsidiary's activities were determined not to be of the type described in the safe harbor (which is not expected), then the activities of the Subsidiary may constitute a U.S. trade or business or be taxed as such.

In general, a foreign corporation, such as the Subsidiary, that does not conduct a U.S. trade or business is nonetheless subject to tax at a flat rate of 30 percent (or lower tax treaty rate), generally payable through withholding, on the gross amount of certain U.S.-source income that is not effectively connected with a U.S. trade or business, subject to certain exemptions,

including, among others, exemptions for capital gains, portfolio interest and income from notional principal contracts. It is not anticipated that the Subsidiary will be subject to material amounts of U.S. withholding tax on its portfolio investments. The Subsidiary intends to properly certify its status as a non-U.S. person to each custodian and withholding agent to avoid U.S. backup withholding requirements discussed below. Additionally, the Subsidiary intends to qualify as a "participating FFI," or otherwise qualify for an exemption under Chapter 4 of the Code to avoid U.S. withholding tax under the Foreign Account Tax Compliance Act, as such terms are described below under the heading, "Foreign Account Tax Compliance Act ("FATCA")."

**CAPITAL LOSS CARRYOVERS**

The capital losses of the Fund, if any, do not flow through to shareholders. Rather, the Fund may use its capital losses, subject to applicable limitations, to offset its capital gains without being required to pay taxes on or distribute to shareholders such gains that are offset by the losses. Thus, if the Fund has a "net capital loss" (that is, capital losses in excess of capital gains), the excess (if any) of the Fund's net short-term capital losses over its net long-term capital gains is treated as a short-term capital loss arising on the first day of the Fund's next taxable year, and the excess (if any) of the Fund's net long-term capital losses over its net short-term capital gains is treated as a long-term capital loss arising on the first day of the Fund's next taxable year. Any such net capital losses of the Fund that are not used to offset capital gains may be carried forward indefinitely to reduce any future capital gains realized by the Fund in succeeding taxable years. The amount of capital losses that can be carried forward and used in any single year is subject to an annual limitation if there is a more than 50% "change in ownership" of the Fund. An ownership change generally results when shareholders owning 5% or more of the Fund increase their aggregate holdings by more than 50% over a three-year lookback period. An ownership change could result in capital loss carryovers being used at a slower rate, thereby reducing the Fund's ability to offset capital gains with those losses. An increase in the amount of taxable gains distributed to the Fund's shareholders could result from an ownership change. The Fund undertakes no obligation to avoid or prevent an ownership change, which can occur in the normal course of shareholder purchases and redemptions or as a result of engaging in a tax-free reorganization with another fund. Moreover, because of circumstances beyond the Fund's control, there can be no assurance that the Fund will not experience, or has not already experienced, an ownership change. Additionally, if the Fund engages in a tax-free reorganization with another fund, the effect of these and other rules not discussed herein may be to disallow or postpone the use by the Fund of its capital loss carryovers (including any current year losses and built-in losses when realized) to offset its own gains or those of the other fund, or vice versa, thereby reducing the tax benefits Fund shareholders would otherwise have enjoyed from the use of such capital loss carryovers. As of April 30, 2025, the Fund had $275,056 in short-term capital loss carryforwards and $983,253 in long-term capital loss carryforwards. These capital loss carryforwards do not expire.

**HEDGING TRANSACTIONS**

Certain investment and hedging activities of the Fund, including transactions in options, futures contracts, forward contracts, foreign currencies, foreign securities, or other similar transactions, will be subject to special tax rules. In a given case, these rules may accelerate income to the Fund, defer losses to the Fund, cause adjustments in the holding periods of the Fund's assets, convert long-term capital gains into short-term capital gains, or convert short-term capital losses into long-term capital losses. These rules could therefore affect the amount, timing, and character of the Fund's income and distributions to shareholders. Income earned as a result of these transactions would, in general, not be eligible for the dividends received deduction or for treatment as exempt-interest dividends when distributed to shareholders. The Fund will endeavor to make any available elections pertaining to such transactions in a manner believed to be in the best interests of the Fund.

Certain of the Fund's hedging activities (including its transactions, if any, in foreign currencies or foreign currency-denominated instruments) are likely to produce a difference between its book income and its taxable income. If the Fund's book income exceeds its taxable income, the distribution (if any) of such excess will be treated as: (1) a dividend to the extent of the Fund's remaining earnings and profits (including earnings and profits arising from tax-exempt income); (2) thereafter as a return of capital to the extent of the recipient's basis in the shares; and (3) thereafter as gain from the sale or exchange of a capital asset. If the Fund's book income is less than its taxable income, the Fund could be required to make distributions exceeding book income to qualify as a regulated investment company that is accorded special tax treatment.

*Investments in commodities — structured notes, corporate subsidiary, and certain ETFs.* Gains from the disposition of commodities, including precious metals, will neither be considered qualifying income for purposes of satisfying the Income Requirement nor qualifying assets for purposes of satisfying the Asset Diversification Test. Also, the IRS has issued a revenue ruling which holds that income derived from commodity-linked swaps is not qualifying income for purposes of the Income

Requirement. In a subsequent revenue ruling, as well as in a number of follow-on private letter rulings (upon which only the fund that received the private letter ruling may rely), the IRS provides that income from certain alternative investments which create commodity exposure, such as certain commodity-linked or structured notes, or a corporate subsidiary (such as the Subsidiary) that invests in commodities, may be considered qualifying income under the Code. In September 2016, the IRS announced that it will no longer issue private letter rulings on questions relating to the treatment of a corporation as a RIC that require a determination of whether a financial instrument or position, such as a commodity-linked or structured note, is a security under section 2(a)(36) of the 1940 Act. (A financial instrument or position that constitutes a security under section 2(a)(36) of the 1940 Act generates qualifying income for a corporation taxed as a regulated investment company.) This caused the IRS to revoke the portion of any rulings that required such a determination, some of which were revoked retroactively and others of which were revoked prospectively as of a date agreed upon with the IRS.

In addition, a RIC may gain exposure to commodities through investment in a Qualified Publicly Traded Partnership, such as an ETF that is classified as a partnership and that invests in commodities, or through investment in a wholly owned subsidiary that is treated as a controlled foreign corporation for federal income tax purposes. Applicable regulations treat "Subpart F" income (defined in Section 951 of the Code to include passive income, such as income from commodity-linked derivatives) as qualifying income, even if a foreign corporation, such as the Subsidiary, does not make a distribution of such income. If a distribution is made, such income will be treated as a dividend by the Fund to the extent that, under applicable provisions of the Code, there is a distribution out of the earnings and profits of the foreign corporation attributable to the distribution. The Fund anticipates that its Subsidiary will distribute the "Subpart F" income earned by the Subsidiary each year, which the Fund will treat as dividend income to the extent attributable to the earnings and profits of the foreign corporation and, therefore, as qualifying income to the Fund. Accordingly, the extent to which the Fund directly invests in commodities or commodity-linked derivatives may be limited by the Income Requirement and the Asset Diversification Test, which the Fund must continue to satisfy to maintain its status as a regulated investment company. The Fund also may be limited in its ability to sell its investments in commodities, commodity-linked derivatives, and certain ETFs, or be forced to sell other investments to generate income due to the Income Requirement. If the Fund does not appropriately limit such investments, or if such investments (or the income earned on such investments) were to be recharacterized for U.S. tax purposes, the Fund could fail to qualify as a regulated investment company. In lieu of potential disqualification, the Fund is permitted to pay a tax for certain failures to satisfy the Asset Diversification Test or Income Requirement, which, in general, are limited to those due to reasonable cause and not willful neglect. Also see "Investments in Commodities" with respect to investments in the Subsidiary.

**FOREIGN CURRENCY-DENOMINATED SECURITIES AND RELATED HEDGING TRANSACTIONS**

The Fund's transactions in foreign currency-denominated debt securities, certain foreign currency options, futures contracts, and forward contracts may give rise to ordinary income or loss to the extent such income or loss results from fluctuations in the value of the foreign currency concerned.

**FOREIGN INVESTMENTS**

If the Fund purchases foreign securities, its investment income may be subject to foreign withholding or other taxes that could reduce the return on these securities. Tax treaties between the U.S. and foreign countries, however, may reduce or eliminate the amount of foreign taxes to which the Fund would be subject. The effective rate of foreign tax cannot be predicted since the amount of Fund assets to be invested within various countries is uncertain. However, the Fund intends to operate so as to qualify for treaty-reduced tax rates when applicable.

Distributions from the Fund may be based on estimates of book income for the year. Book income generally consists solely of the coupon income generated by the portfolio, whereas tax-basis income includes gains or losses attributable to currency fluctuation. Due to differences in the book and tax treatment of fixed income securities denominated in foreign currencies, it is difficult to project currency effects on an interim basis.

Therefore, to the extent that currency fluctuations cannot be anticipated, a portion of distributions to shareholders could later be designated as a return of capital, rather than income, for income tax purposes, which may be of particular concern to simple trusts.

*Foreign Account Tax Compliance Act ("FATCA").* Under FATCA, the Fund will be required to withhold a 30% tax on income dividends made by the Fund to certain foreign entities, referred to as foreign financial institutions ("FFI") or non-financial foreign entities ("NFFE"). After December 31, 2018, FATCA withholding also would have applied to certain capital gain distributions, return of capital distributions and the proceeds arising from the sale of Fund shares; however, based on proposed regulations issued by the IRS, which can be relied upon currently, such withholding is no longer required unless final

regulations provide otherwise (which is not expected). The FATCA withholding tax generally can be avoided: (a) by an FFI, if it reports certain direct and indirect ownership of foreign financial accounts held by U.S. persons with the FFI, and (b) by an NFFE, if it: (i) certifies that it has no substantial U.S. persons as owners, or (ii) if it does have such owners, reporting information relating to them. The U.S. Treasury has negotiated intergovernmental agreements (IGA) with certain countries and is in various stages of negotiations with a number of other foreign countries with respect to one or more alternative approaches to implement FATCA.

An FFI can avoid FATCA withholding if it is deemed compliant or by becoming a "participating FFI," which requires the FFI to enter into a U.S. tax compliance agreement with the IRS under section 1471(b) of the Code (FFI agreement) under which it agrees to verify, report, and disclose certain of its U.S. accountholders and meet certain other specified requirements. The FFI will either report the specified information about the U.S. accounts to the IRS, or to the government of the FFI's country of residence (pursuant to the terms and conditions of applicable law and an applicable IGA entered into between the U.S. and the FFI's country of residence), which will, in turn, report the specified information to the IRS. An FFI that is resident in a country that has entered into an IGA with the U.S. to implement FATCA will be exempt from FATCA withholding, provided that the FFI shareholder and the applicable foreign government comply with the terms of such agreement.

An NFFE that is the beneficial owner of a payment from the Fund can avoid the FATCA withholding tax generally by certifying that it does not have any substantial U.S. owners or by providing the name, address, and taxpayer identification number of each substantial U.S. owner. The NFFE will report the information to the Fund or other applicable withholding agent, which will, in turn, report the information to the IRS.

Such foreign shareholders also may fall into certain exempt, excepted, or deemed compliant categories, as established by U.S. Treasury regulations, IGAs, and other guidance regarding FATCA. An FFI or NFFE 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 should consult their own tax advisors regarding the impact of these requirements on their investment in the Fund. The requirements imposed by FATCA are different from, and in addition to, the U.S. tax certification rules to avoid backup withholding described above. Shareholders are urged to consult their tax advisors regarding the application of these requirements to their own situation.

**FOREIGN TAX CREDIT**

The Fund may be subject to foreign withholding or other taxes with respect to income from foreign securities, which could reduce the amount of the Fund's distributions. Shareholders may be able to claim a credit or deduction for foreign taxes if more than 50% of the Fund's assets are invested in foreign securities at the end of a fiscal year and the Fund makes an election to pass through to the shareholders their pro rata share of foreign taxes paid by the Fund. If this election is made, the Fund may report more taxable income to the shareholders than it actually distributes. The shareholders will then be entitled either to deduct their share of these taxes in computing their taxable income or to claim a foreign tax credit for these taxes against their U.S. federal income tax (subject to limitations for certain shareholders). The Fund will provide the shareholders with the information necessary to claim this deduction or credit on their personal income tax return if the Fund makes this election. It is not anticipated that the Fund will invest in foreign securities to the extent necessary to meet the above 50% threshold to pass through the foreign taxes it pays to shareholders.

**PASSIVE FOREIGN INVESTMENT COMPANIES**

Investment by the Fund in "passive foreign investment companies" ("PFICs") could subject the Fund to a U.S. federal income tax or other charge on the proceeds from the sale of its investment in such a company; however, this tax can be avoided by making an election to mark such investments to market annually or to treat the passive foreign investment company as a "qualified electing Fund."

A PFIC is any foreign corporation: (1) 75 percent or more of the income of which for the taxable year is passive income; or (2) the average percentage of the assets of which (generally by value, but by adjusted tax basis in certain cases) produce or are held for the production of passive income is at least 50 percent. Generally, passive income for this purpose means dividends, interest (including income equivalent to interest), royalties, rents, annuities, the excess of gain over losses from certain property transactions and commodities transactions, and foreign currency gains. Passive income for this purpose does not include rents and royalties received by the foreign corporation from active business and certain income received from related persons. The Fund's investments in foreign securities may be subject to withholding taxes at the source on dividends or interest payments.

**SALE OR REDEMPTION OF SHARES**

The sale, exchange or redemption of the Fund's shares may give rise to a gain or loss. In general, any gain or loss realized upon a taxable disposition of shares will be treated as long-term capital gain or loss if the shares have been held for more than 12 months. Otherwise, the gain or loss on the sale, exchange, or redemption of the Fund's shares will be treated as short-term capital gain or loss. However, if a shareholder sells the Fund's shares at a loss within six months of purchase, any loss will be disallowed for Federal income tax purposes to the extent of any exempt-interest dividends received on such shares. In addition, any loss (not already disallowed as provided in the preceding sentence) realized upon a taxable disposition of the Fund's shares held for six months or less will be treated as long-term, rather than short-term, to the extent of any long-term capital gain distributions received by the shareholder with respect to the Fund's shares. All or a portion of any loss realized upon a taxable disposition of the Fund's shares will be disallowed if other shares of the same Fund are purchased within 30 days before or after the disposition. In such a case, the basis of the newly purchased Fund shares will be adjusted to reflect the disallowed loss.

**IN-KIND PURCHASE AND REDEMPTION OF CREATION UNITS**

To the extent that the Fund sells shares in exchange for securities and/or cash, the investor will recognize a gain or loss equal to the difference between the market value of the Creation Unit at the time and the investor's aggregate basis in the securities surrendered and/or the amount of any cash paid for the Creation Unit. An investor who redeems a Creation Unit for securities or securities and cash will generally recognize a gain or loss equal to the difference between the investor's basis in the Creation Unit and the aggregate market value of the securities and/or cash received for the Creation Unit. The Internal Revenue Service, however, may assert that a loss realized upon an exchange of primarily securities for a Creation Unit cannot be deducted currently under the rules governing "wash sales," or on the basis that there has been no significant change in economic position. Persons exchanging securities should consult their own tax advisor with respect to whether wash sale rules apply and when a loss might be deductible.

Under current federal tax laws, any capital gain or loss realized upon redemption of a Creation Unit is generally treated as long-term capital gain or loss if the shares have been held for more than 12 months and as short-term capital gain or loss if the shares have been held for 12 months or less.

If you purchase or redeem Creation Units, you will be sent a confirmation statement showing how many Creation Units of the Fund you purchased and sold and at what price. If the Fund redeems Creation Units in cash, it may recognize more capital gains than it will if it redeems Creation Units in-kind.

**INVESTMENTS IN PARTNERSHIPS AND QPTPS**

For purposes of the Income Requirement, income derived by a fund from a partnership that is not a QPTP will be treated as qualifying income only to the extent such income is attributable to items of income of the partnership that would be qualifying income if realized directly by the fund. While the rules are not entirely clear with respect to a fund investing in a partnership outside a master feeder structure, for purposes of testing whether a fund satisfies the Asset Diversification Test the fund generally is treated as owning a pro rata share of the underlying assets of a partnership. See "Taxation of the Fund." In contrast, different rules apply to a partnership that is a QPTP. A QPTP is a partnership (a) the interests in which are traded on an established securities market, (b) that is treated as a partnership for federal income tax purposes, and (c) that derives less than 90% of its income from sources that satisfy the Income Requirement (e.g., because it invests in commodities). All of the net income derived by a fund from an interest in a QPTP will be treated as qualifying income, but the fund may not invest more than 25% of its total assets in one or more QPTPs. However, there can be no assurance that a partnership classified as a QPTP in one year will qualify as a QPTP in the next year. Any such failure to annually qualify as a QPTP might, in turn, cause a fund to fail to qualify as a regulated investment company. Although, in general, the passive loss rules of the Code do not apply to RICs, such rules do apply to a fund with respect to items attributable to an interest in a QPTP. Fund investments in partnerships, including in QPTPs, may result in the fund being subject to state, local or foreign income, franchise or withholding tax liabilities.

If an MLP is treated as a partnership for U.S. federal income tax purposes (whether or not a QPTP), all or portion of the dividends received by a fund from the MLP likely will be treated as a return of capital for U.S. federal income tax purposes because of accelerated deductions available with respect to the activities of such MLPs. Further, because of these accelerated

deductions, on the disposition of interests in such an MLP, a fund likely will realize taxable income in excess of economic gain with respect to those MLP interests (or if the fund does not dispose of the MLP, the fund could realize taxable income in excess of cash flow with respect to the MLP in a later period), and the fund must take such income into account in determining whether the fund has satisfied its Distribution Requirement. A fund may have to borrow or liquidate securities to satisfy its Distribution Requirement and to meet its redemption requests, even though investment considerations might otherwise make it undesirable for the fund to sell securities or borrow money at such time. In addition, any gain recognized, either upon the sale of a fund's MLP interest or sale by the MLP of property held by it, including in excess of economic gain thereon, treated as so-called "recapture income," will be treated as ordinary income. Therefore, to the extent a fund invests in MLPs, fund shareholders might receive greater amounts of distributions from the fund taxable as ordinary income than they otherwise would in the absence of such MLP investments.

Current federal tax law generally requires that taxes, penalties, and interest associated with an audit of a partnership be assessed and collected at the partnership level. Therefore, an adverse federal income tax audit of a partnership that the Fund invests in (including MLPs taxed as partnerships) could result in the Fund being required to pay federal income tax. A Fund may have little input in any audit asserted against a partnership, and may be contractually or legally obligated to make payments in regard to deficiencies asserted without the ability to put forward an independent defense. Accordingly, even if a partnership in which the Fund invests were to remain classified as a partnership (instead of as a corporation), it could be required to pay additional taxes, interest and penalties as a result of an audit adjustment, and the Fund, as a direct or indirect partner of such partnership, could be required to bear the economic burden of those taxes, interest and penalties, which would reduce the value of Fund shares.

Although MLPs are generally expected to be treated as partnerships for U.S. federal income tax purposes, some MLPs may be treated as PFICs or "regular" corporations for U.S. federal income tax purposes. The treatment of particular MLPs for U.S. federal income tax purposes will affect the extent to which a fund can invest in MLPs and will impact the amount, character, and timing of income recognized by the Fund.

**BACKUP WITHHOLDING**

By law, a portion of your taxable dividends and sales proceeds may be withheld, unless you:

provide your correct social security or taxpayer identification number,

certify that this number is correct,

certify that you are not subject to backup withholding, and

certify that you are a U.S. person (including a U.S. resident alien).

Withholding is also imposed if the IRS requires it. When withholding is required, the amount will be 24% of any distributions or proceeds paid. Backup withholding is not an additional tax. Any amounts withheld may be credited against the shareholder's U.S. federal income tax liability, provided the appropriate information is furnished to the IRS. Certain payees and payments are exempt from backup withholding and information reporting. The special U.S. tax certification requirements applicable to non-U.S. investors to avoid backup withholding are described under the "Non-U.S. Investors" heading below.

**SECURITIES ISSUED OR PURCHASED AT A DISCOUNT**

The Fund's investment in securities issued at a discount and certain other obligations will (and investments in securities purchased at a discount may) require the Fund to accrue and distribute income not yet received. In order to generate sufficient cash to make the requisite distributions, the Fund may be required to sell securities in its portfolio that it otherwise would have continued to hold.

**SHARES PURCHASED THROUGH TAX-QUALIFIED PLANS**

Special tax rules apply to investments purchased though defined contribution plans and other tax-qualified plans. Shareholders should consult their tax adviser to determine the suitability of shares of the Fund as an investment through such plans, and the precise effect of an investment on their particular tax situation.

**UNRELATED BUSINESS TAXABLE INCOME**

Under current law, the Fund generally serves to block unrelated business taxable income ("UBTI") from being realized by its tax-exempt shareholders. Notwithstanding the foregoing, a tax-exempt shareholder could realize UBTI by virtue of its

investment in the Fund if either: (1) the Fund invests in REITs that hold residual interests in real estate mortgage investment conduits ("REMICs"); or (2) shares in the Fund constitute debt-financed property in the hands of the tax-exempt shareholder within the meaning of Code Section 514(b).

If a charitable remainder trust (as defined in Code Section 664) realizes any UBTI for a taxable year, it will be subject to an excise tax equal to the amount of the UBTI.

**DIVIDENDS AND DISTRIBUTIONS**

 ****

The Fund intends to declare and distribute dividends from net investment income, if any, monthly, and intends to distribute its net realized capital gains, if any, at least annually.

**FINANCIAL STATEMENTS**

 ****

The Fund's most recent financial statements are incorporated herein by reference to the Fund's [Annual Report](https://www.sec.gov/ix?doc=/Archives/edgar/data/0001506213/000158064225004098/strategyshares_n-csr.htm) to Shareholders for the fiscal year ended April 30, 2025 and the Fund's [Semi-Annual Report](https://www.sec.gov/Archives/edgar/data/810695/000158064223004766/rational_ncsrs.htm) to shareholders for the fiscal period ended October 31, 2025, a copy of each may be obtained without charge by calling (855) 4SS-ETFS or (855) 477-3837.

**APPENDIX 1**

**INVESTMENT RATINGS**

The NRSROs that may be utilized by the Fund with regard to portfolio investments for the Fund include Moody's, S&P, Fitch, and A.M. Best. Set forth below is a description of the relevant ratings of each such NRSRO. The NRSROs that may be utilized by the Fund and the description of each NRSRO's ratings is as of the date of this SAI and may subsequently change.

**A.M. BEST**

**LONG-TERM DEBT RATINGS**

**Investment Grade**

**Aaa:** Exceptional **aa:** Very Strong

**a:** Strong

**bbb:** Adequate

**Non-Investment Grade**

**Bb:** Speculative

**b:** Very Speculative

**ccc**, **cc**, **c:** Extremely Speculative

**d:** In Default

**SHORT-TERM DEBT RATINGS**

**Investment Grade**

**AMB-1+**: Strongest

**AMB-1**: Outstanding

**AMB-2**: Satisfactory

**AMB-3:** Adequate

**Non-Investment Grade**

**AMB-4:** Speculative

**D**: In Default

**FITCH**

**LONG-TERM DEBT RATINGS**

**Investment grade**

**AAA**: the best quality companies, reliable and stable

**AA**: quality companies, a bit higher risk than AAA

**A**: economic situation can affect finance

**BBB**: medium class companies, which are satisfactory at the moment

**Non-investment grade**

**BB**: more prone to changes in the economy

**B**: financial situation varies noticeably

**CCC**: currently vulnerable and dependent on favorable economic conditions to meet its commitments

**CC**: highly vulnerable, very speculative bonds

**C**: highly vulnerable, perhaps in bankruptcy or in arrears but still continuing to pay out on obligations

**D**: has defaulted on obligations and Fitch believes that it will generally default on most or all obligations

**NR**: not publicly rated

**SHORT-TERM DEBT RATINGS**

Fitch's short-term ratings indicate the potential level of default within a 12-month period.

**F1+**: best quality grade, indicating exceptionally strong capacity of obligor to meet its financial commitment

**F1**: best quality grade, indicating strong capacity of obligor to meet its financial commitment

**F2**: good quality grade with satisfactory capacity of obligor to meet its financial commitment

**F3**: fair quality grade with adequate capacity of obligor to meet its financial commitment but near-term adverse conditions could impact the obligor's commitments

**B**: of speculative nature and obligor has minimal capacity to meet its commitment and vulnerability to short term adverse changes in financial and economic conditions

**C**: possibility of default is high and the financial commitment of the obligor are dependent upon sustained, favorable business and economic conditions

**D**: the obligor is in default as it has failed on its financial commitments.

Fitch also uses intermediate +/- modifiers for each category between AA and CCC (e.g., AA+, AA, AA-, A+, A, A-, BBB+, BBB, BBB-, etc.).

**MOODY'S**

**GLOBAL LONG-TERM RATING SCALE**

**Aaa:** Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of credit risk.

**Aa:** Obligations rated Aa are judged to be of high quality and are subject to very low credit risk.

**A:** Obligations rated A are judged to be upper-medium grade and are subject to low credit risk.

**Baa:** Obligations rated Baa are judged to be medium-grade and subject to moderate credit risk and as such may possess certain speculative characteristics.

**Ba:** Obligations rated Ba are judged to be speculative and are subject to substantial credit risk.

**B:** Obligations rated B are considered speculative and are subject to high credit risk.

**Caa:** Obligations rated Caa are judged to be speculative of poor standing and are subject to very high credit risk.

**Ca:** Obligations rated Ca are highly speculative and are likely in, or very near, default, with some prospect of recovery of principal and interest.

**C:** Obligations rated C are the lowest rated and are typically in default, with little prospect for recovery of principal or interest.

Moody's appends numerical modifiers 1, 2, and 3 to each generic rating classification from Aa through Caa. The modifier 1 indicates that the obligation ranks in the higher end of its generic rating category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates a ranking in the lower end of that generic rating category. Additionally, a "(hyb)" indicator is appended to all ratings of hybrid securities issued by banks, insurers, finance companies, and securities firms.

Moody's differentiates structured finance ratings from fundamental ratings (i.e., ratings on nonfinancial corporate, financial institution, and public sector entities) on the global long-term scale by adding (sf) to all structured finance ratings. The (sf) indicator was introduced on August 11, 2010 and explained in a special comment entitled, "Moody's Structured Finance Rating Scale." The addition of (sf) to structured finance ratings should eliminate any presumption that such ratings and fundamental ratings at the same letter grade level will behave the same. The (sf) indicator for structured finance security ratings indicates that otherwise similarly rated structured finance and fundamental securities may have different risk characteristics.

**GLOBAL SHORT-TERM RATING SCALE**

**P-1 Issuers (or supporting institutions) rated Prime-1:** have a superior ability to repay short-term debt obligations.

**P-2 Issuers (or supporting institutions) rated Prime-2:** have a strong ability to repay short-term debt obligations.

**P-3 Issuers (or supporting institutions) rated Prime-3:** have an acceptable ability to repay short-term obligations.

**NP Issuers (or supporting institutions) rated Not Prime:** do not fall within any of the Prime rating categories.

**US MUNICIPAL SHORT-TERM DEBT OBLIGATION RATINGS**

**MIG 1**: This designation denotes superior credit quality. Excellent protection is afforded by established cash flows, highly reliable liquidity support, or demonstrated broad-based access to the market for refinancing.

**MIG 2:** This designation denotes strong credit quality. Margins of protection are ample, although not as large as in the preceding group.

**MIG 3**: This designation denotes acceptable credit quality. Liquidity and cash-flow protection may be narrow, and market access for refinancing is likely to be less well-established. SG This designation denotes speculative-grade credit quality.

Debt instruments in this category may lack sufficient margins of protection.

**S&P GLOBAL RATINGS ("S&P")**

**AAA:** An obligation rated 'AAA' has the highest rating assigned by S&P. The obligor's capacity to meet its financial commitment on the obligation is extremely strong.

**AA:** An obligation rated 'AA' differs from the highest-rated obligations only to a small degree. The obligor's capacity to meet its financial commitment on the obligation is very strong.

**A:** An obligation rated 'A' is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher-rated categories. However, the obligor's capacity to meet its financial commitment on the obligation is still strong.

**BBB:** An obligation rated 'BBB' exhibits adequate protection parameters. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitment on the obligation.

**BB; B; CCC; CC; and C:** Obligations rated 'BB', 'B', 'CCC', 'CC', and 'C' are regarded as having significant speculative characteristics. 'BB' indicates the least degree of speculation and 'C' the highest. While such obligations will likely have some quality and protective characteristics, these may be outweighed by large uncertainties or major exposures to adverse conditions.

**BB:** An obligation rated 'BB' is less vulnerable to nonpayment than other speculative issues. However, it faces major ongoing uncertainties or exposure to adverse business, financial, or economic conditions which could lead to the obligor's inadequate capacity to meet its financial commitment on the obligation.

**B:** An obligation rated 'B' is more vulnerable to nonpayment than obligations rated 'BB', but the obligor currently has the capacity to meet its financial commitment on the obligation. Adverse business, financial, or economic conditions will likely impair the obligor's capacity or willingness to meet its financial commitment on the obligation.

**CCC:** An obligation rated 'CCC' is currently vulnerable to nonpayment, and is dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitment on the obligation. In the event of adverse business, financial, or economic conditions, the obligor is not likely to have the capacity to meet its financial commitment on the obligation.

**CC** An obligation rated 'CC' is currently highly vulnerable to nonpayment.

**C:** A 'C' rating is assigned to obligations that are currently highly vulnerable to nonpayment, obligations that have payment arrearages allowed by the terms of the documents, or obligations of an issuer that is the subject of a bankruptcy petition or similar action which have not experienced a payment default. Among others, the 'C' rating may be assigned to subordinated debt, preferred stock or other obligations on which cash payments have been suspended in accordance with the instrument's terms or when preferred stock is the subject of a distressed exchange offer, whereby some or all of the issue is either repurchased for an amount of cash or replaced by other instruments having a total value that is less than par.

**D:** An obligation rated 'D' is in payment default. The 'D' rating category is used when payments on an obligation are not made on the date due, unless S&P believes that such payments will be made within five business days, irrespective of any grace period. The 'D' rating also will be used upon the filing of a bankruptcy petition or the taking of similar action if payments on an obligation are jeopardized. An obligation's rating is lowered to 'D' upon completion of a distressed exchange offer, whereby some or all of the issue is either repurchased for an amount of cash or replaced by other instruments having a total value that is less than par.

**NR:** This indicates that no rating has been requested, that there is insufficient information on which to base a rating, or that S&P does not rate a particular obligation as a matter of policy.

\* The ratings from 'AA' to 'CCC' may be modified by the addition of a plus (+) or minus (-) sign to show relative standing within the major rating categories.

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**APPENDIX 2**

**RATIONAL ADVISORS, INC.**

**PROXY VOTING POLICIES AND PROCEDURES**

Pursuant to the recent adoption by the Securities and Exchange Commission (the "Commission") of Rule 206(4)-6 (17 CFR 275.206(4)-6) and amendments to Rule 204-2 (17 CFR 275.204-2) under the Investment Advisors Act of 1940 (the "Act"), it is a fraudulent, deceptive, or manipulative act, practice or course of business, within the meaning of Section 206(4) of the Act, for an investment advisor to exercise voting authority with respect to client securities, unless (i) the advisor has adopted and implemented written policies and procedures that are reasonably designed to ensure that the advisor votes proxies in the best interests of its clients, (ii) the advisor describes its proxy voting procedures to its clients and provides copies on request, and (iii) the advisor discloses to clients how they may obtain information on how the advisor voted their proxies.

Rational Advisors, Inc. (hereinafter the "Adviser", "we" or "our"), after reviewing and concluding that such policies are reasonably designed to vote proxies in the best interests of clients, has approved and adopted the proxy voting policies (the "Policies") of Institutional Shareholder Services, Inc. ("ISS"), a leading national provider of proxy voting administrative and research services. As a result, such Policies set forth the Advisor's positions on recurring proxy issues and criteria for addressing non-recurring issues. These Policies are reviewed periodically by ISS and therefore are subject to change. Even though it has adopted the Policies as drafted by ISS, the Advisor maintains the fiduciary responsibility for all proxy voting decisions.

Day-to-day administration of proxy voting may be provided internally or by a third-party service provider, depending on client type, subject to the ultimate oversight of the Advisor. The Advisor shall supervise the relationships with its proxy voting services, ISS. ISS apprises the Advisor of shareholder meeting dates and casts the actual proxy votes. ISS also provides research on proxy proposals and voting recommendations. ISS serves as the Advisor's proxy voting record keepers and generate reports on how proxies were voted. The Advisor periodically reviews communications from ISS to determine whether ISS voted the correct amount of proxies, whether the votes were cast in a timely manner, and whether the vote was in accordance with the Policies or the Advisor's specific instructions.

In order to fulfill its responsibilities under the Act, Rational Advisors, Inc. (hereinafter "we" or "our") has adopted the following policies and procedures for proxy voting with regard to companies in investment portfolios of our clients.

**<u>KEY OBJECTIVES</u>**

The key objectives of these policies and procedures recognize that a company's management is entrusted with the day-to-day operations and longer-term strategic planning of the company, subject to the oversight of the company's board of directors. While "ordinary business matters" are primarily the responsibility of management and should be approved solely by the corporation's board of directors, these objectives also recognize that the company's shareholders must have final say over how management and directors are performing, and how shareholders' rights and ownership interests are handled, especially when matters could have substantial economic implications to the shareholders.

Therefore, we will pay particular attention to the following matters in exercising our proxy voting responsibilities as a fiduciary for our clients:

*Accountability*. Each company should have effective means in place to hold those entrusted with running a company's business accountable for their actions. Management of a company should be accountable to its board of directors and the board should be accountable to shareholders.

*Alignment of Management and Shareholder Interests*. Each company should endeavor to align the interests of management and the board of directors with the interests of the company's shareholders. For example, we generally believe that compensation should be designed to reward management for doing a good job of creating value for the shareholders of the company.

<br> W W W. I S S G O V E R N A N C E . C O M 66

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*Transparency*. Promotion of timely disclosure of important information about a company's business operations and financial performance enables investors to evaluate the performance of a company and to make informed decisions about the purchase and sale of a company's securities.

**<u>DECISION METHODS</u>**

No set of proxy voting guidelines can anticipate all situations that may arise. In special cases, we may seek insight from our managers and analysts on how a particular proxy proposal may impact the financial prospects of a company and vote accordingly.

We believe that we invest in companies with strong management. Therefore, we will tend to vote proxies consistent with management's recommendations. However, we will vote contrary to management's recommendations if we believe those recommendations are not consistent with increasing shareholder value.

**<u>SUMMARY OF PROXY VOTING GUIDELINES</u>**

**Election of the Board of Directors**

We believe that good corporate governance generally starts with a board composed primarily of independent directors, unfettered by significant ties to management, all of whose members are elected annually. We also believe that turnover in board composition promotes independent board action, fresh approaches to governance, and generally has a positive impact on shareholder value. We will generally vote in favor of non-incumbent independent directors. The election of a company's board of directors is one of the most fundamental rights held by shareholders. Because a classified board structure prevents shareholders from electing a full slate of directors annually, we will generally support efforts to declassify boards or other measures that permit shareholders to remove a majority of directors at any time, and will generally oppose efforts to adopt classified board structures.

**Approval of Independent Auditors**

We believe that the relationship between a company and its auditors should be limited primarily to the audit engagement, although it may include certain closely related activities that do not raise an appearance of impaired independence.

We will evaluate on a case-by-case basis instances in which the audit firm has a substantial non-audit relationship with a company to determine whether we believe independence has been, or could be, compromised.

**Equity-based compensation plans**

We believe that appropriately designed equity-based compensation plans, approved by shareholders, can be an effective way to align the interests of shareholders and the interests of directors, management, and employees by providing incentives to increase shareholder value. Conversely, we are opposed to plans that substantially dilute ownership interests in the company, provide participants with excessive awards, or have inherently objectionable structural features.

We will generally support measures intended to increase stock ownership by executives and the use of employee stock purchase plans to increase company stock ownership by employees. These may include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Requiring
senior executives to hold stock in a company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Requiring
stock acquired through option exercise to be held for a certain period of time.

These are guidelines, and we consider other factors, such as the nature of the industry and size of the company, when assessing a plan's impact on ownership interests.

<br> W W W. I S S G O V E R N A N C E . C O M 67

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**Corporate Structure**

We view the exercise of shareholders' rights, including the rights to act by written consent, to call special meetings and to remove directors, to be fundamental to good corporate governance.

Because classes of common stock with unequal voting rights limit the rights of certain shareholders, we generally believe that shareholders should have voting power equal to their equity interest in the company and should be able to approve or reject changes to a company's by-laws by a simple majority vote.

We will generally support the ability of shareholders to cumulate their votes for the election of directors.

*Climate Change:*

 

**<u>Say on Climate (SoC) Management Proposals</u>**: Vote case-by-case on management proposals that request shareholders to approve the company's climate transition action plan, taking into account the completeness and rigor of the plan. Information that will be considered where available includes the following:

● The extent to which the company's climate related disclosures are in line with TCFD recommendations and meet other market standards;

● Disclosure of its operational and supply chain GHG emissions (Scopes 1, 2, and 3);

● The completeness and rigor of the company's short-, medium-, and long-term targets for reducing operational and supply chain GHG emissions (Scopes 1, 2, and 3 if relevant);

● Whether the company has sought and received third-party approval that its targets are science-based;

● Whether the company has made a commitment to be "net zero" for operational and supply chain emissions (Scopes 1, 2, and 3) by 2050;

● Whether the company discloses a commitment to report on the implementation of its plan in subsequent years;

● Whether the company's climate data has received third-party assurance;

● Disclosure of how the company's lobbying activities and its capital expenditures align with company strategy;

● Whether there are specific industry decarbonization challenges; and

● The company's related commitment, disclosure, and performance compared to its industry peers.

**<u>Say on Climate (SoC) Shareholder Proposals</u>**: Vote case-by-case on shareholder proposals that request the company to disclose a report providing its GHG emissions levels and reduction targets and/or its upcoming/approved climate transition 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:

● The completeness and rigor of the company's climate-related disclosure;

● The company's actual GHG emissions performance;

● Whether the company has been the subject of recent, significant violations, fines, litigation, or controversy related to its GHG emissions; and

● Whether the proposal's request is unduly burdensome (scope or timeframe) or overly prescriptive.

**<u>Climate Change/Greenhouse Gas (GHG) Emissions:</u>** Generally, vote for resolutions requesting that a company disclose information on the 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 change may have on the company, as well as associated company policies and procedures to address related risks and/or opportunities;

<br> W W W. I S S G O V E R N A N C E . C O M 68

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● The company's level of disclosure compared to industry peers; and

● Whether there are significant controversies, fines, penalties, or litigation associated with the company's climate change-related performance.

Generally, vote for proposals requesting a report on greenhouse gas (GHG) emissions from company operations and/or products and operations, unless:

● The company already discloses current, publicly available information on the impacts that GHG emissions may have on the company, as well as associated company policies and procedures to address related risks and/or opportunities;

● The company's level of disclosure is comparable to that of industry peers; and

● There are no significant controversies, fines, penalties, or litigation associated with the company's GHG emissions.

Vote case-by-case on proposals that call for the adoption of GHG reduction goals from products and operations, taking into account:

● Whether the company provides disclosure of year-over-year GHG emissions performance data;

● Whether company disclosure lags behind industry peers;

● The company's actual GHG emissions performance;

● The company's current GHG emission policies, oversight mechanisms, and related initiatives; and

● Whether the company has been the subject of recent, significant violations, fines, litigation, or controversy related to GHG emissions.

**<u>Energy Efficiency:</u>** Generally vote for proposals requesting that a company report on its energy efficiency policies, unless:

● The company complies with applicable energy efficiency regulations and laws, and discloses its participation in energy efficiency policies and programs, including disclosure of benchmark data, targets, and performance measures; or

● The proponent requests adoption of specific energy efficiency goals within specific timelines.

**<u>Renewable Energy:</u>** Generally, vote for requests for reports on the feasibility of developing renewable energy resources unless the report would be duplicative of existing disclosure or irrelevant to the company's line of business.

Generally, vote against proposals requesting that the company invest in renewable energy resources. Such decisions are best left to management's evaluation of the feasibility and financial impact that such programs may have on the company.

Generally, vote against proposals that call for the adoption of renewable energy goals, taking into account:

● The scope and structure of the proposal;

● The company's current level of disclosure on renewable energy use and GHG emissions; and

● The company's disclosure of policies, practices, and oversight implemented to manage GHG emissions and mitigate climate change risks.

<br> W W W. I S S G O V E R N A N C E . C O M 69

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|  | **TABLE OF CONTENTS** |  |
|  | &nbsp;&nbsp;&nbsp;**Coverage** | **8** |
| **1.** | **Board of Directors** | **9** |
|  | Voting on Director Nominees in Uncontested Elections | 9 |
|  | Independence | 9 |
|  | &nbsp;&nbsp;&nbsp;ISS Classification of Directors – U.S. | 10 |
|  | Composition | 12 |
|  | &nbsp;&nbsp;&nbsp;Attendance | 12 |
|  | &nbsp;&nbsp;&nbsp;Overboarded Directors | 12 |
|  | &nbsp;&nbsp;&nbsp;Gender Diversity | 12 |
|  | &nbsp;&nbsp;&nbsp;Racial and/or Ethnic Diversity | 13 |
|  | Responsiveness | 13 |
|  | Accountability | 14 |
|  | &nbsp;&nbsp;&nbsp;Poison Pills | 14 |
|  | &nbsp;&nbsp;&nbsp;Unequal Voting Rights | 14 |
|  | &nbsp;&nbsp;&nbsp;Classified Board Structure | 15 |
|  | &nbsp;&nbsp;&nbsp;Removal of Shareholder Discretion on Classified Boards | 15 |
|  | &nbsp;&nbsp;&nbsp;Problematic Governance Structure | 15 |
|  | &nbsp;&nbsp;&nbsp;Unilateral Bylaw/Charter Amendments | 15 |
|  | &nbsp;&nbsp;&nbsp;Restricting Binding Shareholder Proposals | 16 |
|  | &nbsp;&nbsp;&nbsp;Director Performance Evaluation | 16 |
|  | &nbsp;&nbsp;&nbsp;Management Proposals to Ratify Existing Charter or Bylaw Provisions | 16 |
|  | &nbsp;&nbsp;&nbsp;Problematic Audit-Related Practices | 17 |
|  | &nbsp;&nbsp;&nbsp;Problematic Compensation Practices | 17 |
|  | &nbsp;&nbsp;&nbsp;Problematic Pledging of Company Stock | 17 |
|  | &nbsp;&nbsp;&nbsp;Climate Accountability | 18 |
|  | &nbsp;&nbsp;&nbsp;Governance Failures | 18 |
|  | Voting on Director Nominees in Contested Elections | 18 |
|  | Vote-No Campaigns | 18 |
|  | Proxy Contests/Proxy Access | 19 |
|  | Other Board-Related Proposals | 19 |
|  | Adopt Anti-Hedging/Pledging/Speculative Investments Policy | 19 |
|  | Board Refreshment | 19 |
|  | &nbsp;&nbsp;&nbsp;Term/Tenure Limits | 19 |
|  | &nbsp;&nbsp;&nbsp;Age Limits | 20 |
|  | Board Size | 20 |
|  | Classification/Declassification of the Board | 20 |
|  | CEO Succession Planning | 20 |
|  | Cumulative Voting | 20 |
|  | Director and Officer Indemnification, Liability Protection, and Exculpation | 21 |
|  | Establish/Amend Nominee Qualifications | 21 |
|  | Establish Other Board Committee Proposals | 22 |
|  | Filling Vacancies/Removal of Directors | 22 |
|  | Independent Board Chair | 22 |
|  | Majority of Independent Directors/Establishment of Independent Committees | 23 |
|  | Majority Vote Standard for the Election of Directors | 23 |
|  | Proxy Access | 23 |
|  | Require More Nominees than Open Seats | 24 |

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|  | Shareholder Engagement Policy (Shareholder Advisory Committee) | 24 |
| **2.** | **Audit-Related** | **25** |
|  | Auditor Indemnification and Limitation of Liability | 25 |
|  | Auditor Ratification | 25 |
|  | Shareholder Proposals Limiting Non-Audit Services | 25 |
|  | Shareholder Proposals on Audit Firm Rotation | 26 |
| **3.** | **Shareholder Rights & Defenses** | **27** |
|  | Advance Notice Requirements for Shareholder Proposals/Nominations | 27 |
|  | Amend Bylaws without Shareholder Consent | 27 |
|  | Control Share Acquisition Provisions | 27 |
|  | Control Share Cash-Out Provisions | 28 |
|  | Disgorgement Provisions | 28 |
|  | Fair Price Provisions | 28 |
|  | Freeze-Out Provisions | 28 |
|  | Greenmail | 28 |
|  | Shareholder Litigation Rights | 29 |
|  | &nbsp;&nbsp;&nbsp;Federal Forum Selection Provisions | 29 |
|  | &nbsp;&nbsp;&nbsp;Exclusive Forum Provisions for State Law Matters | 29 |
|  | &nbsp;&nbsp;&nbsp;Fee shifting | 29 |
|  | Net Operating Loss (NOL) Protective Amendments | 30 |
|  | Poison Pills (Shareholder Rights Plans) | 30 |
|  | Shareholder Proposals to Put Pill to a Vote and/or Adopt a Pill Policy | 30 |
|  | Management Proposals to Ratify a Poison Pill | 31 |
|  | Management Proposals to Ratify a Pill to Preserve Net Operating Losses (NOLs) | 31 |
|  | Proxy Voting Disclosure, Confidentiality, and Tabulation | 31 |
|  | Ratification Proposals: Management Proposals to Ratify Existing Charter or Bylaw Provisions | 32 |
|  | Reimbursing Proxy Solicitation Expenses | 32 |
|  | Reincorporation Proposals | 33 |
|  | Shareholder Ability to Act by Written Consent | 33 |
|  | Shareholder Ability to Call Special Meetings | 33 |
|  | Stakeholder Provisions | 34 |
|  | State Antitakeover Statutes | 34 |
|  | Supermajority Vote Requirements | 34 |
|  | Virtual Shareholder Meetings | 34 |
| **4.** | **Capital/Restructuring** | **35** |
|  | Capital | 35 |
|  | Adjustments to Par Value of Common Stock | 35 |
|  | Common Stock Authorization | 35 |
|  | &nbsp;&nbsp;&nbsp;General Authorization Requests | 35 |
|  | &nbsp;&nbsp;&nbsp;Specific Authorization Requests | 36 |
|  | Dual Class Structure | 36 |
|  | Issue Stock for Use with Rights Plan | 36 |
|  | Preemptive Rights | 36 |
|  | Preferred Stock Authorization | 37 |
|  | &nbsp;&nbsp;&nbsp;General Authorization Requests | 37 |
|  | Recapitalization Plans | 38 |
|  | Reverse Stock Splits | 38 |
|  | Share Issuance Mandates at U.S. Domestic Issuers Incorporated Outside the U.S. | 38 |

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|:---|:---|:---|
|  | Share Repurchase Programs | 39 |
|  | Share Repurchase Programs Shareholder Proposals | 39 |
|  | Stock Distributions: Splits and Dividends | 39 |
|  | Tracking Stock | 40 |
|  | Restructuring | 40 |
|  | Appraisal Rights | 40 |
|  | Asset Purchases | 40 |
|  | Asset Sales | 40 |
|  | Bundled Proposals | 41 |
|  | Conversion of Securities | 41 |
|  | Corporate Reorganization/Debt Restructuring/Prepackaged Bankruptcy Plans/Reverse Leveraged Buyouts/Wrap Plans | 41 |
|  | Formation of Holding Company | 41 |
|  | Going Private and Going Dark Transactions (LBOs and Minority Squeeze-outs) | 42 |
|  | Joint Ventures | 42 |
|  | Liquidations | 43 |
|  | Mergers and Acquisitions | 43 |
|  | Private Placements/Warrants/Convertible Debentures | 43 |
|  | Reorganization/Restructuring Plan (Bankruptcy) | 45 |
|  | Special Purpose Acquisition Corporations (SPACs) | 45 |
|  | Special Purpose Acquisition Corporations (SPACs) - Proposals for Extensions | 45 |
|  | Spin-offs | 46 |
|  | Value Maximization Shareholder Proposals | 46 |
| **5.** | **Compensation** | **47** |
|  | Executive Pay Evaluation | 47 |
|  | Advisory Votes on Executive Compensation—Management Proposals (Say-on-Pay) | 47 |
|  | &nbsp;&nbsp;&nbsp;Pay-for-Performance Evaluation | 48 |
|  | &nbsp;&nbsp;&nbsp;Problematic Pay Practices | 48 |
|  | &nbsp;&nbsp;&nbsp;Compensation Committee Communications and Responsiveness | 49 |
|  | Frequency of Advisory Vote on Executive Compensation ("Say When on Pay") | 50 |
|  | Voting on Golden Parachutes in an Acquisition, Merger, Consolidation, or Proposed Sale | 50 |
|  | Equity-Based and Other Incentive Plans | 50 |
|  | &nbsp;&nbsp;&nbsp;Shareholder Value Transfer (SVT) | 51 |
|  | &nbsp;&nbsp;&nbsp;Three-Year Value-Adjusted Burn Rate | 52 |
|  | Egregious Factors | 52 |
|  | &nbsp;&nbsp;&nbsp;Liberal Change in Control Definition | 52 |
|  | &nbsp;&nbsp;&nbsp;Repricing Provisions | 52 |
|  | &nbsp;&nbsp;&nbsp;Problematic Pay Practices or Significant Pay-for-Performance Disconnect | 53 |
|  | Amending Cash and Equity Plans (including Approval for Tax Deductibility (162(m)) | 53 |
|  | Specific Treatment of Certain Award Types in Equity Plan Evaluations | 54 |
|  | &nbsp;&nbsp;&nbsp;Dividend Equivalent Rights | 54 |
|  | &nbsp;&nbsp;&nbsp;Operating Partnership (OP) Units in Equity Plan Analysis of Real Estate Investment Trusts (REITs) | 54 |
|  | Other Compensation Plans | 54 |
|  | 401(k) Employee Benefit Plans | 54 |
|  | Employee Stock Ownership Plans (ESOPs) | 54 |
|  | Employee Stock Purchase Plans—Qualified Plans | 55 |
|  | Employee Stock Purchase Plans—Non-Qualified Plans | 55 |
|  | Option Exchange Programs/Repricing Options | 55 |

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| | | |
|:---|:---|:---|
|  | Stock Plans in Lieu of Cash | 56 |
|  | Transfer Stock Option (TSO) Programs | 56 |
|  | Director Compensation | 57 |
|  | Shareholder Ratification of Director Pay Programs | 57 |
|  | Equity Plans for Non-Employee Directors | 57 |
|  | Non-Employee Director Retirement Plans | 58 |
|  | Shareholder Proposals on Compensation | 58 |
|  | Bonus Banking/Bonus Banking "Plus" | 58 |
|  | Compensation Consultants—Disclosure of Board or Company's Utilization | 58 |
|  | Disclosure/Setting Levels or Types of Compensation for Executives and Directors | 58 |
|  | Golden Coffins/Executive Death Benefits | 59 |
|  | Hold Equity Past Retirement or for a Significant Period of Time | 59 |
|  | Pay Disparity | 59 |
|  | Pay for Performance/Performance-Based Awards | 60 |
|  | Pay for Superior Performance | 60 |
|  | Pre-Arranged Trading Plans (10b5-1 Plans) | 61 |
|  | Prohibit Outside CEOs from Serving on Compensation Committees | 61 |
|  | Recoupment of Incentive or Stock Compensation in Specified Circumstances | 61 |
|  | Severance and Golden Parachute Agreements | 61 |
|  | Share Buyback Impact on Incentive Program Metrics | 62 |
|  | Supplemental Executive Retirement Plans (SERPs) | 62 |
|  | Tax Gross-Up Proposals | 62 |
|  | Termination of Employment Prior to Severance Payment/Eliminating Accelerated Vesting of Unvested Equity | 62 |
| **6.** | **Routine/Miscellaneous** | **64** |
|  | Adjourn Meeting | 64 |
|  | Amend Quorum Requirements | 64 |
|  | Amend Minor Bylaws | 64 |
|  | Change Company Name | 64 |
|  | Change Date, Time, or Location of Annual Meeting | 65 |
|  | Other Business | 65 |
| **7.** | **Social** **and Environmental Issues** | **66** |
|  | Global Approach – E&S Shareholder Proposals | 66 |
|  | Endorsement of Principles | 66 |
|  | Animal Welfare | 67 |
|  | Animal Welfare Policies | 67 |
|  | Animal Testing | 67 |
|  | Animal Slaughter | 67 |
|  | Consumer Issues | 67 |
|  | Genetically Modified Ingredients | 67 |
|  | Reports on Potentially Controversial Business/Financial Practices | 68 |
|  | Pharmaceutical Pricing, Access to Medicines, and Prescription Drug Reimportation | 68 |
|  | Product Safety and Toxic/Hazardous Materials | 69 |
|  | Tobacco-Related Proposals | 69 |
|  | Climate Change | 70 |
|  | Say on Climate (SoC) Management Proposals | 70 |
|  | Say on Climate (SoC) Shareholder Proposals | 70 |
|  | Climate Change/Greenhouse Gas (GHG) Emissions | 70 |

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|:---|:---|:---|
|  | Energy Efficiency | 71 |
|  | Renewable Energy | 71 |
|  | Diversity | 72 |
|  | Board Diversity | 72 |
|  | Equality of Opportunity | 72 |
|  | Gender Identity, Sexual Orientation, and Domestic Partner Benefits | 73 |
|  | Gender, Race/Ethnicity Pay Gap | 73 |
|  | Racial Equity and/or Civil Rights Audit Guidelines | 73 |
|  | Environment and Sustainability | 73 |
|  | Facility and Workplace Safety | 74 |
|  | Natural Capital-Related and/or Community Impact Assessment Proposals | 74 |
|  | Hydraulic Fracturing | 74 |
|  | Operations in Protected Areas | 74 |
|  | Recycling | 75 |
|  | Sustainability Reporting | 75 |
|  | Water Issues | 75 |
|  | General Corporate Issues | 75 |
|  | Charitable Contributions | 75 |
|  | Data Security, Privacy, and Internet Issues | 76 |
|  | ESG Compensation-Related Proposals | 76 |
|  | Human Rights, Human Capital Management, and International Operations | 76 |
|  | Human Rights Proposals | 76 |
|  | Mandatory Arbitration | 77 |
|  | Operations in High-Risk Markets | 77 |
|  | Outsourcing/Offshoring | 78 |
|  | Sexual Harassment | 78 |
|  | Weapons and Military Sales | 78 |
|  | Political Activities | 78 |
|  | Lobbying | 78 |
|  | Political Contributions | 79 |
|  | Political Expenditures and Lobbying Congruency | 79 |
|  | Political Ties | 80 |
| **8.** | **Mutual Fund Proxies** | **81** |
|  | Election of Directors | 81 |
|  | Closed End Funds-Unilateral Opt-In to Control Share Acquisition Statutes | 81 |
|  | Converting Closed-end Fund to Open-end Fund | 81 |
|  | Proxy Contests | 81 |
|  | Investment Advisory Agreements | 82 |
|  | Approving New Classes or Series of Shares | 82 |
|  | Preferred Stock Proposals | 82 |
|  | 1940 Act Policies | 82 |
|  | Changing a Fundamental Restriction to a Nonfundamental Restriction | 82 |
|  | Change Fundamental Investment Objective to Nonfundamental | 83 |
|  | Name Change Proposals | 83 |
|  | Change in Fund's Subclassification | 83 |
|  | Business Development Companies—Authorization to Sell Shares of Common Stock at a Price below Net Asset Value | 83 |
|  | Disposition of Assets/Termination/Liquidation | 84 |

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| Changes to the Charter Document | 84 |
| Changing the Domicile of a Fund | 84 |
| Authorizing the Board to Hire and Terminate Subadvisers Without Shareholder Approval | 84 |
| Distribution Agreements | 85 |
| Master-Feeder Structure | 85 |
| Mergers | 85 |
| Shareholder Proposals for Mutual Funds | 85 |
| Establish Director Ownership Requirement | 85 |
| Reimburse Shareholder for Expenses Incurred | 85 |
| Terminate the Investment Advisor | 86 |

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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 investment companies (including open-end funds, closed-end funds, exchange-traded funds, and unit investment trusts), limited partnerships ("LPs"), master limited partnerships ("MLPs"), limited liability companies ("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-incorporated companies

In addition to U.S.- incorporated, U.S.- listed companies, ISS' U.S. policies are applied to certain foreign-incorporated company analyses. Like the SEC, ISS distinguishes two types of companies that list but are not incorporated in the U.S.:

■ U.S.
Domestic Issuers – which have a majority of outstanding shares held in the U.S. and meet other criteria, as determined by the SEC,
and are subject to the same disclosure and listing standards as U.S. incorporated companies (e.g. they are required to file DEF14A proxy
statements) – are generally covered under standard U.S. policy guidelines.

■ Foreign
Private Issuers (FPIs) – which are allowed to take exemptions from most disclosure requirements (e.g., they are allowed
to file 6-K for their proxy materials) and U.S. listing standards – are generally covered under a combination of policy guidelines:

&nbsp;&nbsp;&nbsp;&nbsp;■ FPI
Guidelines (see the Americas
Regional Proxy Voting Guidelines) , may apply to companies incorporated 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

&nbsp;&nbsp;&nbsp;&nbsp;■ Guidelines
for the market that is responsible for, or most relevant to, the item on the ballot.

U.S. incorporated companies listed only on non-U.S. exchanges are generally covered under the ISS guidelines for 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 statement and/or other filing normally required of a U.S. Domestic Issuer, so long as the company retains its FPI status.

In all cases – including with respect to other companies with cross-market features that may lead to ballot items related to multiple markets – items that are on the ballot solely due to the requirements of another market (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.** Board of Directors

**Voting on Director Nominees in Uncontested Elections**

Four fundamental principles apply when determining votes on director nominees:

**Independence**: Boards should be sufficiently independent from management (and significant shareholders) to ensure that they are able and motivated to effectively supervise management's performance for the benefit of all 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, as well as having sufficiently independent committees that focus on key governance concerns such as audit, compensation, and nomination of directors.

**Composition**: Companies should ensure that directors add value to the board through their specific skills and expertise and by having sufficient time and commitment to serve effectively. Boards should be of a size appropriate to accommodate diversity, expertise, and independence, while ensuring active and collaborative participation by all members. Boards should be sufficiently diverse to ensure consideration of a wide range of perspectives.

**Responsiveness**: Directors should respond to investor input, such as that expressed through significant opposition to management proposals, significant support for shareholder proposals (whether binding or non-binding), and tender offers where a majority of shares are tendered.

**Accountability**: Boards should be sufficiently accountable to shareholders, including through transparency of the 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.

**General Recommendation:** Generally vote for director nominees, except under the following circumstances (with new nominees**<sup>1</sup>** considered on case-by-case basis):

Independence

Vote against**<sup>2</sup>** or withhold from non-independent directors (Executive Directors and Non-Independent Non-Executive Directors per ISS' Classification of Directors) when:

■ Independent
 directors comprise 50 percent or less of the board;

■ The
 non-independent director serves on the audit, compensation, or nominating committee;

■ The
 company lacks an audit, compensation, or nominating committee so that the full board functions
 as that committee; or

■ The
 company lacks a formal nominating committee, even if the board attests that the independent
 directors fulfill the functions of such a committee.

**<sup>1</sup>** A "new nominee" is a director who is being presented for election by shareholders for the first time. Recommendations on 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.

**<sup>2</sup>** In general, companies with a plurality vote standard use "Withhold" as the contrary vote option in director elections; companies with a majority vote standard use "Against". However, it will vary by company and the proxy must be checked to determine the valid contrary vote option for the particular company.

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**ISS Classification of Directors – U.S.**

&nbsp;&nbsp;&nbsp;&nbsp;

1. Executive
Director

&nbsp;&nbsp;&nbsp;&nbsp;1.1. Current
officer  ***<sup>1</sup>*** of the company or one of its affiliates  ***<sup>2</sup>.*** 

2. Non-Independent
Non-Executive Director

Board Identification

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1. Director
identified as not independent by the board. <u>Controlling/Significant Shareholder</u> 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2. Beneficial
 owner of more than 50 percent of the company's voting power (this may be aggregated if voting
 power is distributed among more than one member of a group).

Current Employment at Company or Related Company

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3. Non-officer
 employee of the firm (including employee representatives).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. Officer  ***<sup>1</sup>*** ,
 former officer, or general or limited partner of a joint venture or partnership with the
 company.

Former Employment

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5. Former
 CEO of the company.  ***<sup>3, 4</sup>*** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6. Former
 non-CEO officer  ***<sup>1</sup>*** of the company or an affiliate  ***<sup>2</sup>*** within the past five years.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.7. Former
 officer  ***<sup>1</sup>*** of an acquired company within the past five years.  ***<sup>4</sup>*** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.8. Officer  ***<sup>1</sup>*** of a former parent or predecessor firm at the time the company was sold or
 split off within the past five years.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9. Former
interim officer if the service was longer than 18 months. If the service was between 12 and 18 months an assessment of the interim officer's
employment agreement will be made.  ***<sup>5</sup>*** 

Family Members

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.10. Immediate
 family member  ***<sup>6</sup>*** of a current or former officer  ***<sup>1</sup>*** of the company or its affiliates  ***<sup>2</sup>*** within the last five years.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.11. Immediate
 family member  ***<sup>6</sup>*** of a current employee of company or its affiliates  ***<sup>2</sup>*** where additional factors 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).

Professional, Transactional, and Charitable Relationships

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.12. Director
 who (or whose immediate family member  ***<sup>6</sup>***) currently provides professional
 services  ***<sup>7</sup>*** in excess of $10,000 per year to: the company, an affiliate  ***<sup>2</sup>*** ,
 or an individual officer of the company or an affiliate; 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.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.13. Director
 who (or whose immediate family member  ***<sup>6</sup>***) currently has any material
 transactional relationship  ***<sup>8</sup>*** with the company or its affiliates  ***<sup>2</sup>*** ;
 or who is (or whose immediate family member  ***<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).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.14. Director
 who (or whose immediate family member  ***<sup>6</sup>*)** is a trustee, director,
 or employee of a charitable or non-profit organization that receives material grants or endowments  ***<sup>8</sup>*** from the company or its affiliates  ***<sup>2</sup>*** .

Other Relationships

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.15. Party
 to a voting agreement  ***<sup>9</sup>*** to vote in line with management on proposals
 being brought to shareholder vote.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.16. Has
 (or an immediate family member  ***<sup>6</sup>*** has) an interlocking relationship
 as defined by the SEC involving members of the board of directors or its Compensation Committee.  ***<sup>10</sup>*** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.17. Founder  ***<sup>11</sup>*** of the company but not currently an employee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.18. Director
 with pay comparable to Named Executive Officers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.19. Any
 material  ***<sup>12</sup>*** relationship with the company.

3. Independent
Director

&nbsp;&nbsp;&nbsp;&nbsp;3.1. No
material  ***<sup>12</sup>*** connection to the company other than a board seat.

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Footnotes:

*1.* The definition of officer will generally follow that of a "Section 16 officer" (officers subject to Section 16 of the Securities and Exchange Act of 1934) and includes the chief executive, operating, financial, legal, technology, and accounting officers of a 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" includes a subsidiary, sibling company, or parent company. ISS uses 50 percent control ownership by the parent company as the standard for applying its affiliate designation. The manager/advisor of an externally managed issuer (EMI) is considered an affiliate.

*3.* Includes any former CEO of the company prior to the company's initial public offering (IPO).

*4.* When there is a former CEO of a special purpose acquisition company (SPAC) serving on the board of an acquired company, ISS will generally classify such directors as independent unless determined otherwise taking into account the following factors: 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.* ISS will look at the terms of the interim officer's employment contract to determine if it contains severance pay, long-term health and pension benefits, or other such standard provisions typically contained in contracts of permanent, non-temporary CEOs. ISS will also consider if a formal search process was under way for a full-time officer at the time.

*6.* "Immediate family member" follows the SEC's definition of such and covers spouses, parents, children, step-parents, step-children, siblings, in-laws, and any person (other than a tenant or employee) sharing the household of any director, nominee for director, executive officer, or significant shareholder of the company.

*7.* Professional services can be characterized as advisory in nature, generally involve access to sensitive company 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. The case of a company providing a professional service to one of its directors or to an entity with which 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.* A material transactional relationship, including grants to non-profit organizations, exists if the company makes annual payments to, or receives annual payments from, another entity, exceeding the greater of: $200,000 or 5 percent of the

recipient's gross revenues, for a company that follows NASDAQ listing standards; or the greater of $1,000,000 or 2 percent of 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.* Dissident directors who are parties to a voting agreement pursuant to a settlement or similar arrangement may be classified as Independent Directors if an analysis of the following factors indicates that the voting agreement does not compromise their alignment with all shareholders' interests: the terms of the agreement; the duration of the standstill provision in the agreement; the limitations and requirements of actions that are agreed upon; if the dissident director nominee(s) is subject to the standstill; and if there any conflicting relationships or related party transactions.

*10.* Interlocks include: executive officers serving as directors on each other's compensation or similar committees (or, in the absence of such a committee, on the board); or executive officers sitting on each other's boards and at least one serves on the other's compensation or similar committees (or, in the absence of such a committee, on the board).

*11.* The operating involvement of the founder with the company will be considered; if the founder was never employed by the 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, or otherwise) that a reasonable person might conclude could potentially influence one's objectivity in the boardroom in a manner that would have a meaningful impact on an individual's ability to satisfy requisite fiduciary standards on behalf of shareholders.

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Composition

**Attendance at Board and Committee Meetings:** Generally vote against or withhold from directors (except nominees who served only part of the fiscal year**<sup>3</sup>**) who attend less than 75 percent of the aggregate of their board 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:

■ Medical
 issues/illness;

■ Family
 emergencies; and

■ Missing
 only one meeting (when the total of all meetings is three or fewer).

In cases of chronic poor attendance without reasonable justification, in addition to voting against the director(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 the aggregate of his/her board and committee meetings during his/her period of service, vote against or withhold from the director(s) in question.

**Overboarded Directors:** Generally vote against or withhold from individual directors who:

■ Sit
on more than five public company boards; or

■ Are
CEOs of public companies who sit on the boards of more than two public companies besides their own— withhold only at their outside
boards **<sup>4</sup>**.

*NOTE: For shareholder meeting reports published on or after February 25th, 2025, Institutional Shareholder Services (ISS) has indefinitely halted the consideration of the gender diversity of a company's board when making vote recommendations with respect to the election or re-election of directors at U.S. companies covered by these guidelines under its proprietary ISS U.S. Benchmark policy.*

 

**Gender Diversity** **:** Generally vote against or withhold from the chair of the nominating committee (or other directors on a case-by-case basis) at companies where there are no women on the company's board. An exception will be made if there was at least one woman on the board at the preceding annual meeting and the board makes a firm commitment to return to a gender-diverse status within a year.

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

*Services (ISS) has indefinitely halted the consideration of the racial and/or ethnic diversity of a company's board*

**<sup>3</sup>** Nominees who served for only part of the fiscal year are generally exempted from the attendance policy.

**<sup>4</sup>** Although all of a CEO's subsidiary boards with publicly-traded common stock will be counted as separate boards, ISS will not 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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*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.*

 

**Racial and/or Ethnic Diversity** **:** 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>**. An exception will be made if there was racial and/or ethnic diversity on the board at the preceding annual meeting and the board makes a firm commitment to appoint at least one racial and/or ethnic diverse member within a year.

Responsiveness

Vote case-by-case on individual directors, committee members, or the entire board of directors as appropriate if:

■ The
 board failed to act on a shareholder proposal that received the support of a majority of
 the shares cast in 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:

&nbsp;&nbsp;&nbsp;&nbsp;■ Disclosed
 outreach efforts by the board to shareholders in the wake of the vote;

&nbsp;&nbsp;&nbsp;&nbsp;■ Rationale
 provided in the proxy statement for the level of implementation;

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 subject matter of the proposal;

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 level of support for and opposition to the resolution in past meetings;

&nbsp;&nbsp;&nbsp;&nbsp;■ Actions
 taken by the board in response to the majority vote and its engagement with shareholders;

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 continuation of the underlying issue as a voting item on the ballot (as either shareholder
 or management proposals); and

&nbsp;&nbsp;&nbsp;&nbsp;■ Other
 factors as appropriate.

■ The
 board failed to act on takeover offers where the majority of shares are tendered; or

■ At
 the previous board election, any director received more than 50 percent withhold/against
 votes of the shares cast and the company has failed to address the issue(s) that caused the
 high withhold/against vote.

Vote case-by-case on Compensation Committee members (or, in exceptional cases, the full board) and/or the say-on-pay proposal when the company's previous say-on-pay received support of less than 70 percent of votes cast.

Factors that will be considered in assessing board responsiveness include:

■ Disclosure
 of engagement efforts with major institutional investors, including the frequency and timing
 of engagements and the company participants (including whether independent directors participated);

■ Disclosure
 of the specific concerns voiced by dissenting shareholders that led to the say-on-pay opposition;
 and

■ Disclosure
of specific and meaningful actions taken to address shareholders' concerns.

If the company discloses meaningful engagement efforts, but in addition states that it was unable to obtain specific feedback, ISS will assess company actions taken in response to the say-on-pay vote as well as the company's explanation as to why such actions are beneficial for shareholders.

Additional factors that may be considered include:

■ Whether
the issues raised are recurring or isolated;

■ The
company's ownership structure;

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**5** Aggregate diversity statistics provided by the board will only be considered if specific to racial and/or ethnic diversity.

■ Significant
corporate activity, such as a recent merger or proxy contest; and

■ Any
other compensation action or factor considered relevant to assessing board responsiveness.

If the say-on-pay support level was less than 50 percent of votes cast, this would warrant the highest degree of responsiveness, as assessed under the factors noted above.

Vote case-by-case on Compensation Committee members (or, in exceptional cases, the full board) if the board implements an advisory vote on executive compensation on a less frequent basis than the frequency that received the plurality of votes cast.

Accountability

**Problematic Takeover Defenses, Capital Structure, and Governance Structure**

 ****

**Poison Pills:** Generally vote against or withhold from all nominees (except new nominees**<sup>1</sup>**, who should be considered case-by-case) if:

■ The
 company has a poison pill with a deadhand or slowhand feature **<sup>6</sup>**;

■ The
 board makes a material adverse modification to an existing pill, including, but not limited
 to, extension, renewal, or lowering the trigger, without shareholder approval; or

■ The
 company has a long-term poison pill (with a term of over one year) that was not approved
 by the public shareholders **<sup>7</sup>**.

Vote case-by-case on nominees if the board adopts an initial short-term pill<sup>6</sup> (with a term of one year or less) without shareholder approval, taking into consideration:

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 trigger threshold and other terms of the pill;

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 disclosed rationale for the adoption;

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 context in which the pill was adopted, (e.g., factors such as the company's size and stage
 of development, sudden changes in its market capitalization, and extraordinary industry-wide
 or macroeconomic events);

&nbsp;&nbsp;&nbsp;&nbsp;■ A
 commitment to put any renewal to a shareholder vote;

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 company's overall track record on corporate governance and responsiveness to shareholders;
 and

&nbsp;&nbsp;&nbsp;&nbsp;■ Other
 factors as relevant.

**Unequal Voting Rights**: Generally vote withhold or against directors individually, committee members, or the entire board (except new nominees**<sup>1</sup>**, who should be considered case-by-case), if the company employs a multi-class capital stock structure with unequal voting rights**<sup>8</sup>**.

**<sup>6</sup>** If a short-term pill with a deadhand or slowhand feature is enacted but expires before the next shareholder vote, ISS will generally still recommend withhold/against nominees at the next shareholder meeting following its adoption.

**<sup>7</sup>** Approval prior to, or in connection, with a company's becoming publicly-traded, or in connection with a de-SPAC transaction, is insufficient.

**<sup>8</sup>** This generally includes classes of common stock that have additional votes per share than other shares; classes of shares that are not entitled to vote on all the same ballot items or nominees; or stock with time-phased voting rights ("loyalty shares").

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Exceptions to this policy will generally be limited to:

■ Newly-public
companies **<sup>9</sup>** with a sunset provision of no more than seven years from the date of going public;

■ Limited
Partnerships and the Operating Partnership (OP) unit structure of REITs;

■ Convertible
preferred shares that vote on an "as-converted" basis;

■ Situations
where the enhanced voting rights are limited in duration and applicability, such as where they are intended to overcome low voting turnout
and ensure approval of a specific non-controversial agenda item and "mirrored voting" applies;

■ Situations
where the super-voting shares represent less than 5% of total voting power and therefore considered to be *de minimis*; or

■ The
company provides sufficient protections for minority shareholders, such as allowing minority shareholders a regular binding vote on whether
the capital structure should be maintained.

**Classified Board Structure:** The board is classified, and a continuing director responsible for a problematic governance issue at the board/committee level that would warrant a withhold/against vote recommendation is not up for election. All appropriate nominees (except new) may be held accountable.

**Removal of Shareholder Discretion on Classified Boards**: The company has opted into, or failed to opt out of, state laws requiring a classified board structure.

**Problematic Governance Structure**: 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>**, who should be considered case-by-case) if, prior to or in connection with the company's public offering, the company or its board adopted the following bylaw or charter provisions that are considered to be materially adverse to shareholder rights:

■ Supermajority
vote requirements to amend the bylaws or charter;

■ A
classified board structure; or

■ Other
egregious provisions.

A provision which specifies that the problematic structure(s) will be sunset within seven years of the date of going public will be considered a mitigating factor.

Unless the adverse provision is reversed or removed, vote case-by-case on director nominees in subsequent years.

**Unilateral Bylaw/Charter Amendments** **:** Generally vote against or withhold from directors individually, committee members, or the entire board (except new nominees**<sup>1</sup>**, who should be considered case-by-case) if the 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:

■ The
 board's rationale for adopting the bylaw/charter amendment without shareholder ratification;

■ Disclosure
 by the company of any significant engagement with shareholders regarding the amendment;

■ The
 level of impairment of shareholders' rights caused by the board's unilateral amendment to
 the bylaws/charter;

■ The
 board's track record with regard to unilateral board action on bylaw/charter amendments or
 other entrenchment provisions;

■ The
 company's ownership structure;

■ The
 company's existing governance provisions;

■ The
 timing of the board's amendment to the bylaws/charter in connection with a significant business
 development; and

**<sup>9</sup>** Includes companies that emerge from bankruptcy, SPAC transactions, spin-offs, direct listings, and those who complete a traditional initial public offering.

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■ Other
factors, as deemed appropriate, that may be relevant to determine the impact of the amendment on shareholders.

Unless the adverse amendment is reversed or submitted to a binding shareholder vote, in subsequent years vote case-by-case on director nominees. Generally vote against (except new nominees**<sup>1</sup>**, who should be considered case-by-case) if the directors:

■ Classified
 the board;

■ Adopted
 supermajority vote requirements to amend the bylaws or charter;

■ Eliminated
 shareholders' ability to amend bylaws;

■ Adopted
 a fee-shifting provision ; or

■ Adopted
 another provision deemed egregious.

**Restricting Binding Shareholder Proposals** **:** Generally vote against or withhold from the members of the governance committee if:

■ The
company's governing documents impose undue restrictions on shareholders' ability to amend the bylaws. Such restrictions include
but are not limited to: outright prohibition on the submission of binding shareholder 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. Generally continue to vote against or withhold on an ongoing basis until shareholders are provided with an unfettered ability to amend the bylaws or a proposal providing for such unfettered right is submitted for shareholder approval.

**Director Performance Evaluation** **:** The board lacks mechanisms to promote accountability and oversight, coupled with sustained poor performance relative to peers. Sustained poor performance is measured by one-, three-, and five-year total shareholder returns in the bottom half of a company's four-digit GICS industry group (Russell 3000 companies only). Take into consideration the company's operational metrics and other factors as warranted. Problematic provisions include but are not limited to:

■ A
 classified board structure;

■ A
 supermajority vote requirement;

■ Either
 a plurality vote standard in uncontested director elections, or a majority vote standard
 in contested elections;

■ The
 inability of shareholders to call special meetings;

■ The
inability of shareholders to act by written consent;

■ A
 multi-class capital structure; and/or

■ A
 non-shareholder-approved poison pill.

**Management Proposals to Ratify Existing Charter or Bylaw Provisions** **:** Vote against/withhold from individual directors, members of the governance committee, or the full board, where boards ask shareholders to ratify existing charter or bylaw provisions considering the following factors:

■ The
 presence of a shareholder proposal addressing the same issue on the same ballot;

■ The
 board's rationale for seeking ratification;

■ Disclosure
 of actions to be taken by the board should the ratification proposal fail;

■ Disclosure
 of shareholder engagement regarding the board's ratification request;

■ The
 level of impairment to shareholders' rights caused by the existing provision;

■ The
 history of management and shareholder proposals on the provision at the company's past
 meetings;

■ Whether
 the current provision was adopted in response to the shareholder proposal;

■ The
 company's ownership structure; and

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■ Previous
use of ratification proposals to exclude shareholder proposals.

Problematic Audit-Related Practices

Generally vote against or withhold from the members of the Audit Committee if:

■ The
 non-audit fees paid to the auditor are excessive ;

■ The
 company receives an adverse opinion on the company's financial statements from its
 auditor; or

■ There
 is persuasive evidence that the Audit Committee entered into an inappropriate indemnification
 agreement with its auditor that limits the ability of the company, or its shareholders, to
 pursue legitimate legal recourse against the audit firm.

Vote case-by-case on members of the Audit Committee and potentially the full board if:

■ Poor
 accounting practices are identified that rise to a level of serious concern, such as: fraud;
 misapplication of GAAP; and material weaknesses identified in Section 404 disclosures. Examine
 the severity, breadth, chronological sequence, and duration, as well as the company's
 efforts at remediation or corrective actions, in determining whether withhold/against votes
 are warranted.

Problematic Compensation Practices

In the absence of an Advisory Vote on Executive Compensation (Say on Pay) ballot item or in egregious situations, vote against or withhold from the members of the Compensation Committee and potentially the full board if:

■ There
 is an unmitigated misalignment between CEO pay and company performance (pay
 for performance);

■ The
 company maintains significant problematic pay practices ;
 or

■ The
 board exhibits a significant level of poor communication
 and responsiveness to shareholders.

Generally vote against or withhold from the Compensation Committee chair, other committee members, or potentially the full board if:

■ The
company fails to include a Say on Pay ballot item when required under SEC provisions, or under the company's declared frequency
of say on pay; or

■ The
 company fails to include a Frequency of Say on Pay ballot item when required under SEC provisions.

Generally vote against members of the board committee responsible for approving/setting non-employee director compensation if there is a pattern (i.e. two or more consecutive or non-consecutive years/across multiple years) of awarding excessive or otherwise problematic**<sup>10</sup>** non-employee director compensation without disclosing a compelling rationale or other mitigating factors.

Adverse recommendations may be warranted in the first year for particularly egregious director compensation issues/instances/cases<sup>10</sup>.

**Problematic Pledging of Company Stock**: Vote against the members of the committee that oversees risks related to pledging, or the full board, where a significant level of pledged company stock by executives or directors raises concerns. The following factors will be considered:

■ The
 presence of an anti-pledging policy, disclosed in the proxy statement, that prohibits future
 pledging activity;

■ The
 magnitude of aggregate pledged shares in terms of total common shares outstanding, market
 value, and trading volume;

■ Disclosure
 of progress or lack thereof in reducing the magnitude of aggregate pledged shares over time;

**<sup>10</sup>** May include excessive magnitude, problematic perquisites, performance awards, stock options, or retirement benefits.

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■ Disclosure
in the proxy statement that shares subject to stock ownership and holding requirements do not include pledged company stock; and

■ Any
other relevant factors.

Climate Accountability

For companies that are significant greenhouse gas (GHG) emitters, through their operations or value chain**<sup>11</sup>**, generally vote against or withhold from the incumbent chair of the responsible committee (or other directors on a 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.

Minimum steps to understand and mitigate those risks are considered to be the following. Both minimum criteria will be required to be in alignment with the policy:

■ Detailed
 disclosure of climate-related risks, such as according to the framework established by the
 Task Force on Climate-related Financial Disclosures (TCFD), including:

&nbsp;&nbsp;&nbsp;&nbsp;■ Board
 governance measures;

&nbsp;&nbsp;&nbsp;&nbsp;■ Corporate
 strategy;

&nbsp;&nbsp;&nbsp;&nbsp;■ Risk
 management analyses; and

&nbsp;&nbsp;&nbsp;&nbsp;■ Metrics
 and targets.

■ Appropriate
 GHG emissions reduction targets.

At this time, "appropriate GHG emissions reductions targets" will be medium-term GHG reduction targets or Net 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.

Governance Failures

Under extraordinary circumstances, vote against or withhold from directors individually, committee members, or the entire board, due to:

■ Material
 failures of governance, stewardship, risk oversight **<sup>12</sup>**, or fiduciary responsibilities
 at the company;

■ Failure
 to replace management as appropriate; or

■ Egregious
actions related to a director's service on other boards that raise substantial doubt about his or her ability to effectively oversee
management and serve the best interests of shareholders at any company.

**Voting on Director Nominees in Contested Elections**

Vote-No Campaigns

**General Recommendation:** In cases where companies are targeted in connection with public "vote-no" campaigns,

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

**<sup>11</sup>** Companies defined as "significant GHG emitters" will be those on the current Climate Action 100+ Focus Group list.

**<sup>12</sup>** Examples of failure of risk oversight include but are not limited to: bribery; large or serial fines or sanctions from regulatory bodies; demonstrably poor risk oversight of environmental and social issues, including climate change; significant adverse legal judgments or settlement; or hedging of company stock.

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

Proxy Contests/Proxy Access

**General Recommendation:** Vote case-by-case on the election of directors in contested elections, considering the following factors:

■ Long-term
financial performance of the company relative to its industry;

■ Management's
track record;

■ Background
 to the contested election;

■ Nominee
 qualifications and any compensatory arrangements;

■ Strategic
 plan of dissident slate and quality of the critique against management;

■ Likelihood
 that the proposed goals and objectives can be achieved (both slates); and

■ Stock
 ownership positions.

In the case of candidates nominated pursuant to proxy access, vote case-by-case considering any applicable factors 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).

**Other Board-Related Proposals**

Adopt Anti-Hedging/Pledging/Speculative Investments Policy

**General Recommendation:** Generally vote for proposals seeking a policy that prohibits named executive officers from engaging in derivative or speculative transactions involving company stock, including hedging, holding stock in a margin account, or pledging stock as collateral for a loan. However, the company's existing policies regarding responsible use of company stock will be considered.

Board Refreshment

Board refreshment is best implemented through an ongoing program of individual director evaluations, conducted annually, to ensure the evolving needs of the board are met and to bring in fresh perspectives, skills, and diversity as needed.

**Term/Tenure Limits**

**General Recommendation:** Vote case-by-case on management proposals regarding director term/tenure limits, considering:

■ The
 rationale provided for adoption of the term/tenure limit;

■ The
 robustness of the company's board evaluation process;

■ Whether
 the limit is of sufficient length to allow for a broad range of director tenures;

■ Whether
 the limit would disadvantage independent directors compared to non-independent directors;
 and

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■ Whether
 the board will impose the limit evenly, and not have the ability to waive it in a discriminatory
 manner.

Vote case-by-case on shareholder proposals asking for the company to adopt director term/tenure limits, considering:

■ The
 scope of the shareholder proposal; and

■ Evidence
 of problematic issues at the company combined with, or exacerbated by, a lack of board refreshment.

**Age Limits**

**General Recommendation:** Generally vote against management and shareholder proposals to limit the tenure of independent directors through mandatory retirement ages. Vote for proposals to remove mandatory age limits.

Board Size

**General Recommendation:** Vote for proposals seeking to fix the board size or designate a range for the board size.

Vote against proposals that give management the ability to alter the size of the board outside of a specified range without shareholder approval.

Classification/Declassification of the Board

**General Recommendation:** Vote against proposals to classify (stagger) the board. Vote for proposals to repeal classified boards and to elect all directors annually.

CEO Succession Planning

**General Recommendation:** Generally vote for proposals seeking disclosure on a CEO succession planning policy, considering, at a minimum, the following factors:

■ The
 reasonableness/scope of the request; and

■ The
 company's existing disclosure on its current CEO succession planning process.

Cumulative Voting

**General Recommendation:** Generally vote against management proposals to eliminate cumulate voting, and for shareholder proposals to restore or provide for cumulative voting, unless:

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■ The
company has proxy access **<sup>13</sup>**, thereby allowing shareholders to nominate directors to the company's ballot; and

■ The
 company has adopted a majority vote standard, with a carve-out for plurality voting in situations
 where there are more nominees than seats, and a director resignation policy to address failed
 elections.

Vote for proposals for cumulative voting at controlled companies (insider voting power > 50%).

Director and Officer Indemnification, Liability Protection, and Exculpation

**General Recommendation:** Vote case-by-case on proposals on director and officer indemnification, liability protection, and exculpation**<sup>14</sup>**.

Consider the stated rationale for the proposed change. Also consider, among other factors, the extent to which the proposal would:

■ Eliminate
 directors' and officers' liability for monetary damages for violating the duty of care;

■ Eliminate
 directors' and officers' liability for monetary damages for violating the duty
 of loyalty;

■ Expand
 coverage beyond just legal expenses to liability for acts that are more serious violations
 of fiduciary 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 discretion of the company's board (*i.e.*, "permissive indemnification"),
 but that previously the company was not required to indemnify.

Vote for those proposals providing such expanded coverage in cases when a director's or officer's legal defense

was unsuccessful if both of the following apply:

■ If
 the individual was found to have acted in good faith and in a manner that the individual
 reasonably believed was in the best interests of the company; and

■ If
 only the individual's legal expenses would be covered.

Establish/Amend Nominee Qualifications

**General Recommendation:** Vote case-by-case on proposals that establish or amend director qualifications. Votes should be based on the reasonableness of the criteria and the degree to which they may preclude dissident nominees from joining the board.

Vote case-by-case on shareholder resolutions seeking a director nominee who possesses a particular subject matter expertise, considering:

**<sup>13</sup>** A proxy access right that meets the recommended guidelines.

**<sup>14</sup>** **Indemnification**: the condition of being secured against loss or damage.

**Limited liability**: a person's financial liability is limited to a fixed sum, or personal financial assets are not at risk if the individual loses a lawsuit that results in financial award/damages to the plaintiff.

**Exculpation**: to eliminate or limit the personal liability of a director or officer to the corporation or its shareholders for monetary damages for breach of fiduciary duty as a director or officer.

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■ The
company's board committee structure, existing subject matter expertise, and board nomination provisions relative to that of its
peers;

■ The
company's existing board and management oversight mechanisms regarding the issue for which board oversight is sought;

■ The
 company's disclosure and performance relating to the issue for which board oversight
 is sought and any significant related controversies; and

■ The
 scope and structure of the proposal.

Establish Other Board Committee Proposals

**General Recommendation:** Generally vote against shareholder proposals to establish a new board committee, 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:

■ Existing
 oversight mechanisms (including current committee structure) regarding the issue for which
 board oversight is sought;

■ Level
 of disclosure regarding the issue for which board oversight is sought;

■ Company
 performance related to the issue for which board oversight is sought;

■ Board
 committee structure compared to that of other companies in its industry sector; and

■ The
 scope and structure of the proposal.

Filling Vacancies/Removal of Directors

**General Recommendation:** Vote against proposals that provide that directors may be removed only for cause.

Vote for proposals to restore shareholders' ability to remove directors with or without cause.

Vote against proposals that provide that only continuing directors may elect replacements to fill board vacancies.

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

Independent Board Chair

**General Recommendation:** Generally vote for shareholder proposals requiring that the board chair position be filled by an independent director, taking into consideration the following:

■ The
 scope and rationale of the proposal;

■ The
 company's current board leadership structure;

■ The
 company's governance structure and practices;

■ Company
 performance; and

■ Any
 other relevant factors that may be applicable.

The following factors will increase the likelihood of a "for" recommendation:

■ A
 majority non-independent board and/or the presence of non-independent directors on key board
 committees;

■ A
 weak or poorly-defined lead independent director role that fails to serve as an appropriate
 counterbalance to a combined CEO/chair role;

■ The
 presence of an executive or non-independent chair in addition to the CEO, a recent recombination
 of the role of CEO and chair, and/or departure from a structure with an independent chair;

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■ Evidence
 that the board has failed to oversee and address material risks facing the company;

■ A
 material governance failure, particularly if the board has failed to adequately respond to
 shareholder concerns or if the board has materially diminished shareholder rights; or

■ Evidence
that the board has failed to intervene when management's interests are contrary to shareholders' interests.

Majority of Independent Directors/Establishment of Independent Committees

**General Recommendation:** Vote for shareholder proposals asking that a majority or more of directors be independent unless the board composition already meets the proposed threshold by ISS' definition of Independent Director (See ISS' Classification of Directors.)

Vote for shareholder proposals asking that board audit, compensation, and/or nominating committees be composed exclusively of independent directors unless they currently meet that standard.

Majority Vote Standard for the Election of Directors

**General Recommendation:** Generally vote for management proposals to adopt a majority of votes cast standard for directors in uncontested elections. Vote against if no carve-out for a plurality vote standard in contested elections is included.

Generally vote for precatory and binding shareholder resolutions requesting that the board change the company'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) that will provide guidelines so that the company will promptly address the situation of a holdover director.

Proxy Access

**General Recommendation:** Generally vote for management and shareholder proposals for proxy access with the following provisions:

■ **Ownership threshold:** maximum requirement not more than three percent (3%) of the voting power;

■ **Ownership duration:** maximum requirement not longer than three (3) years of continuous ownership
 for each member of the nominating group;

■ **Aggregation:** minimal or no limits on the number of shareholders permitted to form a nominating group;
 and

■ **Cap:** cap on nominees of generally twenty-five percent (25%) of the board.

Review for reasonableness any other restrictions on the right of proxy access. Generally vote against proposals that are more restrictive than these guidelines.

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Require More Nominees than Open Seats

**General Recommendation:** Vote against shareholder proposals that would require a company to nominate more candidates than the number of open board seats.

Shareholder Engagement Policy (Shareholder Advisory Committee)

**General Recommendation:** Generally vote for shareholder proposals requesting that the board establish an internal mechanism/process, which may include a committee, in order to improve communications between directors and shareholders, unless the company has the following features, as appropriate:

■ Established
 a communication structure that goes beyond the exchange requirements to facilitate the exchange
 of information between shareholders and members of the board;

■ Effectively
 disclosed information with respect to this structure to its shareholders;

■ Company
 has not ignored majority-supported shareholder proposals, or a majority withhold vote on
 a director nominee; and

■ The
 company has an independent chair or a lead director, according to ISS'
 definition . This individual must be made available for periodic consultation and
 direct communication with major shareholders.

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**2.** Audit-Related

Auditor Indemnification and Limitation of Liability

**General Recommendation:** Vote case-by-case on the issue of auditor indemnification and limitation of liability. Factors to be assessed include, but are not limited to:

■ The
 terms of the auditor agreement—the degree to which these agreements impact shareholders'
 rights;

■ The
 motivation and rationale for establishing the agreements;

■ The
 quality of the company's disclosure; and

■ The
 company's historical practices in the audit area.

Vote against or withhold from members of an audit committee in situations where there is persuasive evidence that the audit committee entered into an inappropriate indemnification agreement with its auditor that limits the ability of the company, or its shareholders, to pursue legitimate legal recourse against the audit firm.

Auditor Ratification

**General Recommendation:** Vote for proposals to ratify auditors unless any of the following apply:

■ An
auditor has a financial interest in or association with the company, and is therefore not independent;

■ There
is reason to believe that the independent auditor has rendered an opinion that is neither accurate nor indicative of the company's
financial position;

■ Poor
accounting practices are identified that rise to a serious level of concern, such as fraud or misapplication of GAAP; or

■ Fees
 for non-audit services ("Other" fees) are excessive.

Non-audit fees are excessive if:

■ Non-audit
 ("other") fees > audit fees + audit-related fees + tax compliance/preparation
 fees

Tax compliance and preparation include the preparation of original and amended tax returns and refund claims, and tax payment planning. All other services in the tax category, such as tax advice, planning, or consulting, should be added to "Other" fees. If the breakout of tax fees cannot be determined, add all tax fees to "Other" fees.

In circumstances where "Other" fees include fees related to significant one-time capital structure events (such as 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 may be excluded from the non-audit fees considered in determining the ratio of non-audit to audit/audit-related fees/tax compliance and preparation for purposes of determining whether non-audit fees are excessive.

Shareholder Proposals Limiting Non-Audit Services

**General Recommendation:** Vote case-by-case on shareholder proposals asking companies to prohibit or limit their auditors from engaging in non-audit services.

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Shareholder Proposals on Audit Firm Rotation

**General Recommendation:** Vote case-by-case on shareholder proposals asking for audit firm rotation, taking into account:

■ The
 tenure of the audit firm;

■ The
 length of rotation specified in the proposal;

■ Any
 significant audit-related issues at the company;

■ The
 number of Audit Committee meetings held each year;

■ The
 number of financial experts serving on the committee; and

■ Whether
 the company has a periodic renewal process where the auditor is evaluated for both audit
 quality and competitive price.

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**3.** Shareholder Rights & Defenses

Advance Notice Requirements for Shareholder Proposals/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 and within the broadest window possible, recognizing the need to allow sufficient notice for company, 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 than 30 days from the beginning of the notice period (also known as a 90-120-day window). The submittal window is the period under which shareholders must file their proposals/nominations prior to the deadline.

In general, support additional efforts by companies to ensure full disclosure in regard to a proponent's economic 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.

Amend Bylaws without Shareholder Consent

**General Recommendation:** Vote against proposals giving the board exclusive authority to amend the bylaws.

Vote case-by-case on proposals giving the board the ability to amend the bylaws in addition to shareholders, taking into account the following:

■ Any
 impediments to shareholders' ability to amend the bylaws (i.e. supermajority voting requirements);

■ The
 company's ownership structure and historical voting turnout;

■ Whether
 the board could amend bylaws adopted by shareholders; and

■ Whether
 shareholders would retain the ability to ratify any board-initiated amendments.

Control Share Acquisition Provisions

**General Recommendation:** Vote for proposals to opt out of control share acquisition statutes unless doing so would enable the completion of a takeover that would be detrimental to shareholders.

Vote against proposals to amend the charter to include control share acquisition provisions. 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 approval of either a majority or supermajority of disinterested shares. Thus, control share acquisition statutes effectively require a hostile bidder to put its offer to a shareholder vote or risk voting disenfranchisement if the bidder continues buying up a large block of shares.

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Control Share Cash-Out Provisions

**General Recommendation:** Vote for proposals to opt out of control share cash-out statutes.

Control share cash-out statutes give dissident shareholders the right to "cash-out" of their position in a company at 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.

Disgorgement Provisions

**General Recommendation:** Vote for proposals to opt out of state disgorgement provisions.

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 stock purchased 24 months before achieving control status. All sales of company stock by the acquirer occurring within a certain period of time (between 18 months and 24 months) prior to the investor's gaining control status are subject to these recapture-of-profits provisions.

Fair Price Provisions

**General Recommendation:** Vote case-by-case on proposals to adopt fair price provisions (provisions that stipulate 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.

Generally vote against fair price provisions with shareholder vote requirements greater than a majority of disinterested shares.

Freeze-Out Provisions

**General Recommendation:** Vote for proposals to opt out of state freeze-out provisions. Freeze-out provisions force an investor who surpasses a certain ownership threshold in a company to wait a specified period of time before gaining control of the company.

Greenmail

**General Recommendation:** Vote for proposals to adopt anti-greenmail charter or bylaw amendments or otherwise

restrict a company's ability to make greenmail payments.

Vote case-by-case on anti-greenmail proposals when they are bundled with other charter or bylaw amendments.

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Greenmail payments are targeted share repurchases by management of company stock from individuals or groups 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.

Shareholder Litigation Rights

**Federal Forum Selection Provisions**

Federal forum selection provisions require that U.S. federal courts be the sole forum for shareholders to litigate claims arising under federal securities law.

**General Recommendation:** Generally vote for federal forum selection provisions in the charter or bylaws that specify "the district courts of the United States" as the exclusive forum for federal securities law matters, in the absence of serious concerns about corporate governance or board responsiveness to shareholders.

Vote against provisions that restrict the forum to a particular federal district court; unilateral adoption (without a shareholder vote) of such a provision will generally be considered a one-time failure under the Unilateral Bylaw/Charter Amendments policy.

**Exclusive Forum Provisions for State Law Matters**

Exclusive forum provisions in the charter or bylaws restrict shareholders' ability to bring derivative lawsuits against the company, for claims arising out of state corporate law, to the courts of a particular state (generally the state of incorporation).

**General Recommendation:** Generally vote for charter or bylaw provisions that specify courts located within the state of Delaware as the exclusive forum for corporate law matters for Delaware corporations, in the absence of serious concerns about corporate governance or board responsiveness to shareholders.

For states other than Delaware, vote case-by-case on exclusive forum provisions, taking into consideration:

■ The
 company's stated rationale for adopting such a provision;

■ Disclosure
 of past harm from duplicative shareholder lawsuits in more than one forum;

■ The
 breadth of application of the charter or bylaw provision, including the types of lawsuits
 to which it would apply and the definition of key terms; and

■ Governance
 features such as shareholders' ability to repeal the provision at a later date (including
 the vote 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.

Generally vote against provisions that specify a state other than the state of incorporation as the exclusive forum for corporate law matters, or that specify a particular local court within the state; unilateral adoption of such a provision will generally be considered a one-time failure under the Unilateral Bylaw/Charter Amendments policy.

**Fee shifting**

Fee-shifting provisions in the charter or bylaws require that a shareholder who sues a company unsuccessfully pay all litigation expenses of the defendant corporation and its directors and officers.

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**General Recommendation:** Generally vote against provisions that mandate fee-shifting whenever plaintiffs are not completely successful on the merits (i.e., including cases where the plaintiffs are partially successful).

Unilateral adoption of a fee-shifting provision will generally be considered an ongoing failure under the Unilateral Bylaw/Charter Amendments policy.

Net Operating Loss (NOL) Protective Amendments

**General Recommendation:** Vote against proposals to adopt a protective amendment for the stated purpose of 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 amendment that would remain in effect for the shorter of three years (or less) and the exhaustion of the NOL:

■ The
 ownership threshold (NOL protective amendments generally prohibit stock ownership transfers
 that would result in a new 5-percent holder or increase the stock ownership percentage of
 an existing 5-percent holder);

■ The
 value of the NOLs;

■ Shareholder
 protection mechanisms (sunset provision or commitment to cause expiration of the protective
 amendment upon exhaustion or expiration of the NOL);

■ The
 company's existing governance structure including: board independence, existing takeover
 defenses, track record of responsiveness to shareholders, and any other problematic governance
 concerns; and

■ Any
 other factors that may be applicable.

**Poison Pills (Shareholder Rights Plans)**

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

**General Recommendation:** Vote for shareholder proposals requesting that the company submit its poison pill to a 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:

■ Shareholders
 have approved the adoption of the plan; 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 seeking stockholder approval (i.e., the "fiduciary out"
 provision). A poison pill adopted under this fiduciary out will be put to a shareholder ratification
 vote within 12 months of adoption or expire. If the pill is not approved 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, vote for the proposal, but add the caveat that a vote within 12 months would be considered sufficient implementation.

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Management Proposals to Ratify a Poison Pill

**General Recommendation:** Vote case-by-case on management proposals on poison pill ratification, focusing on the features of the shareholder rights plan. Rights plans should contain the following attributes:

&nbsp;&nbsp;&nbsp;&nbsp;■ No
 lower than a 20 percent trigger, flip-in or flip-over;

&nbsp;&nbsp;&nbsp;&nbsp;■ A
 term of no more than three years;

■ No
 deadhand, slowhand, no-hand, or similar feature that limits the ability of a future board
 to redeem the pill; and

■ Shareholder
 redemption feature (qualifying offer clause); if the board refuses to redeem the pill 90
 days after a qualifying offer is announced, 10 percent of the shares may call a special meeting
 or seek a written consent to vote on rescinding the pill.

In addition, the rationale for adopting the pill should be thoroughly explained by the company. In examining the request for the pill, take into consideration the company's existing governance structure, including: board independence, existing takeover defenses, and any problematic governance concerns.

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

**General Recommendation:** Vote against proposals to adopt a poison pill for the stated purpose of protecting a 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.

Vote case-by-case on management proposals for poison pill ratification, considering the following factors, if the term of the pill would be the shorter of three years (or less) and the exhaustion of the NOL:

■ The
 ownership threshold to transfer (NOL pills generally have a trigger slightly below 5 percent);

■ The
 value of the NOLs;

■ Shareholder
 protection mechanisms (sunset provision, or commitment to cause expiration of the pill upon
 exhaustion or expiration of NOLs);

■ The
 company's existing governance structure, including: board independence, existing takeover
 defenses, track record of responsiveness to shareholders, and any other problematic governance
 concerns; and

■ Any
 other factors that may be applicable.

Proxy Voting Disclosure, Confidentiality, and Tabulation

**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 issues covered under the policy include, but are not limited to, confidential voting of individual proxies and ballots, confidentiality of running vote tallies, and the treatment of abstentions and/or broker non-votes in the company's vote-counting methodology.

While a variety of factors may be considered in each analysis, the guiding principles are: transparency, consistency, and fairness in the proxy voting process. The factors considered, as applicable to the proposal, may include:

■ The
scope and structure of the proposal;

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■ The
 company's stated confidential voting policy (or other relevant policies) and whether it ensures
 a "level playing field" by providing shareholder proponents with equal access to
 vote information prior to the annual meeting;

■ The
 company's vote standard for management and shareholder proposals and whether it ensures consistency
 and fairness in the proxy voting process and maintains the integrity of vote results;

■ Whether
 the company's disclosure regarding its vote counting method and other relevant voting policies
 with respect to management and shareholder proposals are consistent and clear;

■ Any
 recent controversies or concerns related to the company's proxy voting mechanics;

■ Any
 unintended consequences resulting from implementation of the proposal; and

■ Any
 other factors that may be relevant.

Ratification Proposals: Management Proposals to Ratify Existing Charter or Bylaw Provisions

**General Recommendation:** Generally vote against management proposals to ratify provisions of the company's

existing charter or bylaws, unless these governance provisions align with best practice.

In addition, voting against/withhold from individual directors, members of the governance committee, or the full board may be warranted, considering:

■ The
 presence of a shareholder proposal addressing the same issue on the same ballot;

■ The
 board's rationale for seeking ratification;

■ Disclosure
 of actions to be taken by the board should the ratification proposal fail;

■ Disclosure
 of shareholder engagement regarding the board's ratification request;

■ The
 level of impairment to shareholders' rights caused by the existing provision;

■ The
 history of management and shareholder proposals on the provision at the company's past
 meetings;

■ Whether
 the current provision was adopted in response to the shareholder proposal;

■ The
 company's ownership structure; and

■ Previous
 use of ratification proposals to exclude shareholder proposals.

Reimbursing Proxy Solicitation Expenses

**General Recommendation:** Vote case-by-case on proposals to reimburse proxy solicitation expenses.

When voting in conjunction with support of a dissident slate, vote for the reimbursement of all appropriate proxy solicitation expenses associated with the election.

Generally vote for shareholder proposals calling for the reimbursement of reasonable costs incurred in connection with nominating one or more candidates in a contested election where the following apply:

■ The
 election of fewer than 50 percent of the directors to be elected is contested in the election;

■ One
 or more of the dissident's candidates is elected;

■ Shareholders
 are not permitted to cumulate their votes for directors; and

■ The
 election occurred, and the expenses were incurred, after the adoption of this bylaw.

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Reincorporation Proposals

**General Recommendation:** Management or shareholder proposals to change a company's state of incorporation should be evaluated case-by-case, giving consideration to both financial and corporate governance concerns including the following:

■ Reasons
 for reincorporation;

■ Comparison
 of company's governance practices and provisions prior to and following the reincorporation;
 and

■ Comparison
 of corporation laws of original state and destination state.

Vote for reincorporation when the economic factors outweigh any neutral or negative governance changes.

Shareholder Ability to Act by Written Consent

**General Recommendation:** Generally vote against management and shareholder proposals to restrict or prohibit shareholders' ability to act by written consent.

Generally vote for management and shareholder proposals that provide shareholders with the ability to act by written consent, taking into account the following factors:

■ Shareholders'
 current right to act by written consent;

■ The
 consent threshold;

■ The
 inclusion of exclusionary or prohibitive language;

■ Investor
 ownership structure; and

■ Shareholder
 support of, and management's response to, previous shareholder proposals.

Vote case-by-case on shareholder proposals if, in addition to the considerations above, the company has the following governance and antitakeover provisions:

■ An
 unfettered **<sup>15</sup>** right for shareholders to call special meetings at a 10 percent
 threshold;

■ A
 majority vote standard in uncontested director elections;

■ No
 non-shareholder-approved pill; and

■ An
 annually elected board.

Shareholder Ability to Call Special Meetings

**General Recommendation:** Vote against management or shareholder proposals to restrict or prohibit

shareholders' ability to call special meetings.

Generally vote for management or shareholder proposals that provide shareholders with the ability to call special meetings taking into account the following factors:

■ Shareholders'
 current right to call special meetings;

**<sup>15</sup>** "Unfettered" means no restrictions on agenda items, no restrictions on the number of shareholders who can group together 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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■ Minimum
 ownership threshold necessary to call special meetings (10 percent preferred);

■ The
 inclusion of exclusionary or prohibitive language;

■ Investor
 ownership structure; and

■ Shareholder
 support of, and management's response to, previous shareholder proposals.

Stakeholder Provisions

**General Recommendation:** Vote against proposals that ask the board to consider non-shareholder constituencies or other non-financial effects when evaluating a merger or business combination.

State Antitakeover Statutes

**General Recommendation:** Vote case-by-case on proposals to opt in or out of state takeover statutes (including fair price provisions, stakeholder laws, poison pill endorsements, severance pay and labor contract provisions, and anti-greenmail provisions).

Supermajority Vote Requirements

**General Recommendation:** Vote against proposals to require a supermajority shareholder vote.

Vote for management or shareholder proposals to reduce supermajority vote requirements. However, for companies with shareholder(s) who have significant ownership levels, vote case-by-case, taking into account:

■ Ownership
 structure;

■ Quorum
 requirements; and

■ Vote
 requirements.

Virtual Shareholder Meetings

**General Recommendation:** Generally vote for management proposals allowing for the convening of shareholder meetings by electronic means, so long as they do not preclude in-person meetings. Companies are encouraged to disclose the circumstances under which virtual-only**<sup>16</sup>** meetings would be held, and to allow for comparable rights and opportunities for shareholders to participate electronically as they would have during an in-person meeting.

Vote case-by-case on shareholder proposals concerning virtual-only meetings, considering:

■ Scope
 and rationale of the proposal; and

■ Concerns
 identified with the company's prior meeting practices.

**<sup>16</sup>** Virtual-only shareholder meeting" refers to a meeting of shareholders that is held exclusively using technology without a corresponding in-person meeting.

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**4.** Capital/Restructuring

**Capital**

Adjustments to Par Value of Common Stock

**General Recommendation:** Vote for management proposals to reduce the par value of common stock unless the action is being taken to facilitate an anti-takeover device or some other negative corporate governance action.

Vote for management proposals to eliminate par value.

Common Stock Authorization

**General Authorization Requests**

**General Recommendation:** Vote case-by-case on proposals to increase the number of authorized shares of common stock that are to be used for general corporate purposes:

■ If
 share usage (outstanding plus reserved) is less than 50% of the current authorized shares,
 vote for an increase of up to **50** % of current authorized share;

■ If
 share usage is 50% to 100% of the current authorized, vote for an increase of up to **100** %
 of current authorized shares;

■ If
 share usage is greater than current authorized shares, vote for an increase of up to the
 current share usage; or

■ In
 the case of a stock split, the allowable increase is calculated (per above) based on the
 post-split adjusted authorization.

Generally vote against proposed increases, even if within the above ratios, if the proposal or the company's prior

or ongoing use of authorized shares is problematic, including, but not limited to:

■ The
 proposal seeks to increase the number of authorized shares of the class of common stock that
 has superior voting rights to other share classes;

■ On
 the same ballot is a proposal for a reverse split for which support is warranted despite
 the fact that it would result in an excessive increase in the share authorization;

■ The
 company has a non-shareholder approved poison pill (including an NOL pill); or

■ The
 company has previous sizeable placements (within the past 3 years) of stock with insiders
 at prices substantially below market value, or with problematic voting rights, without shareholder
 approval.

However, generally vote for proposed increases beyond the above ratios or problematic situations when there is disclosure of specific and severe risks to shareholders of not approving the request, such as:

■ In,
 or subsequent to, the company's most recent 10-K filing, the company discloses that there
 is substantial doubt about its ability to continue as a going concern;

■ The
 company states that there is a risk of imminent bankruptcy or imminent liquidation if shareholders
 do not approve the increase in authorized capital; or

■ A
 government body has in the past year required the company to increase its capital ratios.

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For companies incorporated in states that allow increases in authorized capital without shareholder approval, generally vote withhold or against all nominees if a unilateral capital authorization increase does not conform to the above policies.

**Specific Authorization Requests**

**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, SPAC transactions, private placements, or similar transactions) on the same ballot, or disclosed in the proxy statement, that warrant support. For such transactions, the allowable increase will be the greater of:

■ twice
 the amount needed to support the transactions on the ballot, and

■ the
 allowable increase as calculated for general issuances above.

Dual Class Structure

**General Recommendation:** Generally vote against proposals to create a new class of common stock unless:

■ The
 company discloses a compelling rationale for the dual-class capital structure, such as:

■ The
 company's auditor has concluded that there is substantial doubt about the company's ability
 to continue as a going concern; or

■ The
 new class of shares will be transitory;

■ The
 new class is intended for financing purposes with minimal or no dilution to current shareholders
 in both the short term and long term; and

■ The
 new class is not designed to preserve or increase the voting power of an insider or significant
 shareholder.

Issue Stock for Use with Rights Plan

**General Recommendation:** Vote against proposals that increase authorized common stock for the explicit purpose of implementing a non-shareholder-approved shareholder rights plan (poison pill).

Preemptive Rights

**General Recommendation:** Vote case-by-case on shareholder proposals that seek preemptive rights, taking into consideration:

■ The
 size of the company;

■ The
 shareholder base; and

■ The
 liquidity of the stock.

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Preferred Stock Authorization

**General Authorization Requests**

**General Recommendation:** Vote case-by-case on proposals to increase the number of authorized shares of preferred stock that are to be used for general corporate purposes:

■ If
 share usage (outstanding plus reserved) is less than 50% of the current authorized shares,
 vote for an increase of up to **50** % of current authorized shares;

■ If
 share usage is 50% to 100% of the current authorized, vote for an increase of up to **100** %
 of current authorized shares;

■ If
 share usage is greater than current authorized shares, vote for an increase of up to the
 current share usage.

■ In
 the case of a stock split, the allowable increase is calculated (per above) based on the
 post-split adjusted authorization; or

■ If
 no preferred shares are currently issued and outstanding, vote against the request, unless
 the company discloses a specific use for the shares.

Generally vote against proposed increases, even if within the above ratios, if the proposal or the company's prior

or ongoing use of authorized shares is problematic, including, but not limited to:

■ If
 the shares requested are blank check preferred shares that can be used for antitakeover purposes; **<sup>17</sup>** 

■ The
 company seeks to increase a class of non-convertible preferred shares entitled to more than
 one vote per 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 than the number of common shares into which they are convertible ("supervoting
 shares") on matters that do not solely affect the rights of preferred stockholders;

■ The
 stated intent of the increase in the general authorization is to allow the company to increase
 an existing designated class of supervoting preferred shares;

■ On
 the same ballot is a proposal for a reverse split for which support is warranted despite
 the fact that it would result in an excessive increase in the share authorization;

■ The
 company has a non-shareholder approved poison pill (including an NOL pill); and

■ The
 company has previous sizeable placements (within the past 3 years) of stock with insiders
 at prices substantially below market value, or with problematic voting rights, without shareholder
 approval.

However, generally vote for proposed increases beyond the above ratios or problematic situations when there is disclosure of specific and severe risks to shareholders of not approving the request, such as:

■ In,
 or subsequent to, the company's most recent 10-K filing, the company discloses that there
 is substantial doubt about its ability to continue as a going concern;

■ The
 company states that there is a risk of imminent bankruptcy or imminent liquidation if shareholders
 do not approve the increase in authorized capital; or

■ A
 government body has in the past year required the company to increase its capital ratios.

For companies incorporated in states that allow increases in authorized capital without shareholder approval, generally vote withhold or against all nominees if a unilateral capital authorization increase does not conform to the above policies.

**<sup>17</sup>** To be acceptable, appropriate disclosure would be needed that the shares are "declawed": i.e., representation by the board that it will not, without prior stockholder approval, issue or use the preferred stock for any defensive or anti-takeover purpose or for the purpose of implementing any stockholder rights plan.

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**<u>Specific Authorization 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, SPAC transactions, private placements, or similar transactions) on the same ballot, or disclosed in the proxy statement, that warrant support. For such transactions, the allowable increase will be the greater of:

■ twice
 the amount needed to support the transactions on the ballot, and

■ the
 allowable increase as calculated for general issuances above.

Recapitalization Plans

**General Recommendation:** Vote case-by-case on recapitalizations (reclassifications of securities), taking into account the following:

■ More
 simplified capital structure;

■ Enhanced
 liquidity;

■ Fairness
 of conversion terms;

■ Impact
 on voting power and dividends;

■ Reasons
 for the reclassification;

■ Conflicts
 of interest; and

■ Other
 alternatives considered.

Reverse Stock Splits

**General Recommendation:** Vote for management proposals to implement a reverse stock split if:

■ The
 number of authorized shares will be proportionately reduced; or

■ The
 effective increase in authorized shares is equal to or less than the allowable increase calculated
 in accordance with ISS' Common Stock Authorization policy.

Vote case-by-case on proposals that do not meet either of the above conditions, taking into consideration the following factors:

■ Stock
 exchange notification to the company of a potential delisting;

■ Disclosure
 of substantial doubt about the company's ability to continue as a going concern without additional
 financing;

■ The
 company's rationale; or

■ Other
 factors as applicable.

Share Issuance Mandates at U.S. Domestic Issuers Incorporated Outside the **U.S.**

**General Recommendation:** For U.S. domestic issuers incorporated outside the U.S. and listed <u>solely</u> on a U.S. exchange, generally vote for resolutions to authorize the issuance of common shares up to 20 percent of currently issued common share capital, where not tied to a specific transaction or financing proposal.

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For pre-revenue or other early-stage companies that are heavily reliant on periodic equity financing, generally vote 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.

Renewal of such mandates should be sought at each year's annual meeting.

Vote case-by-case on share issuances for a specific transaction or financing proposal.

Share Repurchase Programs

**General Recommendation:** For U.S.-incorporated companies, and foreign-incorporated U.S. Domestic Issuers that 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;

■ The
 use of buybacks to inappropriately manipulate incentive compensation metrics;

■ Threats
 to the company's long-term viability; or

■ Other
 company-specific factors as warranted.

Vote case-by-case on proposals to repurchase shares directly from specified shareholders, balancing the stated rationale against the possibility for the repurchase authority to be misused, such as to repurchase shares from insiders at a premium to market price.

Share Repurchase Programs Shareholder Proposals

**General Recommendation:** Generally vote against shareholder proposals prohibiting executives from selling shares of company stock during periods in which the company has announced that it may or will be repurchasing 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.

Stock Distributions: Splits and Dividends

**General Recommendation:** Generally vote for management proposals to increase the common share authorization for stock split or stock dividend, provided that the effective increase in authorized shares is equal to or is less than the allowable increase calculated in accordance with ISS' Common Stock Authorization policy.

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Tracking Stock

**General Recommendation:** Vote case-by-case on the creation of tracking stock, weighing the strategic value of the transaction against such factors as:

■ Adverse
 governance changes;

■ Excessive
 increases in authorized capital stock;

■ Unfair
 method of distribution;

■ Diminution
 of voting rights;

■ Adverse
 conversion features;

■ Negative
 impact on stock option plans; and

■ Alternatives
 such as spin-off.

**Restructuring**

Appraisal Rights

**General Recommendation:** Vote for proposals to restore or provide shareholders with rights of appraisal.

Asset Purchases

**General Recommendation:** Vote case-by-case on asset purchase proposals, considering the following factors:

■ Purchase
 price;

■ Fairness
 opinion;

■ Financial
 and strategic benefits;

■ How
 the deal was negotiated;

■ Conflicts
 of interest;

■ Other
 alternatives for the business; and

■ Non-completion
 risk.

Asset Sales

**General Recommendation:** Vote case-by-case on asset sales, considering the following factors:

■ Impact
 on the balance sheet/working capital;

■ Potential
 elimination of diseconomies;

■ Anticipated
 financial and operating benefits;

■ Anticipated
 use of funds;

■ Value
 received for the asset;

■ Fairness
 opinion;

■ How
 the deal was negotiated; and

■ Conflicts
 of interest.

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Bundled Proposals

**General Recommendation:** Vote case-by-case on bundled or "conditional" proxy proposals. In the case of items that are conditioned upon each other, examine the benefits and costs of the packaged items. In instances when the joint effect of the conditioned items is not in shareholders' best interests, vote against the proposals. If the combined effect is positive, support such proposals.

Conversion of Securities

**General Recommendation:** Vote case-by-case on proposals regarding conversion of securities. When evaluating these proposals, the investor should review the dilution to existing shareholders, the conversion price relative to market value, financial issues, control issues, termination penalties, and conflicts of interest.

Vote for the conversion if it is expected that the company will be subject to onerous penalties or will be forced to file for bankruptcy if the transaction is not approved.

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

**General Recommendation:** Vote case-by-case on proposals to increase common and/or preferred shares and to issue shares as part of a debt restructuring plan, after evaluating:

■ Dilution
 to existing shareholders' positions;

■ Terms
 of the offer - discount/premium in purchase price to investor, including any fairness opinion;
 termination penalties; exit strategy;

■ Financial
 issues - company's financial situation; degree of need for capital; use of proceeds; effect
 of the financing on the company's cost of capital;

■ Management's
 efforts to pursue other alternatives;

■ Control
 issues - change in management; change in control, guaranteed board and committee seats; standstill
 provisions; voting agreements; veto power over certain corporate actions; and

■ Conflict
 of interest - arm's length transaction, managerial incentives.

Vote for the debt restructuring if it is expected that the company will file for bankruptcy if the transaction is not approved.

Formation of Holding Company

**General Recommendation:** Vote case-by-case on proposals regarding the formation of a holding company, taking into consideration the following:

■ The
 reasons for the change;

■ Any
 financial or tax benefits;

■ Regulatory
 benefits;

■ Increases
 in capital structure; and

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■ Changes
 to the articles of incorporation or bylaws of the company.

Absent compelling financial reasons to recommend for the transaction, vote against the formation of a holding company if the transaction would include either of the following:

■ Increases
in common or preferred stock in excess of the allowable maximum (see discussion under "Capital"); or

■ Adverse
 changes in shareholder rights.

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

**General Recommendation:** Vote case-by-case on going private transactions, taking into account the following:

■ Offer
 price/premium;

■ Fairness
 opinion;

■ How
 the deal was negotiated;

■ Conflicts
 of interest;

■ Other
 alternatives/offers considered; and

■ Non-completion
 risk.

Vote case-by-case on going dark transactions, determining whether the transaction enhances shareholder value by taking into consideration:

■ Whether
 the company has attained benefits from being publicly-traded (examination of trading volume,
 liquidity, and market research of the stock); and

■ Balanced
 interests of continuing vs. cashed-out shareholders, taking into account the following:

&nbsp;&nbsp;&nbsp;&nbsp;■ Are
 all shareholders able to participate in the transaction?

&nbsp;&nbsp;&nbsp;&nbsp;■ Will
 there be a liquid market for remaining shareholders following the transaction?

&nbsp;&nbsp;&nbsp;&nbsp;■ Does
 the company have strong corporate governance?

&nbsp;&nbsp;&nbsp;&nbsp;■ Will
 insiders reap the gains of control following the proposed transaction? and

&nbsp;&nbsp;&nbsp;&nbsp;■ Does
 the state of incorporation have laws requiring continued reporting that may benefit shareholders?

Joint Ventures

**General Recommendation:** Vote case-by-case on proposals to form joint ventures, taking into account the following:

■ Percentage
 of assets/business contributed;

■ Percentage
 ownership;

■ Financial
 and strategic benefits;

■ Governance
 structure;

■ Conflicts
 of interest;

■ Other
 alternatives; and

■ Non-completion
 risk.

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Liquidations

**General Recommendation:** Vote case-by-case on liquidations, taking into account the following:

■ Management's
 efforts to pursue other alternatives;

■ Appraisal
 value of assets; and

■ The
 compensation plan for executives managing the liquidation.

Vote for the liquidation if the company will file for bankruptcy if the proposal is not approved.

Mergers and Acquisitions

**General Recommendation:** Vote case-by-case on mergers and acquisitions. Review and evaluate the merits and drawbacks of the proposed transaction, balancing various and sometimes countervailing factors including:

■ *Valuation* - Is the value to be received by the target shareholders (or paid by the acquirer) reasonable?
 While the fairness opinion may provide an initial starting point for assessing valuation
 reasonableness, emphasis is placed on the offer premium, market reaction, and strategic rationale.

■ *Market reaction* - How has the market responded to the proposed deal? A negative market reaction
 should cause closer scrutiny of a deal.

■ *Strategic rationale* - Does the deal make sense strategically? From where is the value derived?
 Cost and revenue synergies should not be overly aggressive or optimistic, but reasonably
 achievable. Management should also have a favorable track record of successful integration
 of historical acquisitions.

■ *Negotiations and process* - Were the terms of the transaction negotiated at arm's-length? Was the process
 fair 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. The CIC figure presented in the "ISS
 Transaction Summary" section of this report is an aggregate figure 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, the burden is on the company to prove that other issues (such
 as valuation) outweigh any deterioration in governance.

Private Placements/Warrants/Convertible Debentures

**General Recommendation:** Vote case-by-case on proposals regarding private placements, warrants, and convertible debentures taking into consideration:

■ Dilution
 to existing shareholders' position: The amount and timing of shareholder ownership dilution
 should 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 convertible debt. In these instances from a value standpoint, the negative impact of dilution is mitigated by the increase in the company's stock price that must occur to trigger the dilutive event.

■ Terms
 of the offer (discount/premium in purchase price to investor, including any fairness opinion,
 conversion features, termination penalties, exit strategy):

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 terms of the offer should be weighed against the alternatives of the company and in light
 of company's financial condition. Ideally, the conversion price for convertible debt and
 the exercise price for warrants should be at a premium to the then prevailing stock price
 at the time of private placement.

&nbsp;&nbsp;&nbsp;&nbsp;■ When
 evaluating the magnitude of a private placement discount or premium, consider factors that
 influence the discount or premium, such as, liquidity, due diligence costs, control and monitoring
 costs, capital scarcity, information asymmetry, and anticipation of future performance.

■ Financial
 issues:

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 company's financial condition;

&nbsp;&nbsp;&nbsp;&nbsp;■ Degree
 of need for capital;

&nbsp;&nbsp;&nbsp;&nbsp;■ Use
 of proceeds;

&nbsp;&nbsp;&nbsp;&nbsp;■ Effect
 of the financing on the company's cost of capital;

&nbsp;&nbsp;&nbsp;&nbsp;■ Current
 and proposed cash burn rate; and

&nbsp;&nbsp;&nbsp;&nbsp;■ Going
 concern viability and the state of the capital and credit markets.

■ Management's
 efforts to pursue alternatives and whether the company engaged in a process to evaluate 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.

■ Control
 issues:

&nbsp;&nbsp;&nbsp;&nbsp;■ Change
 in management;

&nbsp;&nbsp;&nbsp;&nbsp;■ Change
 in control;

&nbsp;&nbsp;&nbsp;&nbsp;■ Guaranteed
 board and committee seats;

&nbsp;&nbsp;&nbsp;&nbsp;■ Standstill
 provisions;

&nbsp;&nbsp;&nbsp;&nbsp;■ Voting
 agreements;

&nbsp;&nbsp;&nbsp;&nbsp;■ Veto
 power over certain corporate actions; and

&nbsp;&nbsp;&nbsp;&nbsp;■ Minority
 versus majority ownership and corresponding minority discount or majority control premium.

■ Conflicts
 of interest:

&nbsp;&nbsp;&nbsp;&nbsp;■ Conflicts
 of interest should be viewed from the perspective of the company and the investor; and

&nbsp;&nbsp;&nbsp;&nbsp;■ Were
 the terms of the transaction negotiated at arm's length? Are managerial incentives aligned
 with shareholder interests?

■ Market
 reaction:

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 market's response to the proposed deal. A negative market reaction is a cause for concern.
 Market reaction may be addressed by analyzing the one-day impact on the unaffected stock
 price.

Vote for the private placement, or for the issuance of warrants and/or convertible debentures in a private placement, if it is expected that the company will file for bankruptcy if the transaction is not approved.

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Reorganization/Restructuring Plan (Bankruptcy)

**General Recommendation:** Vote case-by-case on proposals to common shareholders on bankruptcy plans of reorganization, considering the following factors including, but not limited to:

■ Estimated
 value and financial prospects of the reorganized company;

■ Percentage
 ownership of current shareholders in the reorganized company;

■ Whether
 shareholders are adequately represented in the reorganization process (particularly through
 the existence of an Official Equity Committee);

■ The
 cause(s) of the bankruptcy filing, and the extent to which the plan of reorganization addresses
 the cause(s);

■ Existence
 of a superior alternative to the plan of reorganization; and

■ Governance
 of the reorganized company.

Special Purpose Acquisition Corporations (SPACs)

**General Recommendation:** Vote case-by-case on SPAC mergers and acquisitions taking into account the following:

■ *Valuation* - Is the value being paid by the SPAC reasonable? SPACs generally lack an independent
 fairness opinion and the financials on the target may be limited. Compare the conversion
 price with the intrinsic value of the target company provided in the fairness opinion. Also,
 evaluate the proportionate value of the combined entity attributable to the SPAC IPO shareholders
 versus the pre-merger value of SPAC. Additionally, a private company discount may be applied
 to the target if it is a private entity.

■ *Market reaction* - How has the market responded to the proposed deal? A negative market reaction
 may be a 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 complete within 18 to 24 months, or the SPAC is to be liquidated. Evaluate
 the valuation, market reaction, and potential conflicts of interest for deals that are announced
 close to the liquidation date.

■ *Negotiations and process* - What was the process undertaken to identify potential target companies
 within 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 higher price for
 the target because of an 80 percent rule (the charter requires that the fair market value
 of the target is at least equal to 80 percent of net assets of the 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.

■ *Voting agreements* - Are the sponsors entering into enter into any voting agreements/tender offers
 with shareholders who are likely to vote against the proposed merger or exercise conversion
 rights?

■ *Governance* - What is the impact of having the SPAC CEO or founder on key committees following the
 proposed merger?

Special Purpose Acquisition Corporations (SPACs) - Proposals for Extensions

The main purpose of SPACs is to identify and acquire a viable target within a specified timeframe, and failure to 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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**General Recommendation:** Generally support requests to extend the termination date by up to one year from the 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 amendment terms, and, if applicable, use of money in the trust fund to pay excise taxes on redeemed shares.

Spin-offs

**General Recommendation:** Vote case-by-case on spin-offs, considering:

■ Tax
 and regulatory advantages;

■ Planned
 use of the sale proceeds;

■ Valuation
 of spinoff;

■ Fairness
 opinion;

■ Benefits
 to the parent company;

■ Conflicts
 of interest;

■ Managerial
 incentives;

■ Corporate
 governance changes; and

■ Changes
 in the capital structure.

Value Maximization Shareholder Proposals

**General Recommendation:** Vote case-by-case on shareholder proposals seeking to maximize shareholder value by:

■ Hiring
 a financial advisor to explore strategic alternatives;

■ Selling
 the company; or

■ Liquidating
 the company and distributing the proceeds to shareholders.

These proposals should be evaluated based on the following factors:

■ Prolonged
 poor performance with no turnaround in sight;

■ Signs
 of entrenched board and management (such as the adoption of takeover defenses);

■ Strategic
 plan in place for improving value;

■ Likelihood
 of receiving reasonable value in a sale or dissolution; and

■ The
 company actively exploring its strategic options, including retaining a financial advisor.

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**5.** Compensation

**Executive Pay Evaluation**

Underlying all evaluations are five global principles that most investors expect corporations to adhere to in 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 take into consideration, among other factors, the link between
 pay and performance; the mix between fixed and variable pay; performance goals; and equity-based
 plan costs;

2. Avoid
arrangements that risk "pay for failure": This principle addresses the appropriateness of long or indefinite contracts, excessive
severance packages, and guaranteed compensation;

3. Maintain
 an independent and effective compensation committee: This principle promotes oversight of
 executive pay programs by directors with appropriate skills, knowledge, experience, and a
 sound process for 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 importance of informative and timely disclosures that enable shareholders to evaluate
 executive pay practices 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 and ability to make appropriate judgments in overseeing managers'
 pay and performance. At the market level, it may incorporate a variety of generally accepted
 best practices.

Advisory Votes on Executive Compensation—Management Proposals (Say-on-Pay)

**General Recommendation:** Vote case-by-case on ballot items related to executive pay and practices, as well as certain aspects of outside director compensation.

Vote against Advisory Votes on Executive Compensation (Say-on-Pay or "SOP") if:

■ There
 is an unmitigated misalignment between CEO pay and company performance (pay
 for performance);

■ The
 company maintains significant problematic pay practices ;
 or

■ The
 board exhibits a significant level of poor communication
 and responsiveness to shareholders.

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

■ There
 is no SOP on the ballot, and an against vote on an SOP would otherwise be warranted due to
 pay-for-performance misalignment, problematic pay practices, or the lack of adequate responsiveness
 on compensation issues raised previously, or a combination thereof;

■ The
 board fails to respond adequately to a previous SOP proposal that received less than 70 percent
 support of votes cast;

■ The
 company has recently practiced or approved problematic pay practices, such as option repricing
 or option backdating; or

■ The
 situation is egregious.

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Primary Evaluation Factors for Executive Pay

**Pay-for-Performance Evaluation**

ISS annually conducts a pay-for-performance analysis to identify strong or satisfactory alignment between pay and performance over a sustained period. With respect to companies in the S&P1500, Russell 3000, or Russell 3000E Indices, this analysis considers the following:

1. Peer
 Group **<sup>18</sup>** Alignment:

■ The
 degree of alignment between the company's annualized TSR rank and the CEO's annualized total
 pay rank within a peer group, each measured over a five-year period.

■ The
 rankings of CEO total pay and company financial performance within a peer group, each measured
 over a five-year period.

■ The
 multiple of the CEO's total pay relative to the peer group median over one- and three-year
 periods.

2. Absolute
 Alignment **<sup>19</sup>** – the absolute alignment between the trend in CEO pay
 and company TSR over the prior five fiscal years – i.e., the difference between the
 trend in annual pay changes and the trend in annualized TSR during the period.

If the above analysis demonstrates significant unsatisfactory long-term pay-for-performance alignment or, in the 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:

■ The
 overall ratio of performance-based compensation to fixed or discretionary pay;

■ The
 ratio of performance- to time-based long-term incentive awards;

■ Vesting
 and/or retention requirements for equity awards that demonstrate a long-term focus;

■ The
 rigor of performance goals;

■ The
 complexity and risks around pay program design;

■ The
 transparency and clarity of disclosure;

■ The
 company's peer group benchmarking practices;

■ Financial/operational
 results, both absolute and relative to peers;

■ Special
 circumstances related to, for example, a new CEO in the prior FY or anomalous equity grant
 practices (e.g., bi-annual awards);

■ Realizable
 and/or realized pay compared to granted pay; and

■ Any
 other factors deemed relevant.

**Problematic Pay Practices**

Problematic pay elements are generally evaluated case-by-case considering the context of a company's overall pay program and demonstrated pay-for-performance philosophy. The focus is on executive compensation practices that contravene the global pay principles, including:

■ Problematic
 practices related to non-performance-based compensation elements;

■ Incentives
 that may motivate excessive risk-taking or present a windfall risk; and

**<sup>18</sup>** The ISS peer group is generally comprised of 14-24 companies that are selected using factors such as market cap, revenue, assets, GICS industry group, and the company selected peers' GICS industry group. ISS' peer selection methodology is detailed in the U.S. Peer Group FAQ.

**<sup>19</sup>** Russell 3000E Index companies (excluding S&P1500 and Russell 3000 companies) are not subject to the Absolute Alignment analysis.

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■ Pay
 decisions that circumvent pay-for-performance, such as options backdating or waiving performance
 requirements.

The list of examples below highlights certain problematic practices that carry significant weight in this overall consideration and may result in adverse vote recommendations:

■ Repricing
 or replacing of underwater stock options/SARs without prior shareholder approval (including
 cash buyouts and voluntary surrender of underwater options);

■ Extraordinary
 perquisites or tax gross-ups;

■ New
 or materially amended agreements that provide for:

&nbsp;&nbsp;&nbsp;&nbsp;■ Excessive
 termination or CIC severance payments (generally exceeding 3 times base salary and average/target/most
 recent bonus);

&nbsp;&nbsp;&nbsp;&nbsp;■ CIC
 severance payments without involuntary job loss or substantial diminution of duties ("single"
 or "modified single" triggers) or in connection with a problematic Good Reason
 definition;

&nbsp;&nbsp;&nbsp;&nbsp;■ CIC
 excise tax gross-up entitlements (including "modified" gross-ups); and/or

&nbsp;&nbsp;&nbsp;&nbsp;■ Multi-year
 guaranteed awards that are not at risk due to rigorous performance conditions;

■ Liberal
 CIC definition combined with any single-trigger CIC benefits;

■ Insufficient
 executive compensation disclosure by externally-managed issuers (EMIs) such that a reasonable
 assessment of pay programs and practices applicable to the EMI's executives is not possible;

■ Severance
 payments made when the termination is not clearly disclosed as involuntary (for example,
 a termination without cause or resignation for good reason); and/or

■ Any
 other provision or practice deemed to be egregious and present a significant risk to investors.

The above examples are not an exhaustive list. Please refer to ISS' U.S. Compensation Policies FAQ document for additional detail on specific pay practices that have been identified as problematic and may lead to negative vote recommendations.

Options Backdating

The following factors should be examined case-by-case to allow for distinctions to be made between "sloppy" plan administration versus deliberate action or fraud:

■ Reason
 and motive for the options backdating issue, such as inadvertent vs. deliberate grant date
 changes;

■ Duration
 of options backdating;

■ Size
 of restatement due to options backdating;

■ Corrective
 actions taken by the board or compensation committee, such as canceling or re-pricing backdated
 options, the recouping of option gains on backdated grants; and

■ Adoption
 of a grant policy that prohibits backdating and creates a fixed grant schedule or window
 period for equity grants in the future.

**Compensation Committee Communications and Responsiveness**

Consider the following factors case-by-case when evaluating ballot items related to executive pay on the board's

responsiveness to investor input and engagement on compensation issues:

■ Failure
 to respond to majority-supported shareholder proposals on executive pay topics; or

■ Failure
 to adequately respond to the company's previous say-on-pay proposal that received low support
 taking into account the factors identified under the Responsiveness section in the Board
 of Directors policy with respect to say-on-pay.

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

**General Recommendation:** Vote for annual advisory votes on compensation, which provide the most consistent and clear communication channel for shareholder concerns about companies' executive pay programs.

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

**General Recommendation:** Vote case-by-case on say on Golden Parachute proposals, including consideration of existing change-in-control arrangements maintained with named executive officers but also considering new or extended arrangements.

Features that may result in an "against" recommendation include one or more of the following, depending on the number, magnitude, and/or timing of issue(s):

■ Single-
 or modified-single-trigger cash severance;

■ Single-trigger
 acceleration of unvested equity awards;

■ Full
 acceleration of equity awards granted shortly before the change in control;

■ Acceleration
 of performance awards above the target level of performance without compelling rationale;

■ Excessive
 cash severance (generally >3x base salary and bonus);

■ Excise
 tax gross-ups triggered and payable;

■ Excessive
 golden parachute payments (on an absolute basis or as a percentage of transaction equity
 value); or

■ Recent
 amendments that incorporate any problematic features (such as those above) or recent actions
 (such as extraordinary equity grants) that may make packages so attractive as to influence
 merger agreements that may not be in the best interests of shareholders; or

■ The
 company's assertion that a proposed transaction is conditioned on shareholder approval of
 the golden parachute advisory vote.

Recent amendment(s) that incorporate problematic features will tend to carry more weight on the overall analysis. 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 (management say-on-pay), ISS will evaluate the say-on-pay proposal in accordance with these guidelines, which may give higher weight to that component of the overall evaluation.

**Equity-Based and Other Incentive Plans**

Please refer to ISS' U.S. Equity Compensation Plans FAQ document for additional details on the Equity Plan Scorecard policy.

**General Recommendation:** Vote case-by-case on equity plan proposals subject to the Equity Plan Scorecard framework, where positive factors may counterbalance negative factors under three pillars:

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**I.** **Plan Cost:** The total estimated cost
of the company's equity plans relative to industry/market cap peers, measured by the company's estimated Shareholder Value Transfer
(SVT) in relation to peers and considering both:

&nbsp;&nbsp;&nbsp;&nbsp;■ SVT
 based on new shares requested plus shares remaining for future grants, plus outstanding unvested/unexercised
 grants; and

&nbsp;&nbsp;&nbsp;&nbsp;■ SVT
 based only on new shares requested plus shares remaining for future grants.

**II.** Plan
Features:

&nbsp;&nbsp;&nbsp;&nbsp;■ Quality
 of disclosure around vesting upon a change in control (CIC);

&nbsp;&nbsp;&nbsp;&nbsp;■ Discretionary
 vesting authority;

&nbsp;&nbsp;&nbsp;&nbsp;■ Liberal
 share recycling on various award types;

&nbsp;&nbsp;&nbsp;&nbsp;■ Lack
 of minimum vesting period for grants made under the plan;

&nbsp;&nbsp;&nbsp;&nbsp;■ Dividends
 payable prior to award vesting; and

&nbsp;&nbsp;&nbsp;&nbsp;■ Cash-denominated
 award limits for non-employee directors.

**III.** Grant
Practices:

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 company's three-year burn
 rate relative to its industry/market cap peers;

&nbsp;&nbsp;&nbsp;&nbsp;■ Vesting
 requirements in CEO's recent equity grants;

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 estimated duration of the plan;

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 proportion of the CEO's most recent equity grants/awards classified by ISS as performance-based;

&nbsp;&nbsp;&nbsp;&nbsp;■ Whether
 the company maintains a sufficient claw-back policy; and

&nbsp;&nbsp;&nbsp;&nbsp;■ Whether
 the company maintains sufficient post-exercise/vesting share-holding requirements.

Generally vote against the plan proposal if the combination of above factors indicates that the plan is not, overall, in shareholders' interests, or if any of the following egregious factors ("overriding factors") apply:

■ Awards
 may vest in connection with a liberal
 change-of-control definition;

■ The
 plan would permit repricing
 or cash buyout of underwater options without shareholder approval (either by expressly permitting
 it – for NYSE and Nasdaq listed companies – or by not prohibiting it when the
 company has a history of repricing – for non-listed companies);

■ The
 plan is a vehicle for problematic
 pay practices or a significant pay-for-performance
 disconnect under certain circumstances;

■ The
 plan is excessively dilutive to shareholders' holdings;

■ The
 plan contains an evergreen (automatic share replenishment) feature;

■ The
 plan lacks sufficient positive features under the Plan Features pillar; or

■ Any
 other factors that are determined to have a significant negative impact on shareholder interests.

**Further Information on certain EPSC Factors:**

**Shareholder Value Transfer (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 and directors. SVT is expressed as both a dollar amount and as a percentage of market value, and includes the new 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.

For omnibus plans, unless limitations are placed on the most expensive types of awards (for example, full-value awards), the assumption is made that all awards to be granted will be the most expensive types.

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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 quartile performers in each industry group (using the Global Industry Classification Standard: GICS) are identified. Benchmark SVT levels for each industry are established based on these top performers' historic SVT. Regression analyses are run on each industry group to identify the variables most strongly correlated to SVT. The benchmark 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>20</sup>**

**Three-Year Value-Adjusted Burn Rate**

A "Value-Adjusted Burn Rate" is used for stock plan evaluations. Value-Adjusted Burn Rate benchmarks are calculated as the greater of: (1) an industry-specific threshold based on three-year burn rates within the company'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 established separately for each of the S&P 500, the Russell 3000 index less the S&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.

The Value-Adjusted Burn Rate is calculated as follows:

Value-Adjusted Burn Rate = ((# of options \* option's dollar value using a Black-Scholes model) + (# of full-value awards \* stock price)) / (Weighted average common shares \* stock price).

Egregious Factors

**Liberal Change in Control Definition**

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. Examples of such a definition include, but are not limited to, announcement or commencement of a tender offer, provisions for acceleration upon a "potential" takeover, shareholder approval of a merger or other transactions, or similar language.

**Repricing Provisions**

Vote against plans that expressly permit the repricing or exchange of underwater stock options/stock appreciate rights (SARs) without prior shareholder approval. "Repricing" typically includes the ability to do any of the following:

■ Amend
 the terms of outstanding options or SARs to reduce the exercise price of such outstanding
 options or SARs;

■ Cancel
 outstanding options or SARs in exchange for options or SARs with an exercise price that is
 less than the exercise price of the original options or SARs;

■ Cancel
 underwater options in exchange for stock awards; or

■ Provide
 cash buyouts of underwater options.

**<sup>20</sup>** For plans evaluated under the Equity Plan Scorecard policy, the company's SVT benchmark is considered along with other factors.

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While the above cover most types of repricing, ISS may view other provisions as akin to repricing depending on the facts and circumstances.

Also, vote against or withhold from members of the Compensation Committee who approved repricing (as defined 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 shareholder approval if the company has a history of repricing/buyouts without shareholder approval, and the applicable listing standards would not preclude them from doing so.

**Problematic Pay Practices or Significant Pay-for-Performance Disconnect**

If the equity plan on the ballot is a vehicle for problematic pay practices, vote against the plan.

ISS may recommend a vote against the equity plan if the plan is determined to be a vehicle for pay-for-performance misalignment. Considerations in voting against the equity plan may include, but are not limited to:

■ Severity
 of the pay-for-performance misalignment;

■ Whether
 problematic equity grant practices are driving the misalignment; and/or

■ Whether
 equity plan awards have been heavily concentrated to the CEO and/or the other NEOs.

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

**General Recommendation:** Vote case-by-case on amendments to cash and equity incentive plans.

Generally vote for proposals to amend executive cash, stock, or cash and stock incentive plans if the proposal:

■ Addresses
 administrative features only; or

■ Seeks
 approval for Section 162(m) purposes <u>only</u>, and the plan administering committee consists
 entirely of independent directors, per ISS' Classification
 of Directors . Note that if the company is presenting the plan to shareholders for
 the first time for any reason (including after the company's initial public offering),
 or if the proposal is bundled with other material plan amendments, then the recommendation
 will be case-by-case (see below).

Vote against proposals to amend executive cash, stock, or cash and stock incentive plans if the proposal:

■ Seeks
 approval for Section 162(m) purposes only, and the plan administering committee does not
 consist 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 shareholders for the first time after the company's IPO and/or proposals that bundle material amendment(s) other than those for Section 162(m) purposes.

Vote case-by-case on all other proposals to amend <u>equity</u> incentive plans, considering the following:

■ If
 the proposal requests additional shares and/or the amendments include a term extension or
 addition of full value awards as an award type, the recommendation will be based on the Equity
 Plan Scorecard evaluation as well as an analysis of the overall impact of the amendments;

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■ If
 the plan is being presented to shareholders for the first time (including after the company's
 IPO), whether or 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

■ If
 there is no request for additional shares and the amendments do not include a term extension
 or addition of 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.

In the first two case-by-case evaluation scenarios, the EPSC evaluation/score is the more heavily weighted consideration.

Specific Treatment of Certain Award Types in Equity Plan Evaluations

**Dividend Equivalent Rights**

Options that have Dividend Equivalent Rights (DERs) associated with them will have a higher calculated award 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 exercised per the plan specifications. DERS transfer more shareholder equity to employees and non-employee directors and this cost should be captured.

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

For Real Estate Investment Trusts (REITS), include the common shares issuable upon conversion of outstanding Operating Partnership (OP) units in the share count for the purposes of determining: (1) market capitalization in the Shareholder Value Transfer (SVT) analysis and (2) shares outstanding in the burn rate analysis.

**Other Compensation Plans**

401(k) Employee Benefit Plans

**General Recommendation:** Vote for proposals to implement a 401(k) savings plan for employees.

Employee Stock Ownership Plans (ESOPs)

**General Recommendation:** Vote for proposals to implement an ESOP or increase authorized shares for existing ESOPs, unless the number of shares allocated to the ESOP is excessive (more than five percent of outstanding shares).

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Employee Stock Purchase Plans—Qualified Plans

**General Recommendation:** Vote case-by-case on qualified employee stock purchase plans. Vote for employee stock purchase plans where all of the following apply:

■ Purchase
 price is at least 85 percent of fair market value;

■ Offering
 period is 27 months or less; and

■ The
 number of shares allocated to the plan is 10 percent or less of the outstanding shares.

Vote against qualified employee stock purchase plans where when the plan features do not meet all of the above criteria.

Employee Stock Purchase Plans—Non-Qualified Plans

**General Recommendation:** Vote case-by-case on nonqualified employee stock purchase plans. Vote for nonqualified employee stock purchase plans with all the following features:

■ Broad-based
 participation;

■ Limits
 on employee contribution, which may be a fixed dollar amount or expressed as a percent of
 base salary;

■ Company
matching contribution up to 25 percent of employee's contribution, which is effectively a discount of 20 percent from market value;
and

■ No
 discount on the stock price on the date of purchase when there is a company matching contribution.

Vote against nonqualified employee stock purchase plans when the plan features do not meet all of the above criteria. If the matching contribution or effective discount exceeds the above, ISS may evaluate the SVT cost of the plan as part of the assessment.

Option Exchange Programs/Repricing Options

**General Recommendation:** Vote case-by-case on management proposals seeking approval to exchange/reprice options taking into consideration:

■ Historic
 trading patterns—the stock price should not be so volatile that the options are likely to
 be back "in-the-money" over the near term;

■ Rationale
 for the re-pricing—was the stock price decline beyond management's control?;

■ Is
 this a value-for-value exchange?;

■ Are
 surrendered stock options added back to the plan reserve?;

■ Timing—repricing
 should occur at least one year out from any precipitous drop in company's stock price;

■ Option
 vesting—does the new option vest immediately or is there a black-out period?;

■ Term
 of the option—the term should remain the same as that of the replaced option;

■ Exercise
 price—should be set at fair market or a premium to market; and

■ Participants—executive
 officers and directors must be excluded.

If the surrendered options are added back to the equity plans for re-issuance, then also take into consideration the

company's total cost of equity plans and its three-year average burn rate.

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In addition to the above considerations, evaluate the intent, rationale, and timing of the repricing proposal. The proposal should clearly articulate why the board is choosing to conduct an exchange program at this point in time. 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.

Vote for shareholder proposals to put option repricings to a shareholder vote.

Stock Plans in Lieu of Cash

**General Recommendation:** Vote case-by-case on plans that provide participants with the option of taking all or a portion of their cash compensation in the form of stock.

Vote for non-employee director-only equity plans that provide a dollar-for-dollar cash-for-stock exchange.

Vote case-by-case on plans which do not provide a dollar-for-dollar cash for stock exchange. In cases where the exchange is not dollar-for-dollar, the request for new or additional shares for such equity program will be considered using the binomial option pricing model. In an effort to capture the total cost of total compensation, ISS will not make any adjustments to carve out the in-lieu-of cash compensation.

Transfer Stock Option (TSO) Programs

**General Recommendation:** One-time Transfers: Vote against or withhold from compensation committee members if they fail to submit one-time transfers to shareholders for approval.

Vote case-by-case on one-time transfers. Vote for if:

■ Executive
 officers and non-employee directors are excluded from participating;

■ Stock
 options are purchased by third-party financial institutions at a discount to their fair value
 using option pricing models such as Black-Scholes or a Binomial Option Valuation or other
 appropriate financial models; and

■ There
 is a two-year minimum holding period for sale proceeds (cash or stock) for all participants.

Additionally, management should provide a clear explanation of why options are being transferred to a third-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 to shareholders. Since TSOs will be one of the award types under a stock plan, the ongoing TSO program, 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;

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■ Term
 of options;

■ Cost
 of the program and impact of the TSOs on company's total option expense; and

■ Option
 repricing policy.

Amendments to existing plans that allow for introduction of transferability of stock options should make clear that only options granted post-amendment shall be transferable.

**Director Compensation**

Shareholder Ratification of Director Pay Programs

**General Recommendation:** Vote case-by-case on management proposals seeking ratification of non-employee director compensation, based on the following factors:

■ If
 the equity plan under which non-employee director grants are made is on the ballot, whether
 or not it warrants support; and

■ An
 assessment of the following qualitative factors:

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 relative magnitude of director compensation as compared to companies of a similar profile;

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 presence of problematic pay practices relating to director compensation;

&nbsp;&nbsp;&nbsp;&nbsp;■ Director
 stock ownership guidelines and holding requirements;

&nbsp;&nbsp;&nbsp;&nbsp;■ Equity
 award vesting schedules;

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 mix of cash and equity-based compensation;

&nbsp;&nbsp;&nbsp;&nbsp;■ Meaningful
 limits on director compensation;

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 availability of retirement benefits or perquisites; and

&nbsp;&nbsp;&nbsp;&nbsp;■ The
 quality of disclosure surrounding director compensation.

Equity Plans for Non-Employee Directors

**General Recommendation:** Vote case-by-case on compensation plans for non-employee directors, based on:

■ The
 total estimated cost of the company's equity plans relative to industry/market cap
 peers, measured by the company's estimated Shareholder Value Transfer (SVT) based on
 new shares requested plus shares remaining for future grants, plus outstanding unvested/unexercised
 grants;

■ The
 company's three-year burn rate relative to its industry/market cap peers (in certain
 circumstances); and

■ The
 presence of any egregious plan features (such as an option repricing provision or liberal
 CIC vesting risk).

On occasion, non-employee director stock plans will exceed the plan cost or burn-rate benchmarks when combined with employee or executive stock plans. In such cases, vote case-by-case on the plan taking into consideration the following qualitative factors:

■ The
 relative magnitude of director compensation as compared to companies of a similar profile;

■ The
 presence of problematic pay practices relating to director compensation;

■ Director
 stock ownership guidelines and holding requirements;

■ Equity
 award vesting schedules;

■ The
 mix of cash and equity-based compensation;

■ Meaningful
 limits on director compensation;

■ The
 availability of retirement benefits or perquisites; and

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■ The
 quality of disclosure surrounding director compensation.

Non-Employee Director Retirement Plans

**General Recommendation:** Vote against retirement plans for non-employee directors. Vote for shareholder proposals to eliminate retirement plans for non-employee directors.

**Shareholder Proposals on Compensation**

Bonus Banking/Bonus Banking "Plus"

**General Recommendation:** Vote case-by-case on proposals seeking deferral of a portion of annual bonus pay, 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:

■ The
 company's past practices regarding equity and cash compensation;

■ Whether
 the company has a holding period or stock ownership requirements in place, such as a meaningful
 retention ratio (at least 50 percent for full tenure); and

■ Whether
 the company has a rigorous claw-back policy in place.

Compensation Consultants—Disclosure of Board or Company's Utilization

**General Recommendation:** Generally vote for shareholder proposals seeking disclosure regarding the company, board, or compensation committee's use of compensation consultants, such as company name, business relationship(s), and fees paid.

Disclosure/Setting Levels or Types of Compensation for Executives and Directors

**General Recommendation:** Generally vote for shareholder proposals seeking additional disclosure of executive and director pay information, provided the information requested is relevant to shareholders' needs, would not put the company at a competitive disadvantage relative to its industry, and is not unduly burdensome to the company.

Generally vote against shareholder proposals seeking to set absolute levels on compensation or otherwise dictate the amount or form of compensation (such as types of compensation elements or specific metrics) to be used for executive or directors.

Generally vote against shareholder proposals that mandate a minimum amount of stock that directors must own in 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 relevant factors, including but not limited to: company performance, pay level and design versus peers, history of

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compensation concerns or pay-for-performance disconnect, and/or the scope and prescriptive nature of the proposal.

Golden Coffins/Executive Death Benefits

**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 awards made in lieu of compensation. This would not apply to any benefit programs or equity plan proposals for which the broad-based employee population is eligible.

Hold Equity Past Retirement or for a Significant Period of Time

**General Recommendation:** Vote case-by-case on shareholder proposals asking companies to adopt policies requiring senior executive officers to retain a portion of net shares acquired through compensation plans. The following factors will be taken into account:

■ The
 percentage/ratio of net shares required to be retained;

■ The
 time period required to retain the shares;

■ Whether
 the company has equity retention, holding period, and/or stock ownership requirements in
 place and the robustness of such requirements;

■ Whether
 the company has any other policies aimed at mitigating risk taking by executives;

■ Executives'
 actual stock ownership and the degree to which it meets or exceeds the proponent's
 suggested holding period/retention ratio or the company's existing requirements; and

■ Problematic
 pay practices, current and past, which may demonstrate a short-term versus long-term focus.

Pay Disparity

**General Recommendation:** Vote case-by-case on proposals calling for an analysis of the pay disparity between corporate executives and other non-executive employees. The following factors will be considered:

■ The
company's current level of disclosure of its executive compensation setting process, including how the company considers pay disparity;

■ If
 any problematic pay practices or pay-for-performance concerns have been identified at the
 company; and

■ The
 level of shareholder support for the company's pay programs.

Generally vote against proposals calling for the company to use the pay disparity analysis or pay ratio in a specific way to set or limit executive pay.

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Pay for Performance/Performance-Based Awards

**General Recommendation:** Vote case-by-case on shareholder proposals requesting that a significant amount of future long-term incentive compensation awarded to senior executives shall be performance-based and requesting 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 performance contingent options or restricted stock, indexed options, or premium-priced
 options, unless the 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-based program is too low
based on the company's historical or peer group comparison, generally vote for the proposal. Furthermore, if target performance
results in an above target payout, vote for the shareholder proposal due to program's poor design. If the company does not disclose
the performance metric of the performance-based equity program, vote for the shareholder proposal regardless of the outcome of the first
step to the test.

In general, vote for the shareholder proposal if the company does not meet both of the above two steps.

Pay for Superior Performance

**General Recommendation:** Vote case-by-case on shareholder proposals that request the board establish a pay-for-superior performance standard in the company's executive compensation plan for senior executives. These proposals generally include the following principles:

■ Set
 compensation targets for the plan's annual and long-term incentive pay components at
 or below the peer group median;

■ Deliver
 a majority of the plan's target long-term compensation through performance-vested,
 not simply time-vested, equity awards;

■ Provide
 the strategic rationale and relative weightings of the financial and non-financial performance
 metrics or criteria used in the annual and performance-vested long-term incentive components
 of the plan;

■ Establish
performance targets for each plan financial metric relative to the performance of the company's peer companies; and

■ Limit
 payment under the annual and performance-vested long-term incentive components of the plan
 to when the company's performance on its selected financial performance metrics exceeds
 peer group median performance.

Consider the following factors in evaluating this proposal:

■ What
 aspects of the company's annual and long-term equity incentive programs are performance
 driven?

■ If
 the annual and long-term equity incentive programs are performance driven, are the performance
 criteria and hurdle rates disclosed to shareholders or are they benchmarked against a disclosed
 peer group?

■ Can
 shareholders assess the correlation between pay and performance based on the current disclosure?
 and

■ What
 type of industry and stage of business cycle does the company belong to?

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

**General Recommendation:** Generally vote for shareholder proposals calling for the addition of certain safeguards in prearranged trading plans (10b5-1 plans) for executives. Safeguards may include:

■ Adoption,
 amendment, or termination of a 10b5-1 Plan must be disclosed in a Form 8-K;

■ Amendment
 or early termination of a 10b5-1 Plan allowed only under extraordinary circumstances, as
 determined by the board;

■ Request
 that a certain number of days that must elapse between adoption or amendment of a 10b5-1
 Plan and initial trading under the plan;

■ Reports
 on Form 4 must identify transactions made pursuant to a 10b5-1 Plan;

■ An
 executive may not trade in company stock outside the 10b5-1 Plan; and

■ Trades
 under a 10b5-1 Plan must be handled by a broker who does not handle other securities transactions
 for the executive.

Prohibit Outside CEOs from Serving on Compensation Committees

**General Recommendation:** Generally vote against proposals seeking a policy to prohibit any outside CEO from 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.

Recoupment of Incentive or Stock Compensation in Specified Circumstances

**General Recommendation:** Vote case-by-case on proposals to recoup incentive cash or stock compensation made to senior executives if it is later determined that the figures upon which incentive compensation is earned turn out 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.

Many companies have adopted policies that permit recoupment in cases where an executive'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.

In considering whether to support such shareholder proposals, ISS will take into consideration the following factors:

■ If
 the company has adopted a formal recoupment policy;

■ The
 rigor of the recoupment policy focusing on how and under what circumstances the company may
 recoup incentive or stock compensation;

■ Whether
 the company has chronic restatement history or material financial problems;

■ Whether
 the company's policy substantially addresses the concerns raised by the proponent;

■ Disclosure
 of recoupment of incentive or stock compensation from senior executives or lack thereof;
 and

■ Any
 other relevant factors.

Severance and Golden Parachute Agreements

**General Recommendation:** Vote case-by-case on shareholder proposals requiring that executive severance (including change-in-control related) arrangements or payments be submitted for shareholder ratification.

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Factors that will be considered include, but are not limited to:

■ The
 company's severance or change-in-control agreements in place, and the presence of problematic
 features (such as excessive severance entitlements, single triggers, excise tax gross-ups,
 etc.);

■ Any
 existing limits on cash severance payouts or policies which require shareholder ratification
 of severance payments exceeding a certain level;

■ Any
 recent severance-related controversies; and

■ Whether
 the proposal is overly prescriptive, such as requiring shareholder approval of severance
 that does not exceed market norms.

Share Buyback Impact on Incentive Program Metrics

**General Recommendation:** Vote case-by-case on proposals requesting the company exclude the impact of share buybacks from the calculation of incentive program metrics, considering the following factors:

■ The
 frequency and timing of the company's share buybacks;

■ The
 use of per-share metrics in incentive plans;

■ The
 effect of recent buybacks on incentive metric results and payouts; and

■ Whether
 there is any indication of metric result manipulation.

Supplemental Executive Retirement Plans (SERPs)

**General Recommendation:** Generally vote for shareholder proposals requesting to put extraordinary benefits contained in SERP agreements to a shareholder vote unless the company's executive pension plans do not contain excessive benefits beyond what is offered under employee-wide plans.

Generally vote for shareholder proposals requesting to limit the executive benefits provided under the company'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.

Tax Gross-Up Proposals

**General Recommendation:** Generally vote for proposals calling for companies to adopt a policy of not providing tax gross-up payments to executives, except in situations where gross-ups are provided pursuant to a plan, policy, or arrangement applicable to management employees of the company, such as a relocation or expatriate tax equalization policy.

Termination of Employment Prior to Severance Payment/Eliminating Accelerated Vesting of Unvested Equity

**General Recommendation:** Vote case-by-case on shareholder proposals seeking a policy requiring termination of employment prior to severance payment and/or eliminating accelerated vesting of unvested equity.

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The following factors will be considered:

■ The
 company's current treatment of equity upon employment termination and/or in change-in-control
 situations (i.e., vesting is double triggered and/or pro rata, does it allow for the assumption
 of equity by acquiring company, the treatment of performance shares, etc.); and

■ Current
 employment agreements, including potential poor pay practices such as gross-ups embedded
 in those agreements.

Generally vote for proposals seeking a policy that prohibits automatic acceleration of the vesting of equity awards to senior executives upon a voluntary termination of employment or in the event of a change in control (except for pro rata vesting considering the time elapsed and attainment of any related performance goals between the award date and the change in control).

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**6.** Routine/Miscellaneous

Adjourn Meeting

**General Recommendation:** Generally vote against proposals to provide management with the authority to adjourn an annual or special meeting absent compelling reasons to support the proposal.

Vote for proposals that relate specifically to soliciting votes for a merger or transaction if supporting that merger or transaction. Vote against proposals if the wording is too vague or if the proposal includes "other business."

Amend Quorum Requirements

**General Recommendation:** Vote case-by-case on proposals to reduce quorum requirements for shareholder meetings below a majority of the shares outstanding, taking into consideration:

■ The
 new quorum threshold requested;

■ The
 rationale presented for the reduction;

■ The
 market capitalization of the company (size, inclusion in indices);

■ The
 company's ownership structure;

■ Previous
 voter turnout or attempts to achieve quorum;

■ Any
 provisions or commitments to restore quorum to a majority of shares outstanding, should voter
 turnout improve sufficiently; and

■ Other
 factors as appropriate.

In general, a quorum threshold kept as close to a majority of shares outstanding as is achievable is preferred.

Vote case-by-case on directors who unilaterally lower the quorum requirements below a majority of the shares outstanding, taking into consideration the factors listed above.

Amend Minor Bylaws

**General Recommendation:** Vote for bylaw or charter changes that are of a housekeeping nature (updates or corrections).

Change Company Name

**General Recommendation:** Vote for proposals to change the corporate name unless there is compelling evidence that the change would adversely impact shareholder value.

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Change Date, Time, or Location of Annual Meeting

**General Recommendation:** Vote for management proposals to change the date, time, or location of the annual meeting unless the proposed change is unreasonable.

Vote against shareholder proposals to change the date, time, or location of the annual meeting unless the current scheduling or location is unreasonable.

Other Business

**General Recommendation:** Vote against proposals to approve other business when it appears as a voting item.

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**7.** Social and Environmental Issues

**Global Approach – E&S Shareholder Proposals**

ISS applies a common approach globally to evaluating social and environmental shareholder proposals. which cover a wide range of topics, including consumer and product safety, environment and energy, labor standards and human rights, workplace and board diversity, and corporate political issues. While a variety of factors goes into each analysis, the overall principle guiding all vote recommendations focuses on how the proposal may enhance or protect shareholder value in either the short or long term.

General Recommendation: Generally vote case-by-case, examining primarily whether implementation of the proposal is likely to enhance or protect shareholder value. The following factors will be considered:

■ If
 the issues presented in the proposal are being appropriately or effectively dealt with through
 legislation or regulation;

■ If
 the company has already responded in an appropriate and sufficient manner to the issue(s)
 raised in the proposal;

■ Whether
 the proposal's request is unduly burdensome (scope or timeframe) or overly prescriptive;

■ The
 company's relevant practices compared with any industry standard practices for addressing
 the issue(s) raised by the proposal;

■ Whether
 there are significant controversies, fines, penalties, or litigation associated with the
 company's practices related to the issue(s) raised in the proposal;

■ If
 the proposal requests increased disclosure or greater transparency, whether reasonable and
 sufficient information is currently available to shareholders from the company or from other
 publicly available sources;

■ If
 the proposal requests increased disclosure or greater transparency, whether implementation
 would reveal proprietary or confidential information that could place the company at a competitive
 disadvantage; and

■ Whether
 the proposal addresses substantive matters that may impact shareholders' interests, including
 how the proposal may impact shareholders' rights.

**Endorsement of Principles**

**General Recommendation:** Generally vote against proposals seeking a company's endorsement of principles that support a particular public policy position. Endorsing a set of principles may require a company to take a stand on an issue that is beyond its own control and may limit its flexibility with respect to future developments.

Management and the board should be afforded the flexibility to make decisions on specific public policy positions based on their own assessment of the most beneficial strategies for the company.

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**Animal Welfare**

Animal Welfare Policies

**General Recommendation:** Generally vote for proposals seeking a report on a company's animal welfare standards, or animal welfare-related risks, unless:

■ The
 company has already published a set of animal welfare standards and monitors compliance;

■ The
 company's standards are comparable to industry peers; and

■ There
are no recent significant fines, litigation, or controversies related to the company's and/or its suppliers' treatment of animals.

Animal Testing

**General Recommendation:** Generally vote against proposals to phase out the use of animals in product testing, unless:

■ The
 company is conducting animal testing programs that are unnecessary or not required by regulation;

■ The
 company is conducting animal testing when suitable alternatives are commonly accepted and
 used by industry peers; or

■ There
 are recent, significant fines or litigation related to the company's treatment of animals.

Animal Slaughter

**General Recommendation:** Generally vote against proposals requesting the implementation of Controlled Atmosphere Killing (CAK) methods at company and/or supplier operations unless such methods are required by 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/or supplier operations considering the availability of existing research conducted by the company or industry groups on this topic and any fines or litigation related to current animal processing procedures at the company.

**Consumer Issues**

Genetically Modified Ingredients

**General Recommendation:** Generally vote against proposals requesting that a company voluntarily label genetically engineered (GE) ingredients in its products. The labeling of products with GE ingredients is best left to the appropriate regulatory authorities.

Vote case-by-case on proposals asking for a report on the feasibility of labeling products containing GE ingredients, taking into account:

■ The
 potential impact of such labeling on the company's business;

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■ The
quality of the company's disclosure on GE product labeling, related voluntary initiatives, and how this disclosure compares with
industry peer disclosure; and

■ Company's
 current disclosure on the feasibility of GE product labeling.

Generally vote against proposals seeking a report on the social, health, and environmental effects of genetically modified organisms (GMOs). Studies of this sort are better undertaken by regulators and the scientific community.

Generally vote against proposals to eliminate GE ingredients from the company's products, or proposals asking for reports outlining the steps necessary to eliminate GE ingredients from the company's products. Such decisions are more appropriately made by management with consideration of current regulations.

Reports on Potentially Controversial Business/Financial Practices

**General Recommendation:** Vote case-by-case on requests for reports on a company's potentially controversial business or financial practices or products, taking into account:

■ Whether
 the company has adequately disclosed mechanisms in place to prevent abuses;

■ Whether
 the company has adequately disclosed the financial risks of the products/practices in question;

■ Whether
the company has been subject to violations of related laws or serious controversies; and

■ Peer
companies' policies/practices in this area.

Pharmaceutical Pricing, Access to Medicines, and Prescription Drug Reimportation

**General Recommendation:** Generally vote against proposals requesting that companies implement specific price restraints on pharmaceutical products unless the company fails to adhere to legislative guidelines or industry norms in its product pricing practices.

Vote case-by-case on proposals requesting that a company report on its product pricing or access to medicine policies, considering:

■ The
 potential for reputational, market, and regulatory risk exposure;

■ Existing
 disclosure of relevant policies;

■ Deviation
 from established industry norms;

■ Relevant
 company initiatives to provide research and/or products to disadvantaged consumers;

■ Whether
 the proposal focuses on specific products or geographic regions;

■ The
 potential burden and scope of the requested report; and

■ Recent
 significant controversies, litigation, or fines at the company.

Generally vote for proposals requesting that a company report on the financial and legal impact of its prescription drug reimportation policies unless such information is already publicly disclosed.

Generally vote against proposals requesting that companies adopt specific policies to encourage or constrain prescription drug reimportation. Such matters are more appropriately the province of legislative activity and may place the company at a competitive disadvantage relative to its peers.

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Product Safety and Toxic/Hazardous Materials

**General Recommendation:** Generally vote for proposals requesting that a company report on its policies, initiatives/procedures, and oversight mechanisms related to toxic/hazardous materials or product safety in its supply chain, unless:

■ The
 company already discloses similar information through existing reports such as a supplier
 code of conduct and/or a sustainability report;

■ The
 company has formally committed to the implementation of a toxic/hazardous materials and/or
 product safety and supply chain reporting and monitoring program based on industry norms
 or similar standards within a specified time frame; or

■ The
 company has not been recently involved in relevant significant controversies, fines, or litigation.

Vote case-by-case on resolutions requesting that companies develop a feasibility assessment to phase-out of certain toxic/hazardous materials, or evaluate and disclose the potential financial and legal risks associated with utilizing certain materials, considering:

■ The
company's current level of disclosure regarding its product safety policies, initiatives, and oversight mechanisms;

■ Current
 regulations in the markets in which the company operates; and

■ Recent
 significant controversies, litigation, or fines stemming from toxic/hazardous materials at
 the company.

Generally vote against resolutions requiring that a company reformulate its products.

Tobacco-Related Proposals

**General Recommendation:** Vote case-by-case on resolutions regarding the advertisement of tobacco products, considering:

■ Recent
 related fines, controversies, or significant litigation;

■ Whether
 the company complies with relevant laws and regulations on the marketing of tobacco;

■ Whether
 the company's advertising restrictions deviate from those of industry peers;

■ Whether
 the company entered into the Master Settlement Agreement, which restricts marketing of tobacco
 to youth; and

■ Whether
 restrictions on marketing to youth extend to foreign countries.

Vote case-by-case on proposals regarding second-hand smoke, considering;

■ Whether
 the company complies with all laws and regulations;

■ The
degree that voluntary restrictions beyond those mandated by law might hurt the company's competitiveness; and

■ The
 risk of any health-related liabilities.

Generally vote against resolutions to cease production of tobacco-related products, to avoid selling products to 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.

Generally vote against proposals regarding tobacco product warnings. Such decisions are better left to public health authorities.

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**Climate Change**

Say on Climate (SoC) Management Proposals

**General Recommendation:** Vote case-by-case on management proposals that request shareholders to approve

the company's climate transition action plan**<sup>21</sup>**, taking into account the completeness and rigor of the plan. Information that will be considered where available includes the following:

■ The
extent to which the company's climate related disclosures are in line with TCFD recommendations and meet other market standards;

■ Disclosure
 of its operational and supply chain GHG emissions (Scopes 1, 2, and 3);

■ The
 completeness and rigor of company's short-, medium-, and long-term targets for reducing
 operational and supply chain GHG emissions (Scopes 1, 2, and 3 if relevant);

■ Whether
 the company has sought and received third-party approval that its targets are science-based;

■ Whether
the company has made a commitment to be "net zero" for operational and supply chain emissions (Scopes 1, 2, and 3) by 2050;

■ Whether
 the company discloses a commitment to report on the implementation of its plan in subsequent
 years;

■ Whether
 the company's climate data has received third-party assurance;

■ Disclosure
 of how the company's lobbying activities and its capital expenditures align with company
 strategy;

■ Whether
 there are specific industry decarbonization challenges; and

■ The
 company's related commitment, disclosure, and performance compared to its industry
 peers.

Say on Climate (SoC) Shareholder Proposals

**General Recommendation:** Vote case-by-case on shareholder proposals that request the company to disclose a report providing its GHG emissions levels and reduction targets and/or its upcoming/approved climate transition 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:

■ The
 completeness and rigor of the company's climate-related disclosure;

■ The
 company's actual GHG emissions performance;

■ Whether
 the company has been the subject of recent, significant violations, fines, litigation, or
 controversy related to its GHG emissions; and

■ Whether
 the proposal's request is unduly burdensome (scope or timeframe) or overly prescriptive.

Climate Change/Greenhouse Gas (GHG) Emissions

**General Recommendation:** Vote case-by-case on resolutions requesting that a company disclose information on the climate change related financial, physical, or regulatory risks it faces to its operations and investments or on how the company identifies, measures, and manages such risks, considering:

**<sup>21</sup>** Variations of this request also include climate transition related ambitions, or commitment to reporting on the implementation of a climate plan.

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■ Whether
the company provides current, publicly-available information on the climate change-related financial, physical, or regulatory risks it
faces to its operations and investments or on the impact that climate change may have on the company;

■ Associated
 company policies and practices addressing climate change related risks and/or opportunities;

■ The
 company's level of disclosure compared to industry peers; and

■ Whether
 there are significant controversies, fines, penalties, or litigation associated with the
 company's climate change-related performance.

Vote case-by-case on proposals requesting that a company report on its greenhouse gas (GHG) emissions from company operations and/or products and operations, considering:

■ Whether
 the company discloses current, publicly-available information on the impacts that GHG emissions
 may have on the company as well as associated company policies and procedures to address
 related risks and/or opportunities;

■ Whether
 the company's level of disclosure is comparable to that of industry peers; or

■ Whether
 there are significant, controversies, fines, penalties, or litigation associated with the
 company's GHG emissions.

Vote case-by-case on proposals that call for the adoption of GHG reduction goals from products and operations, considering:

■ The
 company's actual GHG emissions performance;

■ The
 company's current GHG emission policies, oversight mechanisms, and related initiatives;

■ Whether
 the company provides disclosure of year-over-year GHG emissions performance data;

■ Whether
 company disclosure lags behind industry peers; and

■ Whether
 the company has been the subject of recent, significant violations, fines, litigation, or
 controversy related to GHG emissions.

Energy Efficiency

**General Recommendation:** Generally vote for proposals requesting that a company report on its energy efficiency policies, unless:

■ The
 company complies with applicable energy efficiency regulations and laws, and discloses its
 participation in energy efficiency policies and programs, including disclosure of benchmark
 data, targets, and performance measures; or

■ The
 proponent requests adoption of specific energy efficiency goals within specific timelines.

Renewable Energy

**General Recommendation:** Generally vote for requests for reports on the feasibility of developing renewable energy resources unless the report would be duplicative of existing disclosure or irrelevant to the company's line of business.

Generally vote against proposals requesting that the company invest in renewable energy resources. Such decisions are best left to management's evaluation of the feasibility and financial impact that such programs may have on the company.

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Generally vote against proposals that call for the adoption of renewable energy goals, taking into account:

■ The
 scope and structure of the proposal;

■ The
 company's current level of disclosure on renewable energy use and GHG emissions; and

■ The
 company's disclosure of policies, practices, and oversight implemented to manage GHG emissions
 and mitigate climate change risks.

**Diversity**

Board Diversity

**General Recommendation:** Generally vote for requests for reports on a company's efforts to diversify the board, unless:

■ The
gender and racial minority representation of the company's board is reasonably inclusive in relation to companies of similar size
and business; or

■ The
 board already reports on its nominating procedures and gender and racial minority initiatives
 on the board and within the company.

Vote case-by-case on proposals asking a company to increase the gender and racial minority representation on its board, taking into account:

■ The
degree of existing gender and racial minority diversity on the company's board and among its executive officers;

■ The
 level of gender and racial minority representation that exists at the company's industry
 peers;

■ The
 company's established process for addressing gender and racial minority board representation;

■ Whether
 the proposal includes an overly prescriptive request to amend nominating committee charter
 language;

■ The
 independence of the company's nominating committee;

■ Whether
 the company uses an outside search firm to identify potential director nominees; and

■ Whether
 the company has had recent controversies, fines, or litigation regarding equal employment
 practices.

Equality of Opportunity

**General Recommendation:** Generally vote case-by-case on proposals requesting a company disclose its diversity policies or initiatives, or proposals requesting disclosure of a company's comprehensive workforce diversity data, including requests for EEO-1 data. Factors that will be considered are:

■ Whether
 the company publicly discloses equal employment opportunity policies and initiatives;

■ Whether
 the company publicly discloses comprehensive workforce diversity data/EEO-1 report; or

■ Whether
 the company has recent significant workplace discrimination/fair employment violations or
 litigation.

Generally vote against proposals seeking information on the diversity efforts of suppliers and service providers. Such requests may pose a significant burden on the company.

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Gender Identity, Sexual Orientation, and Domestic Partner Benefits

**General Recommendation:** Generally vote for proposals seeking to amend a company's EEO statement or diversity policies to prohibit discrimination based on sexual orientation and/or gender identity, unless the change would be unduly burdensome.

Generally vote against proposals to extend company benefits to, or eliminate benefits from, domestic partners. Decisions regarding benefits should be left to the discretion of the company.

Gender, Race/Ethnicity Pay Gap

**General Recommendation:** Vote case-by-case on requests for reports on a company's pay data by gender or race/ ethnicity, or a report on a company's policies and goals to reduce any gender or race/ethnicity pay gaps, taking into account:

■ The
 company's current policies and disclosure related to both its diversity and inclusion policies
 and practices and its compensation philosophy on fair and equitable compensation practices;

■ Whether
 the company has been the subject of recent controversy, litigation, or regulatory actions
 related to gender, race, or ethnicity pay gap issues;

■ The
company's disclosure regarding gender, race, or ethnicity pay gap policies or initiatives compared to its industry peers; and

■ Local
 laws regarding categorization of race and/or ethnicity and definitions of ethnic and/or racial
 minorities.

Racial Equity and/or Civil Rights Audit Guidelines

**General Recommendation:** Vote case-by-case on proposals asking a company to conduct an independent racial equity and/or civil rights audit, taking into account:

■ The
 company's established process or framework for addressing racial inequity and discrimination
 internally;

■ Whether
 the company adequately discloses workforce diversity and inclusion metrics and goals;

■ Whether
 the company has issued a public statement related to its racial justice efforts in recent
 years, or has committed to internal policy review;

■ Whether
 the company has engaged with impacted communities, stakeholders, and civil rights experts;

■ The
 company's track record in recent years of racial justice measures and outreach externally;
 and

■ Whether
 the company has been the subject of recent controversy, litigation, or regulatory actions
 related to racial inequity or discrimination.

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**Environment and Sustainability**

Facility and Workplace Safety

**General Recommendation:** Vote case-by-case on requests for workplace safety reports, including reports on accident risk reduction efforts, taking into account:

■ The
company's current level of disclosure of its workplace health and safety performance data, health and safety management policies,
initiatives, and oversight mechanisms;

■ The
nature of the company's business, specifically regarding company and employee exposure to health and safety risks;

■ Recent
 significant controversies, fines, or violations related to workplace health and safety; and

■ The
 company's workplace health and safety performance relative to industry peers.

Vote case-by-case on resolutions requesting that a company report on safety and/or security risks associated with its operations and/or facilities, considering:

■ The
 company's compliance with applicable regulations and guidelines;

■ The
company's current level of disclosure regarding its security and safety policies, procedures, and compliance monitoring; and

■ The
existence of recent, significant violations, fines, or controversy regarding the safety and security of the company's operations
and/or facilities.

Natural Capital- Related and/or Community Impact Assessment Proposals

**General Recommendation:** Vote case-by-case on requests for reports on policies and/or the potential (community) social and/or environmental impact of company operations, considering:

■ Alignment
 of current disclosure of applicable company policies, metrics, risk assessment report(s)
 and risk management procedures with any relevant, broadly accepted reporting frameworks;

■ The
 impact of regulatory non-compliance, litigation, remediation, or reputational loss that may
 be associated with failure to manage the company's operations in question, including
 the management of relevant community and stakeholder relations;

■ The
 nature, purpose, and scope of the company's operations in the specific region(s);

■ The
 degree to which company policies and procedures are consistent with industry norms; and

■ The
 scope of the resolution.

Hydraulic Fracturing

**General Recommendation:** Generally vote for proposals requesting greater disclosure of a company's (natural gas) hydraulic fracturing operations, including measures the company has taken to manage and mitigate the potential community and environmental impacts of those operations, considering:

■ The
 company's current level of disclosure of relevant policies and oversight mechanisms;

■ The
 company's current level of such disclosure relative to its industry peers;

■ Potential
 relevant local, state, or national regulatory developments; and

■ Controversies,
 fines, or litigation related to the company's hydraulic fracturing operations.

Operations in Protected Areas

**General Recommendation:** Generally vote for requests for reports on potential environmental damage as a result of company operations in protected regions, unless:

■ Operations
 in the specified regions are not permitted by current laws or regulations;

■ The
 company does not currently have operations or plans to develop operations in these protected
 regions; or

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■ The
company's disclosure of its operations and environmental policies in these regions is comparable to industry peers.

Recycling

**General Recommendation:** Vote case-by-case on proposals to report on an existing recycling program, or adopt a new recycling program, taking into account:

■ The
 nature of the company's business;

■ The
 current level of disclosure of the company's existing related programs;

■ The
 timetable and methods of program implementation prescribed by the proposal;

■ The
 company's ability to address the issues raised in the proposal; and

■ How
 the company's recycling programs compare to similar programs of its industry peers.

Sustainability Reporting

**General Recommendation:** Generally vote for proposals requesting that a company report on its policies, initiatives, and oversight mechanisms related to social, economic, and environmental sustainability, unless:

■ The
 company already discloses similar information through existing reports or policies such as
 an environment, health, and safety (EHS) report; a comprehensive code of corporate conduct;
 and/or a diversity report; or

■ The
 company has formally committed to the implementation of a reporting program based on Global
 Reporting Initiative (GRI) guidelines or a similar standard within a specified time frame.

Water Issues

**General Recommendation:** Vote case-by-case on proposals requesting a company report on, or adopt a new policy on, water-related risks and concerns, taking into account:

■ The
 company's current disclosure of relevant policies, initiatives, oversight mechanisms, and
 water usage metrics;

■ Whether
 or not the company's existing water-related policies and practices are consistent with relevant
 internationally recognized standards and national/local regulations;

■ The
 potential financial impact or risk to the company associated with water-related concerns
 or issues; and

■ Recent,
 significant company controversies, fines, or litigation regarding water use by the company
 and its suppliers.

**General Corporate Issues**

Charitable Contributions

**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

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community. In the absence of bad faith, self-dealing, or gross negligence, management should determine which, and if, contributions are in the best interests of the company.

Data Security, Privacy, and Internet Issues

**General Recommendation:** Vote case-by-case on proposals requesting the disclosure or implementation of data security, privacy, or information access and management policies and procedures, considering:

■ The
 level of disclosure of company policies and procedures relating to data security, privacy,
 freedom of speech, information access and management, and Internet censorship;

■ Engagement
 in dialogue with governments or relevant groups with respect to data security, privacy, or
 the free flow of information on the Internet;

■ The
 scope of business involvement and of investment in countries whose governments censor or
 monitor the Internet and other telecommunications;

■ Applicable
 market-specific laws or regulations that may be imposed on the company; and

■ Controversies,
 fines, or litigation related to data security, privacy, freedom of speech, or Internet censorship.

ESG Compensation-Related Proposals

**General Recommendation:** Vote case-by-case on proposals seeking a report or additional disclosure on the company's approach, policies, and practices on incorporating environmental and social criteria into its executive compensation strategy, considering:

■ The
 scope and prescriptive nature of the proposal;

■ The
 company's current level of disclosure regarding its environmental and social performance
 and governance;

■ The
 degree to which the board or compensation committee already discloses information on whether
 it has considered related E&S criteria; and

■ Whether
 the company has significant controversies or regulatory violations regarding social or environmental
 issues.

**Human Rights, Human Capital Management, and International Operations**

Human Rights Proposals

**General Recommendation:** Vote case-by-case on proposals requesting a report on company or company supplier labor and/or human rights standards and policies, taking into consideration:

■ Whether
 such information is publicly disclosed;

■ Whether
 the company is lagging industry peers; and

■ Whether
 there are recent, significant company controversies, fines, or litigation regarding human
 rights at the company or its suppliers.

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Vote case-by-case on proposals to implement company or company supplier labor and/or human rights standards and policies, considering:

■ The
 scope of the request;

■ The
 degree to which existing relevant policies and practices are disclosed;

■ Whether
 or not existing relevant policies are consistent with internationally recognized standards;

■ Deviation
 from industry sector peer company standards and practices;

■ Whether
 company facilities and those of its suppliers are monitored and how;

■ Company
 participation in fair labor organizations or other internationally recognized human rights
 initiatives;

■ Scope
 and nature of business conducted in markets known to have higher risk of workplace labor/human
 rights abuse; and

■ Recent,
 significant company controversies, fines, or litigation regarding human rights at the company
 or its suppliers.

Vote case-by-case on proposals requesting that a company conduct an assessment of the human rights risks in its operations or in its supply chain, or report on its human rights risk assessment process, considering:

■ The
degree to which existing relevant policies and practices are disclosed, including information on the implementation of these policies
and any related oversight mechanisms;

■ The
company's industry and whether the company or its suppliers operate in countries or areas where there is a history of human rights
concerns;

■ Recent
 significant controversies, fines, or litigation regarding human rights involving the company
 or its suppliers, and whether the company has taken remedial steps; and

■ Whether
 the proposal is unduly burdensome or overly prescriptive.

Mandatory Arbitration

**General Recommendation:** Vote case-by-case on requests for a report on a company's use of mandatory

arbitration on employment-related claims, taking into account:

■ The
 company's current policies and practices related to the use of mandatory arbitration agreements
 on workplace claims;

■ Whether
 the company has been the subject of recent controversy, litigation, or regulatory actions
 related to the use of mandatory arbitration agreements on workplace claims; and

■ The
 company's disclosure of its policies and practices related to the use of mandatory arbitration
 agreements compared to its peers.

Operations in High-Risk Markets

**General Recommendation:** Vote case-by-case on requests for a report on a company's potential financial and reputational risks associated with operations in "high-risk" markets, such as a terrorism-sponsoring state or politically/socially unstable region, taking into account:

■ The
 nature, purpose, and scope of the operations and business involved that could be affected
 by social or political disruption;

■ Current
 disclosure of applicable risk assessment(s) and risk management procedures;

■ Compliance
with U.S. sanctions and laws;

■ Consideration
 of other international policies, standards, and laws; and

■ Whether
 the company has been recently involved in recent, significant controversies, fines, or litigation
 related to its operations in "high-risk" markets.

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Outsourcing/Offshoring

**General Recommendation:** Vote case-by-case on proposals calling for companies to report on the risks associated with outsourcing/plant closures, considering:

■ Controversies
 surrounding operations in the relevant market(s);

■ The
 value of the requested report to shareholders;

■ The
company's current level of disclosure of relevant information on outsourcing and plant closure procedures; and

■ The
 company's existing human rights standards relative to industry peers.

Sexual Harassment

**General Recommendation:** Vote case-by-case on requests for a report on company actions taken to strengthen policies and oversight to prevent workplace sexual harassment, or a report on risks posed by a company's failure to prevent workplace sexual harassment, taking into account:

■ The
 company's current policies, practices, oversight mechanisms related to preventing workplace
 sexual harassment;

■ Whether
 the company has been the subject of recent controversy, litigation, or regulatory actions
 related to workplace sexual harassment issues; and

■ The
 company's disclosure regarding workplace sexual harassment policies or initiatives compared
 to its industry peers.

Weapons and Military Sales

**General Recommendation:** Vote against reports on foreign military sales or offsets. Such disclosures may involve sensitive and confidential information. Moreover, companies must comply with government controls and reporting on foreign military sales.

Generally vote against proposals asking a company to cease production or report on the risks associated with the use of depleted uranium munitions or nuclear weapons components and delivery systems, including disengaging 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.

**Political Activities**

Lobbying

**General Recommendation:** Vote case-by-case on proposals requesting information on a company's lobbying

(including direct, indirect, and grassroots lobbying) activities, policies, or procedures, considering:

■ The
company's current disclosure of relevant lobbying policies, and management and board oversight;

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■ The
company's disclosure regarding trade associations or other groups that it supports, or is a member of, that engage in lobbying
activities; and

■ Recent
 significant controversies, fines, or litigation regarding the company's lobbying-related
 activities.

Political Contributions

**General Recommendation:** Vote case-by-case on proposals requesting greater disclosure of a company's political contributions and trade association spending policies and activities, considering:

■ The
 company's policies, and management and board oversight related to its direct political contributions
 and payments to trade associations or other groups that may be used for political purposes;

■ The
 company's disclosure regarding its support of, and participation in, trade associations or
 other groups that may make political contributions;

■ The
 company's disclosure of its direct corporate political contributions; and

■ Recent
 significant controversies, fines, or litigation related to the company's political contributions
 or political activities.

Vote against proposals barring a company from making political contributions. Businesses are affected by legislation at the federal, state, and local level; barring political contributions can put the company at a competitive disadvantage.

Vote against proposals to publish in newspapers and other media a company's political contributions. Such publications could present significant cost to the company without providing commensurate value to shareholders.

Political Expenditures and Lobbying Congruency

**General Recommendation:** Generally vote case-by-case on proposals requesting greater disclosure of a company's alignment of political contributions, lobbying, and electioneering spending with a company's publicly stated values and policies, considering:

■ The
company's policies, management, board oversight, governance processes, and level of disclosure related to direct political contributions,
lobbying activities, and payments to trade associations, political action committees, or other groups that may be used for political
purposes;

■ The
 company's disclosure regarding: the reasons for its support of candidates for public
 offices; the reasons for support of and participation in trade associations or other groups
 that may make political contributions; and other political activities;

■ Any
incongruencies identified between a company's direct and indirect political expenditures and its publicly stated values and priorities;
and

■ Recent
significant controversies related to the company's direct and indirect lobbying, political contributions, or political activities.

Generally vote case-by-case on proposals requesting comparison of a company's political spending to objectives

that can mitigate material risks for the company, such as limiting global warming.

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Political Ties

**General Recommendation:** Generally vote against proposals asking a company to affirm political nonpartisanship in the workplace, so long as:

■ There
are no recent, significant controversies, fines, or litigation regarding the company's political contributions or trade association
spending; and

■ The
 company has procedures in place to ensure that employee contributions to company-sponsored
 political 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 investment bankers that have prior government service and whether such service had a bearing on the business of the company. Such a list would be burdensome to prepare without providing any meaningful information to shareholders.

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**8.** Mutual Fund Proxies

Election of Directors

**General Recommendation:** Vote case-by-case on the election of directors and trustees, following the same guidelines for uncontested directors for public company shareholder meetings. However, mutual fund boards do not usually have compensation committees, so do not withhold for the lack of this committee.

Closed End Funds- Unilateral Opt-In to Control Share Acquisition Statutes

**General Recommendation:** For closed-end management investment companies (CEFs), vote against or withhold from nominating/governance committee members (or other directors on a case-by-case basis) at CEFs that have not provided a compelling rationale for opting-in to a Control Share Acquisition statute, nor submitted a by-law amendment to a shareholder vote.

Converting Closed-end Fund to Open-end Fund

**General Recommendation:** Vote case-by-case on conversion proposals, considering the following factors:

■ Past
 performance as a closed-end fund;

■ Market
 in which the fund invests;

■ Measures
 taken by the board to address the discount; and

■ Past
 shareholder activism, board activity, and votes on related proposals.

Proxy Contests

**General Recommendation:** Vote case-by-case on proxy contests, considering the following factors:

■ Past
 performance relative to its peers;

■ Market
 in which the fund invests;

■ Measures
 taken by the board to address the issues;

■ Past
 shareholder activism, board activity, and votes on related proposals;

■ Strategy
 of the incumbents versus the dissidents;

■ Independence
 of directors;

■ Experience
 and skills of director candidates;

■ Governance
 profile of the company; and

■ Evidence
 of management entrenchment.

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Investment Advisory Agreements

**General Recommendation:** Vote case-by-case on investment advisory agreements, considering the following factors:

■ Proposed
 and current fee schedules;

■ Fund
 category/investment objective;

■ Performance
 benchmarks;

■ Share
 price performance as compared with peers;

■ Resulting
 fees relative to peers; and

■ Assignments
 (where the advisor undergoes a change of control).

Approving New Classes or Series of Shares

**General Recommendation:** Vote for the establishment of new classes or series of shares.

Preferred Stock Proposals

**General Recommendation:** Vote case-by-case on the authorization for or increase in preferred shares, considering the following factors:

■ Stated
 specific financing purpose;

■ Possible
 dilution for common shares; and

■ Whether
 the shares can be used for antitakeover purposes.

1940 Act Policies

**General Recommendation:** Vote case-by-case on policies under the Investment Advisor Act of 1940, considering the following factors:

■ Potential
 competitiveness;

■ Regulatory
 developments;

■ Current
 and potential returns; and

■ Current
 and potential risk.

Generally vote for these amendments as long as the proposed changes do not fundamentally alter the investment focus of the fund and do comply with the current SEC interpretation.

Changing a Fundamental Restriction to a Nonfundamental Restriction

**General Recommendation:** Vote case-by-case on proposals to change a fundamental restriction to a non-fundamental restriction, considering the following factors:

■ The
 fund's target investments;

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■ The
 reasons given by the fund for the change; and

■ The
 projected impact of the change on the portfolio.

Change Fundamental Investment Objective to Nonfundamental

**General Recommendation:** Vote against proposals to change a fund's fundamental investment objective to non-fundamental.

Name Change Proposals

**General Recommendation:** Vote case-by-case on name change proposals, considering the following factors:

■ Political/economic
 changes in the target market;

■ Consolidation
 in the target market; and

■ Current
 asset composition.

Change in Fund's Subclassification

**General Recommendation:** Vote case-by-case on changes in a fund's sub-classification, considering the following factors:

■ Potential
 competitiveness;

■ Current
 and potential returns;

■ Risk
 of concentration; and

■ Consolidation
 in target industry.

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

**General Recommendation:** Vote for proposals authorizing the board to issue shares below Net Asset Value (NAV) if:

■ The
 proposal to allow share issuances below NAV has an expiration date no more than one year
 from the date shareholders approve the underlying proposal, as required under the Investment
 Company Act of 1940;

■ The
 sale is deemed to be in the best interests of shareholders by (1) a majority of the company's
 independent directors and (2) a majority of the company's directors who have no financial
 interest in the issuance; and

■ The
 company has demonstrated responsible past use of share issuances by either:

■ Outperforming
 peers in its 8-digit GICS group as measured by one- and three-year median TSRs; or

■ Providing
 disclosure that its past share issuances were priced at levels that resulted in only small
 or moderate discounts to NAV and economic dilution to existing non-participating shareholders.

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Disposition of Assets/Termination/Liquidation

**General Recommendation:** Vote case-by-case on proposals to dispose of assets, to terminate or liquidate, considering the following factors:

■ Strategies
 employed to salvage the company;

■ The
 fund's past performance; and

■ The
 terms of the liquidation.

Changes to the Charter Document

**General Recommendation:** Vote case-by-case on changes to the charter document, considering the following factors:

■ The
 degree of change implied by the proposal;

■ The
 efficiencies that could result;

■ The
 state of incorporation; and

■ Regulatory
 standards and implications.

Vote against any of the following changes:

■ Removal
 of shareholder approval requirement to reorganize or terminate the trust or any of its series;

■ Removal
 of shareholder approval requirement for amendments to the new declaration of trust;

■ Removal
 of shareholder approval requirement to amend the fund's management contract, allowing the
 contract to be modified by the investment manager and the trust management, as permitted
 by the 1940 Act;

■ Allow
 the trustees to impose other fees in addition to sales charges on investment in a fund, such
 as deferred sales charges and redemption fees that may be imposed upon redemption of a fund's
 shares;

■ Removal
 of shareholder approval requirement to engage in and terminate subadvisory arrangements;
 or

■ Removal
 of shareholder approval requirement to change the domicile of the fund.

Changing the Domicile of a Fund

**General Recommendation:** Vote case-by-case on re-incorporations, considering the following factors:

■ Regulations
 of both states;

■ Required
 fundamental policies of both states; and

■ The
 increased flexibility available.

Authorizing the Board to Hire and Terminate Subadvisers Without Shareholder Approval

**General Recommendation:** Vote against proposals authorizing the board to hire or terminate subadvisers without shareholder approval if the investment adviser currently employs only one subadviser.

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Distribution Agreements

**General Recommendation:** Vote case-by-case on distribution agreement proposals, considering the following factors:

■ Fees
 charged to comparably sized funds with similar objectives;

■ The
 proposed distributor's reputation and past performance;

■ The
 competitiveness of the fund in the industry; and

■ The
 terms of the agreement.

Master-Feeder Structure

**General Recommendation:** Vote for the establishment of a master-feeder structure.

Mergers

**General Recommendation:** Vote case-by-case on merger proposals, considering the following factors:

■ Resulting
 fee structure;

■ Performance
 of both funds;

■ Continuity
 of management personnel; and

■ Changes
 in corporate governance and their impact on shareholder rights.

**Shareholder Proposals for Mutual Funds**

Establish Director Ownership Requirement

**General Recommendation:** Generally vote against shareholder proposals that mandate a specific minimum amount of stock that directors must own in order to qualify as a director or to remain on the board.

Reimburse Shareholder for Expenses Incurred

**General Recommendation:** Vote case-by-case on shareholder proposals to reimburse proxy solicitation expenses. When supporting the dissidents, vote for the reimbursement of the proxy solicitation expenses.

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Terminate the Investment Advisor

**General Recommendation:** Vote case-by-case on proposals to terminate the investment advisor, considering the following factors:

■ Performance
 of the fund's Net Asset Value (NAV);

■ The
 fund's history of shareholder relations; and

■ The
 performance of other funds under the advisor's management.

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We empower investors and companies to build

for long-term and sustainable growth by providing

high-quality data, analytics, and insight.

**G E T S T A R T E D W I T H I S S S O L U T I O N S**

Email sales@issgovernance.com or visit www.issgovernance.com for more information.

Founded in 1985, Institutional Shareholder Services group of companies (ISS) empowers investors and companies to build for long-term and sustainable growth by providing high-quality data, analytics and insight. ISS, which is majority owned by Deutsche Bourse Group, along with Genstar Capital and ISS management, is a leading provider of corporate governance and responsible investment solutions, market intelligence, fund services, and events and 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 institutional investors who rely on ISS' objective and impartial offerings, as well as public companies focused on ESG and governance risk mitigation as a shareholder value enhancing measure. Clients rely on ISS' expertise to help them make informed investment decisions. This document and all of the information contained in it, 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.

The Information has not been submitted to, nor received approval from, the United States Securities and Exchange Commission or any other regulatory body. None of the Information constitutes an offer to sell (or a solicitation of an offer to buy), or a promotion or recommendation of, any security, financial product or other investment vehicle or any trading strategy, and ISS does not endorse, approve, or otherwise express any opinion regarding any issuer, securities, financial products or instruments or trading strategies.

The user of the Information assumes the entire risk of any use it may make or permit to be made of the Information.

ISS MAKES NO EXPRESS OR IMPLIED WARRANTIES OR REPRESENTATIONS WITH RESPECT TO THE INFORMATION AND EXPRESSLY DISCLAIMS ALL IMPLIED WARRANTIES (INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF ORIGINALITY, ACCURACY, TIMELINESS, NON-INFRINGEMENT, COMPLETENESS, MERCHANTABILITY, AND FITNESS for A PARTICULAR PURPOSE) WITH RESPECT TO ANY OF THE INFORMATION.

Without limiting any of the foregoing and to the maximum extent permitted by law, in no event shall ISS have any liability regarding any of the Information for any direct, indirect, special, punitive, consequential (including lost profits), or any other damages even if notified of the possibility of such damages. The foregoing shall not exclude or limit any liability that may not by applicable law be excluded or limited.© 2025 \| Institutional Shareholder Services and/or its affiliates

**PART C: OTHER INFORMATION**

**Item 28.** **Exhibits**

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| (a)(1) | [Certificate of Trust of Huntington Strategy Shares (now known as Strategy Shares) (the "Trust" or the "Registrant") – Incorporated](http://www.sec.gov/Archives/edgar/data/1506213/000150621310000011/ex99a1.htm) [herein by reference to Registrant's Initial Registration Statement on Form N-1A filed on November 22, 2010.](http://www.sec.gov/Archives/edgar/data/1506213/000150621310000011/ex99a1.htm) |

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| (a)(2) | [Registrant's Agreement and Declaration of Trust – Incorporated herein by reference to Registrant's Initial Registration Statement on](http://www.sec.gov/Archives/edgar/data/1506213/000150621310000011/ex99a2.htm) [Form N-1A filed on November 22, 2010.](http://www.sec.gov/Archives/edgar/data/1506213/000150621310000011/ex99a2.htm) |

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| (a)(3) | [Certificate of Amendment to Certificate of Trust - Incorporated herein by reference to Registrant's Post-Effective Amendment No. 8](http://www.sec.gov/Archives/edgar/data/1506213/000158064216009259/exa3.htm) [filed on June 8, 2016.](http://www.sec.gov/Archives/edgar/data/1506213/000158064216009259/exa3.htm) |

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(b) [Registrant's By-Laws – Incorporated herein by reference to Registrant's Initial Registration Statement on Form N-1A filed on November](https://www.sec.gov/Archives/edgar/data/1506213/000150621310000011/ex99b.htm) [22, 2010.](https://www.sec.gov/Archives/edgar/data/1506213/000150621310000011/ex99b.htm)

(c) Instruments Defining Rights of Security Holders:

None (other than in the Declaration of Trust and By-laws of the Registrant).

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| (d)(1) | [Management Agreement between Registrant and Rational Advisors, Inc. dated January 1, 2016 - Incorporated herein by reference to](http://www.sec.gov/Archives/edgar/data/1506213/000158064216009259/exd3.htm) [Registrant's Post-Effective Amendment No. 8 filed on June 8, 2016.](http://www.sec.gov/Archives/edgar/data/1506213/000158064216009259/exd3.htm) |

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| (d)(2) | [Exhibit A to Management Agreement between Registrant and Rational Advisors, Inc. dated December 10, 2021 - Incorporated herein by reference to Registrant's Post-Effective Amendment No. 91 filed on December 13, 2021.](https://www.sec.gov/Archives/edgar/data/1506213/000158064221005831/ex99_d8.htm) |

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| (d)(3) | [Management Agreement between Registrant and Day Hagan Asset Management dated January 9, 2020 – Incorporated herein by reference to Registrant's Post-](http://www.sec.gov/Archives/edgar/data/1506213/000158064220000176/ex99d3.htm) [Effective Amendment No. 63 filed on January 10, 2020.](http://www.sec.gov/Archives/edgar/data/1506213/000158064220000176/ex99d3.htm) |

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|:---|:---|
| (d)(4) | [Exhibit to Management Agreement between Registrant and Day Hagan Asset Management dated February 7, 2025 – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 140 filed on February 12, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225000965/ex-d4.htm) |

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|:---|:---|
| (d)(5) | [Management Agreement dated February 19, 2021, between Registrant and Rational Advisors, Inc. - Incorporated herein by reference to](https://www.sec.gov/Archives/edgar/data/1506213/000158064221000751/ex99_d4.htm) [Registrant's Post-Effective Amendment No. 76 filed on February 19, 2021.](https://www.sec.gov/Archives/edgar/data/1506213/000158064221000751/ex99_d4.htm) |

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| (d)(6) | [Exhibit to Management Agreement between Registrant and Rational Advisors, Inc. effective May 17, 2021 - Incorporated herein by](https://www.sec.gov/Archives/edgar/data/1506213/000158064225003099/ex-99d6.htm) [reference to Registrant's Post-Effective Amendment No. 142 filed on May 13, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225003099/ex-99d6.htm) |

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| (d)(7) | [Sub-Advisory Agreement between Rational Advisors, Inc. and Rareview Capital LLC dated May 9, 2025, relating to the Monopoly ETF – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 142 filed on May 13, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225003099/ex-99d7.htm) |

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|:---|:---|
| (d)(8) | [Investment Advisory Agreement dated August 23, 2024, between Registrant and Eventide Asset Management, LLC – Incorporated herein](https://www.sec.gov/Archives/edgar/data/1506213/000158064224004843/ex99d6.htm) [by reference to Registrant's Post-Effective Amendment No. 127 filed on August 26, 2024.](https://www.sec.gov/Archives/edgar/data/1506213/000158064224004843/ex99d6.htm) |

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|:---|:---|
| (d)(9) | [Exhibit 1 to Investment Advisory Agreement between Registrant and Eventide Asset Management, LLC dated December 12, 2024. – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 135 filed on December 13, 2024.](https://www.sec.gov/Archives/edgar/data/1506213/000158064224007559/ex99d7.htm)<br>|

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|:---|:---|
| (d)(10) | [Exhibit 1 to Investment Advisory Agreement between Registrant and Eventide Asset Management, LLC dated September 16, 2025 – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 146 filed on September 19, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225006146/ex99d10.htm) |

---

---

| | |
|:---|:---|
| (d)(11) | [Amendment to Management Agreement dated January 1, 2016, between Registrant and Rational Advisors, Inc. dated March 25, 2025 – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 145 filed on August 27, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225005537/ex99d11.htm)<br>|
| (d)(12) | [Amendment to Management Agreement dated January 9, 2020, between Registrant and Day Hagan Asset Management dated March 25, 2025 – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 145 filed on August 27, 2025](https://www.sec.gov/Archives/edgar/data/1506213/000158064225005537/ex99d12.htm).<br>|
| (d)(13) | [Amendment to Management Agreement dated February 19, 2021, between Registrant and Rational Advisors, Inc. dated March 25, 2025 – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 145 filed on August 27, 2025](https://www.sec.gov/Archives/edgar/data/1506213/000158064225005537/ex99d13.htm).<br>|
| (e)(1) | [ETF Distribution Agreement between Registrant and Foreside Fund Services, LLC dated May 1, 2016 - Incorporated herein by reference](http://www.sec.gov/Archives/edgar/data/1506213/000158064216009259/exe4.htm) [to Registrant's Post-Effective Amendment No. 8 filed on June 8, 2016.](http://www.sec.gov/Archives/edgar/data/1506213/000158064216009259/exe4.htm) |
| (e)(2) | [Novation of ETF Distribution Agreement between the Registrant and Foreside Fund Services, LLC, effective as of September 30, 2021 -](http://www.sec.gov/Archives/edgar/data/1506213/000158064221006059/ex99e_2.htm) [Incorporated herein by reference to Registrant's Post-Effective Amendment No. 95 filed on December 28, 2021.](http://www.sec.gov/Archives/edgar/data/1506213/000158064221006059/ex99e_2.htm) |
| (e)(3) | [First Amendment to ETF Distribution Agreement, as novated, between the Registrant and Foreside Fund Services, LLC, effective as of](http://www.sec.gov/Archives/edgar/data/1506213/000158064221006059/ex99e_3.htm) [December 10, 2021 - Incorporated herein by reference to Registrant's Post-Effective Amendment No. 95 filed on December 28, 2021.](http://www.sec.gov/Archives/edgar/data/1506213/000158064221006059/ex99e_3.htm) |
| (e)(4) | [Second Amendment to ETF Distribution Agreement, as novated, between the Registrant and Foreside Fund Services, LLC, effective as of June 17, 2022– Incorporated herein by reference to Registrant's Post-Effective Amendment No. 110 filed on June 22, 2022.](https://www.sec.gov/Archives/edgar/data/1506213/000158064222003182/ex99e_4.htm) |
| (e)(5) | [Third Amendment to ETF Distribution Agreement, as novated, between the Registrant and Foreside Fund Services, LLC, effective November 7, 2023 – Incorporated](https://www.sec.gov/Archives/edgar/data/1506213/000158064224004843/ex99e5.htm) [herein by reference to Registrant's Post-Effective Amendment No. 127 filed on August 26, 2024.](https://www.sec.gov/Archives/edgar/data/1506213/000158064224004843/ex99e5.htm) |
| (e)(6) | [Fourth Amendment to ETF Distribution Agreement, as novated, between the Registrant and Foreside Fund Services, LLC, March 26, 2024 – Incorporated](https://www.sec.gov/Archives/edgar/data/1506213/000158064224004843/ex99e6.htm) [herein by reference to Registrant's Post-Effective Amendment No. 127 filed on August 26, 2024.](https://www.sec.gov/Archives/edgar/data/1506213/000158064224004843/ex99e6.htm) |
| (e)(7) | [Fifth Amendment to ETF Distribution Agreement, as novated, between the Registrant and Foreside Fund Services, LLC, effective December 12, 2024 – Incorporated](https://www.sec.gov/Archives/edgar/data/1506213/000158064224007559/ex99e7.htm) [herein by reference to Registrant's Post-Effective Amendment No. 135 filed on December 13, 2024.](https://www.sec.gov/Archives/edgar/data/1506213/000158064224007559/ex99e7.htm) |
| (e)(8) | [Sixth Amendment to ETF Distribution Agreement, as novated, between the Registrant and Foreside Fund Services, LLC, effective March 25, 2025 – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 142 filed on May 13, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225003099/ex-99e8.htm) |
| (e)(9) | [Seventh Amendment to ETF Distribution Agreement, as novated, between the Registrant and Foreside Fund Services, LLC, effective September 18, 2025 – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 146 filed on September 19, 2025](https://www.sec.gov/Archives/edgar/data/1506213/000158064225006146/ex99e9.htm). |

---

(e)(10) [Form of Authorized Participant Agreement – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 14 filed on August 26, 2016.](http://www.sec.gov/Archives/edgar/data/1506213/000158064216010517/ex99e5.htm)

(f) Not applicable.

(g)(1) [Amended and Restated <u>Custodial and Agency Services Agreement between the Registrant and Citibank, N.A. dated March 26, 2026 – Filed herewith</u>](ex99g1.htm)

---

| | |
|:---|:---|
| (g)(2) | [Amendment to the Custodial and Agency Services Agreement between the Registrant and Citibank, N.A. effective September 30, 2025 – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 146 filed on September 19, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225006146/ex99g2.htm) |
| (g)(3) | [Amendment to the Custodial and Agency Services Agreement between the Registrant and Citibank, N.A. effective December 8, 2025 – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 147 filed on October 30, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225006857/ex99g3.htm) |
| (h)(1) | [Amended and Restated <u>Services Agreement between the Registrant and Citi Fund Services Ohio, Inc. effective March 26, 2026 - Filed herewith</u>](ex99h1.htm) |

---

---

| | |
|:---|:---|
| (h)(2) | [Amendment to the Services Agreement between the Registrant and Citi Fund Services Ohio, Inc. effective December 8, 2025 – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 147 filed on October 30, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225006857/ex99h2.htm) |

---

---

| | |
|:---|:---|
| (h)(3) | [Expense Limitation Agreement between Registrant and Rational Advisors, Inc. with respect to Strategy Shares](https://www.sec.gov/Archives/edgar/data/1506213/000158064221004001/ex99h3.htm) [Nasdaq 7HANDL™ Index ETF, and Strategy Shares Newfound/ReSolve Robust Momentum ETF effective September 1, 2021 - Incorporated herein by reference to](https://www.sec.gov/Archives/edgar/data/1506213/000158064221004001/ex99h3.htm) [Registrant's Post-Effective Amendment No. 95 filed on December 28, 2021.](https://www.sec.gov/Archives/edgar/data/1506213/000158064221004001/ex99h3.htm) |

---

---

| | |
|:---|:---|
| (h)(4) | Amended [Exhibit A to Expense Limitation Agreement between Registrant and Rational Advisors, Inc. with respect to](https://www.sec.gov/Archives/edgar/data/1506213/000158064225000057/ex99h4.htm) [Strategy Shares Nasdaq 7HANDL™ Index ETF and Strategy Shares Newfound/ReSolve Robust Momentum ETF dated June 25, 2024 – Incorporated herein by](https://www.sec.gov/Archives/edgar/data/1506213/000158064225000057/ex99h4.htm) [reference to Registrant's Post-Effective Amendment No. 137 filed on January 3, 2025](https://www.sec.gov/Archives/edgar/data/1506213/000158064225000057/ex99h4.htm).<br>|

---

---

| | |
|:---|:---|
| (h)(5) | [Amended and Restated Management Services Agreement between the Registrant, on behalf of Day Hagan Smart Sector Fixed Income](https://www.sec.gov/Archives/edgar/data/1506213/000158064223003419/ex99h4.htm) [ETF, Day Hagan Smart Sector ETF, Day Hagan Smart Sector International ETF, Day Hagan Smart Buffer ETF, Eventide High Dividend ETF, Eventide U.S. Market ETF, and MFund Services LLC dated September 16, 2022](https://www.sec.gov/Archives/edgar/data/1506213/000158064223003419/ex99h4.htm) [– Incorporated herein by reference to Registrant's Post-Effective Amendment No. 122 filed on June 30, 2023](https://www.sec.gov/Archives/edgar/data/1506213/000158064223003419/ex99h4.htm). |

---

---

| | |
|:---|:---|
| (h)(6) | [Amended Exhibit A to Amended and Restated Management Services Agreement between the Registrant, on behalf of Day Hagan Smart Sector Fixed Income ETF, Day Hagan Smart Sector ETF, Day Hagan Smart Sector International ETF, Day Hagan Smart Buffer ETF, Eventide High Dividend ETF, Eventide U.S. Market ETF, Eventide Large Cap Growth ETF, Eventide Large Cap Value ETF, Eventide Small Cap ETF, and Eventide International ETF and MFund Services LLC dated September 16, 2025 – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 146 filed on September 19, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225006146/ex99h6.htm)<br>|

---

---

| | |
|:---|:---|
| (h)(7) | [Amended and Restated Management Services Agreement between the Registrant, on behalf of Strategy Shares Nasdaq 7HANDL™ Index](https://www.sec.gov/Archives/edgar/data/1506213/000158064223003419/ex99h4.htm) [ETF, Strategy Shares Newfound/ReSolve Robust Momentum ETF, Strategy Shares Gold Enhanced Yield ETF, and](https://www.sec.gov/Archives/edgar/data/1506213/000158064223003419/ex99h4.htm)[Monopoly ETF, and MFund Services LLC dated September 16, 2022 – Incorporated herein by reference to Registrant's Post-Effective](https://www.sec.gov/Archives/edgar/data/1506213/000158064223003419/ex99h4.htm) [Amendment No. 122 filed on June 30, 2023](https://www.sec.gov/Archives/edgar/data/1506213/000158064223003419/ex99h4.htm). |

---

---

| | |
|:---|:---|
| (h)(8) | [Amended Exhibit A to Amended and Restated Management Services Agreement between the Registrant, on behalf of Strategy Shares](https://www.sec.gov/Archives/edgar/data/1506213/000158064225003099/ex-99h8.htm) [Nasdaq 7HANDL™ Index ETF, Strategy Shares Newfound/ReSolve Robust Momentum ETF, Strategy Shares Gold Enhanced Yield ETF,](https://www.sec.gov/Archives/edgar/data/1506213/000158064225003099/ex-99h8.htm) [and Monopoly ETF, and MFund Services LLC dated March 25, 2025 –](https://www.sec.gov/Archives/edgar/data/1506213/000158064225003099/ex-99h8.htm) Incorporated herein by reference to Registrant's Post-Effective Amendment No. 142 filed on May 13, 2025. |

---

---

| | | |
|:---|:---|:---|
| (h)(9) | [Amended and Restated Compliance Services Agreement between the Registrant and MFund Services LLC dated June 24, 2022 –](https://www.sec.gov/Archives/edgar/data/1506213/000158064223004450/ex99h6.htm) [Incorporated herein by reference to Registrant's Post-Effective Amendment No. 123 filed on August 25, 2023](https://www.sec.gov/Archives/edgar/data/1506213/000158064223004450/ex99h6.htm). | [Amended and Restated Compliance Services Agreement between the Registrant and MFund Services LLC dated June 24, 2022 –](https://www.sec.gov/Archives/edgar/data/1506213/000158064223004450/ex99h6.htm) [Incorporated herein by reference to Registrant's Post-Effective Amendment No. 123 filed on August 25, 2023](https://www.sec.gov/Archives/edgar/data/1506213/000158064223004450/ex99h6.htm). |
| (h)(10) | (h)(10) | [Sub-License Agreement between Nasdaq, Inc. and Rational Advisors, Inc. with respect to Strategy Shares 7HANDL Index ETF dated January 12, 2018 –](https://www.sec.gov/Archives/edgar/data/1506213/000158064218000229/ex99h12.htm) [Incorporated herein by reference to Registrant's Post-Effective Amendment No. 36 filed on January 12, 2018.](https://www.sec.gov/Archives/edgar/data/1506213/000158064218000229/ex99h12.htm) |

---

---

| | |
|:---|:---|
| (h)(11) | [Index Licensing Agreement between and among the Registrant, Solactive AG, and Rational Advisors, Inc. with respect to Strategy Shares](https://www.sec.gov/Archives/edgar/data/1506213/000158064221003136/ex99h12.htm) [Gold Enhanced Yield ETF dated May 17, 2021 — Incorporated herein by reference to Registrant's Pre-Effective Amendment No. 78 filed on July 14, 2021.](https://www.sec.gov/Archives/edgar/data/1506213/000158064221003136/ex99h12.htm) |

---

---

| | |
|:---|:---|
| (h)(12) | [Management Agreement between Rational Advisors, Inc. and SSGBI Fund Limited, a wholly owned subsidiary of Strategy Shares Gold](https://www.sec.gov/Archives/edgar/data/1506213/000158064221000751/ex99_h12.htm) [Enhanced Yield ETF (the "Subsidiary") dated February 19, 2021 - Incorporated herein by reference to the Registrant's Post-Effective Amendment No. 76 filed on](https://www.sec.gov/Archives/edgar/data/1506213/000158064221000751/ex99_h12.htm) [February 19, 2021.](https://www.sec.gov/Archives/edgar/data/1506213/000158064221000751/ex99_h12.htm) |

---

---

| | |
|:---|:---|
| (h)(13) | [Index Licensing Agreement between and among the Registrant, Newfound Research LLC, ReSolve Asset Management SEZC (Cayman),](https://www.sec.gov/Archives/edgar/data/1506213/000158064221004001/ex99h13.htm) [and Rational Advisors, Inc. with respect to Strategy Shares Newfound/ReSolve Robust Momentum ETF dated July 1, 2021 – Incorporated herein by reference](https://www.sec.gov/Archives/edgar/data/1506213/000158064221004001/ex99h13.htm) [to Registrant's Pre-Effective Amendment No. 80 filed on August 26, 2021.](https://www.sec.gov/Archives/edgar/data/1506213/000158064221004001/ex99h13.htm) |

---

---

| | |
|:---|:---|
| (h)(14) | [Form of Rule 12d1-4 Agreement — Incorporated herein by reference to Registrant's Post-Effective Amendment No. 110 filed on June 22, 2022.](https://www.sec.gov/Archives/edgar/data/1506213/000158064222003182/ex99h_16.htm) |
| (h)(15) | Amendment to the Services Agreement between the Registrant, Citibank, N.A. and Citi Fund Services Ohio, Inc. – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 147 filed on October 30, 2025. |

---

---

| | |
|:---|:---|
| (i)(1) | [Opinion and Consent of Stradley Ronon Stevens & Young, LLP with respect to Strategy Shares Nasdaq 7HANDL™ Index ETF —](https://www.sec.gov/Archives/edgar/data/1506213/000158064219003981/ex99i.htm) [Incorporated herein by reference to Registrant's Post-Effective Amendment No. 51 filed on August 28, 2019.](https://www.sec.gov/Archives/edgar/data/1506213/000158064219003981/ex99i.htm) |

---

---

| | |
|:---|:---|
| (i)(2) | [Opinion and Consent of Stradley Ronon Stevens & Young, LLP with respect to Strategy Shares Newfound/ReSolve Robust Momentum](https://www.sec.gov/Archives/edgar/data/1506213/000158064219004852/ex99i.htm) [ETF — Incorporated herein by reference to Registrant's Post-Effective Amendment No. 56 filed on October 28, 2019.](https://www.sec.gov/Archives/edgar/data/1506213/000158064219004852/ex99i.htm) |

---

---

| | |
|:---|:---|
| (i)(3) | [Opinion and Consent of Stradley Ronon Stevens & Young, LLP with respect to Day Hagan Smart Sector ETF — Incorporated herein by](https://www.sec.gov/Archives/edgar/data/1506213/000158064220000176/ex99i.htm) [reference to Registrant's Post-Effective Amendment No. 63 filed on January 10, 2020.](https://www.sec.gov/Archives/edgar/data/1506213/000158064220000176/ex99i.htm) |

---

---

| | |
|:---|:---|
| (i)(4) | [Opinion and Consent of Stradley Ronon Stevens & Young, LLP with respect to Strategy Shares Gold Enhanced Yield ETF — Incorporated](https://www.sec.gov/Archives/edgar/data/1506213/000158064221000751/ex99_i4.htm) [herein by reference to Registrant's Post-Effective Amendment No. 76 filed on February 19, 2021.](https://www.sec.gov/Archives/edgar/data/1506213/000158064221000751/ex99_i4.htm) |

---

---

| | |
|:---|:---|
| (i)(5) | [Opinion and Consent of Stradley Ronon Stevens & Young, LLP with respect to Strategy Shares Day Hagan Smart Sector Fixed Income](http://www.sec.gov/Archives/edgar/data/1506213/000158064221004628/ex99i_5.htm) [ETF – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 82 filed on September 27, 2021.](http://www.sec.gov/Archives/edgar/data/1506213/000158064221004628/ex99i_5.htm) |

---

---

| | |
|:---|:---|
| (i)(6) | [Opinion and Consent of Stradley Ronon Stevens & Young, LLP with respect to Strategy Shares Day Hagan Smart Sector International ETF](https://www.sec.gov/Archives/edgar/data/1506213/000158064222003182/ex99i_9.htm) [– Incorporated herein by reference to Registrant's Post-Effective Amendment No. 110 filed on June 22, 2022](https://www.sec.gov/Archives/edgar/data/1506213/000158064222003182/ex99i_9.htm). |

---

---

| | |
|:---|:---|
| (i)(7) | [Opinion and Consent of Stradley Ronon Stevens & Young, LLP with respect to Eventide High Dividend ETF – Incorporated herein by](https://www.sec.gov/Archives/edgar/data/1506213/000158064224004843/ex99i.htm) [reference to Registrant's Post-Effective Amendment No. 127 filed on August 26, 2024.](https://www.sec.gov/Archives/edgar/data/1506213/000158064224004843/ex99i.htm) |

---

---

| | |
|:---|:---|
| (i)(8) | [Opinion and Consent of Stradley Ronon Stevens & Young, LLP with respect to Day Hagan Smart Buffer ETF – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 140 filed on February 12, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225000965/ex-i9.htm) |

---

---

| | |
|:---|:---|
| (i)(9) | [Opinion and Consent of Stradley Ronon Stevens & Young, LLP with respect to Eventide US Market ETF](https://www.sec.gov/Archives/edgar/data/1506213/000158064224007559/ex99i10.htm) – [Incorporated herein by](https://www.sec.gov/Archives/edgar/data/1506213/000158064224007559/ex99i10.htm) [reference to Registrant's Post-Effective Amendment No. 135 filed on December 13, 2024.](https://www.sec.gov/Archives/edgar/data/1506213/000158064224007559/ex99i10.htm) |

---

---

| | |
|:---|:---|
| (i)(10) | [Opinion and Consent of Stradley Ronon Stevens & Young, LLP with respect to Strategy Shares Monopoly ETF – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 142 filed on May 13, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225003099/ex-99i10.htm) |

---

---

| | |
|:---|:---|
| (i)(11) | [Opinion and Consent of Stradley Ronon Stevens & Young, LLP with respect to Eventide Large Cap Growth ETF, Eventide Large Cap Value ETF, and Eventide Small Cap ETF – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 146 filed on September 19, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225006146/ex99i11.htm) |
| (i)(12) | [Opinion and Consent of Stradley Ronon Stevens & Young, LLP with respect to Eventide International ETF –](https://www.sec.gov/Archives/edgar/data/1506213/000158064225006857/ex99i12.htm) [Incorporated herein by reference to Registrant's Post-Effective Amendment No. 147 filed on October 30, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225006857/ex99i12.htm) |

---

(j) [<u>Consent of Independent Registered Public Accounting Firm –</u> Filed herewith.](ex99j.htm)

(k) Not applicable.

(l) [Subscription Agreement between the Registrant and The Huntington National Bank dated May 11, 2012 – Incorporated herein by reference to Registrant's Pre-](http://www.sec.gov/Archives/edgar/data/1506213/000119312512257390/d352875dex99l.htm) [Effective Amendment No. 3 filed on June 1, 2012.](http://www.sec.gov/Archives/edgar/data/1506213/000119312512257390/d352875dex99l.htm)

---

| | |
|:---|:---|
| (m)(1) | [Amended and Restated Distribution Plan - Incorporated herein by reference to Registrant's Post-Effective Amendment No. 45 filed on](http://www.sec.gov/Archives/edgar/data/1506213/000158064218004489/ex99m2.htm) [September 10, 2018.](http://www.sec.gov/Archives/edgar/data/1506213/000158064218004489/ex99m2.htm) |

---

---

| | |
|:---|:---|
| (m)(2) | [Exhibit A to the Amended and Restated Distribution Plan dated September 16, 2025 – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 146 filed on September 19, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225006146/ex99m2.htm) |

---

(n) Not applicable.

---

| | |
|:---|:---|
| (o)(1) | [Power of Attorney of Donald McIntosh, Trustee of the Trust – Incorporated herein by reference to the Registrant's Post-Effective](http://www.sec.gov/Archives/edgar/data/1506213/000158064219003977/ex99o7.htm) [Amendment No. 51 filed on August 28, 2019.](http://www.sec.gov/Archives/edgar/data/1506213/000158064219003977/ex99o7.htm) |

---

---

| | |
|:---|:---|
| (o)(2) | [Power of Attorney of Tobias Caldwell, Trustee of the Trust – Incorporated herein by reference to the Registrant's Post-Effective](http://www.sec.gov/Archives/edgar/data/1506213/000158064219003977/ex99o8.htm) [Amendment No. 51 filed on August 28, 2019.](http://www.sec.gov/Archives/edgar/data/1506213/000158064219003977/ex99o8.htm) |

---

---

| | |
|:---|:---|
| (o)(3) | [Power of Attorney of Stephen Lachenauer, Trustee of the Trust - Incorporated herein by reference to the Registrant's Post-Effective](http://www.sec.gov/Archives/edgar/data/1506213/000158064219003977/ex99o9.htm) [Amendment No. 51 filed on August 28, 2019.](http://www.sec.gov/Archives/edgar/data/1506213/000158064219003977/ex99o9.htm) |

---

---

| | |
|:---|:---|
| (o)(4) | [Power of Attorney of James Szilagyi, Treasurer and Chief Financial Officer of the Trust - Incorporated herein by reference to the](http://www.sec.gov/Archives/edgar/data/1506213/000158064219003977/ex99o10.htm) [Registrant's Post-Effective Amendment No. 51 filed on August 28, 2019.](http://www.sec.gov/Archives/edgar/data/1506213/000158064219003977/ex99o10.htm) |

---

---

| | |
|:---|:---|
| (p)(1) | [Code of Ethics for the Registrant – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 4 filed on August 27,](http://www.sec.gov/Archives/edgar/data/1506213/000119312514323763/d746436dex99p4.htm) [2014.](http://www.sec.gov/Archives/edgar/data/1506213/000119312514323763/d746436dex99p4.htm) |

---

---

| | |
|:---|:---|
| (p)(2) | [Code of Ethics for Rational Advisors, Inc. - Incorporated herein by reference to Registrant's Post-Effective Amendment No. 8 filed on June](http://www.sec.gov/Archives/edgar/data/1506213/000158064216009259/exp2.htm) [8, 2016.](http://www.sec.gov/Archives/edgar/data/1506213/000158064216009259/exp2.htm) |

---

---

| | |
|:---|:---|
| (p)(3) | [Code of Ethics of Foreside Fund Services, LLC - Incorporated herein by reference to Registrant's Post-Effective Amendment No. 8 filed](http://www.sec.gov/Archives/edgar/data/1506213/000158064216009259/exp4.htm) [on June 8, 2016.](http://www.sec.gov/Archives/edgar/data/1506213/000158064216009259/exp4.htm) |

---

---

| | |
|:---|:---|
| (p)(4) | [Code of Ethics of Vident Investment Advisory, LLC & WeatherStorm, LLC - Incorporated herein by reference to Registrant's Post-Effective Amendment No. 27](http://www.sec.gov/Archives/edgar/data/1506213/000158064216012651/ex99p5.htm) [filed on December 9, 2016.](http://www.sec.gov/Archives/edgar/data/1506213/000158064216012651/ex99p5.htm) |

---

---

| | |
|:---|:---|
| (p)(5) | [Code of Ethics of Day Hagan Asset Management – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 63](http://www.sec.gov/Archives/edgar/data/1506213/000158064220000176/ex99p8.htm) [filed on January 10, 2020.](http://www.sec.gov/Archives/edgar/data/1506213/000158064220000176/ex99p8.htm) |

---

---

| | |
|:---|:---|
| (p)(6) | [Code of Ethics of Eventide Asset Management, LLC – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 127](https://www.sec.gov/Archives/edgar/data/1506213/000158064224004843/ex99p6.htm) [filed on August 26, 2024.](https://www.sec.gov/Archives/edgar/data/1506213/000158064224004843/ex99p6.htm) |

---

(p)(7) [Code of Ethics of Rareview Capital LLC – Incorporated herein by reference to Registrant's Post-Effective Amendment No. 142 filed on May 13, 2025.](https://www.sec.gov/Archives/edgar/data/1506213/000158064225003099/ex-99p7.htm)

---

| | |
|:---|:---|
| **<u>Item 29.</u>** | **<u>Persons Controlled by or under Common Control with the Fund</u>** |

---

None.

---

| | |
|:---|:---|
| **<u>Item 30.</u>** | **<u>Indemnification</u>** |

---

Pursuant to Article VII, Section 4 of the Registrant's Agreement and Declaration of Trust, each of the Registrant's Trustees, officers, and agents may be eligible to receive reimbursement from the Trust for certain losses incurred as a result of serving in such capacities. Each of the Trustees and officers may also be eligible to receive reimbursement from a Trust service provider for losses incurred in connection with services rendered by the provider under the following service contracts: (i) Management Agreement between the Trust and Rational Advisors, Inc. ("Rational"); (ii) Management Services Agreement between the Trust and MFund Services LLC; (iii) Distribution Agreement between the Trust and the Distributor; (iv) Services Agreement between the Trust and Citi Fund Services, Ohio, Inc. ("Citi"); (vi) Custodial and Agency Services Agreement between the Trust and Citibank, N.A. ("Citibank"); and (vii) the form of Authorized Participant Agreement. The Trustees and Officers are covered by the Trust's Errors and Omissions Policy.

Under the Management Agreement and the Distribution Agreement, Rational and the Distributor, respectively, are eligible to receive reimbursement from the Trust for certain losses incurred under those agreements. Under the Services Agreement, the Custody and Agency Services Agreement, and the Management Services Agreement, the Trust's agents and representatives, including Rational and Distributor, are eligible to receive reimbursement of certain losses from Citi, Citibank, and MFund Services LLC, respectively, in connection with services rendered by such providers under the agreements. Under the form of Authorized Participant Agreement, the Trust's agents are eligible for reimbursement of losses resulting from certain activities of authorized participants. As a potential control person of a Fund (affiliate of a Fund), Rational may also be eligible for reimbursement of losses incurred in connection with services provided by the Distributor under the Distribution Agreement.

Insofar as indemnification for liabilities may be permitted pursuant to Section 17 of the Investment Company Act of 1940 for Trustees, Officers, and controlling persons of the Registrant by the Registrant pursuant to the Declaration of Trust or otherwise, the Registrant is aware of the position of the Securities and Exchange Commission as set forth in Investment Company Act Release No. IC-11330. Therefore, the Registrant undertakes that in addition to complying with the applicable provisions of the Declaration of Trust or otherwise, in the absence of a final decision on the merits by a court or other body before which the proceeding was brought, that an indemnification payment will not be made unless in the absence of such a decision, a reasonable determination based upon factual review has been made (i) by a majority vote of a quorum of non-party Trustees who are not interested persons of the Registrant or (ii) by independent legal counsel in a written opinion that the indemnitee was not liable for an act of willful misfeasance, bad faith, gross negligence, or reckless disregard of duties. The Registrant further undertakes that advancement of expenses incurred in the defense of a proceeding (upon undertaking for repayment unless it is ultimately determined that indemnification is appropriate) against an officer, trustee, or controlling person of the Registrant will not be made

absent the fulfillment of at least one of the following conditions: (i) the indemnitee provides security for his undertaking; (ii) the Registrant is insured against losses arising by reason of any lawful advances; or (iii) a majority of a quorum of disinterested non-party trustees or independent legal counsel in a written opinion makes a factual determination that there is reason to believe the indemnitee will be entitled to indemnification.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 ("Securities Act") may be permitted to Trustees, officers, and controlling persons of the Registrant by the Registrant pursuant to the Agreement and Declaration of Trust or otherwise, the Registrant is aware that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Securities Act and, therefore, is 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 trustees, officers, or controlling persons of the Registrant in connection with the successful defense of any act, suit, or proceeding) is asserted by such trustees, officers, or controlling persons in connection with the shares being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issues.

---

| | |
|:---|:---|
| **<u>Item 31.</u>** | **<u>Business and other Connections of the Investment Adviser</u>** |

---

(a) Rational Advisors, Inc. ("Rational"), 207 Calle del Parque, AM Tower, Floor 7, Suite 2, San Juan, PR 00912-3242, is registered with the Securities and Exchange Commission ("SEC") as an investment adviser, file number 801-60176. Rational is a wholly owned subsidiary of Rational Capital LLC.

(i) Rational has engaged in no other business during the past two fiscal years.

(ii) Jerry Szilagyi is the President of Rational, and has been engaged within the last two fiscal years in the capacity of director, officer, employee, partner, or trustee of the following other companies:

Trustee, Mutual Fund Series Trust, 4221 N. 203rd Street, Suite 100, Elkhorn, NE 68022;

Trustee, Variable Insurance Trust, 4221 N. 203rd Street, Suite 100, Elkhorn, NE 68022;

President and Chief Executive Officer of Catalyst Capital Advisors, 207 Calle del Parque, AM Tower, Floor 7, Suite 2, San Juan, PR 00912-3242, a registered investment. Catalyst Capital Advisors LLC serves as advisor to certain series of Mutual Fund Series Trust ("MFST"), a registered investment company;

Managing Member, MFund Services LLC, 36 North New York Avenue, Huntington, NY 11743, an administrator to mutual funds (including each series of the Trust);

Managing Member, MFund Distributors LLC, 36 North New York Avenue, Huntington, NY 11743, (TBP), a provider of marketing services to mutual funds;

Managing Member of AlphaCentric Advisors LLC, 207 Calle del Parque, AM Tower, Floor 7, Suite 2, San Juan, PR 00912-3242, a registered investment advisor. AlphaCentric serves as an advisor to AlphaCentric Prime Meridian Income Fund and certain series of MFST;

CEO of Catalyst Capital International, LLC, 36 North New York Avenue, Huntington, NY 11743;

CEO of Catalyst International Advisors, LLC, 207 Calle del Parque, AM Tower, Floor 7, Suite 2, San Juan, PR 00912-3242;

CEO of Insights Media LLC, 207 Calle del Parque, AM Tower, Floor 7, Suite 2, San Juan, PR 00912-3242; and

CEO, MFund Management LLC, 207 Calle del Parque, AM Tower, Floor 7, Suite 2, San Juan, PR 00912-3242.

(b) Ashton Thomas Private Wealth, LLC d.b.a Day Hagan Asset Management ("Day Hagan"), 8605 E Raintree Drive, Suite 280, Scottsdale, AZ 85260, is registered with the SEC as an investment adviser file number 801-71512 – information will be provided by subsequent amendment.

(c) Eventide Asset Management, LLC ("Eventide"), One International Place, Suite 4210, Boston, Massachusetts 02110, is registered with the SEC as an investment adviser file number 801-69154.

(i) Eventide has engaged in no other business since its inception.

(d) Rareview Capital LLC (Rareview), 10785 W. Twain Avenue, Suite 210, Las Vegas, NV, 89135, is registered with the SEC as an investment adviser file number 801-108100 - information will be provided by subsequent amendment.

**Item 32.** **Foreside Fund Services, LLC**

---

| | |
|:---|:---|
| Item 32(a) | Foreside Fund Services, 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. AB Active ETFs, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;2. ABS Long/Short Strategies Fund

&nbsp;&nbsp;&nbsp;&nbsp;3. ActivePassive Core Bond ETF, Series of Trust for Professional
 Managers

&nbsp;&nbsp;&nbsp;&nbsp;4. ActivePassive Intermediate Municipal Bond ETF, Series of Trust
 for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;5. ActivePassive International Equity ETF, Series of Trust for
 Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;6. ActivePassive U.S. Equity ETF, Series of Trust for Professional
 Managers

&nbsp;&nbsp;&nbsp;&nbsp;7. AdvisorShares Trust

&nbsp;&nbsp;&nbsp;&nbsp;8. AFA Private Credit Fund

&nbsp;&nbsp;&nbsp;&nbsp;9. AGF Investments Trust

&nbsp;&nbsp;&nbsp;&nbsp;10. AIM ETF Products Trust

&nbsp;&nbsp;&nbsp;&nbsp;11. Alexis Practical Tactical ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;12. AlphaCentric Prime Meridian Income Fund

&nbsp;&nbsp;&nbsp;&nbsp;13. American Century ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;14. Amplify ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;15. Applied Finance Dividend Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;16. Applied Finance Explorer Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;17. Applied Finance Select Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;18. Ardian Access LLC

&nbsp;&nbsp;&nbsp;&nbsp;19. ARK ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;20. ARK Venture Fund

&nbsp;&nbsp;&nbsp;&nbsp;21. Bitwise Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;22. BondBloxx ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;23. Bramshill Multi-Strategy Income Fund, Series of Investment Managers
 Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;24. Bridgeway Funds, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;25. Brinker Capital Destinations Trust

26. Brookfield Real Assets Income Fund Inc.

&nbsp;&nbsp;&nbsp;&nbsp;27. Build Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;28. Calamos Convertible and High Income Fund

&nbsp;&nbsp;&nbsp;&nbsp;29. Calamos Convertible Opportunities and Income Fund

&nbsp;&nbsp;&nbsp;&nbsp;30. Calamos Dynamic Convertible and Income Fund

&nbsp;&nbsp;&nbsp;&nbsp;31. Calamos Global Dynamic Income Fund

&nbsp;&nbsp;&nbsp;&nbsp;32. Calamos Global Total Return Fund

&nbsp;&nbsp;&nbsp;&nbsp;33. Calamos Strategic Total Return Fund

&nbsp;&nbsp;&nbsp;&nbsp;34. Carlyle Tactical Private Credit Fund

&nbsp;&nbsp;&nbsp;&nbsp;35. Cascade Private Capital Fund

&nbsp;&nbsp;&nbsp;&nbsp;36. Catalyst Strategic Income Opportunities Fund

&nbsp;&nbsp;&nbsp;&nbsp;37. CBRE Global Real Estate Income Fund

&nbsp;&nbsp;&nbsp;&nbsp;38. Center Coast Brookfield MLP & Energy Infrastructure Fund

&nbsp;&nbsp;&nbsp;&nbsp;39. Clifford Capital Partners Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;40. Cliffwater Corporate Lending Fund

&nbsp;&nbsp;&nbsp;&nbsp;41. Cliffwater Enhanced Lending Fund

&nbsp;&nbsp;&nbsp;&nbsp;42. Coatue Innovative Strategies Fund

&nbsp;&nbsp;&nbsp;&nbsp;43. Cohen & Steers ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;44. Convergence Long/Short Equity ETF, Series of Trust for Professional
 Managers

&nbsp;&nbsp;&nbsp;&nbsp;45. CornerCap Small-Cap Value Fund, Series of Managed Portfolio
 Series

&nbsp;&nbsp;&nbsp;&nbsp;46. CrossingBridge Pre-Merger SPAC ETF, Series of Trust for Professional
 Managers

&nbsp;&nbsp;&nbsp;&nbsp;47. Curasset Capital Management Core Bond Fund, Series of World
 Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;48. Curasset Capital Management Limited Term Income Fund, Series
 of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;49. CYBER HORNET S&P 500® and Bitcoin 75/25 Strategy ETF,
 Series of ONEFUND Trust

&nbsp;&nbsp;&nbsp;&nbsp;50. Davis Fundamental ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;51. Defiance Connective Technologies ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;52. Defiance Drone and Modern Warfare ETF, Series of ETF Series
 Solutions

&nbsp;&nbsp;&nbsp;&nbsp;53. Defiance Quantum ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;54. Denali Structured Return Strategy Fund

&nbsp;&nbsp;&nbsp;&nbsp;55. Dodge & Cox Funds

&nbsp;&nbsp;&nbsp;&nbsp;56. DoubleLine ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;57. DoubleLine Income Solutions Fund

&nbsp;&nbsp;&nbsp;&nbsp;58. DoubleLine Opportunistic Credit Fund

&nbsp;&nbsp;&nbsp;&nbsp;59. DoubleLine Yield Opportunities Fund

&nbsp;&nbsp;&nbsp;&nbsp;60. DriveWealth ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;61. EIP Investment Trust

&nbsp;&nbsp;&nbsp;&nbsp;62. Ellington Income Opportunities Fund

&nbsp;&nbsp;&nbsp;&nbsp;63. ETF Opportunities Trust

&nbsp;&nbsp;&nbsp;&nbsp;64. Exchange Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;65. Exchange Place Advisors Trust

&nbsp;&nbsp;&nbsp;&nbsp;66. FlexShares Trust

&nbsp;&nbsp;&nbsp;&nbsp;67. Fortuna Hedged Bitcoin Fund, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;68. Forum Funds

&nbsp;&nbsp;&nbsp;&nbsp;69. Forum Funds II

&nbsp;&nbsp;&nbsp;&nbsp;70. Forum Real Estate Income Fund

&nbsp;&nbsp;&nbsp;&nbsp;71. Fundrise Growth Tech Fund, LLC

&nbsp;&nbsp;&nbsp;&nbsp;72. GoldenTree Opportunistic Credit Fund

&nbsp;&nbsp;&nbsp;&nbsp;73. Gramercy Emerging Markets Debt Fund, Series of Investment Managers
 Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;74. Grayscale Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;75. Guinness Atkinson Funds

&nbsp;&nbsp;&nbsp;&nbsp;76. Harbor ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;77. Harris Oakmark ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;78. Hawaiian Tax-Free Trust

&nbsp;&nbsp;&nbsp;&nbsp;79. Horizon Kinetics Blockchain Development ETF, Series of Listed
 Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;80. Horizon Kinetics Energy and Remediation ETF, Series of Listed
 Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;81. Horizon Kinetics Inflation Beneficiaries ETF, Series of Listed
 Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;82. Horizon Kinetics Japan Owner Operator ETF, Series of Listed
 Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;83. Horizon Kinetics Medical ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;84. Horizon Kinetics SPAC Active ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;85. Innovator ETFs Trust

&nbsp;&nbsp;&nbsp;&nbsp;86. Ironwood Institutional Multi-Strategy Fund LLC

&nbsp;&nbsp;&nbsp;&nbsp;87. Ironwood Multi-Strategy Fund LLC

&nbsp;&nbsp;&nbsp;&nbsp;88. Jensen Quality Growth ETF, Series of Trust for Professional
 Managers

&nbsp;&nbsp;&nbsp;&nbsp;89. John Hancock Exchange-Traded Fund Trust

&nbsp;&nbsp;&nbsp;&nbsp;90. Kurv ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;91. Lazard Active ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;92. LDR Real Estate Value-Opportunity Fund, Series of World Funds
 Trust

&nbsp;&nbsp;&nbsp;&nbsp;93. Mairs & Power Balanced Fund, Series of Trust for Professional
 Managers

&nbsp;&nbsp;&nbsp;&nbsp;94. Mairs & Power Growth Fund, Series of Trust for Professional
 Managers

&nbsp;&nbsp;&nbsp;&nbsp;95. Mairs & Power Minnesota Municipal Bond ETF, Series of Trust
 for Professional Managers

&nbsp;&nbsp;&nbsp;&nbsp;96. Mairs & Power Small Cap Fund, Series of Trust for Professional
 Managers

&nbsp;&nbsp;&nbsp;&nbsp;97. Manor Investment Funds

&nbsp;&nbsp;&nbsp;&nbsp;98. MoA Funds Corporation

&nbsp;&nbsp;&nbsp;&nbsp;99. Moerus Worldwide
 Value Fund, Series of Northern Lights Fund Trust IV

&nbsp;&nbsp;&nbsp;&nbsp;100. Morgan Stanley
 ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;101. Morgan Stanley
 Pathway Large Cap Equity ETF, Series of Morgan Stanley Pathway Funds

&nbsp;&nbsp;&nbsp;&nbsp;102. Morgan Stanley
 Pathway Small-Mid Cap Equity ETF, Series of Morgan Stanley Pathway Funds

&nbsp;&nbsp;&nbsp;&nbsp;103. Morningstar
 Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;104. NEOS ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;105. Niagara Income
 Opportunities Fund

&nbsp;&nbsp;&nbsp;&nbsp;106. North Square
 Evanston Multi-Alpha Fund

&nbsp;&nbsp;&nbsp;&nbsp;107. NXG Cushing®
 Midstream Energy Fund

&nbsp;&nbsp;&nbsp;&nbsp;108. NXG NextGen
 Infrastructure Income Fund

&nbsp;&nbsp;&nbsp;&nbsp;109. OTG Latin
 American Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;110. Overlay Shares
 Core Bond ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;111. Overlay Shares
 Foreign Equity ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;112. Overlay Shares
 Hedged Large Cap Equity ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;113. Overlay Shares
 Large Cap Equity ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;114. Overlay Shares
 Municipal Bond ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;115. Overlay Shares
 Short Term Bond ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;116. Overlay Shares
 Small Cap Equity ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;117. Palmer Square
 Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;118. Palmer Square
 Opportunistic Income Fund

&nbsp;&nbsp;&nbsp;&nbsp;119. Partners Group
 Private Income Opportunities, LLC

&nbsp;&nbsp;&nbsp;&nbsp;120. Perkins Discovery
 Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;121. Philotimo
 Focused Growth and Income Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;122. Plan Investment
 Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;123. Point Bridge
 America First ETF, Series of ETF Series Solutions

&nbsp;&nbsp;&nbsp;&nbsp;124. Precidian
 ETFs Trust

&nbsp;&nbsp;&nbsp;&nbsp;125. Rareview 2x
 Bull Cryptocurrency & Precious Metals ETF, Series of Collaborative Investment Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;126. Rareview Dynamic
 Fixed Income ETF, Series of Collaborative Investment Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;127. Rareview Systematic
 Equity ETF, Series of Collaborative Investment Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;128. Rareview Tax
 Advantaged Income ETF, Series of Collaborative Investment Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;129. Rareview Total
 Return Bond ETF, Series of Collaborative Investment Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;130. Renaissance
 Capital Greenwich Funds

&nbsp;&nbsp;&nbsp;&nbsp;131. REX ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;132. Reynolds Funds,
 Inc.

&nbsp;&nbsp;&nbsp;&nbsp;133. RMB Investors
 Trust

&nbsp;&nbsp;&nbsp;&nbsp;134. Robinson Opportunistic
 Income Fund, Series of Investment Managers Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;135. Robinson Tax
 Advantaged Income Fund, Series of Investment Managers Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;136. Roundhill
 Ball Metaverse ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;137. Roundhill
 Cannabis ETF, Series of Listed Funds Trust

138. Roundhill
 ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;139. Roundhill
 Magnificent Seven ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;140. Roundhill
 Sports Betting & iGaming ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;141. Roundhill
 Video Games ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;142. Rule One Fund,
 Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;143. Russell Investments
 Exchange Traded Funds

&nbsp;&nbsp;&nbsp;&nbsp;144. Securian AM
 Real Asset Income Fund, Series of Investment Managers Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;145. Six Circles
 Trust

&nbsp;&nbsp;&nbsp;&nbsp;146. Sound Shore
 Fund, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;147. SP Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;148. Sparrow Funds

&nbsp;&nbsp;&nbsp;&nbsp;149. Spear Alpha
 ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;150. STF Tactical
 Growth & Income ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;151. STF Tactical
 Growth ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;152. Strategic
 Trust

&nbsp;&nbsp;&nbsp;&nbsp;153. Strategy Shares

&nbsp;&nbsp;&nbsp;&nbsp;154. Swan Hedged
 Equity US Large Cap ETF, Series of Listed Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;155. Tekla World
 Healthcare Fund

&nbsp;&nbsp;&nbsp;&nbsp;156. Tema ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;157. The 2023 ETF
 Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;158. The 2023 ETF
 Series Trust II

&nbsp;&nbsp;&nbsp;&nbsp;159. The Community
 Development Fund

&nbsp;&nbsp;&nbsp;&nbsp;160. The Cook &
 Bynum Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;161. The Finite
 Solar Finance Fund

&nbsp;&nbsp;&nbsp;&nbsp;162. The Private
 Shares Fund

&nbsp;&nbsp;&nbsp;&nbsp;163. The SPAC and
 New Issue ETF, Series of Collaborative Investment Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;164. Third Avenue
 Trust

&nbsp;&nbsp;&nbsp;&nbsp;165. Third Avenue
 Variable Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;166. Tidal Trust
 I

&nbsp;&nbsp;&nbsp;&nbsp;167. Tidal Trust
 II

&nbsp;&nbsp;&nbsp;&nbsp;168. Tidal Trust
 III

&nbsp;&nbsp;&nbsp;&nbsp;169. TIFF Investment
 Program

&nbsp;&nbsp;&nbsp;&nbsp;170. Timothy Plan
 High Dividend Stock Enhanced ETF, Series of The Timothy Plan

&nbsp;&nbsp;&nbsp;&nbsp;171. Timothy Plan
 High Dividend Stock ETF, Series of The Timothy Plan

&nbsp;&nbsp;&nbsp;&nbsp;172. Timothy Plan
 International ETF, Series of The Timothy Plan

&nbsp;&nbsp;&nbsp;&nbsp;173. Timothy Plan
 Market Neutral ETF, Series of The Timothy Plan

&nbsp;&nbsp;&nbsp;&nbsp;174. Timothy Plan
 US Small Cap Core ETF, Series of The Timothy Plan

&nbsp;&nbsp;&nbsp;&nbsp;175. Total Fund
 Solution

&nbsp;&nbsp;&nbsp;&nbsp;176. Touchstone
 ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;177. Trailmark
 Series Trust

&nbsp;&nbsp;&nbsp;&nbsp;178. T-Rex 2X Inverse
 Bitcoin Daily Target ETF, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;179. T-Rex 2x Inverse
 Ether Daily Target ETF, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;180. T-Rex 2X Long
 Bitcoin Daily Target ETF, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;181. T-Rex 2x Long
 Ether Daily Target ETF

&nbsp;&nbsp;&nbsp;&nbsp;182. U.S. Global
 Investors Funds

&nbsp;&nbsp;&nbsp;&nbsp;183. Union Street
 Partners Value Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;184. Vest Bitcoin
 Strategy Managed Volatility Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;185. Vest S&P
 500® Dividend Aristocrats Target Income Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;186. Vest US Large
 Cap 10% Buffer Strategies Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;187. Vest US Large
 Cap 10% Buffer Strategies VI Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;188. Vest US Large
 Cap 20% Buffer Strategies Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;189. Vest US Large
 Cap 20% Buffer Strategies VI Fund, Series of World Funds Trust

&nbsp;&nbsp;&nbsp;&nbsp;190. Virtus Stone
 Harbor Emerging Markets Income Fund

&nbsp;&nbsp;&nbsp;&nbsp;191. Volatility
 Shares Trust

&nbsp;&nbsp;&nbsp;&nbsp;192. WEBs ETF Trust

&nbsp;&nbsp;&nbsp;&nbsp;193. Wedbush Series
 Trust

194. Wellington
 Global Multi-Strategy Fund

&nbsp;&nbsp;&nbsp;&nbsp;195. Wilshire Mutual
 Funds, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;196. Wilshire Variable
 Insurance Trust

&nbsp;&nbsp;&nbsp;&nbsp;197. WisdomTree
 Digital Trust

&nbsp;&nbsp;&nbsp;&nbsp;198. WisdomTree
 Trust

&nbsp;&nbsp;&nbsp;&nbsp;199. XAI Octagon
 Floating Rate & Alternative Income Term Trust

---

| | |
|:---|:---|
| Item 32(b) | The following are the Officers and Manager of the Distributor, the Registrant's underwriter. The Distributor's main business address is 190 Middle Street, Suite 301, Portland, Maine 04101. |

---

Name Address Position with Underwriter <u>Position with Registrant</u>

---

| | | |
|:---|:---|:---|
| Teresa Cowan | 190 Middle Street, Suite 301,<br> Portland, ME 04101 | President/Manager |
| Chris Lanza<br>Kate Macchia<br>| 190 Middle Street, Suite 301,<br> Portland, ME 04101<br> 190 Middle Street, Suite 301,<br> Portland, ME 04101 | Vice President<br>Vice President |
| Alicia Strout | 190 Middle Street, Suite 301,<br> Portland, ME 04101 | Vice President and Chief Compliance Officer |
| Kelly B. Whetstone<br>Susan L. LaFond | 190 Middle Street, Suite 301,<br> Portland, ME 04101<br> 190 Middle Street, Suite 301,<br> Portland, ME 04101 | Secretary<br>Treasurer |
| Weston Sommers | 190 Middle Street, Suite 301,<br> Portland, ME 04101 | Financial and Operations Principal and Chief Financial Officer |

---

---

| | |
|:---|:---|
| Item 32(c) | Not applicable. |

---

---

| | |
|:---|:---|
| **<u>Item 33.</u>** | **<u>Location of Accounts and Records</u>** |

---

All accounts and records required to be maintained by Section 31(a) of 1940 Act and rules 31a-1 through 31a-3 promulgated thereunder are maintained at one of the following locations:

---

| | |
|:---|:---|
| Service Provider | Address |
| Registrant: | 36 North New York Avenue, Huntington, NY 11743 |
| Rational: | 207 Calle del Parque, AM Tower, Floor 7, Suite 2, San Juan, PR 00912-3242 |
| Distributor: | 190 Middle Street, Suite 304, Portland, ME 04101 |
| Citi: | 3435 Stelzer Road, Columbus, Ohio 43219 |
| Citibank: | 388 Greenwich Street, New York, New York 10048 |
| Ashton Thomas Private Wealth, LLC d.b.a Day Hagan Asset Management: | 8605 E Raintree Drive, Suite 280, Scottsdale, AZ 85260<br>1000 South Tamiami Trail, Sarasota, Florida, 34236 |
| Eventide Asset Management, LLC | One International Place, Suite 4210, Boston, MA 02110 |
| Rareview Capital LLC | 1980 Festival Plaza Drive, Suite 300, Las Vegas, NV, 89135 |

---

---

| | |
|:---|:---|
| **<u>Item 34.</u>** | **<u>Management Services</u>** |

---

Not Applicable.

---

| | |
|:---|:---|
| **<u>Item 35.</u>** | **<u>Undertakin</u>gs** |

---

The Registrant undertakes that the Subsidiary and each Director of the Subsidiary hereby consents to service of process within the United States at the address provided in the Registrant's Statement of Additional Information.

The Registrant further undertakes that the Subsidiary maintains its books and records consistently with the requirements of Section 31 of Investment Company Act of 1940 and rules thereunder, and submits to the examination of its books and records by the Securities and Exchange Commission.

**SIGNATURES**

Pursuant to the requirements of the 1933 Act and the Investment Company Act of 1940, the Registrant certifies that it meets all of the requirement for effectiveness of this registration statement under rule 485(b) under the Securities Act of 1933 and has duly caused this Amendment to its registration statement on Form N-1A to be signed on its behalf by the undersigned, thereto duly authorized, in the City of Huntington and State of New York, and City of San Juan, Commonwealth of Puerto Rico, on May 5, 2026.

---

| | |
|:---|:---|
| STRATEGY SHARES | STRATEGY SHARES |
| By: | /s/ Michael Schoonover |
|  | Michael Schoonover |
|  | President and Principal Executive Officer |

---

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed below by the following persons in the capacities and on the date(s) indicated:

---

| | |
|:---|:---|
| /s/ Michael Schoonover | May 5, 2026 |
| Michael Schoonover, President and Principal Executive Officer | Date |
| /s/ James Szilagyi\* | May 5, 2026 |
| James Szilagyi, Treasurer, Principal Financial Officer, and Principal Accounting Officer | Date |
| /s/ Tobias Caldwell\* | May 5, 2026 |
| Tobias Caldwell, Trustee | Date |
| /s/ Stephen P. Lachenauer\* | May 5, 2026 |
| Stephen Lachenauer, Trustee | Date |
| /s/ Donald McIntosh\* | May 5, 2026 |
| Donald McIntosh, Trustee | Date |

---

---

| | |
|:---|:---|
| By: | /s/ Jennifer Bailey |
|  | Jennifer Bailey |
|  | Attorney-in-Fact |

---

\*(Pursuant to Powers of Attorney previously filed: [POA-James Szilagyi](https://www.sec.gov/Archives/edgar/data/1506213/000158064219003977/ex99o10.htm), [POA-Tobias Caldwell](https://www.sec.gov/Archives/edgar/data/1506213/000158064219003977/ex99o8.htm), [POA-Stephen P. Lachenauer](https://www.sec.gov/Archives/edgar/data/1506213/000158064219003977/ex99o9.htm), [POA-Donald McIntosh](https://www.sec.gov/Archives/edgar/data/1506213/000158064219003977/ex99o7.htm))

**Exhibit List**

---

| | | |
|:---|:---|:---|
| (g)(1) | (g)(1) | [Amended and Restated Custodial and Agency Services Agreement between the Registrant and Citibank, N.A. dated March 26, 2026.](ex99g1.htm) |
| (h)(1) | (h)(1) | [Amended and Restated Services Agreement between the Registrant and Citi Fund Services Ohio, Inc. effective March 26, 2026.](ex99h1.htm) |
| (j) | [<u>Consent of Independent Registered Public Accounting Firm</u>.](ex99j.htm) | [<u>Consent of Independent Registered Public Accounting Firm</u>.](ex99j.htm) |

---

## Ex-99.G

**AMENDED AND RESTATED**

**CUSTODIAL AND AGENCY SERVICES AGREEMENT**

**STRATEGY SHARES**

---

| | |
|:---|:---|
| 1. DEFINITIONS AND INTERPRETATION. | 1 |
| 2. APPOINTMENT AS CUSTODIAN AND AGENT; ESTABLISHMENT OF ACCOUNTS. | 2 |
| 3. CUSTODY ACCOUNT PROCEDURES. | 3 |
| 4. CASH ACCOUNT PROCEDURES. | 4 |
| 5. AGENCY SERVICES: PORTFOLIO COMPOSITION. | 6 |
| 6. AGENCY SERVICES: CREATION UNITS, SALES AND REDEMPTIONS. | 6 |
| 7. INSTRUCTIONS. | 8 |
| 8. PERFORMANCE BY CITI. | 9 |
| 9. CORPORATE ACTIONS. | 10 |
| 10. COMMUNICATIONS, RECORDS AND ACCESS. | 10 |
| 11. TAX STATUS/WITHHOLDING TAXES. | 11 |
| 12. LIEN AND SET OFF. | 11 |
| 13. USE OF THIRD PARTIES. | 11 |
| 14. SCOPE OF RESPONSIBILITY. | 12 |
| 15. INDEMNITY. | 14 |
| 16. MUTUAL EXCLUSION OF CONSEQUENTIAL DAMAGES. | 14 |
| 17. FEES AND EXPENSES. | 15 |
| 18. CITIGROUP ORGANIZATION INVOLVEMENT. | 15 |
| 19. INFORMATION AND DATA PROTECTION. | 15 |
| 20. ADVERTISING. | 16 |
| 21. REPRESENTATIONS. | 16 |
| 22. REPRESENTATIVE CAPACITY. | 17 |
| 23. TERMINATION. | 17 |
| 24. GOVERNING LAW AND JURISDICTION. | 18 |
| 25. MISCELLANEOUS. | 18 |

---

Exhibits, Schedules or Annexes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Exhibit 1: List of Funds

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Annex A: U.S. Special Resolution Regime Recognition Annex

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Annex B: Confidentiality and Data Privacy Conditions Annex

**THIS AMENDED AND RESTATED CUSTODIAL AND AGENCY SERVICES AGREEMENT** is made on March 26, 2026, by and between Strategy Shares (f/k/a Huntington Strategy Shares), a statutory trust organized under the laws of the State of Delaware, (the "**Trust**") and Citibank, N.A. acting through its offices located in New York, New York ("**Citi"**).

**WHEREAS**, the Trust and Citi entered into a Custodial and Agency Services Agreement (the "**Original Agreement**"), dated as of April 23, 2012 with an effective date of June 1, 2012, as amended, pursuant to which, among other things, Citi provides certain custodial services to the Trust;

**WHEREAS**, the parties hereto desire to amend and restate the Original Agreement on the terms and subject to the conditions hereinafter contained;

**WHEREAS**, the Trust is authorized to issue shares ("**Shares**") in separate series (each, a "**Fund**," and together with all other series subsequently established by the Trust and made subject to this Agreement in accordance with Section 25 below, the "**Funds**");

**WHEREAS**, this Agreement shall apply to each Fund set forth on Appendix A hereto;

**WHEREAS**, the Trust will issue and redeem Shares of each Fund only in aggregations of Shares known as "**Creation Units**," as more fully described in the currently effective prospectus and statement of additional information of the Trust and each Fund (collectively, the "**Prospectus**");

**WHEREAS**, the Trust desires to appoint Citi as custodian of the assets of each Fund; and

**WHEREAS**, Citi is willing to accept such appointment on the terms and conditions set forth herein.

**NOW THEREFORE**, in consideration of the mutual promises contained herein, the parties hereto, intending to be legally bound, mutually covenant and agree as follows:

1. <u>DEFINITIONS AND INTERPRETATION</u>.

"**Administrative Support Provider**" means those persons utilized by Citi to perform ancillary services of a purely administrative nature such as couriers, messengers or other commercial transport systems.

"**Authorized Person**" means the Trust or any person (including any individual or entity) authorized by the Trust to act on its behalf in the performance of any act, discretion or duty under this Agreement (including, for the avoidance of doubt, any officer or employee of such person) in a notice reasonably acceptable to Citi.

"**Cash**" means all cash in the form of U.S. Dollars or equivalent received and held under the terms of this Agreement, unless Citi agrees in writing to receive and hold any other currency.

"**Citigroup Organization**" means Citigroup, Inc. and any company or other entity of which Citigroup, Inc. is directly or indirectly a shareholder or owner. For purposes of this Agreement, each branch of Citibank, N.A. will be a separate member of the Citigroup Organization.

"**Clearance System**" means any clearing agency, settlement system, payments system, depository (including any entity, including but not limited to The Depository Trust Company ("**DTC**") and the National Securities Clearing Corporation ("**NSCC**"), that acts as a system for the central handling of Securities in the country where it is incorporated or organized or that acts as a transnational system .for the central handling of securities) used in connection with transactions relating to Shares or Securities and any nominee of the foregoing.

"**Fee Schedule**" means the schedule referred to in Section 17 as annexed hereto.

"**Instructions**" means any and all instructions (including approvals, consents and notices) received by Citi from, or reasonably believed by Citi to be from, any Authorized Person, including any instructions communicated through any manual or electronic medium or system agreed between the Trust and Citi. Instructions shall include information or directions from the Distributor appointed by the Trust, as described in Section 6 hereof. References to the Trust in this Agreement in regard to any Instruction shall include any Authorized Person.

"**Market Infrastructure**" means public utilities, external telecommunications facilities and other common carriers of electronic and other messages, and external postal services. Market infrastructures are not delegates or agents of Citi.

"**Sub custodian**" means those persons utilized by Citi for the safe-keeping, clearance and settlement of Securities.

"**Securities**" means any financial asset (other than Cash) from time to time held for the Trust under the terms of this Agreement; provided, however, unless otherwise agreed to in writing by Citi, Securities shall only consist of those U.S. equity securities eligible for transactions within the Continuous Net Settlement System of the National Securities Clearing Corporation and that are settled by delivery within The Depository Trust Company.

"**Taxes**" means all taxes, levies, imposts, charges, assessments, deductions, withholdings and related liabilities, including additions to tax, penalties and interest imposed on or in respect of (i) Securities or Cash, (ii) the transactions effected under this Agreement or (iii) the Trust; provided that "Taxes" does not include income or franchise taxes imposed on or measured by the net income of Citi or its agents.

2. <u>APPOINTMENT AS CUSTODIAN AND AGENT; ESTABLISHMENT OF ACCOUNTS</u>.

(A) ***Appointment***. The Trust herby constitutes and appoints Citi as (i) custodian of Shares of any Fund received for delivery or redemption to or from any Authorized Participant as provided in Sections 5 and 6 hereof, (ii) custodian of Securities and Cash at any time owned by a Fund and delivered to Citi as custodian hereunder and (iii) agent to perform certain accounting, recordkeeping and other services relating to Shares and the Securities and cash owned by a Fund as provided in Sections 5 and 6 hereof.

(B) ***Accounts***. The Trust authorizes Citi to establish on its books, pursuant to the terms of this Agreement, (i) a custody account or accounts (the "**Custody Account**") on behalf of each Fund or other accounts or arrangements as required in connection with any Securities and (ii) a cash account or accounts (the "**Cash Account**") with respect to each. The Custody Account or other arrangement as appropriate will be deemed to be a custody account for the receipt, safekeeping and maintenance of Securities, the Cash Account will be a current account for Cash including collateral received pursuant to Sections 5 and 6 of this Agreement.

(C) ***Acceptance of Securities and Cash***. Citi will determine in its reasonable discretion whether to accept (i) for custody in any Custody Account or otherwise as required to provide the custodial services specified in this Agreement, Securities of any kind and (ii) for deposit in the Cash Account or the Collateral Account, Cash in any currency. Citi will promptly notify the Trust if Citi does not accept any Securities or Cash.

(D) ***Payments and Deliveries***. The location of Citi is the sole place of payment of any obligation under this Agreement. Citi is only obligated to make payment in respect of the Cash Account in the currency in which that Cash Account is denominated.

3. <u>CUSTODY ACCOUNT PROCEDURES.</u>

(A) ***Designation of Custody Account***. The Custody Account will be in the name of the applicable Fund or such other name as the Trust may reasonably designate.

(B) ***Credits to the Custody Account***. Citi is not obligated to credit Securities to the Custody Account or otherwise as required in connection with services under this Agreement before receipt of such Securities by final settlement as determined in accordance with the regulations of the relevant market. If Citi makes a credit before such receipt, Citi may at any time reverse all or part of the credit and make an appropriate entry to the Custody Account or its other applicable records.

(C) ***Debits to the Custody Account***. If Citi has received Instructions that would result in the delivery of Securities exceeding credits to the Custody Account for that Security, Citi may reject the Instructions or may decide which deliveries it will make as required by market authorities or practices.

(D) ***Segregation***.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Citi will identify on its records that that Shares and Securities do not belong to Citi and are segregated from Citi's assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Citi will hold Securities with a Sub custodian only in an account that holds exclusively assets held by Citi for its customers. Citi will direct each Sub custodian to identify on its books that Securities are held for the account of Citi as custodian for its customers. Citi will direct each Sub custodian to hold Securities in a Clearance System only in an account of the Sub custodian which holds exclusively assets held by the Sub custodian for its customers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Any Securities deposited by Citi with a Sub custodian will be subject only to the instructions of Citi, and any Securities held in a Clearance System for the account of a Sub custodian will be subject only to the instructions of the Sub custodian. Any Securities held directly by Citi in any Clearance System will be held only in an account that holds exclusively assets held by Citi for its customers, to the extent permissible under applicable law and the rules of the Clearance System, and the account will be subject only to the instructions of Citi.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Citi will require the Sub custodian to agree that Securities will not be subject to any right, charge, security interest, lien or claim of any kind in favor of the Sub custodian.

(E) ***Denomination of Securities***. The Trust will bear the risk and expense associated with investing in Securities denominated in any currency.

(F) ***Irrevocable Commitments; Related Charges***. In carrying out Instructions to clear and/or settle transactions under this Agreement Citi may incur irrevocable commitments to pay for or deliver Securities or Shares, and the Trust shall reimburse Citi in respect of irrevocable commitments and any costs or charges, including any cash collateral obligations, incurred by Citi to any person (including any Clearance System) in connection with effecting any Instructions. The Trust's reimbursement obligation shall arise as a current obligation under this Agreement when Citi incurs an irrevocable commitment, regardless of its maturity {including the payment by Citi of required costs or charges).

4. <u>CASH ACCOUNT PROCEDURES</u>.

(A) ***Designation of Cash Account***. A Cash Account will be in the name of the Trust, on behalf of the applicable Fund, or such other name as the Trust may reasonably designate and will be held by Citi as banker and not as fiduciary or trustee.

(B) ***Credits and Debits to the Cash Account***. Citi may, but is not obligated to, make a credit or debit to the Cash Account before receipt by Citi of a corresponding and final payment in cleared funds. If Citi makes a credit or debit before such receipt, Citi may at any time. reverse all or part of the credit or debit (including any interest thereon), make an appropriate entry to the Cash Account, and if it reasonably so decides, require repayment of any amount corresponding to any debit. No prior action or course of dealing by Citi with respect to settlement of any transactions will obligate Citi to make any credit or debit before receipt of Cash.

(C) ***Overdrafts in the Cash Account***. The Trust, on behalf of a Fund, will ensure that it has sufficient immediately available funds in the Cash Account to settle •any Shares or Securities received against payment for credit to the Custody Account or otherwise required to effect any Instruction, including as described in Section 3(F). Citi may, but is not obligated to, make any debit to the Cash Account that might result in or increase an overdraft or exceed the immediately available funds credited to the Cash Account. If the total amount of debits to the Cash Account at any time would otherwise result in any overdraft or exceed the immediately available funds credited to the Cash Account, Citi may decide which debits it will make (in whole or in part and in the order it selects) or may reject any settlement of any Shares or Securities or any Instruction.

(D) ***Payments***. Any overdraft is payable on demand. The Trust on behalf of a Fund will transfer to Citi on closure of the Cash Account and otherwise on demand from Citi sufficient immediately available funds to cover any overdraft on the Cash Account or any other extension of credit and any interest, fees and other amounts owed. Citi may charge interest on any overdraft at the rate set forth on the Fee Schedule, as such rate may be changed from time to time by Citi in accordance with the terms of such Fee Schedule.

(E) ***Extensions of Credit; Reimbursement***. The Trust, on behalf of a Fund, agrees that any extension of credit to the Trust, on behalf of a Fund, under this Agreement will be unadvised, uncommitted and at the sole discretion of Citi, and the Trust, on behalf of a Fund, agrees that it shall repay any extension of credit upon demand. Citi may charge interest on any overdraft at the rate notified to the Trust, on behalf of a Fund, from time to time. Citi may at any time cancel or refuse any extension of credit. No prior action or course of dealing by Citi with respect to extending credit to effect any settlement of any transactions or any Instructions will obligate Citi to extend any credit in regard to any subsequent settlement of any transaction or Instruction. The Trust, on behalf of a Fund, agrees that "extension of credit" as used in this Agreement includes any daylight and overnight overdraft or similar advances, any reimbursement obligation as provided in this Agreement, and uncommitted overdraft lines or similar uncommitted lines provided by Citi to the Trust, on behalf of a Fund, in connection with the Cash Account or services under this Agreement.

(H) ***Rights for Extension of Credit***./***Lien***. In addition to any other remedies available to Citi under applicable law, Citi hereby has, and the Trust on behalf of the applicable Fund hereby grants, a continuing general lien on all Securities of the particular Fund to which Citi extended credit until satisfaction of all liabilities and obligations arising under this Agreement (whether actual or contingent) of the particular Fund to which Citi extended credit to Citi with respect to any fees and expenses or extensions of credit including, but not limited to, daylight and overnight overdrafts, charges resulting from reversals of

credits, reimbursement demands of Citi in respect of irrevocable commitments, and any other present and future obligations of the Trust payable to Citi.

(I) ***Rights for Extension of Credit***./***Set-Off***. Without limiting any rights Citi may have under applicable law, Citi may, without prior notice to the Trust, set off any payment obligation with regard to an extension of credit or the value of any other payment or delivery obligation owed by the particular Fund to which Citi extended credit against any payment obligations or the value of any delivery obligations owed by the particular Fund to which Citi extended credit, regardless of the place of payment, delivery and/or currency of any obligation (and for such purposes may make any currency conversion necessary). If any obligation is unliquidated or unascertained, Citi may set off as provided herein an amount estimated by it in good faith to be the amount of that obligation.

(J) ***Exercise of Rights***. If the Trust, on behalf of the particular Fund to which Citi extended credit, fails to pay Citi in respect of any extension of credit, is dissolved or becomes the subject of formal insolvency proceedings in any jurisdiction, or any step is taken against the Trust, on behalf of the particular Fund to which Citi extended credit, to initiate insolvency proceedings in any jurisdiction, Citi may, without notice to the Trust, and at any time: (i) appropriate and apply all or any part of the Securities and Cash held for the particular Fund to which Citi extended credit under this Agreement, by Citi against any or all obligations of the particular Fund to which Citi extended credit under this Agreement to Citi (whether matured or subject to any demand); (ii) sell all or any part of the Securities; and (iii) exercise, in respect of the Securities and Cash, all the rights and remedies a party with a senior security or similar right would be entitled to exercise in such default under any applicable law. The Trust, on behalf of the particular Fund to which Citi extended credit, shall not grant any person a lien, security interest, charge or similar rights or claims against Securities or Cash without Citi's consent.

(M) ***Foreign Exchange***. The Trust, on behalf of the particular Fund to which Citi extended credit, agrees that it assumes the risks associated with holding or effecting transactions in Cash denominated in any currency including any events or laws that delay or adversely affect transferability, convertibility or availability of any currency, appropriation or seizure, any devaluation or redenomination of any currency or fluctuations or changes in foreign exchange rates. The Trust, on behalf of the particular Fund to which Citi extended credit, may instruct Citi to execute a foreign exchange as part of the services under this Agreement. Instructions may be given on a case by case basis or as a standing Instruction. Citi will debit the Trust's Cash Account, on behalf of the particular Fund to which Citi extended credit, to process foreign exchange and credit the Trust's Cash Account, on behalf of the particular Fund to which Citi extended credit, with the new currency in accordance with the Instruction(s). Citi may net or set off transactions when effecting foreign exchange. Citi may be compensated in part from the spread taken on foreign exchange, and Citi or an affiliate may act as principal in any foreign exchange. The Trust, on behalf of the particular Fund to which Citi extended credit, will be notified of the exchange rate of all executed foreign exchange in its reporting from Citi or, if not included, upon Trust's request. The Trust, on behalf of the particular Fund to which Citi extended credit, acknowledges that the foreign exchange rate applied will depend on a number of factors, including the size of the transaction, the liquidity in the relevant currencies, the time of day and other market factors. The Trust, on behalf of the particular Fund to which Citi extended credit, may not receive published spot rates in the relevant currencies. Unless otherwise provided in applicable law, the Trust, on behalf of the particular Fund to which Citi extended credit, agrees that neither Citi nor any applicable affiliate assumes any fiduciary or other duty by virtue of effecting foreign exchange, nor are they acting as trustee.

5. <u>AGENCY SERVICES: PORTFOLIO COMPOSITION</u>.

(A) ***Determination of Creation Deposit***. Subject to and in accordance with directions and information provided by the Trust's sponsor (the "**Sponsor**") and the Fund's accountant (the "**Fund Accountant**"), in each case as identified by the Trust, the Trust's policies, as adopted from time to time by the Board of Trustees of the Trust (the "**Board**"), and procedures set forth in the Prospectus, Citi will determine for each Fund after the end of each trading day on the New York Stock Exchange (the "**NYSE**") the following information required for the issuance or redemption, as the case may be, of Shares in Creation Unit aggregations of a Fund on such date:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The identity and weighting of the Securities component and the Cash component (together with Securities, the "**Portfolio Components**") of a Creation Unit of such Fund for purposes of purchases in- kind and redemptions in-kind for standard and custom Creation Units. Identity and weighting of Portfolio Components for non-standard and negotiated Creation Units will be provided by the Sponsor by agreed upon deadlines.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Determine value of cash purchase and redemptions ("**Cash Values**") as instructed.

Citi will provide (or cause to be provided) the Portfolio Components and/or Cash Values as instructed according to the policies established by the Board, and as required will provide such information to the NSCC for dissemination prior to the opening of trading on the NYSE on each day that the NYSE is open.

(B) ***Movements of Portfolio Components***. In connection with purchases of Creation Units, Citi will monitor the receipt of the underlying Portfolio Components or the receipt of Cash as collateral in lieu of Securities pursuant to Instructions in accordance with Section 6 below, and will cause the delivery of Shares only upon confirmation that such Securities and/or Cash have settled in the applicable Custody Account or Cash Account. The settlement of Shares shall be aligned with the settlement of the underlying Portfolio Components.

In connection with redemptions of Creation Units, Citi will monitor the receipt of Shares or collateral in lieu of Shares, and will release to the applicable Authorized Participant the underlying Portfolio Components pursuant to Instructions received in accordance with Section 6 of this Agreement.

6. <u>AGENCY SERVICES: CREATION UNITS, SALES AND REDEMPTIONS</u>.

(A) ***Sale of Shares***. Citi will deposit into the Custody Account or Cash Account of the appropriate Fund, such payments (consisting of Securities and Cash, including Cash collateral) as are received from each person authorized to purchase Shares in Creation Units as identified by the Trust (each, an "**Authorized Participant**") for purchase of Shares in Creation Units thereof issued or sold from time to time by a Fund. The Trust's distributor ("**Distributor**") shall be the Trust's Authorized Person for advising Citi each day as to the Creation Units purchased by an Authorized Participant. Citi will provide timely notification to the Sponsor on behalf of each such Fund of any receipt by it of Portfolio Components as payments for Shares and instruct the Trust's transfer agent ("**Transfer Agent**") as to the issuance of new Shares in Creation Units in connection with such payments; and Citi will effect the transfer the Shares to the Authorized Participant through the NSCC or as otherwise required.

(B) ***Repurchases or Redemptions of Shares***. From Securities and Cash held for a Fund as may be available for the purpose, Citi will deliver Portfolio Components, as required, for payment to Authorized Participants who· have delivered to the Distributor proper instructions for the redemption or repurchase of Shares in Creation Unit aggregations, which will have been accepted by the Distributor. The Distributor

shall advise Citi each day as to the repurchase of Shares in Creation Units. Citi will transfer the applicable Portfolio Components to the Authorized Participant and instruct the Transfer Agent as to the cancellation of the corresponding Shares in Creation Units of the applicable Fund. Any cash redemption payment (less any applicable redemption transaction fee) due to the Authorized Participant on redemption will be effected through the NSCC, the DTC or through wire transfer (in the case of redemptions effected outside of the NSCC or the. DTC).

The Trust understands and agrees that, in accordance with generally accepted settlement practices and customs in certain jurisdictions or markets in which Securities may be held, Citi may deliver Securities prior to the receipt of Shares of a Fund the redemption for which such Securities were being delivered. Any loss resulting from such "free" delivery of Securities will be at the risk of the Trust without regard to whether any Instructions were for other delivery or receipt.

(C) ***Acceptance of Collateral in Lieu of Portfolio Components or Shares***. Citi shall accept Cash collateral in lieu of (i) any Securities required to be delivered by an Authorized Participant in connection with a sale of Shares pursuant to Section 6(A) of this Agreement or (ii) Shares in Creation Units required to be delivered by an Authorized Participant in connection with a repurchase or redemption of any such Creation Unit pursuant to Section 6(B) of this Agreement.

If any requisite Cash as collateral has not been received by Citi prior to 2:00 p.m. (Eastern Time) on the Settlement Date for the Shares being purchased (or Redemption Date for the Shares being redeemed), Citi will not be required to release the newly created Shares (or Portfolio Components underlying newly redeemed Shares); provided, however, that Citi shall make a good faith effort to release Shares or Portfolio Components where collateral is received after such time.

(D) ***Calculation of Collateral Amount***. On a daily basis, Citi will (i) calculate the amount of Cash as collateral, if any, required to be delivered by each Authorized Participant and (ii) contact each Authorized Participant, as applicable, and request the Authorized Participant post collateral equal to the Required Collateral Amount (defined below). All fund transfers shall be made by Fed wire. The Required Collateral Amount varies based on the portion of Securities or Shares delivered to a Custody Account by the Authorized Participant in connection with its purchase or redemption of Shares, as applicable, as of the relevant calculation date. The shortfall between the value of Securities delivered to the applicable Account and the value of the total basket of Securities underlying a Creation Unit (the "Total Basket Value") is referred to as the "Deficiency Amount".

In connection with the purchase of Shares by an Authorized Participant, the "Required Collateral Amount" shall be determined as follows: on any date, if the Deficiency Amount is 1/3 or less of the Total Basket Value, the Required Collateral Amount is 115% of the Deficiency Amount. If the Deficiency amount is more than 1/3 of the Total Basket Value, then the Required Collateral Amount is 115% of the Total Basket Value. In connection with the redemption of Shares by an authorized Participant, the Required Collateral Amount shall be equal to 115% of the value of the total number •of Shares underlying the applicable redemption order for each Creation Unit based on the trade date NAV of such Shares.

(E) ***Collateral Calls; Return of Collateral; Buy-Ins***.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Collateral Calls</u>. Citi shall contact the applicable Authorized Participant and request the Authorized Participant to post additional collateral on any business day when the collateral posted is less than the Required Collateral Amount. Notwithstanding this, Citi will not be required to call for additional collateral and the Authorized Participant will not be required to post additional collateral unless the difference between the collateral posted and the Required Collateral Amount

is at least 10% of the Required Collateral Amount on such date (the "Minimum Transfer Amount"); provided, that the Minimum Transfer Amount may be changed from time to time by mutual written consent of the parties. The Authorize Participant must post 100% of such additional collateral plus any applicable wire fee charged by Citi to the Authorized Participant to the extent that such shortfall was greater than or equal to the Minimum Transfer Amount. Citi will verify that the correct amount of additional collateral was timely received. Citi will copy the Sponsor on all collateral calls made to the Authorized Participant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Return of Collateral</u>. As Securities or Shares, as applicable, are delivered to Citi and the Deficiency Amount is reduced, Citi will, as promptly as practicable, cause the Fund to return excess collateral to the Authorized Participant, less any applicable wire fee charged by Citi to the Authorized Participant, to the extent. that the excess collateral is greater than or equal to the Minimum Transfer Amount (at least 10% of the Required Collateral Amount on such date, or such other percentage as may have been agreed to by mutual written consent of the parties). Upon delivery of all required Securities or Shares, as applicable, to Citi by the Authorized Participant (either as a result of a buy- in or as a result of delivery by the Authorized Participant), Citi shall return all remaining collateral to the Authorized Participant. Citi shall pay interest on collateral at a rate mutually agreed upon between Citi and the Fund. Interest accrued on any collateral will be paid to the applicable Authorized Participant on the l0th business day of month following the month in which interest was accrued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) <u>Buy-In</u>. At any time the Sponsor may give Citi an Instruction to pay or transfer any collateral including for settlement of any Securities or Shares purchased by the Fund as a buy-in of any Securities or Shares not delivered by an Authorized Participant. Citi shall have no responsibility for determining if the Sponsor is authorized to effect any payment or transfer of collateral.

7. <u>INSTRUCTIONS</u>.

(A) Instructions may be transmitted through any electronic medium or system or manually as agreed between the Trust and Citi.

(B) The Trust and Citi will comply with applicable security procedures designed to verify the origination of Instructions (the "**Procedures**"). Citi's sole obligation will be to comply with what is contained in the Procedures to establish the identity or authority of any Authorized Person to send any Instruction. Citi is not responsible for errors or omissions made by the Trust or resulting from fraud or the duplication of any Instruction by the Trust, and Citi may act on any Instruction by reference to an account number only, even if any account name is provided. Citi may act on an Instruction if it reasonably believes it contains sufficient information.

(C) Citi may decide not to act on an Instruction where it reasonably doubts its contents, authorization, origination or compliance with any Procedures and will promptly notify the Trust of its decision.

(D) If Citi acts on any Instruction requiring manual processing (including facsimile or telephone), and, if Citi complies with the Procedures, then the Trust will be responsible for any loss or damage suffered by the Trust or Citi in connection with that Instruction. The Trust expressly acknowledges that the Trust is aware that the use of manual forms of communication to convey Instructions increases the risk of error, security and privacy issues and fraudulent activities.

(E) Citi may rely on the authority of each Authorized Person until Citi has received notice acceptable to it of any change from the Trust or any other Authorized Person and Citi has had a reasonable time to act (after which time it may rely on the change).

(F) Citi is obligated to act on Instructions only to the extent they are received prior to applicable cut-off times on banking days when Citi and the applicable financial markets are open for business. Instructions are to be given in the English language unless Citi otherwise specifies or English is not appropriate in regard to any agreed electronic method for sending Instructions.

(G) In some securities markets, securities deliveries and payments therefore may not be or are not customarily made simultaneously. Accordingly, notwithstanding the Trust's Instruction to deliver Securities against payment or to pay for Securities against delivery, Citi may make or accept payment for or. delivery of securities at such time and in such form and manner as is in accordance with relevant local law and practice or with the customs prevailing in the relevant market.

(H) Without additional Instruction, Citi may act on Instructions generated by itself in accordance with its obligations as agency services provider as provided in Sections 5 and 6 of this Agreement.

8. <u>PERFORMANCE BY CITI</u>.

(A) ***Custodial Duties Requiring Instructions***. Citi will carry out the following actions only upon receipt of Instructions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) make payment for and/or receive any Shares or Securities or deliver or dispose of any Shares or Securities, except as otherwise specifically provided for in this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) deal with rights, conversions, options, warrants and other similar interests or any other discretionary right in connection with Securities; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) carry out any action affecting Shares, Securities or Cash or the Custody Account, Cash Account or other applicable record in regard to Shares other than those specified in Section 8(B) below, but in each instance subject to the agreement of Citi.

(B) ***Non-Discretionary Custodial Duties***. Absent a contrary Instruction, Citi is authorized to carry out non-discretionary matters in connection with anything provided in this Agreement or any Instruction. Without limiting the authority of Citi with regard to non-discretionary matters, without further Instructions, Citi will:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) in the Trust's name or on its behalf, sign any documents relating to Shares or Securities which may be required (i) pursuant to an Instruction to obtain any Shares, Securities or Cash or (ii) by any tax or regulatory authority;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) receive and/or credit income, payments and distributions in respect of Shares or Securities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) exchange interim or temporary receipts for definitive certificates, and old or overstamped certificates for new certificates; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) make any payment by debiting the Cash Account or any other designated account of the Trust with Citi as required to effect any Instruction.

9. <u>CORPORATE ACTIONS</u>.

(A) ***Notices***. Citi will notify the Trust of, or make available to the Trust, any notices, circulars, reports and announcements which Citi has received, in the course of acting in the capacity of custodian, concerning Securities held on the Trust's behalf that require discretionary action.

(B) ***Third Party Information***. Citi is not responsible for the form, accuracy or content of any notice, circular, report, announcement or other material not prepared by Citi or made available through any electronic means.

(C) ***No Action Without Instructions***. If the Trust does not provide Citi with timely Instructions with respect to any discretionary action, Citi will not take any action in relation to that action.

(D) ***Shareholders Voting***. Citi's only obligation in regard to any matter where the Trust may exercise shareholder voting rights will be to provide shareholder voting services as specified in a separate proxy services letter between Citi and the Trust.

10. <u>COMMUNICATIONS, RECORDS AND ACCESS</u>.

(A) ***Communications and Statements***. Communications, notices and announcements by Citi and statements with regard to the Custody Account, or other records with regard to Shares, and the Cash Account may be made available by electronic form and not in hard copy. The Trust will notify Citi promptly in writing of anything incorrect in a statement or advice and in any case writing sixty (60) days from the date on which the statement or advice is sent or made available to the Trust.

(B) ***Price Information***. Unless otherwise agreed in writing, Citi may, but is not obligated to, provide information on statements or reports showing pricing or values for Securities held by Citi for the Trust. Unless otherwise agreed in this Agreement or in writing by Citi, Citi has no responsibility to independently verify any such prices or similar data, and Citi has no obligation for the availability or accuracy of any price or similar data specified on any statement or report.

(C) ***Securities Held Elsewhere***. Securities indicated on any statement or report as "held elsewhere" and securities that are on loan or not held in the name of Citi are not held by Citi as custodial agent under this Agreement unless Citi verifies in writing that the Securities are held by a Sub custodian or other securities intermediary in an account on behalf of Citi subject to instructions only from Citi. Citi will not be responsible for Instructions, proxy services, corporate actions or other obligations under this Agreement with regard to such Securities.

(D) ***Access to Records***. Citi will allow the Trust and its independent public accountants, agents or regulators reasonable access to the records of Citi relating to Shares, Securities or Cash as is required by the Trust in connection with an examination of the books and records pertaining to the affairs of the Trust and will seek to obtain such access from each sub custodian and Clearance System.

(E) ***Records***. The Trust shall furnish or cause to be furnished accurate and timely information needed by Citi to complete its records and to perform its services under this Agreement when such information is not readily available from its own records or accounts or when such information is not readily available from generally accepted securities industry services or publications. Citi may rely conclusively on the completeness and correctness of such accounts, information and records. Citi shall have no responsibility for any information furnished by the Transfer Agent, the Sponsor, the Distributor or the Trust as required in connection with the performance of Citi's services as described in Sections 5 and 6 of this Agreement.

Citi acknowledges that all of the accounts and records maintained by Citi pursuant hereto are the property of the Trust.

11. <u>TAX STATUS/WITHHOLDING TAXES</u>.

(A) ***Information***. The Trust will provide Citi, from time to time and in a timely manner, with information and proof (copies or originals) as Citi reasonably requests, as to the Trust's and/or the underlying beneficial owner's tax status or residence. Information and proof may include, as appropriate, executing certificates, making representations and warranties, or providing other information or documents in respect of Securities, as Citi deems necessary or proper to fulfill obligations under applicable law.

(B) ***Payment***. If any Taxes become payable with respect to any payment to be made to the Trust, such Taxes will be payable by the Trust. Citi may withhold the Taxes from such payment or debit any amount available in the Cash Account and apply such Cash in satisfaction of such Taxes. If any Taxes become payable with respect to any prior payment made to the Trust by Citi, Citi may debit any Cash Account in satisfaction of such prior Taxes. The Trust will remain liable for any deficiency.

(C) ***Tax Relief***. In the event the Trust requests that Citi provide tax relief services and Citi agrees to provide such services, Citi will apply for appropriate tax relief (either by way of reduced tax rates at the time of an income payment or retrospective tax reclaims in certain markets as agreed from time to time); provided the Trust provides to Citi such documentation and information as to it or its underlying beneficial owner Trusts as is necessary to secure such tax relief. However, in no event will Citi be responsible, or liable, for any Taxes resulting from the inability to secure tax relief, or for the failure of any Trust or beneficial owner to obtain the benefit of credits, on the basis of foreign taxes withheld, against any income tax liability.

12. <u>LIEN AND SET OFF</u>.

(A) ***Lien***. In addition to any other remedies available under applicable law, Citi will have, and the Trust hereby grants, a continuing general lien on all Securities or Cash held by or subject to the control of Citi until the satisfaction of liabilities arising under this Agreement of the Trust to Citi in respect to any fees and expenses or credit exposures incurred in the performance of services under this Agreement. Notwithstanding anything else in this Section 12(A), the Securities or Cash held with respect to any Fund shall only be used to satisfy any obligations of the Trust to Citi with regard to that Fund and shall not be used to satisfy any obligation of the Trust to Citi in connection with any other Fund.

(B) ***Set Off***. To the extent permitted by applicable law and in addition to any other remedies available to Citi under applicable law, Citi may, after prior reasonable notice to the Trust, set off any payment obligation owed to it by the Trust in connection with all liabilities arising under this Agreement with regard to any Fund against any payment obligation owed by it to the Trust under this Agreement with regard to that Fund regardless of the place of payment or currency of either obligation (and for such purpose may make any currency conversion necessary).

13. <u>USE OF THIRD PARTIES</u>.

(A) ***General Authority***. Citi is hereby authorized to appoint Sub custodians and Administrative Support Providers as its delegates to perform any of the duties of Citi under this Agreement. Citi and each Sub custodian is hereby authorized to use or participate in Market Infrastructures and, as required by law, regulation or best market practice, Clearance Systems in performing the duties of Citi or any duties delegated to any Sub custodian.

(B) ***Selection***. Citi will use reasonable care in the selection and continued appointment of Sub custodians and Administrative Support Providers.

14. <u>SCOPE OF RESPONSIBILITY</u>.

(A) ***Standard of Care***. Citi will perform its obligations with reasonable care as determined in accordance with the standards and practices of professional custodians or agency services providers for hire in the market or jurisdiction in which Citi performs services under this Agreement. Citi will cause each Sub custodian and Administrative Support Provider to perform with reasonable care, as determined in accordance with the standards and practices of professional custodians or similar services provides, as applicable, in the market or jurisdiction in which the Sub custodian or Administrative Support Provider performs services for Citi in connection with this Agreement and any Shares, Securities or Cash.

(B) ***Responsibility for Losses***.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Direct Damages</u>. Citi will be liable for the Trust's direct damages resulting from the negligence, willful default or fraud of Citi or any Sub custodian, Administrative Support Provider or their nominee. Citi will not be liable for any damages or losses by reason only of the liquidation or insolvency of any Sub custodian or Administrative Support Provider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Stop Loss</u>. The Trust will promptly notify Citi of any loss known to the Trust which it believes was caused by Citi or any Sub Custodian or Administrative Support Provider. Absent such notification, Citi's liability for any loss in regard to such discrepancy or errors will not accrue beyond the date the Trust should have provided such notice.

(C) ***Limitations on Citi's Responsibility***.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>General</u>. Citi is responsible for the performance of only those duties as are expressly set forth herein, including the performance of any Instruction given in accordance with this Agreement. Citi will have no implied duties or obligations and the provision of services under this Agreement does not constitute Citi a trustee or fiduciary with respect to any Shares, Securities or Cash. Citi has no duty or responsibility to determine that any Instruction is for the payment or delivery of Securities or Cash from or to the correct Custody Account or Cash Account. Citi has no responsibility or liability whatsoever for or on account of Shares, Securities or Cash not delivered to it.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Sole Obligations of Citi</u>. The Trust understands and agrees that (i) the obligations and duties of Citi will be performed only by Citi and are not obligations or duties of any other member of the Citigroup Organization (including any branch or office of Citi) and (ii) the rights of the Trust with respect to Citi extend only to Citi and, except as provided by law, do not extend to any other member of the Citigroup Organization.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) <u>No Liability for Third Parties</u>. Except as provided in this Agreement with regard to Sub custodians and Administrative Support Providers, Citi is not responsible for the acts, omissions, defaults or insolvency of any third party including, but not limited to, any Clearance System, Market Infrastructure, broker, counterparty or issuer of Securities. Clearance Systems are not delegates or agents of Citi, and Citi has no responsibility for selection or appointment of any Clearance System or Market Infrastructure.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) <u>Performance Subject to Laws</u>. The Trust understands and agrees that Citi's performance of this Agreement is subject to the relevant local laws (including governmental acts, regulations,

decrees, orders and treaties) and the rules, operating procedures and practices of any relevant stock exchange, Clearance System, or market where or through which Instructions are to be carried out and to which Citi (directly or indirectly) is subject and as exist in the country in which any Shares, Securities or Cash are held. Shares or Securities deposited with Clearance Systems hereunder will be subject to the laws, rules, and statements of principle and practices of such Clearance Systems. Citi will not be responsible for any failure to perform any of its obligations (nor will it be responsible for any unavailability of funds credited to the Cash Account) if such performance by Citi, any Sub custodian or any Administrative Support Provider would result in Citi, any Sub custodian or any Administrative Support Provider being in breach of any law, regulation or other requirement of any governmental or other authority in accordance with which it is required to act. Citi may take and instruct any delegate to take any action which it considers appropriate so as to comply with any applicable law, regulation, request from any public or regulatory authority or any of its policies which relate to the prevention of fraud, money laundering, terrorism or other criminal activities or the provision of financial or other services to sanctioned persons or entities. In certain circumstances such action may delay or prevent the processing of Instructions, the settlement of transactions or the performance of obligations under this Agreement. The laws and market practice applicable in many jurisdictions are subject to regular change, and Citi will only be obligated to bring to the Trust's attention those changes which affect Citi's performance of this Agreement which are of a fundamental nature.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) <u>Prevention of Performance</u>. Citi will not be responsible for any failure to perform any of its obligations (nor will it be responsible for any unavailability of funds credited to the Cash Account) if such performance by Citi, any Sub custodian or any Administrative Support Provider is prevented, hindered or delayed by a Force Majeure Event, in such case its obligations will be suspended for so long as the Force Majeure Event continues. "Force Majeure Event" means any event due to any cause beyond the reasonable control of Citi, any Sub custodian or any Administrative Support Provider, such as restrictions on convertibility or transferability, requisitions, involuntary transfers, unavailability of communications system, sabotage, fire, flood, explosion, acts of God, civil commotion, strikes or industrial action of any kind, riots, insurrection, war or acts of government. Upon the occurrence of any Force Majeure Event, Citi will inform the Trust and will use its reasonable efforts to mitigate any losses that the Trust may suffer as a result thereof. For the avoidance of doubt, Citi confirms that it maintains and regularly tests disaster recovery plans and contingency back-up services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) <u>Trust's Reporting Obligations</u>. The Trust will be solely responsible for all filings, tax returns and reports on any transactions in respect of Shares, Securities or Cash or relating to Shares, Securities or Cash as may be required by any relevant authority, whether governmental or otherwise. The Trust is responsible for compliance with all applicable limitations or qualifications in regard to the Trust's investment in any Securities in any country or jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) <u>Validity of Securities</u>. Citi will exercise reasonable care in receiving Shares or Securities but does not warrant or guarantee the form, authenticity, value, transferability or validity of any Shares or Security received or held by Citi. Citi also does not guarantee the validity of the issue of any Shares or of Securities received for a Fund, the legality of the transactions thereof or the propriety of the price incurred therefor; the legality of any sale of any Shares or Securities by or for a Fund or the propriety of the amount for which the same are sold; the legality of an issue or sale of any Shares or the sufficiency of the amount to be received therefore; the legality of the repurchase of any Shares or the propriety of the amount to be paid therefore; the legality of the

declaration of any dividend by a Fund or the legality of the distribution of any Securities as payment in kind of such dividend; and any property or moneys of a Fund unless and until received by it, and any such property or moneys delivered or paid by it pursuant to the terms hereof. If Citi becomes aware of any defect in title or forgery of any Security, Citi shall promptly notify the Trust.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) <u>Capacity of Custodian</u>. Citi is not acting under this Agreement as an investment manager, nor as an investment, legal or tax adviser to the Trust, and Citi's duty is solely to act as a custodian or agency services provider in accordance with the terms of this Agreement. For the avoidance of doubt, the parties hereby agree that Citi is not an agent of or .a trustee for any customer of the Trust, and in no circumstances will any customer of the Trust have any direct rights against Citi with regard to this Agreement and consequently any matter in respect of a customer of the Trust will be dealt with only between the Trust and Citi.

15. <u>INDEMNITY</u>.

(A) ***Indemnity to Citi***. The Trust agrees to indemnify Citi (including without limitation each and any of its respective officers, directors, employees, and representatives) for, and to defend and hold Citi harmless from, all losses, costs, damages and expenses (including reasonable legal fees incurred by Citi or such person in any action or proceeding between Citi and the Trust or between Citi and any third party arising from or in connection with the performance of this Agreement) (each referred to as a "**Loss**"), imposed on, incurred by, or asserted against Citi in connection with or arising out of this Agreement, except any Loss resulting from the negligence or fraud of Citi or any Sub custodian or Administrative Support Provider or any of their nominees.

(B) ***Trust's Direct Liability***. The disclosure by the Trust to Citi that the Trust has entered into this Agreement as the agent or representative of another person will not relieve the Trust of any of its obligations under this Agreement.

(C) ***Indemnity to the Trust***. Citi agrees to indemnify the Trust (including without limitation each and any of its respective officers, directors, employees, and representatives) for, and to defend and hold the Trust harmless from, all losses, costs, damages and expenses (including reasonable legal fees incurred by the Trust or such person in any action or proceeding between the Trust and Citi or between the Trust and any third party arising from or in connection with the performance of this Agreement) (each referred to as a "Loss"), imposed on, incurred by, or asserted against the Trust in connection with or arising out of this Agreement, except any Loss that is payable to Citi or any other person .as specified in Section 15(A) of this Agreement; provided, however, the liability of Citi for any Loss will not exceed the payment of Direct Damages as provided in Section 14(B)(i) of this Agreement except for reasonable legal fees as specified in this Section 15(C).

16. <u>MUTUAL EXCLUSION OF CONSEQUENTIAL DAMAGES</u>.

UNDER NO CIRCUMSTANCES WILL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR SPECIAL OR PUNITIVE DAMAGES, OR CONSEQUENTIAL LOSS OR DAMAGE, OR ANY LOSS OF PROFITS, GOODWILL, BUSINESS OPPORTUNITY, BUSINESS, REVENUE OR ANTICIPATED SAVINGS, IN RELATION TO THIS AGREEMENT, WHETHER OR NOT THE RELEVANT LOSS WAS FORESEEABLE, OR THE PARTY WAS ADVISED OF THE POSSIBILITY OF SUCH LOSS OR DAMAGE OR THAT SUCH LOSS WAS IN CONTEMPLATION OF THE OTHER PARTY.

17. <u>FEES AND EXPENSES</u>.

The Trust agrees to pay all fees, charges and obligations incurred from time to time for any services pursuant to this Agreement as determined in accordance with the terms of the Fee Schedule, which may be changed from time to time by Citi upon mutual agreement of the parties, together with any other amounts payable to Citi under this Agreement. Citi may debit the Cash Account to pay any such fees, charges and obligations.

18. <u>CITIGROUP ORGANIZATION INVOLVEMENT</u>.

The Trust agrees and understands that any member of the Citigroup Organization can engage as principal or otherwise in any transaction effected by the Trust or by any person for its account and benefit, or by or on behalf of any counterparty or issuer. Citi is entitled to effect any transaction by or with itself or any member of the Citigroup Organization and to pay or keep any fee, commissions or compensation as specified in the Trust's Instruction or, if no specification is provided, any charges, fees, commissions or similar payments generally in effect from time to time with regard to such or similar transactions.

19. <u>INFORMATION AND DATA PROTECTION</u>.

Citi will treat information related to the Trust as confidential but, unless prohibited by law, the Trust, on behalf of itself and on behalf of its employees, contractors and customers, authorizes the transfer or disclosure of any information relating to the Trust to and between the branches, subsidiaries, representative offices, affiliates and agents of Citi and third parties selected by any of them, wherever situated, for confidential use in connection with the provision of services to the Trust (including for data processing, statistical and risk analysis purposes), and further acknowledges that any such branch, subsidiary, representative office, affiliate, agent or third party may transfer or disclose any such information as required by any law, court, regulator or legal process.

The Trust will treat the terms of this Agreement, including any Fee Schedule, as confidential to the extent permitted by applicable law.

Without the written approval of Citi, the Trust will not use the name, trade mark or service mark of Citi or describe the services contemplated under or the terms or conditions of this Agreement in any communication or document intended for distribution to any customer or investor in connection with the offering or sale by the Trust of Shares, products or services (an "**Offering Document**"); nor will the Trust amend any such references to Citi or the terms or conditions of this Agreement in any Offering Document that has been previously approved by Citi without Citi's written approval. Citi will not unreasonably withhold, condition or delay any of the foregoing requested approvals, provided that the Trust include, upon request by Citi, reasonable notices describing those terms of this Agreement relating to Citi and its liability and the limitations thereon. To the extent Citi distributes notices or statements to customers, Citi may, upon advance notice to the Trust, include reasonable notices describing those terms of this Agreement relating to Citi and its liability and the limitations thereon; if customer notices are not sent by Citi but rather by the Trust or some other person, the Trust will reasonably cooperate with any request by Citi to include such notices. The Trust shall not, in any communications with customers, whether oral or written, make any representations to its customers stating or implying that Citi is providing valuations with respect to Shares, Securities, products or services, verifying any valuations, or verifying the existence of any assets in connection with Shares, Securities, products or services.

20. <u>ADVERTISING</u>.

Neither the Trust nor Citi will display the name, trademark or service mark of the other without the prior written approval of the other, nor will the Trust display that of Citigroup, Inc. or any subsidiary of Citigroup, Inc. without prior written approval from Citigroup, Inc. or the subsidiary concerned. The Trust will not advertise or promote any service. provided by Citi without Citi's prior written consent. Provided, however, the Trust may identify Citi as custodian and agency services provider as provided in this Agreement as permitted in Section 19 of this Agreement or as otherwise required by the Trust under applicable law.

21. <u>REPRESENTATIONS</u>.

(A) ***General***. The Trust and Citi each represents at the date this Agreement is entered into and any custodial service is used or provided that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) It is duly organized and in good standing in every jurisdiction where it is required so to be;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) It has the power and authority to sign and to perform its obligations under this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) This Agreement is duly Authorized and signed and is its legal, valid and binding obligation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Any consent, authorization or instruction required in connection with its execution and performance of this Agreement has been provided by any relevant third party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Any act required by any relevant governmental or other authority to be done in connection with its execution and performance of this Agreement has been or will be done (and will be renewed if necessary); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) Its performance of this Agreement will not violate or breach any applicable law, regulation, contract or other requirement.

(B) ***Trust***. The Trust also represents at the date this Agreement is entered into and any custodial service is used or provided that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) It has authority to deposit the Securities received in the Custody Account and the Cash in the Cash Account and there is no claim or encumbrance that adversely affects any delivery of Securities or payment of Cash made in accordance with this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Where it acts as an agent on behalf of any of its own customers, whether or not expressly identified to Citi from time to time, any such customers will not be customers or indirect customers of Citi; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) It has not relied on any oral or written representation made by Citi or any person on its behalf.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) It has received from the Securities and Exchange Commission· an order to operate as an exchange traded fund.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) It is duly authorized to issue the Shares.

22. <u>REPRESENTATIVE CAPACITY</u>.

(A) ***Non-Recourse***. A copy of the declaration of trust or other organizational document of the Trust and/or each Fund is on file with the appropriate authority, which has been provided by the Trust to Citi, and Citi acknowledges and agrees that this Agreement is not executed on behalf of the trustees of the Trust as individuals, and the obligations of this Agreement are not binding on any of the trustees, officers, shareholders of the Trust individually, but are binding only upon the assets and property of each Fund with respect to its Shares, Securities and Cash.

(B) ***Several Obligations***. With respect to any obligations of the Trust with respect to a Fund arising out of this Agreement, Citi shall look for payment or satisfaction of any obligation solely to the Shares, Securities, Cash or other assets of the Fund to which such obligation relates as though each Fund has separately contracted with Citi by separate written instrument with respect to its assets and transactions.

23. <u>TERMINATION</u>.

(A) ***Term***. This Agreement will begin on the Effective Date and have an initial term of one (1) year from the Effective Date (the "**Initial Term**"). Thereafter, unless otherwise terminated pursuant to Section 23(B), this Agreement shall be renewed automatically for successive one year periods ("**Rollover Periods**").

(B) ***Date of Termination***. Any party may terminate this Agreement in whole or as between itself and the other parties hereto by giving the other parties hereto written notice not less than ninety (90) days' prior to the end of the Initial Term or any Rollover Period (which notice of non-renewal will cause this Agreement to terminate as of the end of the Initial Term or such Rollover Period, as applicable). Termination with respect to any Fund shall be effected by Citi and the Trust agreeing to an amended Appendix A deleting such Fund. Termination of this Agreement with respect to any Fund shall not terminate this Agreement with respect to any other Fund.

(C) ***Termination-related Obligations***. If the Trust has terminated this Agreement without cause during the Initial Term (other than pursuant to a notice of non-renewal properly delivered in accordance with Section 23(B) of this Agreement), the Trust will pay Citi as liquidated damages for such default, an amount equal to the balance that would be due Citi for its services under this Agreement during the balance of the Initial Term or Rollover Period, as applicable, assuming for purposes of the calculation of the one-time payment that the fees that would be earned by Citi for each month would be based upon the average fees payable to Citi monthly during the 12 months before the date of the event that triggers such payment ("**Liquidated Damages**"); provided, however, that if the Trust closes all of the Funds subject to this Agreement such Liquidated Damages shall be an amount equal to the balance that would be due Citi for its services under this Agreement during the lesser of (x) the balance of the Initial Term or Rollover Period, as applicable, or (y) twelve (12) months. In the event that the Trust is, in part or in whole, liquidated, dissolved, merged into a third party, acquired by a third party, or involved in any other transaction that materially reduces the assets and/or accounts serviced by Citi pursuant to this Agreement, the liquidated damages provision set forth above will apply, and will be adjusted ratably if any of the events described above is partial. Any liquidated damages amount payable to Citi will be payable on or before the date of the event that triggers the payment obligation. Inasmuch as a default by Trust will cause substantial damages to Citi and because of the difficulty of estimating the. damages that will result, the Parties agree that the Liquidated Damages is a reasonable forecast of probable actual loss to Citi and that this sum is agreed to as liquidated damages and not as a penalty.

(D) ***Effect on Property***. Citi will deliver Shares, Securities and Cash as Instructed by the Trust. If by the termination date the Trust has not given Instructions to deliver any Shares, Securities or Cash, Citi will continue to safekeep such Shares, Securities and/or Cash until the Trust provides Instructions to effect a free delivery of such. However, Citi will provide no other services as regard to any such Shares or Securities except to collect and hold any cash distributions. Citi will be entitled to charge the Trust standard fees for Shares, Securities or Cash retained in safekeeping after termination of this Agreement. Notwithstanding termination of this Agreement or any Instruction, Citi may retain sufficient Shares, Securities or Cash to close out or complete any transaction that Citi will be required to settle on the Trust's behalf.

(E) ***Surviving Terms***. The rights and obligations contained in Sections 11, 12, 13, 14, 15, 19, 22, 23 and 24 of this Agreement will survive the termination of this Agreement.

24. <u>GOVERNING LAW AND JURISDICTION</u>.

(A) ***Governing Law***. This Agreement will be governed by and construed in accordance with the internal laws (and not the laws of conflicts) of the State of New York.

(B) ***Jurisdiction***. The federal and State courts located in New York Country in the State of New York will have non-exclusive jurisdiction to hear any disputes arising out of or in connection with this Agreement, and the parties irrevocably submit to the jurisdiction of such courts.

(C) ***Venue***. Each party hereto waives any objection it may have at any time, to the laying of venue of any actions or proceedings brought in any court specified in Section 24 hereof, waives any claim that such actions or proceedings have been brought in an inconvenient forum and further waives the right to object that such court does not have jurisdiction over such party.

25. <u>MISCELLANEOUS</u>.

(A) ***Entire Agreement; Amendments***. This Agreement consists exclusively of this document together with any schedules. Citi may notify the Trust of terms which are applicable to the provision of services in the location of a particular office and such terms will be contained in a schedule and will supplement this Agreement in relation to that office. In case of inconsistency with the rest of this Agreement, such terms will prevail in relation to that office.

Except as specified in this Agreement, this Agreement may only be modified by written agreement of the Trust and Citi.

Additional Funds may be added to this Agreement upon written agreement of the Trust and Citi by amendment of Appendix A adding any additional Fund.

(B) ***Severability***. If any provision of this Agreement is or becomes illegal, invalid or unenforceable under any applicable law, the remaining provisions will remain in full force and effect (as will that provision under any other law).

(C) ***Waiver of Rights***. No failure or delay of the Trust or Citi in exercising any right or remedy under this Agreement will constitute a waiver of that right. Any waiver of any right will be limited to the specific instance. The exclusion or omission of any provision or term from this Agreement will not be deemed to be a waiver of any right or remedy the Trust or Citi may have under applicable law.

(D) ***Recordings***. The Trust and Citi consent to telephonic or electronic recordings for security and quality of service purposes and agree that either may produce telephonic or electronic recordings or computer records as evidence in any proceedings brought in connection with this Agreement.

(E) ***Further Information***. The Trust agrees to execute further documents and provide materials and information as may be reasonably requested by Citi to enable it to perform its duties and obligations under this Agreement.

(F) ***Assignment***. No party may assign or transfer any of its rights or obligations under this Agreement without the other's prior written consent, which consent will not be unreasonably withheld or delayed; provided that Citi may make such assignment or transfer to a branch, subsidiary or affiliate if it does not materially affect the provision of services to the Trust.

(G) ***Headings***. Titles to Sections of this Agreement are included for convenience of reference only and will be disregarded in construing the language contained in this Agreement.

(H) ***Counterparts***. This Agreement may be executed in several counterparts, each of which will be an original, but all of which together will constitute one and the same agreement.

*SIGNATURES ON FOLLOWING PAGE*

 

IN WITNESS WHEREOF, the parties hereto have caused this Amended and Restated Agreement to be executed by their respective officers thereunto duly authorized.

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;**STRATEGY SHARES** | &nbsp;&nbsp;**STRATEGY SHARES** | &nbsp;&nbsp;**STRATEGY SHARES** |
| &nbsp;&nbsp;By: | &nbsp;&nbsp;/s/ Jennifer Bailey | &nbsp;&nbsp;/s/ Jennifer Bailey |
| &nbsp;&nbsp;Name: | &nbsp;&nbsp;Jennifer Bailey | &nbsp;&nbsp;Jennifer Bailey |
| &nbsp;&nbsp;Title: | &nbsp;&nbsp;Secretary | &nbsp;&nbsp;Secretary |
| &nbsp;&nbsp;Date: | &nbsp;&nbsp;4/6/2026 | &nbsp;&nbsp;4/6/2026 |
| &nbsp;&nbsp;**CITIBANK, N.A.** | &nbsp;&nbsp;**CITIBANK, N.A.** | &nbsp;&nbsp;**CITIBANK, N.A.** |
| &nbsp;&nbsp;By: | &nbsp;&nbsp;By: | &nbsp;&nbsp;/s/ Christopher Ravn |
| &nbsp;&nbsp;Name: | &nbsp;&nbsp;Name: | &nbsp;&nbsp;Christopher Ravn |
| &nbsp;&nbsp;Title: | &nbsp;&nbsp;Title: | &nbsp;&nbsp;Managing Director, CBNA VP |
| &nbsp;&nbsp;Date: | &nbsp;&nbsp;Date: | &nbsp;&nbsp;4/9/2026 |

---

**EXHIBIT 1**

**LIST OF FUNDS**

* Strategy Shares Gold Enhanced Yield ETF

* SSGBI Fund Limited, a wholly owned subsidiary of Strategy Shares Gold Enhanced Yield ETF

* Strategy Shares Nasdaq 7HANDL™ Index ETF

* Strategy Shares Newfound/Resolve Robust Momentum ETF

* Monopoly ETF

* Day Hagan Smart Buffer ETF

* Day Hagan Smart Sector ETF

* Day Hagan Smart Sector Fixed Income ETF

* Day Hagan Smart Sector International ETF

* Eventide High Dividend ETF

* Eventide International ETF\*

* Eventide Large Cap Growth ETF

* Eventide Large Cap Value ETF

* Eventide Small Cap ETF

* Eventide US Market ETF

\*Effective December 8, 2025.

**ANNEX A**

**U.S. SPECIAL RESOLUTION REGIME RECOGNITION**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) <u>Recognition of U.S. Regimes.</u> In the event that Citi becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of this Agreement, any transaction under this Agreement or any related Credit Enhancement between the parties (each, a "**Relevant Agreement**") and any interest and obligation in or under, and any property securing, such Relevant Agreement ("**Relevant Interests**") from Citi will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if the Relevant Agreement and Relevant Interests were governed by the laws of the United States or a state of the United States. In the event Citi or any Citi Affiliate becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights with respect to any Relevant Agreement against Citi are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Relevant Agreement were governed by the laws of the United States or a state of the United States.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) <u>Effective Date.</u> The provisions of this Appendix will come into effect on the later of the date of this Agreement and the Applicable Compliance Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) <u>Definitions.</u> For the purposes of this Appendix, the following definitions apply:

"*Applicable Compliance Date*" means: (a) the date of this Agreement, if Trust is a covered entity under the QFC Stay Rules; (b) July 1, 2019, if Trust is a "financial counterparty" other than a "small financial institution" (as such terms are defined under, and interpreted in accordance with, the QFC Stay Rules); or (c) otherwise, January 1, 2020.

"*Citi Affiliate*" means an "affiliate" (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of Citi.

"*Credit Enhancement*" means, with respect to any Relevant Agreement, any credit enhancement or other credit support arrangement in support of the obligations of Citi or Trust thereunder or with respect thereto, including any guarantee, pledge, charge, mortgage or other security interest in collateral or title transfer collateral arrangement, trust or similar arrangement, letter of credit, transfer of margin, reimbursement obligation or any similar arrangement.

"*Default Right*" has the meaning assigned to that term in, and shall be interpreted in accordance with, the QFC Stay Rules, including without limitation any right of a party to liquidate, terminate, cancel, rescind, or accelerate an agreement or transactions thereunder; set off or net amounts owed; exercise remedies in respect of collateral or other credit support or related property; demand payment or delivery; suspend, delay, or defer payment or performance; alter the amount of, demand the return of or modify any right to reuse collateral or margin provided; otherwise modify the obligations of a party; or any similar rights.

"*QFC Stay Rules*" means the regulations codified at 12 C.F.R. 252.2, 252.81–8. All references herein to the QFC Stay Rules shall be construed, with respect to Citi to mean the particular QFC Stay Rule(s) applicable to it.

"*U.S. Special Resolution Regime*" means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.

**ANNEX B**

**CONFIDENTIALITY AND DATA PRIVACY CONDITIONS**

**1. Introduction.** These conditions ("**Conditions**") form part of the Agreement that applies between Strategy Shares (the "**Client**") and Citibank, N.A. (the "**Service Provider**") in relation to the provision of Services to the Client pursuant to the Agreement. The purpose of these Conditions is to set out each Party's obligations in relation to Confidential Information and Personal Data received from the other Party in connection with the provision of Services under the Agreement. Some provisions of these Conditions are region-specific and will only apply in respect of the regions or countries specified. In some countries, further country-specific terms are required, and these will be included in the local conditions for that country provided in writing to the Client.

**2.1 Definitions.**

**"Confidential Information"** means any information or materials (in tangible or intangible form) relating to the Disclosing Party and/or its affiliates (including any entity that directly or indirectly controls, is controlled by or is under common control with, a party), branches or representative offices (collectively, "**Affiliates**") or their respective Representatives or Owners, that is received or accessed in any form or medium (and without regard to whether the information is owned by a party hereto or by a third party) by the Receiving Party or its Affiliates or their respective Representatives in connection with providing, receiving or using Services. "Confidential Information" includes Personal Data, information relating to the Disclosing Party's products and services and the terms and conditions on which they are provided, technology (including software, systems data, the form and format of reports and online computer screens), pricing information, internal policies, operational procedures, bank account and/or Service Provider details, transactional information, information related to the Disclosing Party's, its Affiliates' or its third party licensors' or vendors' trade secrets, customers, shareholders, investment or trading strategies, portfolio holdings, investments, shareholdings, business plans, strategies, forecasts or forecast assumptions, operations, methods of doing business, records, finances, assets, intellectual property rights, or other property or and any other confidential business or technical information, in each case that: (i) is designated by the Disclosing Party as confidential at the time of disclosure; (ii) is protected by applicable bank secrecy or other laws and regulations; (iii) a reasonable person would consider to be of a confidential and/or proprietary nature given the nature of the information and the circumstances of its disclosure; or (iv) is derived from, or developed by reference to or use of, any information described in the preceding clauses (i), (ii) and (iii).

**''Disclosing Party"** means a party to the Agreement that discloses Confidential Information to the other party.

**"Owner**" means any natural person or entity (or its branch) that: (i) owns, directly or indirectly, stock of, or profits, interests or capital or beneficial interests in, a party; or (ii) otherwise owns or exercises control over a party directly or indirectly through ownership, controlling interest or any other arrangement or means, including: (a) a person who ultimately has a controlling interest in, or who otherwise exercises control over, a party; or (b) the senior managing official(s) of a party.

**"Receiving Party"** means a party to the Agreement that receives Confidential Information from the other party to the Agreement.

**"Representatives"** means a party's officers, directors, employees, contractors, agents, representatives, professional advisers and Third Party Service Providers.

**2.2 Protection**. The Receiving Party will keep the Disclosing Party's Confidential Information confidential on the terms hereof and exercise at least the same degree of care with respect to the Disclosing Party's Confidential Information that the Receiving Party exercises to protect its own Confidential Information of a similar nature, and in any event, no less than reasonable care and as required under Data Protection Law. The Receiving Party will only use and disclose the Disclosing Party's Confidential Information to the extent permitted in these Conditions and the Agreement.

**2.3 Exceptions to Confidentiality.** Notwithstanding anything in these Conditions to the contrary but subject to Data Protection Law, the restrictions on the use and disclosure of Confidential Information in these Conditions do not apply to information that: (i) was publicly known or available in the public domain prior to the time of disclosure to the Receiving Party by or on behalf of the Disclosing Party; (ii) becomes publicly known or available in the public domain after disclosure to the Receiving Party by or on behalf of the Disclosing Party through no action or inaction of the Receiving Party; (iii) is in the possession of the Receiving Party, or becomes available to the Receiving Party, without confidentiality restrictions; (iv) is independently developed by the Receiving Party without use of or reliance upon any of the Confidential Information; (v) has been anonymized and/or aggregated with other information such that neither the Confidential Information of the Disclosing Party nor the identity of any Data Subject is disclosed; (vi) an authorized officer of the Disclosing Party has agreed in writing that the Receiving Party may disclose on a non-confidential basis; or (vii) is required to be disclosed by judicial or administrative processor otherwise by applicable law or regulation.

**3. Authorized Disclosures.**

**3.1 Definitions.**

**"Service Provider Recipients"** means the Service Provider, Service Provider Affiliates and their respective Representatives and Third Party Service Providers;

**"Payment Infrastructure Provider"** means any Clearance System (as defined in the Agreement) including any third party that forms part of a payment system infrastructure or which otherwise facilitates payments, including without limitation, communications, clearing and other payment systems or service providers; intermediary, agent and correspondent bank; digital or ewallets; or similar entities but excluding any third parties that have been appointed as agents by Service Provider Recipients in connection with the Agreement.

**"Permitted Purposes"** means in relation to a party's (or its Affiliates' or their respective Representatives') use of the other party's (or its Affiliates' or their respective Representatives') Confidential Information:

&nbsp;&nbsp;&nbsp;&nbsp;**(A)** To provide, or to receive and use, the Services in accordance with the Agreement and other applicable
documentation and to undertake related activities, such as, by way of non-exhaustive example:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) To fulfill applicable domestic and foreign legal, regulatory and compliance requirements (including know
your customer (KYC) and anti-money laundering (AML) obligations

applicable to a party and/or its Affiliates) and to otherwise make the disclosures specified in Condition 3.3 (Legal and Regulatory Disclosures);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) To verify the identity or authority of a party's Representatives who interact
with the other party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) For risk assessment, information security management, statistical, trend analysis
and planning purposes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) To monitor and record calls and electronic communications with the other party
for quality, training, investigation and fraud and other crime prevention purposes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) For fraud and other crime detection, prevention, investigation and prosecution;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) To enforce and defend a party's or its Affiliates' rights; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) To manage a party's relationship with the other party (which may include
the Service Provider providing information to the Client and its Affiliates about the Service Provider's and Service Provider Affiliates'
products and services);

&nbsp;&nbsp;&nbsp;&nbsp;**(B)** To make disclosures to third parties to whose accounts or from whose accounts the
Client instructs the Service Provider or Service Provider Affiliates to make or receive a payment from an account, to make or receive
any delivery of other property or to enable such third parties to perform reconciliations;

&nbsp;&nbsp;&nbsp;&nbsp;**(C)** To make disclosures to Payment Infrastructure Providers and to Service Provider
or Service Provider Affiliate's Third Party Service Providers in connection with the provision of the Services;

&nbsp;&nbsp;&nbsp;&nbsp;**(D)** To make disclosures to, and to obtain information from, credit information bureaus,
credit rating agencies, central banks or other bodies in connection with risk-based analysis and decisions by the Service Provider or
where such disclosures are otherwise required by applicable law, regulation or market practices, including to securities issuers or their
agents or representatives;

&nbsp;&nbsp;&nbsp;&nbsp;**(E)** To make disclosures to the Disclosing Party's Affiliates and third party
designees;

&nbsp;&nbsp;&nbsp;&nbsp;**(F)** In connection with the provision of products and services (including supporting
the opening of accounts) by the Service Provider or Service Provider Affiliates to the Client's Affiliates including transfer agents
or registrars in connection with any property of the Client; and

&nbsp;&nbsp;&nbsp;&nbsp;**(G)** For any additional purposes expressly authorized by the other party.

**"Third Party Service Provider"** means a third party reasonably selected by the Receiving Party or its Affiliate to provide services to or for the benefit of the Receiving Party, and who is not a Payment Infrastructure Provider (e.g. technology service providers, business process service providers, call center service providers, outsourcing service providers, consultants and other external advisors).

**3.2 Permitted Disclosures.** The Disclosing Party agrees (and where required by applicable bank secrecy or other laws is hereby deemed to provide a waiver and/or release to ensure) that the Receiving Party

may use and disclose the Disclosing Party's Confidential Information to the Receiving Party's Affiliates and to its and their respective Representatives, Payment Infrastructure Providers and any other third party recipients specified in these Conditions, who require access to such Confidential Information to the extent reasonably necessary to fulfil the relevant Permitted Purposes. The Receiving Party shall ensure that any of its Affiliates and Representatives to whom the Disclosing Party's Confidential Information is disclosed pursuant to this Condition 3.2 shall be bound pursuant to terms no less stringent than these Conditions and the Agreement to keep such Confidential Information confidential and to use it for only the relevant Permitted Purposes.

**3.3 Legal and Regulatory Disclosures.** The Disclosing Party agrees (and where required by applicable bank secrecy or other laws is hereby deemed to provide a waiver and/or release to ensure) that the Receiving Party may disclose the Disclosing Party's Confidential Information pursuant to: (i) legal requirements or (ii) any other domestic or foreign legal and/or regulatory obligation or request.

**4. Retention Period.**

Each of the Client and Service Provider or Service Provider Recipients may retain, use, and as applicable Process, the other party's Confidential Information for the period of time reasonably necessary for the relevant Permitted Purposes. On termination of the provision of the Services (including closure of accounts), each of the Client and Service Provider Recipients shall be entitled to retain, use, and as applicable Process, the other party's Confidential Information for legal, regulatory, audit and internal compliance purposes and in accordance with their internal records management policies, to the extent that this is permissible under applicable laws and regulations, and otherwise in accordance with these Conditions and the Agreement, but shall otherwise securely destroy or delete such Confidential Information.

**5. Information Security.** 

The Service Provider Recipients, in accordance with Data Protection Law, will, and will use reasonable endeavors to ensure that the Service Provider, Service Provider Affiliates and Third Party Service Providers will, implement reasonable and appropriate physical, technical and organizational security measures to protect Client Confidential Information that is within its or their custody or control against unauthorized or unlawful use (or in the case of Personal Data, unlawful Processing) and accidental destruction or loss. The Service Provider shall not Process Client Personal Data for any purpose other than Permitted Purposes unless expressly authorized or instructed by the Client.

**6. Personal Data.**

**6.1 Definitions.** 

"**Data Protection Law**" means any and all applicable data protection and privacy laws and regulations relating to the Processing of Personal Data, including any amendments or supplements to or replacements thereof.

"**Data Subject**" means a natural person who is identified, or who can be identified, directly or indirectly, in particular by reference to an identifier such as a name, an identification number, location data, an online identifier or to one or more factors specific to his or her physical, physiological, genetic, mental, economic, cultural or social identity, or, if different, the meaning given to this term or nearest equivalent

term under Data Protection Law.

**"Personal Data"** means any information that can be used, directly or indirectly, alone or in combination with other information, to identify a Data Subject, or if different, the meaning given to this term or nearest equivalent term under Data Protection Law.

**"Processing"** means any operation or set of operations which is performed on Personal Data or on sets of Personal Data, whether or not by automated means, such as collection, recording, organization, structuring, storage, adaptation or alteration, retrieval, consultation, use, disclosure by transmission, transfer, dissemination or otherwise making available, alignment or combination, restriction, erasure or destruction, or, if different, the meaning given to this term or nearest equivalent term under Data Protection Law.

**"Security Incident**" means an incident whereby the confidentiality of Disclosing Party Personal Data or other Confidential Information within the Receiving Party's possession, custody or control has been materially compromised in violation of these Conditions or the Agreement so as to pose a reasonable likelihood of harm to the Disclosing Party or the Data Subjects involved.

**6.2 Compliance with Data Protection Law.** In connection with the provision or receipt and use of the Services: (i) each party will comply with Data Protection Law; and (ii) the Client confirms that any Personal Data that it provides to Service Provider Recipients has been Processed fairly and lawfully, is accurate at the time provided and is relevant for the purposes for which it is being provided.

**6.3 Cross-border Personal Data transfers.** The Client acknowledges, and where required by applicable law or regulation agrees, that in the connection with providing the Services and otherwise making disclosures pursuant to Condition 3 (Authorized Disclosures), Personal Data of Client Data Subjects (e.g., the Client or its Affiliates' respective Representatives and Owners) may be disclosed and/or transferred to recipients located in countries other than the country in which the Service Provider entity or its branch which provides the Services is established or the Client is located. However, the Service Provider: (i) requires its Affiliates and Third Party Service Providers to protect Personal Data pursuant to Condition 5 (Information security); and (ii) carries out cross-border transfers of Personal Data in accordance with Data Protection Law.

**6.4 Legal basis for Processing Personal Data.** To the extent that the Service Provider Processes Personal Data of Client Data Subjects, the Client warrants that it has, if and to the extent required by Data Protection Law, provided notice to and obtained valid consent from such Data Subjects in relation to the Service Provider's Processing of their Personal Data as described in these Conditions. If the Client is itself a Data Subject, the Client warrants that if and to the extent required by Data Protection Law: (i) it has received the Service Provider's Privacy Statement or other privacy disclosure(s)as the Service Provider may notify the Client from time to time and (ii) it consents to such Processing.

**6.5 Security Incidents.**

**(A)** If the Service Provider becomes aware of a Security Incident, the Service Provider will investigate and remediate the effects of the Security Incident in accordance with its internal policies and procedures and the requirements of applicable laws and regulations. The Service Provider will notify the Client of a Security Incident as soon as reasonably practicable after the Service Provider becomes aware of it and in

compliance with any time periods required by applicable laws and regulations, unless the Service Provider is subject to a legal or regulatory constraint, or if it would compromise the Service Provider's investigation and delaying notification is consistent with applicable laws or regulation.

**(B)** Each party is responsible for making any notifications to regulators and Data Subjects concerning a Security Incident that it is required to make under Data Protection Law. Each party will provide reasonable information and assistance to the other party to the extent necessary to help the other party to meet its obligations to regulators and Data Subjects.

**(C)** Neither party will issue press or media statements or comments in connection with any Security Incident that name the other party unless it has obtained the other party's prior written permission or unless such Security Incident has otherwise become publicly known other than through a disclosure that is prohibited under this sentence.

**7. Provision of Data from Vendors and Exchanges.** 

**7.1 Definitions.** 

"**Data Suppliers**" means a vendor, exchange or other entity which supplies data used in the provision of the Services to the Client.

**7.2 Provision of Data.** 

The Service Provider may provide the Client with pricing and other data licensed from Data Suppliers. The Service Provider is licensed to provide such data only upon the following conditions: (i) Data Suppliers require that the data may not be used for any purpose independent of the service relationship established under the Agreement, and shall be used only internally (including in custodial holdings reports for actual investments sent to the investments' beneficial owners and to intermediaries between the Client and the beneficial owners); (ii) the Data Suppliers' licenses require that the Data Suppliers and their applicable affiliates shall be third-party beneficiaries of this Condition 7; and (iii) the Data Suppliers' licenses state that the Data Suppliers and their applicable affiliates have no liability or responsibility to the Client relating to the Client's receipt or use of the data. In addition to the foregoing, a Data Supplier may specify other terms or limitations applicable to the Client's use of its data and the Client shall comply with such limitations as communicated by the Service Provider. A Data Supplier may, in its discretion: (x) direct Service Provider to terminate the Client's receipt of the Data Supplier's data for any or no reason with or without notice; and (y) require the Client to enter into an agreement with it directly as a condition of receipt of its data.

**7.3 Distribution of Data to Subadvisors.** 

If a Client which is an investment manager engages a subadvisor to help manage certain of its funds, then, upon consent of the Service Provider, such Client may distribute the Data Suppliers' data to such subadvisor; provided, however, that the use of such data by the subadvisor shall be subject to the provisions of Conditions 7.2(i) to (iii) (inclusive).

## Ex-99.H

**AMENDED AND RESTATED**

**SERVICES AGREEMENT**

**STRATEGY SHARES;**

**CITIBANK, N.A.; and**

**CITI FUND SERVICES OHIO, INC.**

**<u>**TABLE OF CONTENTS**</u>**

---

| | |
|:---|:---|
| 1. DEFINITIONS. | 1 |
| 2. SERVICES AND RELATED TERMS AND CONDITIONS. | 1 |
| 3. INSTRUCTIONS. | 4 |
| 4. COMPLIANCE WITH LAWS; ADVICE. | 5 |
| 5. COMMUNICATIONS; RECORDS AND ACCESS; CONFIDENTIALITY; PUBLICITY. | 5 |
| 6. SCOPE OF RESPONSIBILITY. | 9 |
| 7. INDEMNITY. | 11 |
| 8. FEES AND EXPENSES. | 12 |
| 9. REPRESENTATIONS. | 12 |
| 10. REPRESENTATIVE CAPACITY. | 14 |
| 11. TERM AND TERMINATION. | 14 |
| 12. GOVERNING LAW AND JURISDICTION. | 15 |
| 13. MISCELLANEOUS. | 16 |

---

Schedule 1 Definitions

Schedule 2 Services

Schedule 3 Dependencies

Schedule 4 List of Funds

Schedule 5 Market or Reference Data

Schedule 6 Confidentiality and Data Privacy Conditions

**THIS AMENDED AND RESTATED SERVICES AGREEMENT** (this "**Agreement**") is effective March 26, 2026, by, between and among Strategy Shares (the "**Client**"), Citibank, N.A.<sup>[1]</sup> ("**Citibank**"), and Citi Fund Services Ohio, Inc. ("**CFSO**", together with Citibank, the "**Service Provider**"), and, with the Client, the "**Parties**").

**WHEREAS**, the Client is authorized to issue shares ("**Shares**") in separate series (each, a "**Fund**") and together with all other series subsequently established by the Client and made subject to this Agreement in accordance with Section 12 below, the "Funds"');

**WHEREAS**, the Client and the Service Provider entered into a Services Agreement (the "**Original Agreement**"), with an effective date of January 1, 2016, as amended, pursuant to which, among other things, the Service Provider provides certain administrative services to the Client;

**WHEREAS**, the parties hereto desire to amend and restate the Original Agreement on the terms and subject to the conditions hereinafter contained;

**WHEREAS**, this Agreement shall apply to each Fund set forth on Schedule 4 hereto;

**WHEREAS**, the Client will issue and redeem Shares of each Fund only in aggregations of Shares known as "Creation Units," as more fully described in the currently effective prospectus and statement of additional information of the Client and each Fund (collectively, the "**Prospectus**");

**WHEREAS**, the Client desires to appoint Service Provider as administrator, transfer agent, dividend disbursing agent and fund accountant of the assets of each Fund; and

**WHEREAS**, Service Provider is willing to accept such appointment on the terms and conditions set forth herein.

**NOW THEREFORE**, in consideration of the mutual covenants contained herein, the Parties, intending to be legally bound, mutually covenant and agree as follows:

1. <u>DEFINITIONS</u>.

Schedule I contains capitalized terms that have the meanings set forth therein. Other capitalized terms used but not defined in Schedule I will have the meanings set forth herein.

2. <u>SERVICES AND RELATED TERMS AND CONDITIONS</u>.

(A) ***Services***. The Services are described in Schedule 2 (the "**Services Schedule**"). The Service Provider will perform the Services in accordance with and subject to the terms of this Agreement starting on the Effective Date and ending on the final day of the Term. The Services will be provided only on Business Days, and any functions or duties normally scheduled to be performed on any day that is not a Business Day will be performed on, and as of, the next Business Day.

(B) ***Service Changes***. The Service Provider will be obliged to perform only those Services set forth in the Services Schedule. The Service Provider will not be obliged to change the Services unless it has agreed to do so pursuant to an amendment to the Services Schedule. The Service Provider will reasonably accommodate requests to change the Services that the Service Provider determines in good faith to be non-material taking into account the effort and costs required to effect the requested change; the Client recognizes that isolated requests for changes or adjustments, when combined with other such requests,

------

<sup>[1]</sup> Solely as to Schedule 2 – Appendix C

may in the aggregate have a material effect. Any change to the Services agreed by the Service Provider (a "**Service Change**") will be set forth in an amendment to the Services Schedule signed by both Parties; each such amendment will specify (i) the timeline and dependencies, and the parties' respective obligations, for implementing the Service Change and (ii) any implementation or additional ongoing fees and expenses that may be required to effect such Service Change. The foregoing process is the "**Change Control Process**."

(C) ***Provision of Information; Cooperation***. In order to permit the Service Provider to provide the Services, the Client agrees to provide, and to cause its employees, agents, subcontractors and current and immediately preceding service providers to the Client to provide, to the Service Provider the information (and in such reasonable medium) that the Service Provider may reasonably request in connection with the Services and this Agreement, including, without limitation, any Organic Documents, Prospectus, Offering Documents and Policies and Procedures of the Client and any amendments thereto. Client requests to change the Services necessitated by a change to the Client's Organic Documents, Prospectus, Offering Documents or Policies and Procedures or a change in applicable Law will be effective only upon execution by the parties of an amendment to the Services Schedule, as contemplated by the Change Control Process.

(D) ***Dependencies***. Without prejudice to clause 6(B), the Service Provider will not be liable to the Client or any other Person for any failure to provide any Service in the following circumstances: (i) if any Dependency set forth in Schedule 3 is not met through no fault of the Service Provider; (ii) if the failure is at the written request or with the written consent of an Authorized Person; (iii) if any Law to which the Service Provider is subject prohibits or limits the performance of the Services; and/or (iv) if the failure results from a Force Majeure Event.

Notwithstanding the foregoing, the Service Provider will nevertheless use reasonable efforts to provide the Services while any of the circumstances specified in this clause 2(D) subsist, provided that the Client will reimburse the Service Provider for any extraordinary costs (relative to the costs that it would have incurred in the ordinary course of providing the Services, assuming such failure or inability had not so occurred) to the extent that they have been reasonably incurred or agreed in advance between the Parties. For purposes hereof, "**Force Majeure Event**" means any event due to any cause beyond the reasonable control of the Service Provider or, as applicable, any Administrative Support Provider, such as unavailability of communications systems or pricing information, sabotage, fire, flood, explosion, acts of God, civil commotion, strikes or industrial action of any kind, riots, insurrection, war or acts of government, or suspension or disruption of any relevant stock exchange or securities clearance system or market. The Service Provider will use reasonable efforts to minimize the adverse effects to the Client of any Force Majeure Event.

(E) ***Information, Instruction and Data Sources; Liability for Third Parties***. For purposes of this Agreement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) as between the Client and the Service Provider, the Client is responsible for the accuracy and completeness of, and the Service Provider has no obligation to review for accuracy or completeness: (A) the information contained in the Organic Documents, Prospectus, Offering Documents and any Policies and Procedures submitted to the Service Provider pursuant to clause 2(C) above and (B) any Instruction or data submitted to the Service Provider for processing by the Client or its employees, agents and subcontractors (other than the Service Provider), general and limited partners (if any) and current and predecessor service providers, including information and data submitted by (1) any investment adviser providing services or acting for the benefit of

the Client ("**Investment Advisers**"), (2) any intermediaries, distributors or principal underwriters, or their agents, acting for the benefit of the Client or its Customers ("**Intermediaries**"), or (3) any custodian that holds assets of the Client or its Customers ("**Custodians**"). The Service Provider may charge the Client for additional work required to re-process any such incorrect data at its standard hourly rates or as may be agreed to from time to time in a written fee schedule approved by the parties;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) subject to clauses 2(D) and 6, the Service Provider is responsible for the accuracy and completeness of any data prepared and/or produced by the Service Provider or its employees, agents or subcontractors (other than Non-Discretionary Subcontractors);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the Service Provider will not be responsible for the errors or failures to act of, or the inaccuracy or incompleteness of, any Instruction or data supplied by, and has no obligation to review any data supplied by, (A) securities pricing services, (B) any Authorized Participant; (C) clearance or settlement systems, (D) any Persons specified in clause (E)(i) above, (E) any Persons who possess information about Client or its Customers reasonably necessary for the Service Provider to provide the Services and with whom the Service Provider is required to engage or contract in order to receive such information, including, without limitation, agents of Investment Advisers, Intermediaries, or Custodians; and (F) third parties engaged by the Service Provider at the request of the Client to provide services to or for the benefit of the Client or its Customers ("**Non-Discretionary Subcontractor**"), and such Persons will not be considered agents or subcontractors of the Service Provider for purposes of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) the Client authorizes and instructs the Service Provider to rely on the information and data it receives from any Persons specified in clauses (E)(i) and E(iii) above; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Service Provider is permitted to appoint agents and subcontractors to perform any of the duties of the Service Provider under this Agreement ("**Administrative Support Providers**"). The Service Provider will use reasonable care in the selection and continued appointment of Administrative Support Providers.

(F) ***Other Services and Activities; Conflicts of Interest***. The Client acknowledges that the Service Provider and its affiliates may provide services, including administration, advisory, banking and lending, broker dealer and other financial services, to Client or to other Persons. Because the Service Provider may be prohibited under applicable Law or contractually from disclosing to the Client any fact or thing that may come to the knowledge of the Service Provider or such affiliates in the course of providing such services, or because the Service Provider in providing the Services may be "walled off" from facts or things that may come to the knowledge of the Service Provider or its affiliates in the course of providing services, including administration, advisory, banking and lending, broker dealer and other financial services, to Client or to other Persons, and therefore unable to make any such disclosures to the Client, neither the Service Provider nor such affiliates will be required or expected under this Agreement to do so. Among other things, Service Provider or an affiliate may receive or generate valuation information with respect to securities, products or services of Client, and neither the Service Provider nor any affiliate is under any obligation to disclose such information to Client or any of Client's Customers. The Client acknowledges that neither the Service Provider nor any affiliate is under any obligation to use any such information to assess or verify the accuracy of any information, including valuation information, that the Service Provider receives from the Client or from any Person specified in clauses 2(E)(i) and (iii). Subject to compliance with its confidentiality obligations hereunder, the Service Provider may acquire, hold or deal with, for its own account or for the account of other Persons, any shares or securities in which the

Client is authorized to invest (for itself or its Customers), and the Service Provider will not be required to account to the Client for any profit arising therefrom.

(G) ***AML/OFAC***. The Client acknowledges that, unless included in the Services listed on Schedule 2, the Service Provider will not and shall have no duty or obligation to provide services relating to anti-money laundering ("**AML**") compliance under the USA PATRIOT Act or compliance with any regulations or Executive Orders administered by the U.S. Treasury Department's Office of Foreign Assets Control ("**OFAC**") in connection with the services provided under this Agreement. Client agrees to provide or cause to be provided to the Service Provider any AML or OFAC compliance reviews or reports conducted by Client or another Person in connection with the services provided by the Service Provider under this Agreement.

3. <u>INSTRUCTIONS</u>.

(A) ***Medium of Transmission***. Instructions may be transmitted manually or through any electronic medium, as agreed by the Parties or, absent such agreement, consistent with the standards and practices of professionals for hire providing services similar to the Services in the jurisdiction in which the Service Provider performs services under this Agreement.

(B) ***Security Procedures***. The Client will comply with reasonable security procedures designed by the Service Provider to verify the origination of Instructions (the "**Security Procedures**"). The Service Provider's sole obligation will be to comply in good faith with what is contained in the Security Procedures to establish the identity or authority of any Authorized Person to send any Instruction. The Service Provider is not responsible for errors or omissions made by the Client or resulting from fraud or the duplication of any Instruction by the Client. The Service Provider may act on an instruction if it reasonably believes it contains sufficient information.

(C) ***Requests for Instructions***. The Service Provider may request Instructions from an Authorized Person and may refuse to act if such refusal is permitted by this Agreement or otherwise reasonable under the circumstances, including when the Service Provider reasonably doubts the contents, authorization, origination or compliance with any Security Procedures or applicable Law of an Instruction, and will promptly notify the Client of its decision.

(D) ***Reliance***. The Service Provider may rely on the authority of each Authorized Person until the Service Provider has received notice acceptable to it of any change from the Client or any other Authorized Person and the Service Provider has had a reasonable time to act (after which time it may rely on the change). The Service Provider may rely on the assumption that any Instruction does not conflict with any Law or the Organic Documents, Prospectus or Offering Documents applicable to the Client.

(E) ***Cut Off Times***. The Service Provider is only obligated to act on Instructions received prior to applicable cut- off times on a Business Day. Instructions are to be given in the English language unless the Service Provider otherwise agrees in writing.

(F) ***Deemed Delivery***. Unless shown to have been received earlier, such notice, instruction or other instrument shall be deemed to have been delivered, in the case of personal delivery, at the time it is left at the premises of the Party, in the case of a registered letter at the expiration of five (5) business days after posting and, in the case of fax or electronic means, immediately on dispatch; provided that, if any document is sent by fax or electronic means outside normal business hours, it shall be deemed- to have been received at the next time after delivery when normal business hours commence. Evidence that the notice, instruction, or other instrument was properly addressed, stamped, and put into the post shall be

conclusive evidence of posting. In proving the service of notice sent by fax or electronic means it shall be sufficient to prove that the fax or electronic communication was properly transmitted.

4. <u>COMPLIANCE WITH LAWS; ADVICE</u>.

(A) ***Compliance***. The Service Provider will comply in all material respects with all Laws applicable to the delivery of the Services. The Client will comply in all material respects with all Laws applicable to the subject matter of the Services and the Client's receipt of the Services. Nothing in this Agreement will oblige either Party to take any action that will breach any Law applicable to such Party, or to omit to take an action if such omission will breach any such Law.

(B) ***No Fiduciary etc***. The Service Provider is not, under this Agreement, (i) acting as, and is not required to take any action that would require licensing or registration as, a fiduciary, an investment adviser, a certified public accountant or a broker or dealer; or (ii) providing investment, legal or tax advice to the Client or any other Person or acting as a Fund's independent accountants or auditors.

(C) ***Laws Applicable to the Client***. Except as specifically set forth in the Services Schedule, the Service Provider assumes no responsibility for compliance by the Client with any Laws applicable to the Client; and, notwithstanding any other provision of this Agreement to the contrary, the Service Provider assumes no responsibility for compliance by the Client with the Laws of any jurisdiction other than those federal and state Laws applicable to the services provided under this Agreement.

(D) ***Advice of Experts***. About any matter related to the Services, the Service Provider may seek advice from counsel or independent accountants of its own choosing (who may provide such services to either Party). Any costs related to such advice from external counsel or independent accountants will be borne by the Client. The Service Provider will not be liable if it relies on advice of reputable counsel or independent accountants.

5. <u>COMMUNICATIONS; RECORDS AND ACCESS; CONFIDENTIALITY; PUBLICITY</u>.

(A) ***Communications and Statements***. Communications, notices and invoices from the Service Provider may be sent or made available by electronic form and not in hard copy. The Client will notify the Service Provider promptly in writing of anything incorrect in an invoice or periodic accounting or other report (a "**Report**") and, in any case, within sixty (60) days from the date on which the Report is sent or made available to the Client. Reports to which the Client has not objected within this time period will be deemed accepted by the Client.

(B) ***Records and Access***.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Upon request, the Service Provider will provide its Service Organization Control ("**SOC 1**") report issued under the Statement on Standards for Attestation Engagements No. 16 ("**SSAE 16**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Subject to applicable Law, the Service Provider will allow the Client and its independent public accountants, agents or regulators reasonable access via internet based systems only to those records of the Client maintained by the Service Provider and relating to the Services ("**Client Records**") as are reasonably requested by the Client in connection with an examination of the books and records pertaining to the affairs of the Client, and will seek to obtain such access from each agent or subcontractor of the Service Provider that maintains Client Records. Upon termination of this Agreement, the Service Provider may retain archival copies of Client Records.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The Client agrees that it shall pay such charges for (a) document collection, duplication, review and retrieval and (b) making the Service Provider personnel available for extraordinary periods as the Service Provider may reasonably request in connection with audits, examinations or inspections. The Client acknowledges that such charges may include the fees and expenses of external counsel to the Service Provider.

(C) ***Confidentiality***. The Service Provider will maintain reasonable controls consistent with, and shall treat, all Confidential Information related to the Client as confidential. The Client, on behalf of itself and on behalf of its employees, agents, subcontractors and Customers, authorizes the transfer or disclosure of any Confidential Information relating to the Client to and between the branches, subsidiaries, representative offices, affiliates and Administrative Support Providers of the Service Provider and third parties selected by any of them, wherever situated, for confidential use in connection with the provision of the Services (including for data processing, statistical and risk analysis purposes), and further acknowledges that any such branch, subsidiary, representative office, affiliate, agent or third party may transfer or disclose any such information (i) to the applicable Customer and the Customer's accountants, (ii) to the Client's Investment Advisers, Intermediaries, Custodians and other service providers, (iii) to the Client's tax authorities and applicable regulators incident to the delivery of any tax filing or reporting services provided under this Agreement, and (iv) as required by any Governmental Authority or pursuant to applicable Law.

(D) ***Proprietary Information***.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The Client acknowledges that the databases, computer programs, screen formats, report formats, interactive design techniques, and documentation manuals maintained by the Service Provider and/or its affiliates or Administrative Support Provider constitute copyrighted, trade secret, or other proprietary information (collectively, "**Proprietary Information**") of substantial value to the Service Provider or each such third party. The Client agrees to treat all Proprietary Information as proprietary to the Service Provider or such third parties and further agrees that it will not divulge any Proprietary Information or Confidential Information related to Citigroup Organization to any Person or organization or use such information for any purpose, except to receive the Services or as may be specifically permitted under this Agreement or as required under applicable Law. Subject to applicable Law, the Client will treat the terms of this Agreement, including any written fee schedule as may be approved from time to time by the parties, as Confidential Information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Without limitation of the obligations of the Service Provider under clause 5(C), the Service Provider acknowledges that any Customer list and all information related to Customers furnished to or maintained by the Service Provider in connection with this Agreement (collectively, "**Customer Data**"), the unique investment methods utilized by a Client ("**Investment Methods**") and the identities of the portfolio holdings at any time and from time to time of the Client ("**Portfolio Data**") constitute proprietary information of substantial value to the Client. The Service Provider agrees to treat, and to require its employees and Administrative Support Providers to treat, all Customer Data, Investment Methods and Portfolio Data as proprietary to the Client and further agrees that it will not divulge any Customer Data, Investment Methods or Portfolio Data to any Person or organization without the Client's written consent, except as may be specifically permitted under this Agreement.

(E) ***Market or Reference Data***. The Client acknowledges that Market or Reference Data sourced from Market or Reference Data Vendors ("**Market or Reference Data Vendors**") may be subject to

various conditions, disclaimers and restrictions imposed on the Service Provider and persons who use or access such Market or Reference Data through the Service Provider, including the Client. Accordingly, the Client acknowledges and agrees with the Service Provider, and for the benefit of such market or Reference Data Vendors, as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Although the Service Provider shall use reasonable efforts to cause Market or Reference Data Vendors to provide the Service Provider with Market or Reference Data for distribution to the Client, the provision of Market or Reference Data by the Service Provider to the Client is contingent on the continued effectiveness of the applicable underlying license agreement(s) between the Service Provider and the applicable Market or Reference Data Vendors (each an "**Underlying License Agreement**") and compliance by the Client with the terms of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) To the extent practicable, the Service Provider shall provide reasonable advance written notice to the Client (which may be in the form of a hyperlink to a web site) of (i) if the use of Market or Reference Data Vendor is specifically requested by the Client, the termination of the Underlying License Agreement with respect thereto, or (ii) any conditions or restrictions, in addition to those set forth in this clause 5(E) and in Schedule 5 of this Agreement, from time to time applicable to the Client's use of Market or Reference Data imposed by any Market or Reference Data Vendors ("**Market or Reference Data Conditions**"). Market or Reference Data Conditions may include the requirement that the Client enter into an agreement with a Market or Reference Data Vendor. The Client hereby accepts the Market or Reference Data Conditions set forth in this Agreement (including Schedule 5 hereto). Until the Client delivers written notice that it does not accept Market or Reference Data Conditions that are not set out in Schedule 5, the Client shall be deemed to have accepted such Market or Reference Data Conditions about which it has been notified, provided that acceptance of a requirement that the Client enter into an agreement with a Market or Reference Data Vendor shall be deemed to occur only when the Client enters into such an agreement. Upon rejection by Client of any Market or Reference Data Conditions, the Client shall promptly cease using the applicable Market or Reference Data. Upon receipt of notice of termination of an Underlying License Agreement, the Client shall cease using the applicable Market or Reference Data.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The termination of an Underlying License Agreement or of the Client's rights to use Market or Reference Data may adversely affect the Services, and in such event any Service Provider obligation to provide such Market or Reference Data (or related data or reports) as part of the Services shall be terminated. In such event, the Parties shall work cooperatively and in good faith to implement alternative sources for Market or Reference Data, subject to the Change Control Process.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Market or Reference Data Vendors make no warranties, express or implied, as to merchantability, accuracy, fitness for purpose, availability, completeness, timeliness of sequencing, or any other matter, in respect Market or Reference Data used by the Service Provider to provide the Services, and neither does the Service Provider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Market or Reference Data Vendors shall have no liability whatsoever to the Client in respect of Market or Reference Data used by the Service Provider to provide the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) No copyright or any other intellectual property rights in the Market or Reference Data used or provided by the Service Provider to provide the Services are transferred to the Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) The Client shall not use Market or Reference Data for any illegal purpose or in any manner not specifically authorized by this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) The Client is only entitled to use or disseminate Market or Reference Data provided to it by the Service Provider as set out in Schedule 5. Except as specifically permitted in Schedule 5, the Client shall not, and shall ensure that its Affiliates and its or their officers, employees and Agents shall not (i) use the Market or Reference Data for any other purpose, or (ii) publish, disclose, distribute, give access to, broadcast, use or offer the Market or Reference Data to any third party. The foregoing limited rights to use Market or Reference Data shall terminate automatically upon any termination of this Agreement.

(F) ***Use of Name***. Without the written consent of the Client, the Service Provider may use the name of the Client only (A) to sign any necessary letters or other documents for and on behalf of the Client incident to the delivery of the Services and (B) in client lists used for marketing purposes. Subject to the foregoing, neither Party will publicly display the name, trade mark or service mark of the other without the prior written approval of the other, nor will the Client display that of the Service Provider or any subsidiary of the Service Provider without prior written approval from the Service Provider or the subsidiary concerned.

(G) ***Communications to Customers***. Without the written approval of the Service Provider, the Client will not use the name, trade mark or service mark of the Service Provider or describe the Services or the terms or conditions of this Agreement in any communication or document intended for distribution to any Customer in connection with the offering or sale by the Client of securities, products or services (an "**Offering Document**"); nor will the Client ·amend any such references to the Service Provider or the terms or conditions of this Agreement in any Offering Document that has been previously approved by the Service Provider without the Service Provider's written approval. The Service Provider will not unreasonably withhold, condition or delay any of the foregoing requested approvals, provided that the Client include, upon request by the Service Provider, reasonable notices describing those terms of this Agreement relating to the Service Provider and its liability and the limitations thereon. If the Services include the distribution by the Service Provider of notices or statements to Customers, the Service Provider may, upon advance notice to the Client, include reasonable notices describing those terms of this Agreement relating to the Service Provider and its liability and the limitations thereon; if Customer notices are not sent by the Service Provider but rather by the Client or some other Person, the Client will reasonably cooperate with any request by Service Provider to include such notices. Client shall not, in any communications with Customers, whether oral or written, make any representations to its Customers stating or implying that the Service Provider is providing valuations with respect to Client's securities, products or services, verifying any valuations, or verifying the existence of any assets in connection with Client's securities, products or services.

(H) ***Privacy***. Service Provider acknowledges that certain information made available to it hereunder may be deemed nonpublic personal information under the Gramm-Leach-Bliley Act, other U.S. or state privacy laws and the rules and regulations promulgated thereunder (collectively, the "**Privacy Laws**"). Service Provider agrees: (i) not to disclose or use such information except as required to carry out Service Provider's duties under this Agreement or as otherwise permitted by law in its ordinary course of business, (ii) to establish and maintain physical, electronic and procedural safeguards reasonably designed to protect the security, confidentiality and integrity of, and to prevent unauthorized access to or use of such nonpublic personal information and (iii) to comply with such Privacy Laws.

6. <u>SCOPE OF RESPONSIBILITY</u>.

(A) ***Standard of Care***. The Service Provider will perform its obligations with reasonable care as determined in accordance with the standards and practices of professionals for hire providing services similar to the Services in the jurisdiction(s) in which the Service Provider performs services under this Agreement (the "**Standard of Care**"). The Service Provider will use reasonable care to cause each Administrative Support Provider to perform with reasonable care as determined in accordance with such standards.

(B) ***Responsibility for Losses***. Notwithstanding any other provision of this Agreement to the contrary (including clause 6(A)), (i) the Service Provider will not be liable to the Client for any damages or losses save for those resulting from the willful misconduct, fraud or gross negligence of the Service Provider or any Administrative Support Provider as a result of the performance or non-performance by the Service Provider of its obligations and duties hereunder, and (ii) the Service Provider shall not be liable to the Client for any damages or losses caused by the performance or non performance of any Administrative Support Provider selected by the Service Provider with reasonable care; and (iii) the Service Provider's liability will be subject to the limitations set forth in this Agreement.

(C) ***Limitations on Liability***.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The Service Provider is responsible for the performance of only those duties as are expressly set forth herein and in the Services Schedule. The Service Provider will have no implied duties or obligations. Each Party shall mitigate damages for which the other Party may become responsible hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Client understands and agrees that (i) the obligations and duties of the Service Provider will be performed only by the Service Provider and are not obligations or duties of any other member of the Citigroup Organization (including any branch or office of the Service Provider) and (ii) the rights of the Client with respect to the Service Provider extend only to the Service Provider and, except as provided by applicable Law, do not extend to any other member of the Citigroup Organization.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The Service Provider shall have no responsibility to review, confirm or otherwise assume any duty with respect to the accurateness or completeness of any Instruction or Dependency or any other information it receives from the Client or any Person specified in clauses 2(E)(i) and (iii), and shall be without liability for any loss or damage suffered by the Client or any of Client's Customers as a result of the Service Provider's reasonable reliance on and utilization of any such Instruction, Dependency or other such information. For the avoidance of doubt, the Service Provider shall not be liable and shall be indemnified by the Client for any action taken or omitted by it in good faith in reliance on any Instruction believed by it in good faith to have been authorized by an Authorized Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) The Service Provider shall have no responsibility and shall be without liability for any loss or damage caused by the failure of the Client or any Person specified in clauses 2(E)(i) and (iii) to provide the Service Provider with any information required by clause 2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Except as provided in this Agreement with regard to Administrative Support Providers, the Service Provider is not responsible for the acts, omissions, defaults or insolvency of any third party including, but not limited to, any Investment Advisers, Custodians, Intermediaries, Non-Discretionary Subcontractors or any other Person described in clause 2(E)(iii).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) The Service Provider shall have no responsibility for the management of the investments or any other assets of the Client or its Customers, and the Service Provider shall have no obligation to review, monitor or otherwise ensure compliance by the Client with the policies, restrictions, guidelines or disclosures applicable to the Client or any other term or condition of the Original Documents, Organic Documents, Policies and Procedures or Prospectus. Further, the Service Provider shall have no liability to the Client or any Person specified in clauses 2(E)(i) and (iii) for any loss or damage suffered by any such Person as a result of any breach of the investment policies, objectives, guidelines or restrictions applicable to the Client or any misstatement or omission in the Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) The Client acknowledges that the reporting obligations of the Service Provider set forth in the Services Schedule do not constitute a duty to monitor compliance by the Client, and the Service Provider shall not be liable for ensuring compliance by the Client, with any legislation or regulations or exemptions from legislation or regulations of any jurisdiction applicable to the Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) The Client acknowledges that the Service Provider does not provide valuations with respect to the Client's securities, products or services, does not verify any valuations provided to it by the Client of any other person, and does not verify the existence of any assets in connection with Client's securities, products or services but instead relies exclusively on information about valuations and the existence of assets provided to it by the Client or another third party, and the Service Provider shall have no responsibility and shall be without liability for any loss or damage arising with respect to valuation or verification of assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) The Service Provider will not be responsible or liable for any loss or damage arising from the misuse or sharing of a Client Gateway User ID by any Authorized Person of the Client who has been issued a User ID by the Service Provider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, SERVICE PROVIDER DISCLAIMS ALL REPRESENTATIONS AND WARRANTIES, EXPRESS OR IMPLIED, MADE TO THE CLIENT OR ANY OTHER PERSON, INCLUDING, WITHOUT LIMITATION, ANY WARRANTIES REGARDING QUALITY, SUITABILITY OR OTHERWISE (IRRESPECTIVE OF ANY COURSE OF DEALING, CUSTOM OR USAGE OF TRADE), OF ANY SERVICES OR ANY GOODS PROVIDED INCIDENTAL TO SERVICES PROVIDED UNDER THIS AGREEMENT. SERVICE PROVIDER DISCLAIMS ALL WARRANTY OF TITLE OR NON-INFRIGNEMENT EXCEPT AS OTHERWISE SET FORTH IN THIS AGREEMENT.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) Notwithstanding anything in this Agreement to the contrary, the cumulative liability of Service Provider to the Client for all losses, claims, suits, controversies, breaches or damages for any cause whatsoever (including but not limited to those arising out of or related to this Agreement), and regardless of the form of action or legal theory, shall not exceed the total amount of compensation paid to Service Provider under this Agreement during the twelve (12) months immediately before the date on which the alleged damages were claimed to have been incurred.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xii) For the avoidance of doubt, it is hereby agreed and declared that references to the Service Provider in this clause 6 shall be deemed to include references to the directors, officers, employees, agents and delegates of the Service Provider.

(D) **<u>MUTUAL EXCLUSION OF CONSEQUENTIAL DAMAGES</u>**.

EXCEPT FOR ANY LIQUIDATED DAMAGES AGREED BY THE PARTIES RELATED TO AN UNEXCUSED TERMINATION OF THIS AGREEMENT, UNDER NO CIRCUMSTANCES WILL EITHER PARTY BE LIABLE TO THE OTHER PARTY FOR SPECIAL OR PUNITIVE DAMAGES, OR CONSEQUENTIAL LOSS OR DAMAGE, OR ANY LOSS OF PROFITS, GOODWILL, BUSINESS OPPORTUNITY, BUSINESS, REVENUE OR ANTICIPATED SAVINGS, IN RELATION TO THIS AGREEMENT, WHETHER OR NOT THE RELEVANT LOSS WAS FORESEEABLE, OR THE PARTY WAS ADVISED OF THE POSSIBILITY OF SUCH LOSS OR DAMAGE OR THAT SUCH LOSS WAS IN CONTEMPLATION OF THE OTHER PARTY.

7. <u>INDEMNITY</u>.

(A) ***Indemnity by the Client***. The Client will indemnify the Service Provider, its affiliates and its and their respective officers, directors, employees and representatives (each, an "**Indemnitee**") for, and will defend and hold each Indemnitee harmless from, all losses, costs, damages and expenses (including reasonable legal fees) incurred by the Service Provider or such person in any action or proceeding between the Service Provider and the Client or between the Service Provider and any third party arising from or in connection with the performance of this Agreement (each referred to as a "**Loss**'"), imposed on, incurred by, or asserted against the Service Provider in connection with or arising out of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) this Agreement, except any Loss resulting from the willful misconduct, fraud or gross negligence of the Service Provider or any Administrative Support Provider, in each case in connection with the Services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any alleged untrue statement of a material fact contained in any Prospectus or Offering Document of the Client or arising out of or based upon any alleged omission to state a material fact required to be stated in any Prospectus or Offering Document or necessary to make the statements in any Prospectus or Offering Document not misleading, unless such statement or omission was made in reliance upon, and in conformity with, information furnished in writing to the Client by· the Service Provider specifically for use in the Prospectus or Offering Document;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any act or omission of the Client or any Person specified in clauses 2(E)(i) and (iii) whose Instruction or data, including records, reports and other information, including but not limited to information with respect to valuation and verification of assets, the Service Provider must rely upon in performing its duties hereunder, or as a result of acting upon any Instructions reasonably believed by the Service Provider to have been authorized by the Client or an Authorized Person of the Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) the offer or sale of Creation Units in violation of federal or state securities laws or regulations requiring that such Creation Units be registered, or in violation of any stop order or other determination or ruling by any federal or state agency with respect to the offer or sale of such Creation Units; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) all actions relating to the transmission of Creation Units or Authorized Participant data through the clearing systems of the National Securities Clearing Corporation, if applicable.

(B) ***Indemnity by the Service Provider***. The Service Provider will indemnify the Client, its affiliates and its and their respective officers, directors, employees and representatives (each, an "**Indemnitee**")

for, and will defend and hold each Indemnitee harmless from, all losses, costs, damages and expenses (including reasonable legal fees) incurred by the Client or such person in any action or proceeding between the Client and third party arising from or in connection with the performance of this Agreement (each referred to as a "**Loss**"), imposed on, incurred by, or asserted against the Client in connection with or arising out of the Service Provider's (or any Administrative Support Provider's) willful misconduct, fraud, or negligence in the provision of services under the Agreement.

(C) ***Notification, Participation; indemnitor Consent***. Upon the assertion of a claim for which a party may be required to indemnify any Indemnitee, the Indemnitee must promptly notify the Indemnitor of such assertion, and will keep the Indemnitor advised with respect to all developments concerning such claim. The Indemnitor will have the option to participate with the Indemnitee in the defense of such claim or to defend against said claim in its own name or in the name of the Indemnitee. The Indemnitee shall in no case confess any claim or make any compromise in any case in which the Indemnitor may be required to indemnify it except with the Indemnitee's prior written consent, which shall not be unreasonably withheld, conditioned or delayed; notwithstanding clauses 7(A) hereof, in the event the Indemnitee has not secured such consent the Indemnitor will have no obligation to indemnify the Indemnitee.

8. <u>FEES AND EXPENSES</u>.

(A) ***Fee Schedule***. The Client will pay all fees, expenses, charges and obligations incurred from time to time in relation to the Services in accordance with the terms of a written fee schedule as may be agreed to from time to time by the parties (the "**Fee Schedule**"), together with any other amounts payable to the Service Provider under this Agreement. For the avoidance of doubt, the Service Provider will not be responsible for the fees or expenses of, and the Client will reimburse the Service Provider for any advances or payments made by the Service Provider for the benefit of the Client incident to the proper performance of the Services to, any Investment Manager, Custodian, Non-Discretionary Subcontractor, Intermediary or any other Person listed or described in the Fee Schedule.

(B) ***Taxes***. The Service Provider shall not be liable for any taxes, assessments or governmental charges that may be levied or assessed on any basis whatsoever in connection with the Client or any Customer, excluding taxes, if any, assessed against the Service Provider related to its income or assets. The foregoing clause is subject to any more detailed provisions related to sales, use, excise, value-added, gross receipts, services, consumption and other similar transaction taxes related to the Services or this Agreement set forth in the Fee Schedule (if any).

(C) ***Invoices***. Invoices will be payable within thirty (30) days of the date of the invoice. If Client disputes an invoice, it shall nevertheless pay on or before the date that payment is due such portion of the invoice as is not subject to a bona fide dispute. Without prejudice to Service Provider's other rights, Service Provider reserves the right to charge interest on overdue amounts (except to the extent the amount is subject to a bona fide dispute) from the due date until actual payment at an annual rate equal to the sum of the overnight Fed Funds rate as in effect from time to time plus 2 percentage points.

9. <u>REPRESENTATIONS</u>.

(A) ***General***. The Client and the Service Provider each represents at the date this Agreement is entered into and any Service is used or provided that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) It is duly organized and in good standing in every jurisdiction where it is required so to be;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) It has the power and authority to sign and to perform its obligations under this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) This Agreement is duly authorized and signed and is its legal, valid and binding obligation, subject to bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting the rights and remedies of creditors and secured parties generally;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Any consent, authorization or instruction required in connection with its execution and performance of this Agreement has been provided by any relevant third party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Any act required by any relevant governmental or other authority to be done in connection with its execution and performance of this Agreement has been or will be done (and will be renewed if necessary);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) Its performance of this Agreement will not violate or breach any applicable law, regulation, contract or other requirement.

The Service Provider's representations and warranties in relation to clauses 9(A)(ii), 9(A)(iv) and 9(A)(vi) above, as relevant to the provision by Service Provider of Market or Reference Data under this Agreement, are subject to clause 5(E) of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) It has received from the Securities and Exchange Commission an order to operate as an exchange traded fund; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) It is duly authorized to issue the Shares.

(B) ***Client***. The Client also represents at the date this Agreement is entered into and any Service is used or provided that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Where it acts as an agent on behalf of any of its own Customers, whether or not expressly identified to the Service Provider from time to time, any such Customers will not, by virtue of the services provided hereunder by the Service Provider to the Client, be customers or indirect customers of the Service Provider;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) It has not relied on any oral or written representation made by the Service Provider or any person on its behalf other than those contained in this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Client's decision to retain the Service Provider is not conditioned on or influenced by the amount of assets that any affiliate of the Service Provider or any customers of the Service Provider or such affiliates may from time to time invest in or through the Client; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) It is in compliance with all Laws applicable to it, including, but not limited to, all securities, tax and commodities laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) This Agreement has been presented to, reviewed and approved by the Board of Directors or Trustees of the Funds (collectively, the "**Board**").

(C) ***Service Provider***. The Service Provider also represents at the date this Agreement is entered into and any Service is used or provided:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) It has commercially reasonable data security and business continuity controls and plans; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) It has access to the necessary facilities, equipment, and personnel to perform its duties and obligations under this Agreement.

10. <u>REPRESENTATIVE CAPACITY</u>.

(A) ***Non-Recourse***. A copy of the declaration of trust or other organizational document of the Client and/or each Fund is on file with the appropriate authority, which has been provided by the Client to Service Provider, and Service Provider acknowledges and agrees that this Agreement is not executed on behalf of the trustees of the Client as individuals, and the obligations of this Agreement are not binding on any of the trustees, officers, shareholders of the Client individually, but are binding only upon the assets and property of each Fund.

(B) ***Several Obligations***. With respect to any obligations of the Client with respect to a Fund arising out of this Agreement, Service Provider shall look for payment or satisfaction of any obligation solely to the Fund to which such obligation relates as though each Fund has separately contracted with Service Provider by separate written instrument with respect to its assets and transactions.

11. <u>TERM AND TERMINATION</u>.

(A) ***Term***. This Agreement will begin on the Effective Date and continue for have an initial term of one (1) year from the Effective Date (the "**Initial Term**"). Thereafter, unless otherwise terminated pursuant to clause 11(B), this Agreement shall be renewed automatically for successive one year periods ("**Rollover Periods**).

(B) ***Termination***. Subject to clause 11(C):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Either Party may terminate this Agreement with or without cause, by provision of a written notice of non-renewal provided at least 90 days prior to the end of the Initial Term or any Rollover Period (which notice of non-renewal will cause this Agreement to terminate as of the end of the Initial Term or such Rollover Period, as applicable).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Either Party may terminate this Agreement with cause on at least thirty (30) days' written notice to the other Party if the other party has materially breached any of its obligations hereunder; provided, however, that (i) the termination notice will describe the breach; (ii) no such termination will be effective if, with respect to any breach that is capable of being cured prior to the date set forth in the termination notice, the breaching Party has reasonably cured such breach; and (iii) subject to applicable Law, no such thirty (30) day notice period shall be required in the event the other Party is insolvent or has submitted a voluntary petition for administration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) This Agreement may be further terminated by either party immediately in the event of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the winding up of or the appointment of an examiner or receiver or liquidator to the other party or on the happening of a like event whether at the direction of an appropriate regulatory agency or court of competent jurisdiction or otherwise; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the other party no longer being permitted or able to perform its obligations under this Agreement pursuant to applicable law or regulation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) This Agreement may be terminated by the Service Provider immediately based on the Service Provider's reasonable opinion that the Client has violated any Law to which the Client is subject.

(C) ***Termination-related Obligations***. Related to termination of this Agreement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If the Client has terminated this Agreement without cause during the Initial Term or any Rollover Period (other than pursuant to a notice of non-renewal properly delivered in accordance with clause 11(B) of this Agreement), the Client will make a one-time cash payment to Service Provider as liquidated damages -for such default, an amount equal to the balance that would be due Service Provider for its services under this Agreement during the balance of the Initial Term or Rollover Period, as applicable, assuming for purposes of the calculation of the one-time payment that the fees that would be earned by Service Provider for each month would be based upon the average fees payable to Service Provider monthly during the 12 months before the date of the event that triggers such payment ("**Liquidated Damages**"); provided, however, that if the Client closes all of the Funds subject to this Agreement such Liquidated Damages shall be an amount equal to the balance that would be due Service Provider for its services under this Agreement during the lesser of (x) the balance of the Initial Term or Rollover Period, as applicable, or (y) twelve (12) months. In the event that the Client is, in part or in whole, liquidated, dissolved, merged into a third party, acquired by a third party, or involved in any other transaction that materially reduces the assets and/or accounts serviced by Service Provider pursuant to this Agreement, the liquidated damages provision set forth above will apply, and will be adjusted ratably if any of the events described above is partial. Any liquidated damages amount payable to Service Provider will be payable on or before the date of the event that triggers the payment obligation. Inasmuch as a default by Client will cause substantial damages to Service Provider and because of the difficulty of estimating the damages that will result, the Parties agree that the Liquidated Damages is a reasonable forecast of probable actual loss to Service Provider and that this sum is agreed to as liquidated damages and not as a penalty.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Upon termination, the Service Provider will, at the expense and direction of the Client, transfer to the Client or any successor service provider(s) to the Client copies of all Client Records, subject to the payment by the Client of unpaid and undisputed amounts due to the Service Provider hereunder, including any Liquidated Damages. If by the termination date the Client has not given Instructions to deliver the Client Records, the Service Provider will keep the Client Records until the Client provides Instructions to deliver the Client Records. provided that the Service Provider will be entitled to charge the Client then-standard fees for maintaining the Client Records, and the Service Provider shall have no obligation to keep the Client records beyond six (6) months after the termination date. The Service Provider will provide no other services to or for the benefit of the Client or any successor service provider unless specifically agreed in writing by the Service Provider or as set forth in the Services Schedule.

(D) ***Surviving Terms***. The rights and obligations contained in clauses 2(D), 2(E), 5(A), 5(C)-(G), 5(H), 6-8, and 10-13 of this Agreement will survive the termination of this Agreement.

12. <u>GOVERNING LAW AND JURISDICTION</u>.

(A) ***Governing Law***. This Agreement will be governed by and construed in accordance with the internal laws (and not the laws of conflicts) of the State of New York.

(B) ***Arbitration***. To the extent permitted by applicable law, each Party agrees that any controversy arising out of or relating to this Agreement or the Services provided hereunder, shall be resolved by arbitration conducted only at FINRA (even though neither party hereto may be a FINRA member). Should any dispute be arbitrated, judgment upon any award rendered by the arbitrators in such proceeding

may be entered in any state or federal court of competent jurisdiction located in the Borough of Manhattan, New York City.

(C) ***Sovereign Immunity***. The Client and the Service Provider each irrevocably waives, with respect to itself and its revenues and assets, all immunity on the grounds of sovereignty or similar grounds in respect of its obligations under this Agreement.

13. <u>MISCELLANEOUS</u>.

(A) ***Entire Agreement; Amendments***. This Agreement consists exclusively of this document together with any schedules and supersedes any prior agreement related to the subject matter hereof, whether oral or written. In case of inconsistency between the terms of this Agreement and the terms of any Schedule, appendix of exhibit hereto, the terms of this Agreement will prevail, <u>provided</u> that in the case of an inconsistency between this Agreement and the Service Schedule, the terms of the Service Schedule will prevail.

Except as specified in this Agreement, this Agreement may only be modified by written agreement of the Client and the Service Provider.

Additional Funds may be added to this Agreement upon written agreement of the Client and Service Provider by amendment of Schedule 4 adding any additional Fund.

(B) ***Severability***. If any provision of this Agreement is or becomes illegal, invalid or unenforceable under any applicable law, the remaining provisions will remain in full force and effect (as will that provision under any other law).

(C) ***Waiver of Rights***. Subject to clause 5(A), no failure or delay of the Client or the Service Provider in exercising any right or remedy under this Agreement will constitute a waiver of that right. Any waiver of any right will be limited to the specific instance. The exclusion or omission of any provision or term from this Agreement will not be deemed to be a waiver of any right or remedy the Client or the Service Provider may have under applicable law.

(D) ***Recordings***. The Client and the Service Provider consent to telephonic or electronic recordings for security and quality of service purposes and agree that either may produce telephonic or electronic recordings or computer records as evidence in any proceedings brought in connection with this Agreement.

(E) ***Further Information***. The Client agrees to execute further documents and provide materials and information as may be reasonably requested by Service Provider to enable it to perform its duties and obligations under this Agreement.

(F) ***Assignment***. No Party may assign or transfer any of its rights or obligations under this Agreement without the other's prior written consent, which consent will not be unreasonably withheld or delayed; provided that the Service Provider may make such assignment or transfer to a branch, subsidiary or affiliate if it does not materially affect the provision of services to the Trust.

(G) ***Headings***. Titles to clauses of this Agreement are included for convenience of reference only and will be disregarded in construing the language contained in this Agreement.

(H) ***Counterparts***. This Agreement may be executed in several counterparts, each of which will be an original, but all of which together will constitute one and the same agreement.

(I) ***Third Party Beneficiaries or Joint Venture***. There are no third-party beneficiaries to this Agreement. This Agreement does not create a joint venture or partnership between the Parties.

(J) ***Certain Communications***. The Client hereby acknowledges that it has requested the delivery of Reports, Client Records and Other information processed and/or maintained by the Service Provider hereunder in an unencrypted manner and accepts the risk that such delivery means may expose such information to disclosure through media and hardware that are not within the control of the Service Provider during the delivery process. -

**IN WITNESS WHEREOF**, the parties hereto have caused this Amended and Restated Agreement to be executed by their respective officers thereunto duly authorized.

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;**STRATEGY SHARES** | &nbsp;&nbsp;**STRATEGY SHARES** | &nbsp;&nbsp;**STRATEGY SHARES** |
| &nbsp;&nbsp;By: | &nbsp;&nbsp;/s/ Jennifer Bailey | &nbsp;&nbsp;/s/ Jennifer Bailey |
| &nbsp;&nbsp;Name: | &nbsp;&nbsp;Jennifer Bailey | &nbsp;&nbsp;Jennifer Bailey |
| &nbsp;&nbsp;Title: | &nbsp;&nbsp;Secretary | &nbsp;&nbsp;Secretary |
| &nbsp;&nbsp;Date: | &nbsp;&nbsp;4/6/2026 | &nbsp;&nbsp;4/6/2026 |
| &nbsp;&nbsp;**Solely as to Schedule 2 – Appendix C:** | &nbsp;&nbsp;**Solely as to Schedule 2 – Appendix C:** | &nbsp;&nbsp;**Solely as to Schedule 2 – Appendix C:** |
| &nbsp;&nbsp;**CITIBANK, N.A.** | &nbsp;&nbsp;**CITIBANK, N.A.** | &nbsp;&nbsp;**CITIBANK, N.A.** |
| &nbsp;&nbsp;By: | &nbsp;&nbsp;By: | &nbsp;&nbsp;/s/ Peggy Vena |
| &nbsp;&nbsp;Name: | &nbsp;&nbsp;Name: | &nbsp;&nbsp;Peggy Vena |
| &nbsp;&nbsp;Title: | &nbsp;&nbsp;Title: | &nbsp;&nbsp;VP |
| &nbsp;&nbsp;Date: | &nbsp;&nbsp;Date: | &nbsp;&nbsp;4/6/2026 |
| &nbsp;&nbsp;**CITI FUND SERVICES OHIO, INC.** | &nbsp;&nbsp;**CITI FUND SERVICES OHIO, INC.** | &nbsp;&nbsp;**CITI FUND SERVICES OHIO, INC.** |
| &nbsp;&nbsp;By: | &nbsp;&nbsp;By: | &nbsp;&nbsp;/s/ John Danko |
| &nbsp;&nbsp;Name: | &nbsp;&nbsp;Name: | &nbsp;&nbsp;John Danko |
| &nbsp;&nbsp;Title: | &nbsp;&nbsp;Title: | &nbsp;&nbsp;President |
| &nbsp;&nbsp;Date: | &nbsp;&nbsp;Date: | &nbsp;&nbsp;4/6/2026 |

---

**Schedule 1 to Services Agreement**

**Definitions**

"**Administrative Support Provider**" has the meaning set forth in clause 2(E)(v) of the Agreement.

"**Affiliate**" means, with respect to any Person, any other Person that is controlled by, controls, or is under common control with such Person; for purposes hereof, "control" of a Person means (i) ownership of, or possession of the right to vote, more than 25% of the outstanding voting equity of that person or (ii) the right to control the appointment of the board of directors, management or executive officers of that person.

"**Agreement**" means the Service Agreement to which this Schedule 1 is attached and any appendices and schedules attached hereto, in each case as they may be amended from time to time.

"**AML**" has the meaning set forth in clause 2(G) of the Agreement.

"**Authorized Participant**" means a broker or dealer that is a "participant" as defined in the rules of DTC and that has executed an Authorized Participant Agreement with the Distributor for the purchase and redemption of Creation Units.

"**Authorized Participant Agreement**" means an agreement between the Distributor, on behalf of the Client, and an Authorized Participant governing the purchase and redemption of Creation Units.

"**Authorized Person**" means the Client or any Person authorized by the Client, including the Distributor, to act on its behalf in the performance of any act, discretion or duty under the Agreement (including, for the avoidance of doubt, any officer or employee of such Person) in a notice reasonably acceptable to the Service Provider.

"**Board**" has the meaning set forth in clause 9(B)(v) of the Agreement.

"**Business Day**" means any day on which the NYSE Arca, Inc. is open for business.

"**Change Control Process**" has the meaning set forth in clause 2(B) of the Agreement.

"**Citigroup Organization**" means Citigroup, Inc. and any company or other entity of which Citigroup, Inc. is directly or indirectly a shareholder or owner. For purposes of this Agreement, each branch of Citibank, N.A. will be a separate member of the Citigroup Organization.

"**Client Records**" has the meaning set forth in clause 5(B) of the Agreement.

"**Client**" has the meaning set forth in the preamble to this Agreement and includes successors-in-interest, unless the context will require otherwise.

"**Confidential Information**" includes all tangible and intangible information and materials being disclosed in connection with this Agreement by one of the Parties ("Disclosing Party") to the other Party ("Receiving Party"), in any form or medium (and without regard to whether the information is owned by a Party or by a third party), that satisfy at least one of the following criteria:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) information related to the Disclosing Party's, its affiliates' or its third party licensors' or vendors' trade secrets, customers, business plans, strategies, forecasts or forecast assumptions, operations, methods of doing business, records, finances, assets, Proprietary Information,

technology, software, systems data or other proprietary or confidential business or technical information;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) information designated as confidential in writing by the Disclosing Party or information that the Receiving Party should reasonably know to be information that is of a confidential or proprietary nature;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any information derived from, or developed by reference to or use of, any information described in the preceding clauses (i) and (ii); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) any information that constitutes material, non-public information,

provided, however, that, notwithstanding the foregoing, the following will not be considered Confidential Information: (A) information that is disclosed to the Receiving Party without any obligation of confidentiality by a third person who has a right to make such disclosure; (B) information that is or becomes publicly known without violation of this Agreement by the Receiving Party; or (C) information that is independently developed by the Receiving Party or its employees or affiliates without reference to the Disclosing Party's information.

"**Creation Unit**" means a large block of a specified number of Shares, as specified in the Prospectus. A Creation Unit is the minimum number of Shares that may be created or redeemed at any one time.

"**Custodian**" has the meaning set forth in clause 2(E)(i) of the Agreement.

"**Customer Data**" has the meaning set forth in clause 5(D)(ii) of the Agreement.

"**Customer**" means any Person to whom the Client sells securities, products or services the sale or servicing of which are supported by the Services provided under the Agreement.

"**Dependencies**" has the meaning set forth in Schedule 3 to the Agreement.

"**Distributor**" means the part identified as distributor or principal underwriter in the Prospectus that signs the Authorized Participant Agreement on behalf of the Client.

"'**DTC**" means the Depository Trust Company, a limited purpose trust company organized under the laws of the State of New York.

"**DTC Participant**" means a "participant" as such term is defined in the rules of DTC.

"**DTC Participant Acco**unt" means an "account" as such term is defined in the rules of DTC.

"**Effective Date**" means March _, 2025.

"**Fee Schedule**" has the meaning set forth in clause 8(A) of the Agreement.

"**Force Majeure Event**" has the meaning set forth in clause 2(D) of the Agreement.

"**Fund**" has the meaning set forth in the preamble to this Agreement.

"**Governmental Authority**" means any regulatory agency, court, other governmental body or self-regulatory agency with jurisdiction over a Party.

"**Indemnitee**" has the meaning set forth in clause 7 of the Agreement.

"**Initial Term**" has the meaning set forth in clause 11(A) of the Agreement.

"**Instructions**" means any and all instructions (including approvals, consents and notices) received by the Service Provider from, or reasonably believed by the Service Provider to be from, any Authorized Person, including any instructions communicated through any manual or electronic medium or system agreed between the Client and the Service Provider.

"**Intermediary**" has the meaning set forth in clause 2(E)(i) of the Agreement.

"**Investment Adviser**" has the meaning set forth in clause 2(E)(i) of the Agreement.

"**Investment Methods**" has the meaning set forth in clause 5(D)(ii) of the Agreement.

"**Laws**" means any statutes, rules and regulations of any governmental authority and applicable judicial or regulatory interpretations thereof.

"**Liquidated Damages**" has the meaning set forth in clause 11(C)(i) of the Agreement.

"**Loss**" has the meaning set forth in clause 7 of the Agreement.

"**Market or Reference Data**" means valuation, pricing, market and other information, including corporate action data.

"**Market or Reference Data Conditions**" has the meaning set forth in clause 5(E)(ii) of this Agreement.

"**Market or Reference Data Vendors**" means providers of Market or Reference Data, which may include Affiliates of the Service Provider.

"**Non-Discretionary Subcontractors**" has the meaning set forth in clause 2(E)(iii) of the Agreement.

"**OFAC**" has the meaning set forth in clause 2(G) of the Agreement.

"**Offering Document**" has the meaning set forth in clause 5(G) of the Agreement.

"**Organic Documents**" means, for any incorporated or unincorporated entity, the documents pursuant to which the entity was formed as a legal entity, as such documents may be amended from time to time.

"**Parties**" means the Client and the Service Provider.

"**Person**" means any natural person or incorporated or unincorporated entity.

"**Policies and Procedures**" means the written policies and procedures of the Client in any way related to the Services, including any such policies and procedures contained in the Organic Documents and the Offering Documents.

"**Portfolio Data**" has the meaning set forth in clause 5(D)(ii) of the Agreement.

"**Privacy Laws**" has the meaning set forth in clause 5(H) of the Agreement.

"**Proprietary Information**" has the meaning set forth in clause 5(D)(i) of the Agreement.

"**Prospectus**" has the meaning set forth in the preamble to this Agreement. '

"**Report**" has the meaning set forth in clause 5(A) of the Agreement.

"**Rollover Periods**" has the meaning set forth in Section 11(A) of the Agreement.

"**Security Procedures**" has the meaning set forth in clause 3(B) of the Agreement.

"**Service Change**" has the meaning set forth in clause 2(B) of the Agreement.

"**Service Provider**" has the meaning set forth in the preamble to this Agreement and includes successors-in-interest.

"**Services Schedule**" means Schedule 2 to the Agreement.

"**Services**" means the services set forth in Schedule 2 to the Agreement.

"**Shares**" has the meaning set forth in the preamble to this Agreement.

"**SOC 1**" has the meaning set forth in clause 5(B) of this Agreement.

"**SSAE 16**" has the meaning set forth in clause 5(B) of this Agreement.

"**Standard of Care**" has the meaning set forth in clause 6(A) of the Agreement.

"**Term**" means the period between the Effective Date and the date this Agreement is terminated.

"**Underlying License Agreement**" has the meaning set forth in clause 5(E)(i) of this Agreement.

**Schedule 2 to Services Agreement – Services** 

**Appendix A -- Fund Administration Services**

Service Provider shall provide the Services listed on this <u>Schedule 2</u> to the Client and any series thereof listed on <u>Schedule 4</u> (each, a "**Fund**"), subject to the terms and conditions of the Agreement (including the Schedules).

**I. Services**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Financial Statements and other SEC Filings:</u> 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) For each Fund, prepare for review and approval of the Client drafts of (i) the annual report to Shareholders
and (ii) the semi-annual report. Subject to review and approval by the Client, file the final versions thereof on Form N-CSR with the
SEC.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Prepare and file the Fund's Form N-CEN annually.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Assist with the layout of the Funds' semi-annual and annual reports.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Prepare and file holdings reports on Form N-PORT with the SEC, as required at the end of each month, effective
for the period beginning March 1, 2020.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Rule 18f-4 Support for Funds Relying on "Limited Derivatives User" Exemption (Lite)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. Daily monitoring and reporting of derivative exposure levels

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. Monthly exposure calculation reporting on Form N-PORT (Item B.9)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Rule 18f-4 Support for Non-Exempt Funds (Standard)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. Daily value at risk (VaR) calculations and reporting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. Monthly VaR reporting on Form N-PORT (Item B.10)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. Stress testing and VaR backtesting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. Form N-RN filing coordination, ad hoc, as directed by the client

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Tailored Shareholder Reporting ()"**TSR**") production and filing (semi-annual)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Certain Operational Matters</u> 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Calculate Fund expenses and make disbursements for the Funds, including trustee and vendor fees and compensation.
Disbursements shall be subject to review and approval of an Authorized Person and shall be made only out of the assets of the applicable
Fund.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Prepare an annual projection of the Funds' non-asset based expense accruals prior to the beginning of
each fiscal year of each Fund and monitor actual and accrued expenses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Compute, as appropriate, each Funds' dividend payables and dividend factors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Assist the Funds' transfer agent with respect to the payment of dividends and other distributions
to Shareholders that have been approved by the Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Calculate performance data of the Funds for dissemination to (i) the Client, including the Board, (ii)
up to fifteen (15) information services covering the investment company industry and (iii) other parties, as requested by the Client and
agreed to by Service Provider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Assist the Client in developing appropriate post-trade portfolio compliance procedures for each Fund,
and provide compliance monitoring services with respect to such procedures as reasonably requested by the Client, provided that such compliance
must be determinable by reference to the Fund's accounting records.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Monitor and advise the Client and the Funds on their regulated investment company status under the Internal Revenue Code of 1986,
as amended, and the regulations promulgated thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Assist the Client with portfolio compliance monitoring in accordance with Rule 22e-4(b) including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. daily liquidity classifications of portfolio securities held by the Fund;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. daily monitoring of compliance with the Fund's established Highly Liquid Investment Minimum (HLIM),
as applicable, to any Funds requiring the Full Service Liquidity Risk Management offering as designated by the Client;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. daily monitoring of compliance with the Fund's 15% illiquid holdings maximum; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. monthly liquidity classification of portfolio securities on Form N-PORT effective for the period beginning
March 1, 2020, as applicable, to any Funds requiring the Full Service Liquidity Risk Management offering as designated by the Client;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. Prepare and file Form N-LIQUID as required.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Assist the Client and Fund Counsel in responding to routine regulatory examinations or investigations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) Monitor wash sales annually.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) Prepare informational schedules for use by the Client's auditors in connection with such auditor's
preparation of the Client's tax returns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) Coordinate with independent auditors concerning the Client's regular annual audit.

**II. Notes and Conditions Related to Fund Administration Services**

&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;1. With respect to any document to be filed with the SEC, the Client shall be responsible for all expenses
associated with causing such document to be converted into an EDGAR format prior to filing, as well as all associated filing and other
fees and expenses.

&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;2. If requested by the Client with respect to a fiscal period during which Service Provider served as financial
administrator, Service Provider will provide a sub-certification pertaining to Service Provider's services consistent with the requirements
of the Sarbanes-Oxley Act of 2002.

**Schedule 2 to Services Agreement – Services**

**Appendix B -- Fund Accounting Services**

**I. Services**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Record Maintenance</u> 

Maintain the following books and records of each Fund pursuant to Rule 31a-1 (the "**Rule**") under the Investment Company Act of 1940, as amended (the "**1940 Act**"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Journals containing an itemized daily record in detail of all purchases and sales of securities, all receipts
and disbursements of cash and all other debits and credits, as required by subsection (b)(1) of the Rule.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) General and auxiliary ledgers reflecting all asset, liability, reserve, capital, income and expense accounts,
including interest accrued and interest received, as required by subsection (b)(2)(i) of the Rule.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Separate ledger accounts required by subsection (b)(2)(ii) and (iii) of the Rule.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) A monthly trial balance of all ledger accounts (except shareholder accounts) as required by subsection
(b)(8) of the Rule.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Accounting Services</u> 

Perform the following accounting services for each Fund:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Allocate income and expense and calculate the net asset value per share ()"**NAV**") of
each class of shares offered by each Fund in accordance with the relevant provisions of the applicable Prospectus of each Fund and applicable
regulations under the 1940 Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Apply securities pricing information as required or authorized under the terms of the valuation policies
and procedures of the Client ()"**Valuation Procedures** "), including (A) pricing information from independent pricing services,
with respect to securities for which market quotations are readily available, (B) if applicable to a particular Fund or Funds, fair value
pricing information or adjustment factors from independent fair value pricing services or other vendors approved by the Client (collectively,
" **Fair Value Information Vendors**") with respect to securities for which market quotations are not readily available,
for which a significant event has occurred following the close of the relevant market but prior to the Fund's pricing time, or which
are otherwise required to be made subject to a fair value determination under the Valuation Procedures, and (C) prices obtained from each
Fund's investment adviser or other designee, as approved by the Board.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Coordinate the preparation of reports that are prepared or provided by Fair Value Information Vendors
which help the Client to monitor and evaluate its use of fair value pricing information under its Valuation Procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Assist the Client in identifying instances where market prices are not readily available, or are unreliable,
each set forth within parameters included in the Client's Valuation Procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Verify and reconcile with the Funds' custodian all daily trade activity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Compute, as appropriate, each Fund's net income and capital gains, dividend payables, dividend factors,
7-day yields, 7-day effective yields, 30-day yields, and weighted average portfolio maturity (and other yields or standard or non-standard
performance information as mutually agreed).;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Review daily the net asset value calculation and dividend factor (if any) for each Fund prior to release,
check and confirm the net asset values and dividend factors for reasonableness

and deviations, and distribute net asset values to National Securities Clearing Corporation via the portfolio composition file.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Determine and report unrealized appreciation and depreciation on securities held by the Funds.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Amortize premiums and accrete discounts on fixed income securities purchased at a price other than face
value, in accordance with the Generally Accepted Accounting Principles of the United States or any successor principles.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) Update fund accounting system to reflect rate changes, as received from a Fund's investment adviser
or a third party vendor, on variable interest rate instruments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) Post Fund transactions to appropriate categories.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) Accrue expenses of each Fund according to instructions received from the Client's Administrator,
and submit changes to accruals and expense items to authorized officers of the Client (who are not Service Provider employees) for review
and approval.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) Determine the outstanding receivables and payables for all (1) security trades, (2) Fund share transactions
and (3) income and expense accounts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) Provide accounting reports in connection with the Client's regular annual audit <u>,</u> and other audits and examinations by regulatory agencies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) Provide such periodic reports as the parties shall agree upon, as set forth in a separate schedule.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Financial Statements and Regulatory Filings</u> 

Perform the following services related to the financial statements and related regulatory filing obligations for each Fund:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Provide monthly a hard copy of the unaudited financial statements described below, upon request of the
Client. The unaudited financial statements will include the following items:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. Unaudited Statement of Assets and Liabilities,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. Unaudited Statement of Operations,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. Unaudited Statement of Changes in Net Assets, and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. Unaudited Condensed Financial Information

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Provide accounting information for the following: (in compliance with Reg. S-X, as applicable):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. federal and state income tax returns and federal excise tax returns;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. the Client's semi-annual reports with the SEC on Form N-CEN and Form N-CSR;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. the Client's schedules of investments for filing with the SEC on Form N-Q, effective for the period
ending March 31, 2020;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. the Client's monthly schedules of investment for filing with the SEC on Form N-PORT, effective for the
period beginning March 1, 2020;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. the Client's annual and semi-annual shareholder reports and quarterly Board meetings;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vi. registration statements on Form N-1A and other filings relating to the registration of shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vii. reports related to Service Provider's monitoring of each Fund's status as a regulated investment
company under Subchapter M of the Internal Revenue Code of 1986, as

amended;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;viii. annual audit by the Client's auditors; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ix. examinations performed by the SEC.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Calculate turnover and expense ratio

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Calculate daily spread between NAV and market price of Shares

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Prepare schedule of Capital Gains and Losses

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Provide daily cash report

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Maintain and report security positions and transactions in accounting system

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Prepare Broker Commission Report

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Monitor expense limitations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) Maintain list of failed trades

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) Provide unrealized gain/loss report

**II. Notes and Conditions Related to Fund Accounting Services**

* Subject to the provisions of Sections 2
and 6 of the Agreement, Service Provider's liability with respect to NAV Differences (as defined below) shall be as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) During each NAV Error Period (as defined below) resulting from a NAV Difference that is at least $0.01
but that is less than 1/2 of 1%, Service Provider shall reimburse each applicable Fund for any net losses to the Fund; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) During each NAV Error Period resulting from a NAV Difference that is at least 1/2 of 1%, Service Provider
shall reimburse each applicable Fund on its own behalf and on behalf of each shareholder of such Fund for any losses experienced by the
Fund or any Fund shareholder, as applicable; provided, that Service Provider's reimbursement responsibility shall not exceed the lesser
of (i) the net loss that the Fund incurs or (ii) the costs to the Fund of reprocessing the shareholder transactions during the NAV Error
Period; provided, further, however, that Service Provider shall not be responsible for reimbursing reprocessing costs with respect to
any shareholder that experiences an aggregate loss during any NAV Error Period of less than $25.

For purposes of this Section II.1: (A) the NAV Difference means the difference between the NAV at which a shareholder purchase or redemption should have been effected *("Recalculated NAV"*) and the NAV at which the purchase or redemption was effected divided by Recalculated NAV; (B) *NAV Error Period* means any Fund business day or series of two or more consecutive Fund business days during which an NAV Difference of $0.01 or more exists; (C) NAV Differences and any Service Provider liability therefrom are to be calculated each time a Fund's (or Class's) NAV is calculated; (D) in calculating any amount for which Service Provider would otherwise be liable under this Agreement for a particular NAV error, Fund (or Class's) losses and gains shall be netted; and (E) in calculating any amount for which Service Provider would otherwise be liable under this Agreement for a particular NAV error that continues for a period covering more than one NAV determination, Fund (or Class's) losses and gains for the period shall be netted.

* The Client acknowledges and agrees that
although Service Provider's services related to fair value pricing are intended to assist the Client and its Board in its obligations
to price and monitor pricing of Fund investments, Service Provider is not responsible for the accuracy or appropriateness of pricing information
or methodologies, including any fair value pricing information or adjustment factors other than as set forth in clause 2(E)(ii) of the
Agreement.

**Schedule 2 to Services Agreement – Services**

**Service Provided by Citibank, N.A.**

**Appendix C -- Transfer Agency Services**

**I. Services**

1. Index Receipt Agent includes the following services:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Portfolio composition file (PCF) production and distribution

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) ETF order processing and trade bursting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Provide ETF fail monitoring/collateral

2. Shareholder Transactions

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Perform and facilitate the performance of purchases and redemptions of Creation Units.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Issue Shares of the applicable Fund in Creation Units for settlement with purchasers through DTC as the
purchaser is authorized to receive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Prepare and transmit by means of DTC's book entry system payments for dividends and distributions
on or with respect to the Shares declared by the Client on behalf of the applicable Fund.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Confirm to DTC the number of Shares issued to the Shareholder, as DTC may reasonably request.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Record the issuance of Shares of the Fund and maintain a record of the total number of Shares of the Fund
which are outstanding, and, based upon data provided to it by the Fund, the total number of authorized Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Prepare and transmit to the Client and the Client's administrator and to any applicable securities
exchange (as specified to Service Provider by the Client or its administrator) information with respect to purchases and redemptions of
Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Calculate and transmit on each Business Day to the Client's administrator the number of outstanding
Shares for each Fund.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Transmit on each Business Day to the Client, the Client's administrator and DTC the amount of Shares
purchased on such day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Prepare a monthly report of all purchases and redemptions of Shares during such month on a gross transaction
basis, and identify on a daily basis the net number of Shares either redeemed or purchased on such Business Day and with respect to each
Authorized Participant purchasing or redeeming Shares, the amount of Shares purchased or redeemed.

3. Compliance Reporting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Provide reports to the Securities and Exchange Commission and FINRA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Prepare and distribute appropriate Internal Revenue Service forms for corresponding Fund.

4. Shareholder Account Maintenance

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Maintain the record of the name and address of DTC or its nominee as the sole shareholder of a Fund (the
" **Shareholder**") and the number of Shares issued by the Fund and held by the Shareholder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Prepare and deliver other reports, information and documents to DTC as DTC may reasonably request.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Maintain account documentation files for Shareholder.

5. Anti-Money Laundering Services

In each case consistent with and as required or permitted by the written anti-money laundering program of the Client ("**AML Program**"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Perform monitoring and reporting as may be reasonably requested by the Client's CCO.

**II. Notes and Conditions Related to Transfer Agency Services**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Service Provider may require any or all of the following in connection with the original issue of Shares:
(a) Instructions requesting the issuance, (b) evidence that the Board has authorized the issuance, (c) any required funds for the payment
of any original issue tax applicable to such Shares, and (d) an opinion of the counsel to the Client about the legality and validity of
the issuance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Service Provider shall have no obligation, when recording the issuance of Shares, to monitor the issuance
of such Shares or to take cognizance of any laws relating to the issue or sale of such Shares, which functions shall be the sole responsibility
of the Fund.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Pursuant to purchase orders received in good form and accepted by or on behalf of the Client by the Distributor,
Service Provider will register the appropriate number of book entry only Shares in the name of DTC or its nominee as the sole shareholders
for each Fund and deliver Shares of such Fund in Creation Units on the business day next following the trade date to the DTC Participant
Account of the Custodian for settlement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Pursuant to such redemption orders that the Client's index receipt agent receives from the Distributor,
the Client or its agent, Service Provider will redeem the appropriate number of Shares of the applicable Fund in Creation Units that are
delivered to the designated DTC Participant Account of Custodian for redemption and debit such shares from the account of the Shareholder
on the register of the applicable Fund.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Service Provider will issue Shares of the applicable Fund in Creation Units for settlement with purchasers
through DTC as the purchaser is authorized to receive. Beneficial ownership of Shares shall be shown on the records of DTC and DTC Participants
and not on any records maintained by Service Provider. In issuing Shares of the applicable Fund through DTC to a purchaser, Service Provider
shall be entitled to rely upon the latest Instructions that are received from the Client or its agent by the Index Receipt Agent (as set
forth in Schedule B, Section A. Subsection 3(b) of this Agreement) concerning the issuance and delivery of such shares for settlement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. Service Provider will not issue any Shares for a Fund where it has received an Instruction from the Client
or written notification from any federal or state authority that the sale of the Shares of such Fund has been suspended or discontinued,
and Service Provider shall be entitled to rely upon such Instructions or written notification.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. The Client acknowledges and agrees that deviations requested by the Client from Service Provider's
written transfer agent compliance procedures ()"**Exceptions**") may involve operational and compliance risks, including
a substantial risk of loss. Service Provider may in its sole discretion determine whether to permit an Exception. Exceptions must be requested
in writing and shall be

deemed to remain effective until the Client revokes the Exception request in writing. Notwithstanding any provision in this Agreement that expressly or by implication provides to the contrary, as long as Service Provider acts in good faith, Service Provider shall have no liability for any loss, liability, expenses or damages to the Client or any Shareholder resulting from such an Exception.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. Service Provider is hereby granted such power and authority as may be necessary to establish one or more
bank accounts for the Client with such bank or banks as are acceptable to the Client, as may be necessary or appropriate from time to
time in connection with the transfer agency services to be performed hereunder. The Client shall be deemed to be the customer of such
bank or banks for purposes of such accounts and shall execute all requisite account opening documents in connection with such accounts.
To the extent that the performance of such services hereunder shall require Service Provider to disburse amounts from such accounts in
payment of dividends, redemption proceeds or for other purposes hereunder, the Client shall provide such bank or banks with all instructions
and authorizations necessary for Service Provider to effect such disbursements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. Client represents and warrants that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) (i) by virtue of its Charter, Shares that are redeemed by the Client may be resold by the Client and (ii)
all Shares that are offered to the public are covered by an effective registration statement under the Securities Act of 1933, as amended
and the 1940 Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) (i) The Client has adopted the AML Program, which has been provided to Service Provider and the Client's
AML Compliance Officer, (ii) the AML Program has been reasonably designed to facilitate Compliance by the Client with applicable anti-money
laundering Laws and regulations (collectively, the "**Applicable AML Laws**") in all relevant respects, (iii) the AML Program
and the designation of the AML Compliance Officer have been approved by the Board, (iv) the delegation of certain services thereunder
to Service Provider, as provided in Schedule 2 of this Agreement, has been approved by the Board, and (v) the Client will submit any material
amendments to the AML Program to Service Provider for Service Provider's review and consent prior to adoption.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. The Client hereby represents that the sale of Shares are not subject to Blue sky laws and the Service
Provider shall not be responsible for any registration, notification, tracking or other function related to the Blue Sky laws of any state.

**Schedule 3 to Services Agreement**

**Dependencies**

The Service Provider's delivery of the Services is dependent upon:

(A) The Client and its employees, agents, subcontractors and current and predecessor service providers (including, but not limited to, Investment Advisers, Custodians and Intermediaries) and the employees, agents and subcontractors of such service providers providing information and, as applicable, Instructions to the Service Provider promptly, accurately and in agreed formats and by agreed media.

(B) The Client and its employees, agents, subcontractors and current and predecessor service providers (including, but not limited to, Investment Advisers, Custodians and Intermediaries) and the employees, agents and subcontractors of such service providers cooperating where reasonably required with the Service Provider.

(C) The communications systems operated by the Client and third parties (other than Administrative Support Providers) in respect of activities that interface with the Services remaining fully operational.

(D) The authority, accuracy, truth and completeness of any information, instructions or data provided by the Client and its employees, agents, subcontractors and current and predecessor service providers (including, but not limited to, Investment Advisers, Custodians and Intermediaries) and the employees, agents and subcontractors of such service providers that is reasonably requested by the Service Provider or is otherwise provided to the Service Provider by Persons for whom the Service Provider is not responsible under the Agreement.

(E) The Client and its employees, agents, subcontractors and current and predecessor service providers (including, but not limited to, Investment Advisers, Custodians and Intermediaries) and the employees, agents and subcontractors of such service providers providing the· Service Provider with any reasonable assistance and cooperation requested by the Service Provider in connection with the management and resolution of discrepancies requiring escalation between the Parties.

(F) The Client informing the Service Provider on a timely basis of any modification to, or replacement of, any agreement to which it is a party that is relevant to the provision of the Services.

(G) The Client and any third parties that are not the agents or employees of the Service Provider meeting their respective responsibilities, as set forth in the Agreement and, with respect to such third parties, as listed in the Services Schedule or agreed by the Client or such third parties from time to time, including applicable cut-off times.

**Schedule 4 to Services Agreement**

**List of Funds**

* Strategy Shares Gold Enhanced Yield ETF

* SSGBI Fund Limited, a wholly owned subsidiary of Strategy Shares
Gold Enhanced Yield ETF

* Strategy Shares Nasdaq 7HANDL™ Index ETF

* Strategy Shares Newfound/Resolve Robust Momentum ETF

* Monopoly ETF

* Day Hagan Smart Buffer ETF

* Day Hagan Smart Sector ETF

* Day Hagan Smart Sector Fixed Income ETF

* Day Hagan Smart Sector International ETF

* Eventide High Dividend ETF

* Eventide International ETF\*

* Eventide Large Cap Growth ETF

* Eventide Large Cap Value ETF

* Eventide Small Cap ETF

* Eventide US Market ETF

\*Effective December 8, 2025.

**Schedule 5 to Services Agreement**

**Certain Market and Reference Data Conditions\* and Permitted Uses**

1. <u>Market or Reference Data Conditions Imposed by Bloomberg Finance L.P.</u>:

Bloomberg Finance L.P. ("**Bloomberg**") requires the following conditions for use of any of its Market or Reference Data:

"**Service Data**" means data received from Bloomberg, including without limitation, valuation, pricing, market and other information, including corporate action data.

"**Third-Party Data Providers**" means all third-party sources of data included in the Service Data.

Client represents, covenants, and warrants that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. Subject to subsection 1(b) below, Client will use the Service Data internally only and will not use Service Data provided by Service Provider for any purpose independent of the Licensee Services (as defined below);

"*Licensee Services*" consist of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Record-Keeping and Registration

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Transaction Processing and Settlement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Position Reporting

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Net Asset Value (NAV) Calculations and NAV Reporting; and/or,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Correspondent Banking

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Client may include a limited amount of Service Data (i) in fund performance reports sent to its clients relating to their actual investments and to its prospective clients, (ii) in prospectuses and marketing materials, and (iii) in order to fulfill a legal or regulatory requirement. No other external distribution of Service Data is permitted;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. Client will permit Third-Party Data Providers, and Bloomberg and its affiliates on behalf of or at the request of such Third-Party Data Providers, reasonable access to audit Client's use of Service Data sourced from such Third Party Data Providers;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. Client acknowledges and agrees that Bloomberg and its affiliates as third-party beneficiaries to the Services Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e. Client acknowledges that Bloomberg has no liability or responsibility to Client relating to Client's receipt or use of Service Data or Licensee Services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f. If Client is located in Australia, Client represents, warrants and covenants that it is a wholesale client within the meaning of s761G or s761GA of the Australian Corporations Act;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g. Client Use of Subadvisor: If Client has engaged a Subadvisor to help manage certain of its funds, then Client may distribute Service Data received from Service Provider to such Subadvisor; provided, however, that Client further represents, warrants, and covenants that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. Client's Subadvisor will use the Service Data solely to verify the NAV calculation and not for any other purpose other than as described under subsection l(b) above; and,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. Client will enter into a written agreement with Subadvisor which requires the Subadvisor to agree to:

&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;1. Subsection l(g)(i) above acknowledging use of Service Data solely to verify NAV calculations and for other purposes described in subsection l(b) above;

&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;2. Subsection l(c) above granting Third-Party Data Providers and Bloomberg the right to audit Client's use of Service Data;

&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;3. Subsection l(d) above including Bloomberg and its affiliates as third- party beneficiaries to the written agreement between Client and its Subadvisor; and,

&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;4. Subsection l(e) above acknowledging that Bloomberg has no liability relating to Subadvisor's use of the Service Data.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h. As a condition of receiving the Service Data, Client shall comply with any terms or conditions relating to the use of the Service Data from time to time provided it by Bloomberg or Service Provider.

2. <u>Permitted Uses Pursuant to Section 5(E)(viii) of the Agreement</u>: With respect to the Market or Reference Data of other Market or Reference Data Vendors, the following are permitted uses:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Client may include limited and incidental amounts of Market or Reference Data in its reports to its Investors and regulators;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Client may disseminate incidental amounts of Market or Reference Data to third parties who perform portfolio and fund operations services for the Client (e.g. custodians) in connection with confirmation and settlement management;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) If Client is an investment manager, Client may use the Market or Reference Data in internal management, research, decision and related systems used in the ordinary course of Client's business as an investment manager; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Client may allow its Affiliates to use, access or disseminate the Market or Reference Data as permitted above on Client's behalf: provided that Client is fully responsible to the Service Provider and the applicable Market or Reference Data Vendors for the acts or omissions of such Affiliates, as if any act or omission of such Affiliate were the act or omission of the Client.

\* The conditions set forth in this <u>Schedule 5</u> are not exhaustive, and Service Provider reserves the right to notify Client about other Market and Reference Data Conditions, as contemplated by clause 5(E)((ii) of this Agreement.

**Schedule 6 to Services Agreement**

**Confidentiality and Data Privacy Conditions**

1. **Introduction**

These conditions (**"Conditions"**) explain how each Party may use, and must protect, the other Party's Confidential Information (including Personal Data) in connection with the provision of Services by the Service Provider, and receipt and use by the Client, pursuant to the Agreement.

The terms of these Conditions are subject to any more detailed terms contained in the Services Agreement(s) to which these Conditions relate; in the event of any conflict between the terms of these Conditions and such terms in such Services Agreements(s), these Conditions shall control unless such more detailed terms in a Services Agreement specifically reference these Conditions, in which case such more detailed terms shall control.

2. **Protection of Confidential Information**

2.1 **Definitions.** For purposes of these Conditions, the following terms shall have the meanings set
forth below and as set forth elsewhere in these Conditions. Capitalized terms used but not defined in these Conditions shall have the
meaning(s) assigned thereto in the applicable Services Agreement to which these Conditions relate.

**"Client"** means an entity that receives Services from the Service Provider under a Services Agreement, including a "Lender" that receives agent lending services.

**"Confidential Information"** means information (in tangible or intangible form) relating to the disclosing Party and/or its affiliates (including any entity that directly or indirectly controls, is controlled by or is under common control with, a Party), branches or representative offices (collectively, **"Affiliates"**) or their respective Representatives or Owners, that is received or accessed by the receiving Party or its Affiliates or their respective Representatives in connection with providing, receiving or using Services. "Confidential Information" includes Personal Data, information relating to the Service Provider's products and services and the terms and conditions on which they are provided, technology (including software, the form and format of reports and online computer screens), pricing information, internal policies, operational procedures, bank account details, transactional information, and any other information, in each case that: (i) is designated by the disclosing Party as confidential at the time of disclosure; (ii) is protected by applicable bank secrecy or other laws and regulations; or (iii) a reasonable person would consider to be of a confidential and/or proprietary nature given the nature of the information and the circumstances of its disclosure.

**"Owner"** means any natural person or entity (or its branch) that: (i) owns, directly or indirectly, stock of, or profits, interests or capital or beneficial interests in, a Party; or (ii) otherwise owns or exercises control over a Party directly or indirectly through ownership, controlling interest or any other arrangement or means, including: (a) a person who ultimately has a controlling interest in, or who otherwise exercises control over, a Party; or (b) the senior managing official(s) of a Party.

2.2 **Protection.** The receiving Party will treat the disclosing Party's Confidential Information
as confidential on the terms hereof and exercise at least the same degree of care with respect to the disclosing Party's Confidential
Information that the receiving Party exercises to protect its own Confidential Information of a similar nature, and in any event, no less
than reasonable care. The receiving Party will only use and disclose the disclosing Party's Confidential Information to the

extent permitted in these Conditions.

2.3 **Exceptions to Confidentiality.** Notwithstanding anything in these Conditions to the contrary but
subject to Data Protection Law, the restrictions on the use and disclosure of Confidential Information in these Conditions do not apply
to information that: (i) is in or enters the public domain other than as a result of the wrongful act or omission of the receiving Party
or its Affiliates or their respective Representatives in breach of these Conditions; (ii) is lawfully obtained by the receiving Party
from a third Party, or is already known by the receiving Party, in each case without notice of any obligation to maintain it as confidential;
(iii) is independently developed by the receiving Party without reference to the disclosing Party's Confidential Information; (iv)
an authorized officer of the disclosing Party has agreed in writing that the receiving Party may disclose on a non-confidential basis;
or (v) has been anonymized and/or aggregated with other information such that neither the Confidential Information of the disclosing Party
nor the identity of any Data Subject is disclosed.

3. **Authorised Disclosures**

3.1 **Definitions**

**"Service Provider Recipients"** means the Service Provider, its Affiliates and their respective Representatives.

**"Market Infrastructure Provider"** means a third Party that forms part of a payment or securities clearance system infrastructure or which otherwise facilitates payments or the clearance and settlement of securities transactions, including without limitation: communications, clearing and other payment systems, depositaries, dematerialized book entry systems, and/or similar third parties or service providers; intermediary, agent and correspondent banks; digital or ewallets; or similar entities or nominees of the foregoing, but excluding any third parties that have been appointed as agents by the Service Provider Recipients at their sole discretion in connection with a Services Agreement.

**"Permitted Purposes"** means in relation to a Party's (or its Affiliates' or their respective Representatives') use of the other Party's (or its Affiliates' or their respective Representatives') Confidential Information:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(A)** To provide, or to receive and use, the Services in accordance with the terms and conditions of the applicable Services Agreement(s) and to undertake related activities, such as, by way of non-exhaustive example:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) To fulfill applicable domestic and foreign legal, regulatory and compliance requirements (including know your customer (KYC), anti-money laundering (AML) and sanctions screening obligations applicable to a Party and/or its Affiliates) and to otherwise make the disclosures specified in Condition 3.3 (Legal and Regulatory Disclosures);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) To verify the identity or authority of a Party's Representatives who interact with the other Party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) For credit and other risk assessment, information security management, statistical, trend analysis and planning purposes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) To monitor and record calls and electronic communications with the other Party for quality, training, investigation and fraud and other crime prevention purposes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) For fraud and other crime detection, prevention, investigation and prosecution;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) To enforce and defend a Party's or its Affiliates' rights; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) To manage a Party's relationship with the other Party (which may include the Service Provider providing information to the Client and its Affiliates about the Service Provider's and its Affiliates' products and services), including to maintain service quality and manage complaints and disputes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(B)** To make disclosures to third parties to whose accounts, or from whose accounts, the Client instructs the Service Provider or its Affiliates to make or receive a payment from an account, to make or receive any delivery of other property or to enable such third parties to perform reconciliations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(C)** To make disclosures to Market Infrastructure Providers and to the Service Provider's and its Affiliates' Third-Party Service Providers in connection with the provision of the Services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(D)** To make disclosures to, and to obtain information from, credit information bureaus, credit rating agencies, central banks or other bodies in connection with risk-based analysis and decisions by the Service Provider or where such disclosures are otherwise required by applicable law, regulation or market practices, including to securities issuers or their agents or representatives;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(E)** To make disclosures to the disclosing Party's Affiliates and third-Party designees;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(F)** In connection with the provision of products and services (including supporting the opening of accounts) by the Service Provider and its Affiliates to the Client's Affiliates, including transfer agents or registrars in connection with any property of the Client; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(G)** For any additional purposes expressly authorized by the other Party.

**"Third Party Service Provider"** means a third Party selected by the receiving Party or its Affiliate to provide services to or for the benefit of the receiving Party, and who is not a Market Infrastructure Provider (e.g., technology service providers, business process service providers, call center service providers, outsourcing service providers, consultants and other external advisors).

3.2 **Permitted Disclosures.** The disclosing Party agrees (and where required by applicable bank secrecy
or other laws is hereby deemed to provide a waiver and/or release to ensure) that the receiving Party may use and disclose the disclosing
Party's Confidential Information to the receiving Party's Affiliates and to its and their respective Representatives, Market
Infrastructure Providers and any other third Party recipients specified in these Conditions, who require access to such Confidential Information
to the extent reasonably necessary to fulfil the relevant Permitted Purposes. The receiving Party shall ensure that any of its Affiliates
and Representatives to whom the disclosing Party's Confidential Information is disclosed pursuant to this Condition 3.2 shall be
bound to keep such Confidential Information confidential and to use it for only the relevant Permitted Purposes.

3.3 **Legal and Regulatory Disclosures.** The disclosing Party agrees (and where required by applicable
bank secrecy or other laws is hereby deemed to provide a waiver and/or release to ensure) that the receiving Party (and, where the Service
Provider is the receiving Party, Service Provider Recipients and Market Infrastructure Providers) may disclose the disclosing Party's
Confidential Information pursuant to: (i) legal process; (ii) any other domestic or foreign legal and/or regulatory permission, obligation
or request; (iii) agreement entered into by any of them and any domestic or foreign governmental authority; or (iv) between or among any
two or more domestic or foreign governmental authorities, including disclosure to courts, tribunals, and/or legal, regulatory, tax and
other governmental authorities.

3.4 **Certain Tax-Related Disclosures**. Where the Services may include the Service Provider arranging
or acting as a counterparty to a transaction effected in the United States or involving a United States Party (a "**U.S. Transaction** "),
the Client may disclose to any and all persons, without limitation of any kind, the U.S. tax treatment and U.S. tax structure of the U.S.
Transaction and all related materials of any kind (including opinions or other tax analyses) that may be provided to the taxpayer by the
Service Provider (if any), provided that the Client may not disclose under this paragraph (i) Confidential Information about the Service
Provider's technology (including software, the form and format of reports and online computer screens), fees for Services, internal
policies, or operational procedures, or (ii) any information for which non-disclosure is reasonably necessary in order to comply with
applicable securities laws.

4. **Retention Period.** Each of the Client and Service Provider Recipients may retain, use, and as applicable
Process, the other Party's Confidential Information for the period of time reasonably necessary for the relevant Permitted Purposes.
On termination of the provision of the Services (including closure of accounts), each of the Client and Service Provider Recipients shall
be entitled to retain, use, and as applicable Process, the other Party's Confidential Information for legal, regulatory, audit and
internal compliance purposes and in accordance with their internal records management policies, to the extent that this is permissible
under applicable laws and regulations, and otherwise in accordance with these Conditions, but shall otherwise securely destroy or delete
such Confidential Information.

5. **Information Security.** The Service Provider will, and will use reasonable endeavors to ensure that
its Affiliates and Third Party Service Providers will, implement reasonable and appropriate physical, technical and organizational security
measures to protect Client Confidential Information that is within its or their custody or control against unauthorized or unlawful use
(or in the case of Personal Data, unlawful Processing) and accidental destruction or loss.

6. **Personal Data**

6.1 **Definitions**

**"Data Protection Law"** means any and all applicable data protection and privacy laws and regulations relating to the Processing of Personal Data, including any amendments or supplements to or replacements thereof.

**"Data Subject"** means a natural person who is identified, or who can be identified, directly or indirectly, in particular by reference to an identifier such as a name, an identification number, location data, an online identifier or to one or more factors specific to his or her physical, physiological, genetic, mental, economic, cultural or social identity, or, if different, the meaning given to this term or nearest equivalent term under Data Protection Law.

**"Personal Data"** means any information that can be used, directly or indirectly, alone or in combination with other information, to identify a Data Subject, or if different, the meaning given to this term or nearest equivalent term under Data Protection Law.

**"Processing"** means any operation or set of operations which is performed on Personal Data or on sets of Personal Data, whether or not by automated means, such as collection, recording, organization, structuring, storage, adaptation or alteration, retrieval, consultation, use, disclosure by transmission, transfer, dissemination or otherwise making available, alignment or combination, restriction, erasure or destruction, or, if different, the meaning given to this term or nearest equivalent term under Data Protection Law.

**"Security Incident"** means an incident whereby the confidentiality of disclosing Party Personal Data within the receiving Party's custody or control has been materially compromised in violation of these Conditions so as to pose a reasonable likelihood of harm to the Data Subjects involved.

6.2 **Compliance with Data Protection Law.** In connection with the provision or receipt and use of the
Services: (i) each Party will comply with Data Protection Law; and (ii) the Client confirms that any Personal Data that it provides to
Service Provider Recipients has been Processed fairly and lawfully, is accurate and is relevant for the purposes for which it is being
provided.

6.3 **Cross-border Personal Data Transfers.** The Client acknowledges, and where required by applicable
law or regulation agrees, that in the connection with providing the Services and otherwise making disclosures pursuant to Condition 3
(Authorised Disclosures), Personal Data of Client Data Subjects (e.g., the Client's or its Affiliates' respective Representatives
and Owners) may be disclosed and/or transferred to recipients located in countries other than the country in which the Service Provider
entity or its branch which provides the Services is established or the Client is located. However, the Service Provider: (i) requires
its Affiliates and Third-Party Service Providers to protect Personal Data pursuant to Condition 5 (Information Security); and (ii) carries
out cross-border transfers of Personal Data in accordance with Data Protection Law.

6.4 **Legal Basis for Processing Personal Data.** To the extent that the Service Provider Processes Personal
Data of Client Data Subjects, the Client warrants that it has, if and to the extent required by Data Protection Law, provided notice to
and obtained valid consent from such Data Subjects in relation to the Service Provider's Processing of their Personal Data as described
in these Conditions, and in any applicable the Service Provider Privacy Statement or other privacy disclosure(s) accessible at https://www.citibank.com/icg/global_markets/uk_terms.jsp (or such other URL or statement as the Service Provider may notify to the Client from time to time). If the Client is itself a Data Subject,
the Client warrants that if and to the extent required by Data Protection Law: (a) it has received the privacy disclosure(s) referenced
in the preceding sentence; and (b) it consents to such Processing.

6.5 **Security Incidents**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) If the Service Provider becomes aware of a Security Incident, the Service Provider will investigate and remediate the effects of the Security Incident in accordance with its internal policies and procedures and the requirements of applicable laws and regulations. The Service Provider will notify the Client of a Security Incident as soon as reasonably practicable after the Service Provider becomes aware of it, unless the Service Provider is subject to a legal or regulatory constraint, or if it would compromise the Service Provider's investigation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) Each Party is responsible for making any notifications to regulators and Data Subjects concerning a Security Incident that it is required to make under Data Protection Law. Each Party will provide reasonable information and assistance to the other Party to the extent necessary to help the other Party to meet its obligations to regulators and Data Subjects.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) Neither Party will issue press or media statements or comments in connection with any Security Incident that name the other Party unless it has obtained the other Party's prior written permission.

7. **Provision of Data from Data Suppliers.**

7.1 **Provision of Data.** In connection with the Services, the Service Provider may provide the Client
with pricing and other data ()"**Service Data**") licensed from vendors, exchanges and other data

suppliers (collectively, "**Data Suppliers**"). the Service Provider provides Service Data subject to the following conditions, which the Client accepts and with which the Client agrees to comply:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) Service Data may not be used for any purpose independent of the Services, and shall be used only internally (including, where Data Suppliers grant such rights of use, in custodial holdings reports for actual investments sent to the investments' beneficial owners and to intermediaries between the Client and the beneficial owners);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) Client shall not sublicense or redistribute Service Data without the written consent of the Service Provider or the relevant Data Supplier;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) Data Suppliers and their Affiliates are third-Party beneficiaries of this Condition 7;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D) The Client shall comply with any other terms or conditions relating to the use of Service Data from time to time provided to the Client by the Data Supplier, or by the Service Provider or a Serice Provider Affiliate in connection with the Services; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(E) Data Suppliers may, in their discretion: (i) audit Client's use of Service Data, (ii) direct the Service Provider to terminate the Client's receipt of Service Data for any or no reason, and with or without advance notice; and/or (iii) require the Client to enter into an agreement with it directly as a condition of receipt of the Service Data.

The Service Provider shall not be liable for any Data Suppliers' actions, such as restrictions on, or termination of, rights to use Service Data.

7.2 **Distribution of Service Data to Subadvisors.** If a Client that is an investment manager engages
a subadvisor to help manage certain of its funds, then, upon written consent of the Service Provider, such Client may distribute Service
Data to such subadvisor; provided, however, that (i) the use of such data by the subadvisor shall be subject to the provisions of Conditions
7.2(A)–(E) (inclusive) and (ii) Client shall provide, upon request of the Service Provider, with written evidence that any such
subadvisor has accepted such terms.

7.3 **Disclaimer.** Neither Data Suppliers nor the Service Provider (i) make any warranties, express or
implied, as to merchantability, accuracy, fitness for purpose, availability, completeness, timeliness or sequencing, or any other matter,
in respect of Service Data and (ii) shall have any liability whatsoever to the Client in respect of Service Data used by the Service Provider
to provide the Services. No copyright or any other intellectual property rights in the Service Data used or provided by the Service Provider
to provide the Services are transferred to the Client. The Client shall not use Service Data for any illegal purpose or *in* any
manner not specifically authorized by these Conditions or the relevant Services Agreement.

Confidentiality and Data Privacy Conditions (Securities Services) v.1.0_August 2024<br>Securities Services<br> **https://www.citigroup.com/global/businesses/services/securities-services**<br>© 2026 Citibank, N.A. All rights reserved. Citi and Citi and Arc Design are trademarks and service marks of Citigroup Inc. or its affiliates and are used and registered throughout the world.<br>

## Ex-99.J

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**CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

We hereby consent to the incorporation by reference in this Registration Statement on Form N-1A of our report dated June 26, 2025, relating to the consolidated financial statements and financial highlights of Strategy Shares Gold Enhanced Yield ETF, a series of Strategy Shares, which are included in Form N-CSR for the year ended April 30, 2025, and to the references to our firm under the headings "Financial Highlights" in the Prospectus and "Other Service Providers" in the Statement of Additional Information.

/s/ Cohen & Company, Ltd.

COHEN & COMPANY, LTD.

Greenwood Village, Colorado

May 4, 2026

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