Disclosure

Related and Connected Issuer Policy and Disclosure

Securities laws of certain jurisdictions of Canada require securities dealers and advisors to trade in accordance with particular disclosure rules when they trade in or advise on their own securities or securities of other issuers which are related or connected to them. The rules require dealers and advisors to inform investors of relevant relationships and connections with these issuers prior to the trade. Investors should refer to applicable provisions of those securities laws for details or consult with a legal advisor.

General

The dealer may deal with or for an investor in securities transactions where the issuer of the securities is in an ownership or business relationship with it. Since these transactions may create a conflict between certain proprietary interests and those of the Investor dealers are required by securities laws to disclose certain relevant matters relating to the transactions.

Important Concepts

A Related Issuer” is a party related to the dealer if it exercises a controlling influence over that party, or that party exercises a controlling influence over it through voting, ownership or other means.

 

A “Connected Issuer” is a party connected to the dealer if a reasonable person might question strict independence from that party due to indebtedness or certain other relationships.

Required Disclosure

The dealer must make certain disclosures where it acts as a broker, advisor or when it exercises discretion on an investor’s behalf with respect to securities issued by it or a related party or in the course of initial distribution by a connected party. The dealer must disclose either its relationship with the issuer of the securities, or that it is the issuer.

 

The following is a list of the time and manner in which these disclosures must be made:

  • Where the dealer underwrites securities the required disclosure will be contained in the documents being used to qualify those securities.
  • Where the dealer buys or sells securities for the investors Account the required disclosure will be contained in the confirmation of trade that the dealer prepares for the investor.
  • Where the dealer advises the investor on the purchase or sale of securities the disclosure shall be made prior to the dealer issuing the advice.
  • Where the dealer exercises discretion under the investor’s authority in the purchase or sale of securities for the investors’ Account, the dealer may not exercise that account discretion for the types of transactions described above.

The dealer may act as advisor, dealer and underwriter in an ordinary course of dealings with related or connected issuers. In any case, matters are required to be carried out in accordance with all applicable disclosure and other regulatory requirements.

 

Pendfund Income Fund Inc. or its directors, officers, partners, dealing representatives or other employees may from time to time recommend that you trade in or advise on a security issue underwritten by it or by others. Pendfund Income Fund Inc. acts as both an underwriter and issuer of its securities in Pendfund Income Fund I.

 

If you wish for further information concerning the relationship between Pendfund Income Fund Inc. and related or connected entities or persons or if you have any questions, please contact your advisor.

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