Relationship Disclosure Information

In this document, we provide important information concerning the relationship between Compass Private Wealth Inc. (“Compass”) and you, our client. If there is a material change to the information contained in this document, we will provide you with updated information in writing as soon as possible.

We encourage our clients to:

carefully review all documentation that we provide,
inform us of changes to your life circumstances or objectives that could reasonably result in changes to the types of investments appropriate for you, such as changes in employment, marital status or retirement plans,
promptly inform us of any account statement errors, and
contact us with any questions or concerns.

Our Firm

Compass Private Wealth Inc. is a privately owned, independent firm registered as a Portfolio Manager in Ontario, British Columbia and Québec.

We must comply with legislation that applies to our business. This includes securities, tax, anti-money-laundering, anti-terrorist financing, privacy, anti-spam, and other legislation. These laws may require us to withhold tax and report or disclose information about you. For more information, please review the Compass Privacy Policy.

Products and Services

As an investment management firm, we provide portfolio management services through fee-based discretionary portfolios to individuals, trusts, estates, pension funds, corporations and institutions.

The current minimum investment amount for our Portfolio Management Services is $1,000,000. In some circumstances, we may waive this minimum at our discretion.

Managed Accounts

Compass provides discretionary advice in respect of your portfolio of securities and cash under its management. When we advise for your account with discretionary authority, you will sign and receive a copy of the Compass Investment Management Agreement containing legal terms of our relationship and the limits of our discretionary authority to manage your account, and a copy of your personalized Investment Policy. Client portfolios are tailored to meet the needs of the individual client through the development and implementation of client specific investment guidelines in an Investment Policy Statement (“IPS”). We will manage your account in accordance with the IPS.

Compass Investment Strategy

We implement our investment strategies with the Compass Alternative Income Fund (at times referred to as the “Fund” or “CAIF”) and the Compass Equity Model based Portfolio. The Compass Equity Model is managed by Compass.

CAIF is managed by Compass and subadvised by Majestic Asset Management LLC (“Majestic”), who also acts as the Investment Fund Manager (“IFM”) of CAIF. Majestic, as IFM, will direct the business and operations of CAIF, and Compass will be responsible for the appointment and oversight of Majestic as sub-advisor to CAIF. Compass does not receive compensation from Majestic, as Sub-Adviser, or from CAIF for these duties.

Investment Suitability and Know Your Client Information

As a Portfolio Manager, Compass has an obligation to assess the suitability of purchases and sales of securities in your account based on our understanding of your needs and personal circumstances. We are legally and ethically required to ensure that any investment action we take, recommend or decide on is suitable and puts your interest first.

In order to properly assess investment suitability, we must obtain certain information from you (“know your client” or “KYC information”), including:

Personal circumstances – your age, family situation, number of dependents, employment status, whether anyone else can place transactions in your account or whether someone other than you has financial interest in the account.
Financial circumstances – including the source of the account investment funds, your annual income, net worth, net financial assets, and any ongoing or periodic liquidity or cash flow needs from the account(s).
Investment knowledge and experience – whether you are a novice at investing, have some investment knowledge, or you understand more complex financial products and their risks.
Investment needs and objectives – what you tell us about your financial goals and objectives for the account. This information helps us find the right balance between keeping your money safe (preserving capital), earning income, and increasing your capital through growth in the market value of your holdings.
Liquidity needs and investment time horizon – account withdrawals, account flexibility and when you expect to need your financial assets. You may not need your assets for many years, or you may need them soon for a major purchase (e.g. to pay for education or to retire).
Risk profile – which includes both your willingness to assume risk (your risk tolerance) and your ability to assume risk (risk capacity).
Risk tolerance – the maximum amount of uncertainty you are willing to accept when making a financial decision, and how comfortable you are with the possibility of losing money.
Risk capacity – the ability to endure potential financial loss, accept risk, withstand declines in the value of your portfolio.
Investment portfolio composition – how the purchase or sale of particular securities fits with your other holdings in terms of allocation between debt, equity and other classes, and the riskiness of the assets held.
Financial stability – the stability of your financial circumstances and whether you are using borrowed money to finance your account(s).
Marital status or family situation and number of dependents.
Employment status and occupation.
Information to establish your identity, including: contact information, date of birth, social insurance number, valid ID, residency and citizenship, identifying and other information for a corporate, trust or other non-individual account.
Information on persons who are authorized to provide instructions on the account and beneficial owners.
Whether you are an insider of a reporting issuer.

We collect this information in our account opening documents, and we will provide you with a copy at the time your account(s) are opened and at any time upon request. Up-to-date, accurate and complete KYC information is important to ensure that Compass can accurately assess suitability for your portfolio.

We will ask you at least annually to confirm or update your KYC information so that we can meet our obligations. If there is a material change in your personal or financial circumstances, please contact us so that we can update your account information accordingly and discuss any implications to your Investment Policy. Your information will be kept confidential, in keeping with our privacy policy and applicable law.

Because Compass manages portfolios primarily with a combination of the CAIF and the Compass Equity Model, the suitability determination conducted by Compass and its advisers will not consider the securities of other issuers of non-proprietary products or whether those non-proprietary products would be better, worse, or equal in meeting your investment needs and objectives.

The CAIF may be redeemed weekly, monthly or quarterly, depending on the fund or model. It is important to note that redemptions of the CAIF may be suspended or deferred in whole or in part at the sole discretion of the Manager. This will only occur in situations where the Manager determines that conditions are such that disposal of the securities or other property of CAIF is not reasonably practicable, or it is not reasonably practicable to determine fairly the value of CAIF’s property. The Manager will provide notice of any redemption suspension or deferral to a Unitholder requesting redemption. Additionally, the Manager may have the right in its absolute discretion to require the redemption of some or all of the Units owned by a Unitholder by notice in writing to the Unitholder. Please refer to the offering documents.

Custody Information

Client Assets – Client assets are held in Canada in a segregated account at Raymond James Correspondent Services (the “Custodian”), located at Suite 2100, 925 West Georgia Street, Vancouver, BC V6C 3L2. Raymond James Correspondent Services is a division of Raymond James Ltd., which is a member of the Canadian Investor Protection Fund. Please contact the Custodian or review the CIPF website for a description of CIPF coverages or protections.

RJCS is an independent Qualified Canadian Custodian required to segregate client assets from their own assets and is subject to regulatory oversight, minimum capital and insurance requirements. Client assets are subject to risk of loss: (i) if RJCS becomes bankrupt or insolvent; (ii) if there is a breakdown in RJCS’s information technology systems; or (iii) due to the fraud, willful or reckless misconduct, negligence or error of RJCS or its personnel. Compass has reviewed the Custodian’s reputation, financial stability, relevant internal controls and ability to deliver custodial services and has concluded that the Custodian’s system of controls and supervision is sufficient to manage risks of loss to client assets in accordance with prudent business practice.

In addition to custodial services, RJCS executes, clears and settles trades and provides Compass and its clients with trading and account statement reporting.

When you invest in CAIF, no certificates representing the securities you purchase will be issued. Instead, your ownership is recorded on the register of investors for CAIF. Compass has trading authority over client assets held at the Canadian Custodian but does not have access to client assets held at the Custodian and is not authorized to transfer securities or cash into or out of client accounts held at the Custodian.

CAIF Assets – CAIF assets are subject to the custody and recordkeeping arrangements disclosed in the offering documents of the applicable fund. CAIF assets are held in trust, separately and apart from Compass’ assets. CAIF’s account is operated and controlled by their fund administrator, SGGG Fund Services Inc., and Compass has viewing-only access.

CAIF assets are subject to risk of loss if CAIF, Majestic Asset Management or SGGG becomes bankrupt or insolvent, or due to fraud, willful or reckless misconduct, negligence or error by these parties or their personnel or if they experience a breakdown in information systems. Compass has reviewed the system of controls and supervision maintained by CAIF and has concluded that they are sufficient to manage the risk to a client of loss, in accordance with prudent business practice.

Trusted Contact Person

Under securities regulations, Compass must take reasonable steps to obtain the name and contact information of a Trusted Contact Person (TCP) for you and your written consent for us to contact your TCP under certain circumstances. The use of a TCP is intended to be a resource for your adviser and Compass in protecting your assets and interests. The TCP form is not a power of attorney and does not permit the person to make financial decisions for you. It is generally recommended that the TCP you name is someone different from anyone who has a power of attorney for you.

Compass does not impose temporary holds on client accounts if it suspects that the exploitation of a vulnerable client may have occurred or be attempted but will contact the Trusted Contact Person where one has been named. We encourage all clients to name a TCP.

Fees

As a portfolio manager, Compass derives its income from portfolio management and financial planning fees.

Portfolio management fees are calculated under contractual arrangements with clients as a percentage of the market value of assets under management, charged monthly in arrears. Disclosure of the investment management fees payable is provided in the client’s Investment Management Agreement.

Portfolio management fees may be negotiated and may be discounted from the standard advisory fee below, based on factors including the level of service provided, investment mandate, reporting requirements and account/relationship size.

The portfolio management fees are based on the following annual fee schedules:

Portfolio Assets ($)	Your Fee Schedule
Under $500,000	1.75%
$500,001 to $2,000,000	1.5%
$2,000,001 to $5,000,000	1.25%
Over $5,000,000	negotiable

The above fee schedules are applied to the combined portfolio value of all accounts of an immediate family and any related corporate or trust accounts. Applicable taxes will be charged.

For CAIF, the compensation structure is as follows:

Majestic, as Investment Fund Manager, receives 0.12% of AUM
Compass, as Investment Adviser does not receive compensation
Majestic, as Sub-Adviser, receives 0.25% of AUM

Trading commissions and administrative fees are charged by RJCS and are disclosed in the RJCS account opening documentation. Each of these costs is charged directly to your account by RJCS.

Portfolio Management fees, fund expenses and other charges to your account will reduce overall returns. The effect of the fees and expenses being deducted every year not only reduces the return in any given year but has a compounding impact over time. This is because you lose any future return that would have been earned on the amount of fees had they stayed in the portfolio and been invested.

As described under “Content and Frequency of Reporting”, we will provide you annually with an Investment Performance Report and Cost and Compensation Report that will show you the amount earned and the amount of expenses over various time periods, including since the inception of your investment account with Compass.

Compass will not impose any new charges on your account unless we provide at least 60 days prior written notice to you before the change becomes effective. Any such changes may be further restricted under the Investment Management Agreement, the applicable disclosure document for CAIF or by securities rules and regulations.

If you hold securities of CAIF, you will indirectly bear the expenses borne by CAIF, as described in the applicable offering materials. For example, CAIF will bear its own operating and other expenses including, but not limited to:

custodial fees;
legal expenses;
external accounting;
audit and tax preparation expenses; and
any other operating expenses.

Account Reporting

Account Statements

Through a services agreement, RJCS will provide you with quarterly account statements (or monthly on request) with the name, quantity and market value of each security held in your account(s), the total market value of all cash and securities held in the account(s) and all purchases, sales and other activities during the period. While RJCS provides account statement reporting, it does not have suitability obligations on your behalf. Both Compass and RJCS are responsible for ensuring the information in the account statements is complete and accurate.

Investment Performance Reports

Compass will provide you with an investment performance report for each of your accounts every 12 months, except that the first performance report that we provide you may be sent within 24 months after we first make a trade for you. Each investment performance report that we provide to you will include:

the market value of cash and securities in your account at the beginning and end of the period;
the changes in the market value of cash and securities in your account over the period covered by the report and since your account was opened; and
the annualized total percentage return for your account over one, three, five- and ten-year periods and since your account was opened. Total percentage return represents gains and losses of an investment over a specified period of time, including realized and unrealized capital gains and losses plus income, expressed as a percentage.

Reports on Charges and other Compensation

We will provide you with an Annual Report on Charges and Compensation for each of your accounts. The Report will include applicable operating charges, management fees, transaction charges and compensation we received, if any, from third parties in connection with the operation of your account or the distribution of securities held within your account(s).

Benchmarks

Benchmarks are indices that are constructed as broad standards to show the performance of various assets and sectors. For example, the S&P/TSX Composite Index follows the share prices of the largest companies listed on the Toronto Stock Exchange. This index would be a good benchmark for assessing performance of a Canadian equity fund that invests only in large Canadian companies. It would be a poor benchmark if investments are concentrated in other products, sectors or geographic areas. Due to the customization of client portfolios, Compass does not provide benchmark comparisons on account statements.

General Investment Risks

It is important to be aware of the potential for risk inherent in investing in the capital markets. The investments we deal in are not guaranteed, and you could lose part or even all of your investments. Some of the key risks to consider include:

Market risk: the impact of a decline in the overall market on the value of your portfolio.
Interest Rate Risk: the risk that interest rates will change such that the return earned is not commensurate with returns on comparable instruments in the marketplace.
Inflation Risk: the risk of a decline in the purchasing power of your savings and/or portfolio due to a general rise in prices.
Credit risk: the possibility of a loss resulting from a borrower’s failure to repay a loan or meet contractual obligations.
Volatility: fluctuation in market value of securities.
Regulatory Risk: the risk that a change in laws and regulations will materially impact a security, business, sector, or market.
Business Risk: the risk inherent in the operations of an entity or its industry, for example, these risks may involve political and/or economic developments, changes in competitive landscapes, and changes in commodities prices due to changes in supply and demand.
Financial Risk: the risk associated with the amount of leverage or debt used by an entity to finance its assets.
Exempt Securities Risk: the risk of the inclusion of exempt securities in your portfolio. These risks include the absence of daily liquidity, lower initial and ongoing disclosure obligations compared to publicly traded securities, the lack of a secondary market, and resale, transfer and redemption restrictions imposed by Partnership Agreements and applicable securities legislation.
Currency Risk: the risk of a change in value of a security or investment denominated in a foreign currency due to a change in exchange rates.
Liquidity Risk: the risk that a financial instrument cannot be freely purchased or sold or cannot be purchased or sold without a significant concession in price due to the size of the market.
Large Unitholder Risk: the risk that a redemption by a large unitholder redeeming its units in CAIF may pose a liquidity risk to CAIF.
Concentration Risk: if a portfolio invests a large proportion of its assets in securities issued by one issuer, in a single asset class or in a single sector, it may present a concentration risk. When a portfolio is not adequately diversified, it could experience greater volatility and may be strongly affected by changes in the market value of these securities.
Derivatives Risk: CAIF’s underlying investments may from time to time employ the use of derivatives as part of its trading or underlying investments strategy. Derivative products are highly specialized instruments that require investment techniques and risk analyses which may differ from those associated with stocks and bonds. Derivatives are subject to a number of risks, such as interest rate risk and market risk. They also involve the risk of mispricing or improper valuation, the risk that changes in the value of the derivative may not correlate perfectly with the underlying reference security and the risk that the counterparty may not honour its obligation. Derivatives may be highly illiquid and the use of derivatives could result in a loss of more than the principal amount invested.

There may be other risks associated with an investment in units of a particular fund, which are detailed in the offering memorandum of each fund.

Leveraging/Borrowing to Invest

Some people borrow money to invest. There are certain risks involved in using borrowed money to finance the purchase of a security, and using borrowed money to finance the purchase of securities involves greater risk than a purchase using cash. If you borrow money to purchase securities, your responsibility to repay the loan and pay interest as required by its terms remains the same even if the value of the securities purchased declines. Generally, you should only borrow to invest if:

You are comfortable with taking risk.
You are comfortable taking on debt to buy investments that may fluctuate in value.
You are investing for the long-term.
You have a stable income.

Conflicts of Interest

Under securities regulation, Compass is required to address all material conflicts of interest between a client and the firm, including each individual acting on its behalf, in the best interest of its clients. Further, if a reasonable investor would expect to be informed of the nature and extent of an identified conflict of interest, Compass must provide appropriate disclosure including the potential impact and risk that the conflict of interest could pose to clients and how the conflict of interest has been addressed. Compass has developed policies and procedures to identify conflicts of interests.

We have identified and describe below the material conflicts of interest that we believe are relevant to you as a client and the measures Compass has taken to prevent, avoid and mitigate such conflicts of interest. Conflicts of interest related to our Fund are also disclosed in Fund documents that we provide to you. Specific disclosure will be given to clients about any other material conflicts of interest before any trading is executed in their account.

Fairness in Allocations

Compass is engaged to act as a Portfolio Manager by multiple clients. When managing multiple client accounts, a conflict of interest may arise when selecting which clients’ accounts to participate in trade allocations where not all orders can be fulfilled.

Compass has adopted trading policies which are designed to ensure fair allocation of securities among clients’ accounts. First, all order executions must satisfy the clients’ account objectives, mandates and suitability/restrictions as outlined in their Investment Policy Statements. Second, because Compass implements its investment strategies through the use of CAIF, which is in continuous distribution, there are normally no supply limitations in allocating CAIF to client accounts. Finally, in the event that not all client orders can be filled, Compass has adopted the policy that each participating client would receive a pro rata percentage of the available amount, based upon their order as a percentage of the entire investment opportunity. If the strict application of this rule does not lead to a fair and reasonable allocation, then allocation by a method other than this rule will be permitted where such allocation produces a more fair and reasonable result. The Chief Compliance Officer will be advised of any such circumstances for review and approval.

Best Execution and Soft Dollar Arrangements

Compass is responsible for selecting and retaining dealers or third parties for the execution of transactions in client accounts and, when applicable, the negotiation of commissions paid. Compass is required to consider any potential conflicts of interests that may place the interests of the adviser or firm above those of the clients in directing client orders to a particular broker. Compass is an independent investment management firm with no ownership relationship or affiliation with broker/dealers and is not aware of any existing material conflicts of interest. Compass has selected Raymond James Correspondent Services as its primary relationship for trading, custodial and settlement services. Compass monitors transactions and annually reviews best execution, considering such factors as price achievement, ease of client account transition, trading costs, related custodial and settlement services, speed, likelihood of execution and settlement and other relevant considerations.

Soft dollar arrangement refers to an arrangement whereby the Portfolio Manager directs transactions to a Broker, in exchange for which the Broker provides brokerage and research services to the Portfolio Manager. Compass does not have any soft dollar arrangements.

Principal Transactions, Cross Trades and Prohibited Trades

Principal transactions may result in an adviser or adviser firm competing with client portfolios or other conflicts of interest. Compass does not engage in trading for its own account, with the possible exception for the purpose of trade error corrections.

A cross trade or interfund trade occurs when a portfolio manager trades or transfers a security from one portfolio or fund under its control to another portfolio or fund under its control. This may introduce a conflict of interest, depending on the relative performance of the portfolios and how the portfolio manager is compensated. Compass prohibits cross trades.

Compass prohibits effecting a trade between a Fund and the account of a PM, the account of responsible persons of Compass or accounts of their associates.

Referral Arrangements

Referral arrangements and referral fees create a conflict of interest because the individual that makes the referral has a financial interest in introducing the client to the other service provider. Compass has a referral arrangement with Raymond James (USA) Ltd. (“RJUL”) whereby, if Compass identifies clients who may benefit from the services of an SEC-registered investment adviser, Compass may refer these clients to RJUL. As a registered adviser under the Investment Advisers Act of 1940, RJUL is qualified and registered to offer products or services not offered by Compass. Compass is not affiliated with RJUL other than as a referrer.

Under the referral arrangement, Compass will receive a referral fee from RJUL for a referred client. The amount of any referral fee paid or received for referral services will not affect the fees paid or payable by the client. Particulars of the referral arrangement, including the manner in which the referral fee is calculated, the party to whom it is paid, and the activities that are covered will be provided to any client that is referred.

Compass has adopted the following policies and procedures to mitigate this conflict of interest:

Disclosure is provided to referred clients.
Compass has satisfied itself that RJUL has the necessary registration and competence to perform its duties as an investment adviser.
The receipt of referral fees by Compass does not result in the referred clients paying higher fees than RJUL clients who have not been referred.
Compass has policies and procedures on Referral Arrangements, including contracting, documenting and monitoring referral arrangements.

Account Errors

An investment management firm has a potential conflict of interest in determining when, and how, to deal with a pricing error or other type of account error, due to the time, processing cost and reimbursement of clients involved. Compass has trading policies and procedures that reduce the potential occurrence for errors and establish standards for the correction of discrepancies in client accounts as follows: if a trade error results in a profit to an account, the account will be the beneficiary. If the trade was subject to allocations amongst more than account, each account will benefit pro rata; and where a trading error results in a loss with a permanent impairment in assets to an account, the account will be reimbursed.

Connected Issuers and Proprietary Fund

Compass is the Portfolio Manager to CAIF, and therefore, CAIF is a connected issuer to Compass. When a firm recommends its proprietary investments to its clients, it is a conflict of interest because the firm may have a financial interest in recommending its own investments instead of other non-related investments which might be more suitable for the client.

Compass has adopted policies and procedures designed to mitigate the conflict of interest, including the following:

Compass discloses the proprietary nature of its Fund to clients and ensures that client fees are within industry norms.
Advisers are not compensated differentially for the use of CAIF in client accounts.
Compass monitors Fund performance and underlying securities continuously.
Advisers develop the client’s Investment Policy Statement with the client’s input and regularly review performance and suitability with the client.
Compass adjusts the CAIF allocation for each client according to individual client circumstances, objectives, preferences and suitability.
Compass performs transaction suitability reviews.
Compass does not act as investment fund manager or sub-advisor for CAIF, and CAIF has an independent fund administrator.

Portfolio Valuation and Fees

Portfolio managers such as Compass are generally paid management fees based on Net Asset Value and have an incentive to overvalue fund holdings or override third-party valuations in order to obtain increased fees or make performance appear better than it is. Compass does not provide valuations for CAIF; rather, the Investment Fund Manager for CAIF, Majestic Asset Management, is responsible for ensuring a reasonable valuation framework and a consistent approach to determining the fair value of CAIF and for establishing the Net Asset Values for CAIF. Additional valuation details are contained in the Limited Partnership Agreements governing CAIF.

The CAIF valuations are dependent on the underlying securities in CAIF. SGGG Fund Services Inc., acts as an independent third-party fund administrator, performs calculations for the Net Asset Value of CAIF as of each Valuation Date. The Fund Administrator has been instructed by the Investment Fund Manager to price underlying securities in the fund at their last traded price where possible and appropriate and may receive values or quotations for non-public securities that are supplied by the Investment Fund Manager, Majestic Asset Management.

Any other assets that may occasionally be held in Compass client accounts will be publicly listed securities or mutual funds with easily obtainable and verifiable prices. If Compass were unable to access such market prices, it would apply the fair valuation hierarchy based on guidelines of IFRS 13 Fair Value Measurement.

Compensation Paid to Compass

Compensation methods can affect the judgement and objectivity of advisers. It is an inherent conflict of interest for a registrant to receive third-party compensation. Third-party compensation can influence portfolio managers in their selection of securities or service providers. It is also an inherent conflict of interest for registered firms to create incentives to sell or recommend certain products or services over others. Compass does not compensate advisers based on any sales targets or incentivize the sale or recommendation of one product or service over another.

Compass has attempted to minimize possible conflicts of interest arising from compensation. Compass receives portfolio management fees based on its fee schedule from the accounts it manages, as described above under “Fees”. Compass does not receive compensation from Majestic, as Sub-Adviser, or from CAIF. Compass does not receive performance fees or bonuses. Compass may receive referral fees, as described above under “Referral Arrangements.” Compass does not receive any other third-party compensation.

Fees may vary due to certain client accounts being subject to grandfathered fees, pre-existing client relationships and fee schedules, account size, account aggregation for fee assessment, or other circumstances. This presents a potential conflict regarding application of charges unfairly. To address this conflict Compass has established processes to ensure clients are treated fairly, honestly, and in good faith.

Personal Trading and Access to Material Non-public Information

Compass has a Personal Trading Policy which sets out certain expected standards of conduct for staff with access to certain information and imposes restrictions and controls on their personal trading. The policy is designed to ensure the fair treatment of clients and to ensure that personal trading is in the best interests of Compass clients, avoids conflicts of interest, and does not involve transactions that are prohibited by law, such as insider trading, or that negatively impact our clients.

To ensure that employees with information access do not take advantage of their knowledge of confidential client trading information or their position within the firm to unfairly profit through their personal trading activities, Compass has established guidelines for their trading, including a strict prohibition on “front-running client orders.” Compass monitors employee trading to ensure adherence to its personal trading policy.

During the course of its business, Compass may become privy to certain material and non-public information or other information of a confidential nature as it relates to a publicly traded entity. In such a case, Compass and its advisers are prohibited from acting upon such information until it is made public, which may also prevent it from using such information for the benefit of the client.

Personal Financial Dealings with Clients

Personal financial dealings with clients introduce private interests into the adviser-client relationship and can compromise the independence and objectivity of the adviser. Compass policies, with certain narrow exceptions, generally prohibit personal financial dealings such as lending or borrowing money or securities to or from clients, purchasing assets from a client outside the normal course of business, or accepting appointments of fiduciary roles such as power of attorney, executor or trustee from a client.

Gifts and Business Entertainment

The giving or receiving of gifts can affect the independence and objectivity of advisers, issuers and service providers. Compass has established written standards for the provision and acceptance of gifts and business entertainment to or from persons or entities with which the firm has a business relationship and monitors employees’ adherence to such standards. Compass’s policy is that Compass and its employees are obliged to refuse to accept any gift that would affect their independence, objectivity, or loyalty to clients. Compass has established policies and procedures for disclosure and tracking of gifts and has placed value limits on gifts and business entertainment.

Serving on Boards of Directors

When advisers are directors of investee issuers, they owe a fiduciary duty to both the issuer and to clients. These duties may result in conflicts of interest that are difficult or impossible to reconcile. Therefore, Compass advisers are not permitted to sit on the Board of Directors of any issuer in which any client accounts have a current investment or may have an investment in the future.

Investing Alongside Clients

Portfolio managers that invest alongside their clients are in conflict of interest if they prioritize their personal purchases or redemptions of CAIF over clients, or use their knowledge of impending trades, the financial condition of underlying holdings, or CAIF liquidity issues for their own advantage.

Compass’s policies prohibit advisers from using inside knowledge for personal benefit, including investing in a Fund with knowledge of an impending closure to investment or redeeming a personal Fund investment with knowledge of an impending restriction on redemption or liquidity constraints. If an adviser becomes aware that a Fund that normally permits redemptions is about to freeze redemptions, the adviser is not permitted to redeem their own securities before all affected clients are informed and given the opportunity to redeem.

Proxy Voting and Corporate Actions

Compass has a regulatory obligation to review and vote on corporate actions and shareholder voting matters in the best interests of the portfolios it manages. With respect to proxy voting for CAIF, Majestic Asset Management LLC, the Sub-Adviser to CAIF, is responsible for proxy voting on the securities held in CAIF. There is no proxy voting for Exchange Traded Funds.

With respect to any other holdings within client accounts, clients are responsible for ensuring that they receive proxy materials and for proxy voting related to those securities.

Outside Activities

Outside activities may create material existing or potential conflicts of interest between an adviser and clients, because the compensation they receive for these activities, or the nature of the relationship between the individual and the outside entity, may cause some advisers to put their interests ahead of their clients’ interests. In addition, outside activities could interfere with an adviser’s ability to properly carry out professional duties. Some outside activities may put advisers in a position of influence that could harm clients or potential clients who may be susceptible to that influence.

Compass has developed policies and procedures that govern advisers’ outside activities. This includes a notification and pre-approval process and measures to mitigate, restrict or prohibit any outside business activity that could interfere or give the appearance of interfering with an adviser’s ability to act in the best interests of or perform work for Compass and its clients. If an outside activity is approved, the approval may be subject to terms and conditions to mitigate conflicts of interest. Our employees are also required to annually review their outside business activity submission for accuracy and completeness.

If a Compass adviser has an approved outside activity that could represent a conflict of interest, we will provide details of the outside activity to affected clients.

What to do if you have a complaint

If you have a complaint about our services, products, or the administration of your account, please contact us at:

Compass Private Wealth Inc.

Attn: Chief Compliance Officer

501 Hanlon Creek Blvd

Guelph, ON N1C 0A1

It is best to make your complaint in writing, if possible, with the main points in the order that they occurred, the account involved, who you dealt with, key dates and the circumstances surrounding the issue. It is also helpful to state the outcome you are seeking. We will acknowledge receipt of a complaint formally within five business days of its receipt. As soon as practically possible within 90 days of receiving a complaint, we will provide a written assessment detailing the results of its investigation, either how we will remedy the situation or not, and an explanation of our position and decision.

If you are not satisfied with our decision and you reside outside Québec, you may seek independent dispute resolution services at our expense from the Ombudsman for Banking Services (“OBSI”), by email at ombudsman@obsi.ca, by phone at 1-888-451-4519 or by fax at 1-888-422-2865.

OBSI’s recommendations are not binding on you or us. OBSI can recommend compensation of up to $350,000. If you agree to their recommendation, you agree to that limit. OBSI services are available within 6 years from the time you first knew, or ought to have known, about an event causing the complaint. You may only file with OBSI following the expiry of 90 days from the time the complaint was first raised with Compass directly and within 180 days following our response to your complaint. If you want to recover more than $350,000, you may wish to consider alternatives to resolve your complaint. You have the option to use your own resolution service at your own expense.

If you reside in Québec and you are dissatisfied with how your complaint was handled by us, you may request your complaint file be forwarded to the Autorité des Marchés Financiers for examination. The Autorité des Marchés Financiers may act as a mediator only where it determines it is appropriate to do so.

You also have the option of going to court, but you should be aware that there are time limits, known as limitation dates, within which you may start a lawsuit. These periods vary between provinces.

If you have any questions about the information provided, please do not hesitate to contact us.