Conflict of Interest

Principles

Threestones Capital Management S.A (hereafter “Threestones” or the “Company”) is a public limited company (société anonyme) incorporated and governed by the laws of the Grand Duchy of Luxembourg, having its registered office at 50-52 route d’Esch, L-1470 Luxembourg and registered with the Registre de Commerce et des Sociétés de Luxembourg under number B146.773.

The Company is currently licensed by the CSSF as an Alternative Investment Fund Management Company (“AIFM”) under the regime set out in Article 5 of the Law of 12 July 2013 relating to AIFMs exclusively covers the activities referred to in Annex I of the aforementioned law.

Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund Managers prescribes that AIFMs shall take all reasonable steps to avoid conflicts of interest, and when they cannot be avoided, to identify, manage and monitor and, where applicable, disclose those conflicts of interest. The aim of this principle is two-fold:

1. To prevent such situations from adversely affecting the interests of the Funds and their investors, and
2. To ensure that the Funds for which the Company is acting as an Alternative Investment Fund Manager are fairly treated. No investor in the Fund shall obtain preferential treatment unless such preferential treatment is disclosed in the relevant Funds rules or confidential prospectus.

AIFMs are required to take all reasonable steps to identify conflicts of interest that arise – while managing Funds – between:

• the AIFM, including its directors or Senior Managers, employees or any person directly or indirectly linked to the Company by control, and the Fund managed by the Company or the investors in that Fund;
• the Fund or the investors in that Fund, and another Fund or the investors in that Fund;
• the Fund or the investors in that Fund, and another Client of the AIFM; or
• two Clients of the AIFM.

In order to comply with its obligations to prevent and avoiding conflicts of interest, the Company has segregated tasks and responsibilities that are incompatible with each other and that could generate systematic conflicts of interest. Article 31 of the Company Delegated Regulation requires that the Company establishes, implements, and applies an effective conflict of interest Policy. This Policy is appropriate to the size and organization of the Company and the nature, scale, and complexity of its business.

The Company has also performed an assessment, as required by law, to determine whether its operating conditions may involve any other material conflict of interest. Such conflicts of interest, if any, shall be disclosed to the investors of the Funds managed by the Company.

Where, despite the measures taken, the Company cannot ensure, with reasonable confidence, that risks of damage to investors’ interests will be prevented, the Company shall clearly disclose the general nature or sources of conflicts of interest to the investors before undertaking business on their behalf and develop appropriate policies and procedures.

Identification of potential conflicts of interest

The circumstances which could result in a conflict of interest are described below (non-exhaustive list):

• The AIFM, a relevant person is likely to make a financial gain, or avoid a financial loss, at the expense of a Fund;
• The AIFM, a relevant person has an interest in the outcome of a service provided to, or transaction carried out on behalf of the Funds managed by the AIFM which is distinct from the Funds interests;
• An employee is involved in a business that is the same as the Funds’ businesses;
• The AIFM or an employee has financial or other incentive to favor the interests of one Fund or group of Funds over the interests of another Fund or group of Funds;
• The AIFM or an employee receives or will receive from a person other than the Fund(s) or its investors an inducement in relation to collective portfolio management activities provided to Funds in the form of monies, goods or services, other than the standard commission or fee for that service.
• The AIFM, a relevant person has an interest in the outcome of a service or an activity provided to a Fund or another Client or of a transaction carried out on behalf of a Fund or another Client, that does not correspond to the interest of a Fund in that outcome;
• The interests of another Client or group of Clients over the interests of a Fund, or
• The interests of one investor over the interests of another investor or group of investors of the same Fund.
• The relevant persons may be given benefits and paying remuneration by current or potential service provider,
• The relevant persons may obtain information which is not open to the public;
• The relevant persons may have board assignments and ownership in competitors of the fund, the AIFM or companies who otherwise have interests that are contrary to the interests of the fund and the AIFM
• Potential conflicts of interest between funds;
• Potential conflicts of interest related to the redemption of investments;
• Potential conflicts of interest related to benefits, gifts and compensation,
• Potential conflict of interest arising from sustainability risks (for example, conflicts arising from remuneration or personal transactions of relevant persons as well as any sources of conflicts that could give rise to greenwashing, mis selling, misrepresentation of investment strategies or churning) ;
• Potential conflict of interest arising from an employee or third party having a financial or other incentive to under-estimate the level of sustainability risks or promote Funds with sustainability risks or characteristics in a misleading manner at the expense of one of the Funds or its investors.

Conflicts of interest are generally prevented by ensuring that actions taken by the AIFM are in best interests of the Funds and are taken independently of the interests of the AIFM and/or of other Funds where relevant.

If you would like more information, feel free to request the full Conflict of Interest Policy, contact: [email protected].