Form 485BPOS LITMAN GREGORY FUNDS

Form 485BPOS LITMAN GREGORY FUNDS

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September 6, 2018 4:06 PM EDT

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As filed with the U.S. Securities and Exchange Commission on September 6, 2018

File Nos. 811-07763

333-10015

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM N-1A

and/or

REGISTRATION STATEMENT

UNDER

THE INVESTMENT COMPANY ACT OF 1940

☒

Amendment No. 86

☒

(Check appropriate box or boxes)

LITMAN GREGORY FUNDS TRUST

(Exact Name of Registrant as Specified in Charter)

1676 N. California Blvd., Suite 500, Walnut Creek, California 94596

(Address of Principal Executive Offices) (Zip Code)

(925) 254-8999

(Registrant’s Telephone Number, including Area Code)

Jeremy L. DeGroot

1676 N. California Blvd., Suite 500

Walnut Creek, California 94596

(Name and Address of Agent for Service)

Copies of Communications to:

David A. Hearth, Esq.

Paul Hastings LLP

101 California Street, 48th Floor

San Francisco, California 94111

Approximate Date of Proposed Public Offering: As soon as practicable following effectiveness.

It is proposed that this filing will become effective (check appropriate box)

☐	immediately upon filing pursuant to paragraph (b)

☒	on September 7, 2018 pursuant to paragraph (b)

☐	60 days after filing pursuant to paragraph (a)(1)

☐	on (date) pursuant to paragraph (a)(1)

☐	75 days after filing pursuant to paragraph (a)(2)

☐	on (date) pursuant to paragraph (a)(2) 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.

LITMAN GREGORY FUNDS TRUST

LOGO

Prospectus

(Share Class – Ticker Symbol)

Litman Gregory Masters High Income Alternatives Fund - Institutional Class - MAHIX

Investor Class - MAHNX

September 7, 2018

LOGO

As with all mutual funds, the U.S. Securities and Exchange Commission (“SEC”) has not approved or disapproved these securities, nor has the SEC judged whether the information in this Prospectus is accurate or adequate. Any representation to the contrary is a criminal offense.

Table of Contents


Summary Section		2

Summary of Other Important Information Regarding the Fund		9

Transaction Policies		9

Tax Information		9

Payments to Broker-Dealers and Other Financial Intermediaries		9

Description of Principal Investment Risks		10

Fund Management and Investment Styles		25

The Advisor		25

Sub-Advisors		28

Shareholder Services		34

Index Descriptions		40

Financial Highlights		41

For More Information

Back Cover

Litman Gregory Masters High Income Alternatives Fund

Summary Section

Investment Objectives

The Litman Gregory Masters High Income Alternatives Fund (the “High Income Alternatives Fund”) seeks to generate a high level of current income from diverse sources, consistent with the goal of capital preservation over time. Capital appreciation is a secondary objective.

Fees and Expenses of the High Income Alternatives Fund

This table describes the fees and expenses that you may pay if you buy and hold shares of the High Income Alternatives Fund.

Shareholder Fees (fees paid directly from your investment)

Institutional
Class

Investor

Class

None

Annual Operating Expenses (expenses that you pay each year as a percentage of the value of your investment)


	Institutional Class		Investor Class
Management Fees		0.95%		0.95%
Distribution and or Service (12b-1) Fees		None		0.25%
Other Expenses⁽¹⁾		0.15%		0.15%

Total Annual Fund Operating Expenses		1.10%		1.35%
Fee Waiver and/or Expense Reimbursement⁽²⁾		0.12%		0.12%

Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement⁽²⁾		0.98%		1.23%

(1)	“Other Expenses” have been estimated for the current fiscal year. Actual expenses may be different.

(2)

Litman Gregory Fund Advisors, LLC (“Litman Gregory”), the advisor to the High Income Alternatives Fund, has contractually agreed to limit the High Income Alternatives Fund’s operating expenses (including management fees payable to Litman Gregory but excluding any taxes, interest, brokerage commissions, expenses incurred in connection with any merger or reorganization, borrowing costs (including commitment fees), dividend expenses, acquired fund fees and expenses and extraordinary expenses such as but not limited to litigation costs) through April 30, 2020 (unless otherwise sooner terminated) to an annual rate of 0.98% for the Institutional Class and 1.23% for the Investor Class (the “Operating Expense Limitation”). Because operating expenses do not include dividend and interest expense, which fluctuates depending on the portfolio composition, the Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement disclosed in this table may exceed the Operating Expense Limitation. This agreement may be renewed for additional periods not exceeding one (1) year and may be terminated by the Board of Trustees (the “Board”) of Litman Gregory Funds Trust (the “Trust”) upon sixty (60) days’ written notice to Litman Gregory. Litman Gregory may also decline to renew this agreement by written notice to the Trust at least thirty (30) days before the renewal date. Any fee waiver or expense reimbursement made by Litman Gregory pursuant to this agreement is subject to the repayment by the High Income Alternatives Fund within three (3) years of the date such amounts were waived or reimbursed, but only if the High Income Alternatives Fund is able to make the repayment without exceeding the expense limitation in effect at the time of such waiver/reimbursement and the time of recoupment, and the repayment is approved by the Board. Litman Gregory Fund Advisors LLC has contractually agreed through April 30, 2020, to waive a portion of its advisory fees so that after paying all of the sub-advisory fees, the net advisory fee as a percentage of the High Income Alternative Fund’s daily net assets retained by Litman Gregory is 0.40% on the first $1 billion of assets, 0.375% on the next $1 billion of assets, 0.35% on the next $1 billion of assets, 0.325% on the next $1 billion of assets and 0.30% on assets in excess of $4 billion. This agreement may be terminated at any time by the Board of Trustees of the Litman Gregory Funds Trust (the “Trust”) upon sixty (60) days’ written notice to Litman Gregory, and Litman Gregory may decline to renew this agreement at its expiration on April 30, 2020 by written notice to the Trust at least thirty (30) days before the agreement’s annual expiration date. While Litman Gregory has waived its right to receive reimbursement of the portion of its advisory fees waived pursuant to this agreement, Litman Gregory may be reimbursed for non-advisory related expenses.

Example

This example is intended to help you compare the cost of investing in the High Income Alternatives Fund with the cost of investing in other mutual funds. The example assumes that you invest $10,000 in the High Income Alternatives Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The example also assumes that your investment has a 5% return each year and that the High Income Alternatives Fund’s operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be:


	One Year		Three Years
Institutional Class	$	100	$	329
Investor Class	$	125	$	408

Portfolio Turnover

The High Income Alternatives Fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when shares of the High Income Alternatives Fund are held in a taxable account as compared to shares in investment companies that hold investments for a longer period. These costs, which are not reflected in the annual fund operating expenses or in the example, will affect the High Income Alternatives Fund’s performance.

Principal Strategies

Litman Gregory Fund Advisors, LLC, the advisor to the High Income Alternatives Fund, believes that it is possible to identify highly skilled and experienced investment managers who can successfully execute various investment approaches that can provide high current income relative to investment-grade fixed income portfolios, with low to moderate volatility relative to the stock market and volatility typically less than high yield credit indexes. Furthermore, Litman Gregory believes that by allocating assets among multiple investment managers with different but complementary strategies it can further enhance the risk-adjusted return potential of an overall fund portfolio over a full market cycle.

Based on these beliefs, the High Income Alternatives Fund’s strategy is to engage several established investment managers as sub-advisors (each a “sub-advisor” or “manager”) to offer investors a mix of strategies that Litman Gregory believes offer risk-return characteristics that are attractive individually and even more compelling collectively. The High Income Alternatives Fund is intended to be used by investors seeking high current income consistent with capital preservation over time, and with long-term capital appreciation a secondary objective.

Litman Gregory is responsible for hiring and firing investment managers and carefully chooses the sub-advisors. Before hiring a sub-advisor, Litman Gregory performs extensive due diligence. This includes quantitative and qualitative analysis



2						Litman Gregory Funds Trust

including, but not limited to, evaluation of: the investment process; the consistency of its execution and discipline; portfolio construction; individual holdings; strategies employed; past mistakes; risk controls; team depth and quality; operations and compliance; and business focus and vision. Litman Gregory’s evaluation process includes review of literature and documents, detailed quantitative historical performance evaluation, extensive discussions with members of the investment team, and firm management and background checks through industry contacts. Each sub-advisor’s management fee is also an important consideration. It is Litman Gregory’s objective to hire sub-advisors who it believes are skilled and will deliver strong portfolio income relative to investment-grade fixed income portfolios, with low to moderate volatility relative to the stock market and volatility typically less than the high yield credit indexes. Litman Gregory prefers managers who it believes will add value by flexibly responding to evolving market conditions by adjusting duration and credit exposure, among other factors.

Allocations among sub-advisors are based on several factors, including Litman Gregory’s expectation for the risk-adjusted return potential of each sub-advisor’s strategy and the impact on overall portfolio risk, with the objective of maximizing return subject to the goal of high income relative to investment-grade fixed income portfolios without taking undue risk. Litman Gregory may at times adjust the allocations of capital to sub-advisors if it believes there is a highly compelling tactical opportunity in a particular sub-advisor’s strategy. A tactical opportunity could represent the potential for an exceptional risk-adjusted return opportunity relative to the other strategies, or it may represent a superior risk reduction opportunity that could benefit the High Income Alternatives Fund’s overall portfolio. No strategy will be allocated less than 10% of portfolio assets or more than 60% of portfolio assets as measured at the time of allocation. It is possible that additional managers and strategies will be added to (or removed from) the High Income Alternatives Fund in the future and/or there may be adjustments in the allocation ranges.

Sub-advisor strategies may seek to benefit from: opportunities to combine securities with differing risk characteristics; market inefficiencies; opportunities to provide liquidity; tactical opportunities in asset classes or securities; special situations such as spin-offs; as well as other opportunities in other areas. In the aggregate, the managers can invest globally in debt and equity securities of companies of any size, domicile or market capitalization, government and corporate bonds, loans, loan participation interests, mortgage or other asset-backed securities and other fixed income securities and currencies, including short positions of any of the foregoing, within their respective segments of the High Income Alternatives Fund. The managers may invest without limitation in below investment grade fixed income securities. Under normal market conditions, the Fund does not expect to invest more than 25% of its total assets in emerging market securities They may also write options, invest in derivatives, including, without limitation, options, futures contracts, participatory notes (“P-Notes”) and swaps, to manage risk or enhance return and can also borrow amounts up to one third of the value of the High Income Alternatives Fund’s total assets (except that the Fund may

exceed this limit to satisfy redemption requests or for other temporary purposes). Each of the managers may invest in illiquid securities; however, the High Income Alternatives Fund as a whole may not hold more than 15% of its net assets in illiquid securities.

Each sub-advisor will have an investment approach that generally focuses on a particular asset class or specific strategies. Currently, the strategies the sub-advisors focus on are as follows: (1) an equity income strategy, (2) a credit value strategy, (3) a multi credit strategy, and (4) an option income strategy. Litman Gregory may hire sub-advisors that focus on other strategies in the future, and not all strategies that may be appropriate will be represented in the High Income Alternatives Fund’s portfolio at all times.

The sub-advisor that manages the equity income strategy invests across a variety of publicly-traded income producing asset classes where it has specific expertise. Targeted investments include publicly traded business development companies (“BDCs”), mortgage real estate investment trusts (“mREITS”), master limited partnerships (“MLPs”), and selectively, credit-based closed-end funds (“CEFs”) trading at discounts to net asset value and other opportunistic income investments like preferred equity. The team actively seeks to add value by finding positions with capital appreciation potential and adjusting capital allocation across sectors based on relative value. A central tenet of this strategy is the targeting of mainly long-term sustainable value (through the focus on quality management and strong franchises), and to the extent that companies do not exhibit these traits, the portfolio management team would demand a steep discount in price as a means to help mitigate risk. Risk management on a position and portfolio level is designed to avoid significant losses from individual company developments, as well as from negative sector or macro events.

The sub-advisor that manages the credit value strategy seeks to achieve the fund’s investment objectives by primarily investing its segment of the Fund in fixed income securities it believes to have the potential for excess return. The sub-advisor’s investment strategy will be to invest in fixed income securities from a wide variety of sectors, asset-backed securities, commercial mortgage-backed securities, corporate bonds, floating-rate loans and municipal bonds. The sub-advisor expects to invest in structured and corporate securities. The sub-advisor’s emphasis is expected to be on A/BBB-rated asset backed securities and BBB/BB-rated corporate securities, as these ratings segments have historically offered attractive risk-adjusted returns, along with low default rates. The sub-advisor will also invest in U.S. Treasury futures to manage duration of the portfolio, which allows individual security selection to be managed without regard to portfolio duration. Duration is a measure of the expected life of a fixed income security that is used to determine the sensitivity of a security to changes in interest rates. Fixed income securities and portfolios with longer durations are subject to more volatility than those with shorter durations. The sub-advisor will not typically own CCC rated or distressed securities.



Fund Summary						3

Litman Gregory Masters High Income Alternatives Fund — (Continued)

The sub-advisor that manages the multi credit strategy seeks to preserve invested capital and maximize total return through a combination of current income and capital appreciation. The team seeks to achieve its investment objective by investing in a wide range of fixed income and other debt and senior-equity securities selected from a variety of credit qualities, and sectors, including, but not limited to, corporate bonds, loans and loan participations, structured finance investments, U.S. government and agency, mezzanine and preferred securities and convertible securities. The team seeks opportunities across fixed income market sectors – especially in non-index-eligible securities – and they aim to take advantage of downturns/inefficiencies that occur during times of uncertainty. The strategy is flexible and is not constrained by duration, sector, issuer, or credit quality.

The sub-advisor that manages the option income strategy seeks to achieve its goal primarily through a strategy of writing collateralized put options on both U.S. indices, including the S&P 500^® Index and the Russell 2000^® Index, and exchange traded funds (“ETFs”). The manager attempts to generate returns through the receipt of option premiums from selling puts, as well as through investments in fixed income instruments, which collectively are intended to reduce volatility relative to what it would be if the Fund held the underlying equity index on which the options are written. The portfolio’s investments in fixed income instruments may be of any duration and may include U.S. Treasury securities and other securities issued by the U.S. government and its agencies and instrumentalities, corporate debt securities, cash and cash equivalents, mortgage-backed securities and asset-backed securities. The manager also may invest in money market mutual funds and ETFs.

Principal Risks

As with all mutual funds, it is possible to lose money on an investment in the High Income Alternatives Fund. An investment in the High Income Alternatives Fund is not a deposit of any bank and is not guaranteed, endorsed or insured by any financial institution, government authority or the Federal Deposit Insurance Corporation (FDIC). The principal risks of investing in the High Income Alternatives Fund are:

•

Asset-Backed Securities Risk. This is the risk that the impairment of the value of the collateral underlying a security in which the Fund invests, such as the non-payment of loans, will result in a reduction in the value of the security. The value of these securities may also fluctuate in response to the market’s perception of the value of issuers or collateral..

•

Below Investment-Grade Fixed Income Securities Risk. This is the risk of investing in below investment-grade fixed income securities (also known as “junk bonds”), which may be greater than that of higher rated fixed income securities. These securities are rated Ba1 through C by Moody’s Investors Service (“Moody’s”) or BB+ through D by Standard & Poor’s Rating Group (“S&P”) (or comparably rated by another nationally recognized statistical rating organization), or, if not rated by Moody’s or S&P, are

considered by the sub-advisors to be of similar quality. These securities are regarded by the rating organizations as predominantly speculative with respect to capacity to pay interest and repay principal in accordance with the terms of the obligation and therefore have greater risk of default than higher rated securities. The market value of these securities is more sensitive to corporate developments and economic conditions and can be volatile. Market conditions can diminish liquidity and make accurate valuations difficult to obtain.

•

Collateral Risk. If the Fund’s financial instruments are secured by collateral, the issuer may have difficulty liquidating the collateral and/or the Fund may have difficulty enforcing its rights under the terms of the securities if an issuer defaults. Collateral may be insufficient or the Fund’s right to the collateral may be set aside by a court. Collateral will generally consist of assets that may not be readily liquidated, including for example, equipment, inventory, work in the process of manufacture, real property and payments to become due under contracts or other receivable obligations. There is no assurance that the liquidation of those assets would satisfy an issuer’s obligations under a financial instrument. Non-affiliates and affiliates of issuers of financial instruments may provide collateral in the form of secured and unsecured guarantees and/or security interests in assets that they own, which may also be insufficient to satisfy an issuer’s obligations under a financial instrument.

•

Collateralized Loan Obligations and Collateralized Debt Obligations Risk. Collateralized loan obligations (“CLOs”) bear many of the same risks as other forms of asset-backed securities, including interest rate risk, credit risk and default risk. As they are backed by pools of loans, CLOs also bear similar risks to investing in loans directly. CLOs issue classes or “tranches” that vary in risk and yield. CLOs may experience substantial losses attributable to loan defaults. Losses caused by defaults on underlying assets are borne first by the holders of subordinate tranches. The Fund’s investment in CLOs may decrease in market value when the CLO experiences loan defaults or credit impairment, the disappearance of a subordinate tranche, or market anticipation of defaults and investor aversion to CLO securities as a class.

Collateralized debt obligations (“CDOs”) are structured similarly to CLOs and bear the same risks as CLOs including interest rate risk, credit risk and default risk. CDOs are subject to additional risks because they are backed by pools of assets other than loans including securities (such as other asset-backed securities), synthetic instruments or bonds and may be highly leveraged. Like CLOs, losses incurred by a CDO are borne first by holders of subordinate tranches. Accordingly, the risks of CDOs depend largely on the type of underlying collateral and the tranche of CDOs in which the Fund invests. For example, CDOs that obtain their exposure through synthetic investments entail the risks associated with derivative instruments.

•

Convertible Securities Risk. This is the risk that the market value of convertible securities may fluctuate due to changes in, among other things, interest rates; other general economic conditions; industry fundamentals; market sentiment; the



4						Litman Gregory Funds Trust

issuer’s operating results, financial statements, and credit ratings; and the market value of the underlying common or preferred stock.

•

Credit Risk. This is the risk that the High Income Alternatives Fund could lose money if the issuer or guarantor of a fixed income security, or the counterparty of a derivatives contract or other transaction, is unable or unwilling (or is perceived to be unable or unwilling) to make timely payment of principal and/or interest, or to otherwise honor its obligations.

•

Currency Risk. This is the risk that investing in foreign currencies may expose the High Income Alternatives Fund to fluctuations in currency exchange rates and that such fluctuations in the exchange rates may negatively affect an investment related to a currency or denominated in a foreign currency.

•

Debt Securities Risk. This is the risk that the value and liquidity of debt securities may be reduced under certain circumstances. The value of debt securities can fluctuate in response to issuer activity and changes in general economic and credit market conditions, including changes in interest rates. It is likely there will be less governmental action in the near future to maintain low interest rates. The negative impact on debt securities from the resulting rate increases for that and other reasons could be swift and significant. In recent years, dealer capacity in the debt and fixed income markets appears to have undergone fundamental changes, including a reduction in dealer market-making capacity. These changes have the potential to decrease substantially liquidity and increase volatility in the debt and fixed income markets.

•

Corporate Debt Obligations Risk. Corporate debt obligations are subject to the risk of an issuer’s inability to meet principal and interest payments on the obligations. Therefore, the High Income Alternative Fund may be indirectly exposed to such risks associated with corporate debt obligations.

•

Derivatives Risk. Use of derivatives, such as options, is a highly specialized activity that can involve investment techniques and risks different from, and in some respects greater than, those associated with investing in more traditional investments, such as stocks and bonds. Derivatives can be highly complex and highly volatile and may perform in unanticipated ways. Derivatives can create leverage, and the Fund could lose more than the amount it invests; some derivatives can have the potential for unlimited losses. Derivatives may at times be highly illiquid, and the Fund may not be able to close out or sell a derivative at a particular time or at an anticipated price. Derivatives can be difficult to value and valuation may be more difficult in times of market turmoil. There may be imperfect correlation between the behavior of a derivative and that of the reference instrument underlying the derivative. Suitable derivatives may not be available in all circumstances, and there can be no assurance that the Fund will use derivatives to reduce exposure to other risks when that might have been beneficial. Derivatives involve counterparty risk, which is the risk that the other party to the derivative will fail to make required payments or otherwise comply with the terms of the derivative. When the Fund uses derivatives, it will likely be required to provide margin or

collateral and/or segregate cash or other liquid assets; these practices are intended to satisfy contractual undertakings and regulatory requirements and will not prevent the Fund from incurring losses on derivatives. Ongoing changes to regulation of the derivatives markets and potential changes in the regulation of funds using derivative instruments could limit the Fund’s ability to pursue its investment strategies. The extent and impact of the regulation are not yet fully known and may not be for some time. New regulation of derivatives may make them more costly, or may otherwise adversely affect their liquidity, value or performance.

^¡

Options Risk. The use of options involves investment strategies and risks different from those associated with ordinary portfolio securities transactions. The prices of options are volatile and are influenced by, among other things, actual and anticipated changes in the value of the underlying instrument, or in interest or currency exchange rates, including the anticipated volatility (known as implied volatility), which in turn are affected by fiscal and monetary policies and by national and international political and economic events. As such, prior to the exercise or expiration of the option, the Fund is exposed to implied volatility risk, meaning the value, as based on implied volatility, of an option may increase due to market and economic conditions or views based on the sector or industry in which issuers of the underlying instrument participate, including company-specific factors. By writing call and put option spreads on underlying instruments, the Fund’s returns from that strategy will be determined by the performance of the underlying instrument. If the underlying instrument appreciates or depreciates sufficiently over the period to offset the net premium received, the Fund may incur losses. Changes in the volatility of the underlying stock or instrument can constrain returns from this strategy. By writing put options, the Fund takes on the risk of declines in the value of the underlying instrument, including the possibility of a loss up to the entire strike price of each option it sells, but without the corresponding opportunity to benefit from potential increases in the value of the underlying instrument. When the Fund writes a put option, it assumes the risk that it must purchase the underlying instrument at a strike price that may be higher than the market price of the instrument. If there is a broad market decline and the Fund is not able to close out its written put options, it may result in substantial losses to the Fund. By writing a call option, the Fund may be obligated to deliver instruments underlying an option at less than the market price. In the case of an uncovered call option, there is a risk of unlimited loss. When an uncovered call is exercised, the Fund must purchase the underlying instrument to meet its call obligations and the necessary instruments may be unavailable for purchase. The Fund will receive a premium from writing options, but the premium received may not be sufficient to offset any losses sustained from exercised options.

^¡

Futures Contracts Risk. This is the risk that an investment in futures contracts may be subject to losses that exceed the amount of the premiums paid and may subject the High Income Alternatives Fund’s net asset value to greater volatility.



Fund Summary						5

Litman Gregory Masters High Income Alternatives Fund — (Continued)

^¡

Forward Contracts Risk. There are no limitations on daily price movements of forward contracts. Changes in foreign exchange regulations by governmental authorities might limit the trading of forward contracts. To the extent the Fund enters into non-U.S. currency forward contracts with banks, the Fund is subject to the risk of bank failure or the inability of or refusal by a bank to perform such contracts. There have been periods during which certain banks have refused to continue to quote prices for forward contracts or have quoted prices with an unusually wide spread (the difference between the price at which the bank is prepared to buy and the price at which it is prepared to sell).

^¡

P-Notes Risk. This is the risk that the performance results of P-Notes will not replicate exactly the performance of the issuers or markets that the P-Notes seek to replicate. Investments in P-Notes involve risks normally associated with a direct investment in the underlying securities as well as additional risks, such as counterparty risk.

^¡

Swaps Risk. Risks inherent in the use of swaps include: (1) swap contracts may not be assigned without the consent of the counterparty; (2) potential default of the counterparty to the swap; (3) absence of a liquid secondary market for any particular swap at any time; and (4) possible inability of the High Income Alternatives Fund to close out the swap transaction at a time that otherwise would be favorable for it to do so.

•

Equity Securities Risk. This is the risk that the value of equity securities may fluctuate, sometimes rapidly and unpredictably, due to factors affecting the general market, an entire industry or sector, or particular companies. These factors include, without limitation, adverse changes in economic conditions, the general outlook for corporate earnings, interest rates or investor sentiment; increases in production costs; and significant management decisions. This risk is greater for small- and medium-sized companies, which tend to be more vulnerable to adverse developments than larger companies.

•

Preferred Stock Risk. In the event an issuer is liquidated or declares bankruptcy, the claims of owners of bonds take precedence over the claims of those who own preferred and common stock. If interest rates rise, the fixed dividend on preferred stocks may be less attractive, causing the price of preferred stocks to decline.

•

Foreign Investment and Emerging Markets Risk. This is the risk that an investment in foreign (non-U.S.) securities may cause the High Income Alternatives Fund to experience more rapid and extreme changes in value than a fund that invests exclusively in securities of U.S. companies, due to factors such as currency conversion rate fluctuations, currency blockages, political and economic instability, differences in financial reporting, accounting and auditing standards, nationalization, expropriation or confiscatory taxation, and smaller and less-strict regulation of securities markets. These risks are greater in emerging markets.

•

Interest Rate Risk. This is the risk that debt securities will decline in value because of changes in interest rates. Generally, the value of debt securities rise when prevailing

interest rates fall, and fall when prevailing interest rates rise. A fund with a longer average portfolio duration will be more sensitive to changes in interest rates than a fund with a shorter average portfolio duration.

•

Investment Companies Risk. This is the risk that investing in other investment companies, including ETFs, CEFs, BDCs, unit investment trusts and open-end funds, subjects the Fund to those risks affecting the investment vehicle, including the possibility that the value of the underlying securities held by the investment vehicle could decrease or the portfolio becomes illiquid. Moreover, the Fund and its shareholders will incur its pro rata share of the underlying vehicles’ expenses, which will reduce the Fund’s performance. In addition, investments in an ETF are subject to, among other risks, the risk that the ETF’s shares may trade at a discount or premium relative to the net asset value of the shares and the listing exchange may halt trading of the ETF’s shares. BDCs may carry risks similar to those of a private equity or venture capital fund. BDC company 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. BDCs usually trade at a discount to their net asset value because they invest in unlisted securities and have limited access to capital markets. Shares of CEFs also frequently trade at a discount to their net asset value for those and other reasons.

•

Investments in Loan Risk. Investments in loans, including loan syndicates and other direct lending opportunities, involve special types of risks, including credit risk, interest rate risk, counterparty risk and prepayment risk. Loans may offer a fixed or floating interest rate. Loans are often generally below investment grade and may be unrated. The Fund’s investments in loans can also be difficult to value accurately and may be more susceptible to liquidity risk than fixed-income instruments of similar credit quality and/or maturity. The Fund is also subject to the risk that the value of the collateral for the loan may be insufficient or unavailable to cover the borrower’s obligations should the borrower fail to make payments or become insolvent. Participations in loans may subject the Fund to the credit risk of both the borrower and the issuer of the participation and may make enforcement of loan covenants, if any, more difficult for the Fund as legal action may have to go through the issuer of the participations. Transactions in loans are often subject to long settlement periods, thus potentially limiting the ability of the Fund to invest sale proceeds in other investments and to use proceeds to meet its current redemption obligations. In addition, many banks have been weakened by the recent financial crisis, and it may be difficult for the Fund to obtain an accurate picture of a lending bank’s financial condition.

•

Leverage Risk. This is the risk that leverage may cause the effect of an increase or decrease in the value of the High Income Alternatives Fund’s portfolio securities to be magnified and the High Income Alternatives Fund to be more volatile than if leverage was not used. Leverage may result from certain transactions, including the use of derivatives and borrowing.



6						Litman Gregory Funds Trust

•

MLP Risk. Investing in MLP units involves some risks that differ from an investment in the equity securities of a company. Holders of MLP units have limited control and voting rights on matters affecting the partnership. Holders of units issued by a MLP are exposed to a remote possibility of liability for all of the obligations of that MLP in the event that a court determines that the rights of the holders of MLP units to vote to remove or replace the general partner of that MLP, to approve amendments to that MLP’s partnership agreement, or to take other action under the partnership agreement of that MLP would constitute “control” of the business of that MLP, or a court or governmental agency determines that the MLP is conducting business in a state without complying with the partnership statute of that state. Holders of MLP units are also exposed to the risk that they will be required to repay amounts to the MLP that are wrongfully distributed to them.

•

MLP Tax Risk. Investments in MLP units also present special tax risks. The MLPs in which the Fund invests may fail to be treated as partnerships for U.S. federal income tax purposes. The Fund’s ability to meet its investment objectives will depend, in large measure, on the level of dividends, distributions or income it receives from the MLPs in which it invests and on the MLPs’ continued treatment as partnerships for U.S. federal income tax purposes. If a MLP does not meet current legal requirements to maintain its partnership status, or if it is unable to do so because of tax or other law changes, it would be treated as a corporation for U.S. federal income tax purposes. In that case, the MLP would be obligated to pay U.S. federal income tax (as well as state and local taxes) at the entity level on its taxable income and distributions received by the Fund would be taxable to the Fund as dividend income to the extent of the MLP’s current and accumulated earnings and profits for federal tax purposes. The classification of a MLP as a corporation for U.S. federal income tax purposes could have the effect of reducing the amount of cash available for distribution by the MLP and the value of the Fund’s investment in any such MLP. As a result, the value of the Fund’s shares and the cash available for distribution to Fund shareholders could be materially reduced.

•

Mortgage-Backed Securities Risk. This is the risk of investing in mortgaged-backed securities, which includes interest rate risk, prepayment risk and the risk of defaults on the mortgage loans underlying these securities.

•

Mortgage REIT Risk. Investing in mREITs involves certain risks related to investing in real property mortgages. In addition, mREITs must satisfy highly technical and complex requirements in order to qualify for the favorable tax treatment accorded to REITs under the Internal Revenue Code of 1986 (the “Code”). No assurances can be given that a mREIT in which the Fund invests will be able to continue to qualify as a REIT or that complying with the REIT requirements under the Code will not adversely affect such REIT’s ability to execute its business plan.

•

Multi-Style Management Risk. This is the risk that the High Income Alternatives Fund could experience overlapping security transactions as a result of having different portfolio managers using different strategies to manage the High

Income Alternatives Fund’s assets. Certain portfolio managers may be purchasing securities at the same time other portfolio managers may be selling those same securities, which may lead to higher transaction expenses compared to a fund using a single investment strategy.

•

Municipal Securities Risk. Municipal securities can be significantly affected by litigation, political or economic events, as well as uncertainties in the municipal market related to taxation, legislative changes or the rights of municipal security holders. Municipal securities backed by current or anticipated revenues from specific projects or assets can be negatively affected by the inability of the issuer to collect revenues for the projects or from the assets.

•

Portfolio Turnover Risk. This is the risk that the High Income Alternatives Fund may experience high portfolio turnover rates as a result of its investment strategies. High portfolio turnover rates may indicate higher transaction costs and may result in higher taxes when shares of the High Income Alternatives Fund are held in a taxable account as compared to shares in investment companies that hold investments for a longer period.

•

Short Sale Risk. This is the risk that the value of a security the High Income Alternatives Fund sells short does not go down as expected. The risk of loss is theoretically unlimited if the value of the security sold short continues to increase. In addition, short sales may cause the High Income Alternatives Fund to be compelled, at a time disadvantageous to it, to buy the security previously sold short, thus resulting in a loss. To meet current margin requirements, the High Income Alternatives Fund is required to deposit with the broker additional cash or securities so that the total deposit with the broker is maintained daily at 150% of the current market value of the securities sold short.

•

Unfavorable Tax Treatment Risk. This is the risk that a material portion of the High Income Alternatives Fund’s return could be in the form of net investment income or short-term capital gains, some of which may be distributed to shareholders and taxed at ordinary income tax rates. Therefore, shareholders may have a greater need to pay regular taxes than compared to other investment strategies that hold investments longer. Due to this investment strategy, it may be preferable for certain shareholders to invest in the High Income Alternatives Fund through pre-tax or tax-deferred accounts as compared to investment through currently taxable accounts. Potential shareholders are encouraged to consult their tax advisors in this regard.

Performance

The High Income Alternatives Fund has not commenced investment operations. Once the High Income Alternatives Fund has a performance record of at least one calendar year, a bar chart and performance table will be included in this Prospectus. Updated performance information is available on the High Income Alternatives Fund’s website at www.mastersfunds.com.



Fund Summary						7

Litman Gregory Masters High Income Alternatives Fund — (Continued)

Management


INVESTMENT ADVISOR	PORTFOLIO MANAGER	MANAGED THE HIGH INCOME ALTERNATIVES FUND SINCE:
Litman Gregory Fund Advisors, LLC	Jeremy DeGroot, CFA, President of the Trust, Principal, Chief Investment Officer and Co-Portfolio Manager		2018

	Jack Chee, Principal, Senior Research Analyst and Co-Portfolio Manager		2018

	Jason Steuerwalt, CFA, Senior Research Analyst and Co-Portfolio Manager		2018

SUB-ADVISOR	PORTFOLIO MANAGER
Ares Management LLC	Greg Mason, CFA, Managing Director and Portfolio Manager		2018

	Troy Ward, Managing Director and Portfolio Manager		2018
Brown Brothers Harriman & Co.	Andrew P. Hofer, Managing Director, Portfolio Manager and Head of Taxable Portfolio Management		2018

	Neil Hohmann, Managing Director, Head of Structured Products and Portfolio Manager		2018

	Paul Kunz, CFA, Senior Vice President and Portfolio Manager		2018
Guggenheim Partners Investment Management, LLC	Scott Minerd, Chairman of Investments, Global Chief Investment Officer, Managing Partner and Portfolio Manager		2018

	Anne Walsh, CFA, Chief Investment Officer – Fixed Income, Senior Managing Director and Portfolio Manager		2018

	Steven Brown, CFA, Managing Director and Portfolio Manager		2018

	Adam Bloch, Director and Portfolio Manager		2018
Neuberger Berman Investment Advisers LLC	Derek Devens, CFA, Managing Director and Senior Portfolio Manager		2018

For important information about the purchase and sale of fund shares, tax information and financial intermediary compensation, please turn to the “Summary of Other Important Information Regarding the Fund” section on page 9 of this Prospectus.



8						Litman Gregory Funds Trust

Summary of Other Important Information Regarding the Fund

Transaction Policies

You may purchase, redeem or exchange High Income Alternatives Fund shares on any business day by written request via mail (Litman Gregory Funds Trust, c/o DST Asset Manager Solutions, Inc., P.O. Box 219922, Kansas City, MO 64121-9922), by wire transfer, by telephone at 1-800-960-0188, or through a financial intermediary. The minimum initial and subsequent investment amounts for the High Income Alternatives Fund are shown below.

Fund/Type of Account

Minimum
Initial

Investment

Minimum
Additional

Investment

Minimum

Account
Balance

High Income Alternatives Fund⁽¹⁾

Regular

- Institutional Class

$100,000

250

$2,500

- Investor Class

$1,000

100

$250

Retirement Account

- Institutional Class

$5,000

100

$250

- Investor Class

$500

100

$250

Automatic Investment Account

- Institutional Class

$2,500

250

$2,500

- Investor Class

$2,500

250

$2,500

(1)

The minimum investment amounts may be waived or lowered for investments effected through banks and other institutions that have entered into arrangements with the High Income Alternatives Fund or the distributor of the Fund and for investments effected on a group basis by certain other entities and their employees, such as investments pursuant to a payroll deduction plan and asset-based or wrap programs. Please consult your financial intermediary for information about minimum investment requirements. The High Income Alternatives Fund reserves the right to change or waive the minimum initial and subsequent investment requirements at any time. The High Income Alternatives Fund reserves the right to close purchases to new investors at any time.

Tax Information

Depending on the character of income distributed, the High Income Alternatives Fund’s distributions will be taxed as ordinary income or capital gains, unless you are investing through a tax-deferred arrangement, such as a 401(k) plan or an individual retirement account. Such tax-deferred arrangements may be taxed later upon withdrawal from those accounts.

Payments to Broker-Dealers and Other Financial Intermediaries

If you purchase shares of the High Income Alternatives Fund through a broker-dealer or other financial intermediary (such as a bank), the High Income Alternatives Fund and/or Litman Gregory may pay the intermediary for the sale of High Income Alternatives 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 High Income Alternatives Fund over another investment. Ask your salesperson or visit your financial intermediary’s website for more information.



Summary of Other Important Information Regarding the Fund						9

Description of Principal Investment Risks

All mutual funds carry a certain amount of risk. The High Income Alternatives Fund’s returns will vary, and you could lose money on your investment in the Fund. An investment in the High Income Alternatives Fund is not a deposit of a bank and is not insured, endorsed or guaranteed by any financial institution, the Federal Deposit Insurance Corporation (FDIC) or any other government agency. The principal risks for the High Income Alternatives Fund are identified in the Fund’s Summary Section and are described in further detail below. Additional information about the principal risks is included in the High Income Alternatives Fund’s Statement of Additional Information (the “SAI”).

Asset-Backed Securities Risk

The Fund may invest in asset-backed securities (“ABS”), which are debt obligations or debt securities that entitle the holders thereof to receive payments that depend primarily on the cash flow from underlying financial assets, together with rights or other assets designed to assure the servicing or timely distribution of proceeds to holders of such securities. An ABS is typically created by the sale of assets or collateral to a conduit, generally a bankruptcy-remote vehicle such as a grantor trust or other special-purpose entity, which becomes the legal issuer of the ABS. Interests in or other securities issued by the trust or special-purpose entity, which give the holder thereof the right to certain cash flows arising from the underlying assets, are then sold to investors through an investment bank or other securities underwriter.

The structure of an ABS and the terms of the investors’ interest in the collateral can vary widely depending on the type of collateral, the desires of investors and the use of credit enhancements. Although the basic elements of all ABS are similar, individual transactions can differ markedly in both structure and execution. Holders of ABS bear various risks, including credit risks, liquidity risks, interest rate risks, market risks, operations risks, structural risks and legal risks.

Credit risk is an important issue in ABS because of the significant credit risks inherent in the underlying collateral and because issuers are primarily private entities. Credit risk arises from losses due to defaults by the borrowers in the underlying collateral or the issuer’s or servicer’s failure to perform. Market risk arises from the cash-flow characteristics of the security, which for many ABS tend to be predictable. The greatest variability in cash flows comes from credit performance, including the presence of early amortization or acceleration features designed to protect the investor if credit losses in the portfolio rise well above expected levels. Interest-rate risk arises for the issuer from the relationship between the pricing terms on the underlying collateral and the terms of the rate paid to security holders. ABS are subject to the risk that a change in interest rates may influence the pace of prepayments of the underlying securities which, in turn, affects yields on an absolute basis. Liquidity risk can arise from increased perceived credit risk. For example, liquidity can also become a significant problem if concerns regarding credit quality lead investors to avoid the securities issued by the relevant special-purpose entity. Operations risk arises through the potential for misrepresentation of asset quality or terms by the originating institution, misrepresentation of the nature and current value of the assets by the servicer and inadequate controls over disbursements and receipts by the servicer. Structural risk may arise through investments in ABS with structures (for example, the establishment of various security tranches) that are intended to reallocate the risks entailed in the underlying collateral (particularly credit risk) in ways that give certain investors less credit risk protection (i.e., a lower priority claim on the cash flows from the underlying pool of assets) than others. As a result, such securities have a higher risk of loss as a result of delinquencies or losses on the underlying assets.

Further, credit risk retention requirements for ABS may increase the costs to originators, securitizers and, in certain cases, asset managers of securitization vehicles in which the Fund may invest. Although the impact of these requirements is uncertain, certain additional costs may be passed to the Fund and the Fund’s investments in ABS may be adversely affected. Many of the other changes required by the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), or foreign regulatory developments could materially impact the value of the Fund’s assets, expose the Fund to additional costs and require changes to investment practices, thereby adversely affecting the Fund’s performance.



10						Litman Gregory Funds Trust

Additional risks relating to investments in ABS may arise because of the type of ABS in which the Fund invests, defined by the assets collateralizing the ABS. For example, collateralized mortgage obligations may have complex or highly variable prepayment terms, such as companion classes, interest only or principal only payments, inverse floaters and residuals. These investments generally entail greater market, prepayment and liquidity risks than other mortgage-backed securities, and may be more volatile or less liquid than other mortgage-backed securities. In addition, ABS backed by aircraft loans and leases may provide the Fund with a less effective security interest in the related underlying collateral than do mortgage-related securities and, thus, it is possible that recovery on repossessed collateral might be unavailable or inadequate to support payments on these ABS. In addition to the risks inherent in ABS generally, risks associated with aircraft securitizations include but are not limited to risks related to commercial aircraft, the leasing of aircraft by commercial airlines and the commercial aviation industry generally. With respect to any one aircraft, the value of such aircraft can be affected by the particular maintenance and operating history for the aircraft or its components, the model and type of aircraft, the jurisdiction of registration (including legal risks, costs and delays in attempting to repossess and export such aircraft following any default under the related loan or lease) and regulatory risk. The Fund may invest in these and other types of ABS that may be developed in the future.

• Residential Mortgage-Backed Securities – Home mortgage loans are typically grouped together into pools by banks and other lending institutions, and interests in these pools are then sold to investors, allowing the bank or other lending institution to have more money available to loan to home buyers. Some of these pools are guaranteed by U.S. government agencies or by government sponsored private corporations-familiarly called “Ginnie Mae,” “Fannie Mae” and “Freddie Mac.” Non-agency MBS is subject to the risk that the value of such security will decline because, among other things, the security is not issued or guaranteed as to principal or interest by the U.S. government or a government sponsored enterprise. These securities are often subject to greater credit risk than agency MBS. In addition, these securities may be less readily marketable as the market for these securities is typically smaller and less liquid than the market for agency MBS, thus these securities may be subject to greater price fluctuation than agency MBS. Home mortgage loans may also be purchased and grouped together by non-lending institutions such as investment banks and hedge funds who will sell interests in such pools to investors. Mortgage-backed securities may be particularly sensitive to changes in interest rates given that rising interest rates tend to extend the duration of fixed-rate mortgage-backed securities. As a result, a rising interest rate environment can cause the prices of mortgage-backed securities to be increasingly volatile, which may adversely affect the Fund’s holdings of mortgage-backed securities. In light of the current interest rate environment, the Fund’s investments in these securities may be subject to heightened interest rate risk.

• Commercial Mortgage-Backed Securities – Commercial mortgage backed securities (“CMBS”) are collateralized by one or more commercial mortgage loans. Banks and other lending institutions typically group the loans into pools and interests in these pools are then sold to investors, allowing the lender to have more money available to loan to other commercial real estate owners. Commercial mortgage loans may be secured by office properties, retail properties, hotels, mixed use properties or multi-family apartment buildings. Investments in CMBS are subject to the risks of ABS generally and particularly subject to credit risk, interest rate risk, and liquidity and valuation risk.



Description of Principal Investment Risks						11

Description of Principal Investment Risks — (Continued)


Below Investment-Grade Fixed Income Securities Risk		Below investment-grade fixed income securities (also known as “junk bonds”) are considered speculative. These securities are rated Ba1 through C by Moody’s Investors Service (“Moody’s”) or BB+ through D by Standard & Poor’s Rating Group (“S&P”) (or comparably rated by another nationally recognized statistical rating organization), or, if not rated by Moody’s or S&P, are considered by the sub-advisors to be of similar quality. These securities may be subject to greater risks than those of higher rated fixed income securities, including greater risk of default. The market value of below investment-grade fixed income securities is more sensitive to individual corporate developments and economic changes than higher rated securities. Adverse publicity and investor perceptions, whether or not accurate, regarding below investment-grade fixed-income securities may depress prices and diminish liquidity for such securities. The market for below investment-grade fixed-income securities may be less active than the market for higher rated securities, which can adversely affect the price at which these securities may be sold. Less active markets may diminish the High Income Alternatives Fund’s ability to obtain accurate market quotations when valuing the portfolio securities and thereby giving rise to valuation risk. In addition, the High Income Alternatives Fund may incur additional expenses if a holding defaults and the High Income Alternatives Fund has to seek recovery of its principal investment. Below investment-grade fixed-income securities may also present risks based on payment expectations. For example, these securities may contain redemption or call provisions. If an issuer exercises these provisions in a declining interest rate market, the High Income Alternatives Fund would have to replace the security with a lower yielding security resulting in a decreased return for investors.
Collateral Risk		If the Fund’s financial instruments are secured by collateral, the issuer may have difficulty liquidating the collateral and/or the Fund may have difficulty enforcing its rights under the terms of the securities if an issuer defaults. Collateral may be insufficient or the Fund’s right to the collateral may be set aside by a court. Collateral will generally consist of assets that may not be readily liquidated, including for example, equipment, inventory, work in the process of manufacture, real property and payments to become due under contracts or other receivable obligations. There is no assurance that the liquidation of those assets would satisfy an issuer’s obligations under a financial instrument. Non-affiliates and affiliates of issuers of financial instruments may provide collateral in the form of secured and unsecured guarantees and/or security interests in assets that they own, which may also be insufficient to satisfy an issuer’s obligations under a financial instrument.
Collateralized Loan Obligations and Collateralized Debt Obligations Risk		Investments in collateralized loan obligations (“CLOs”) carry the same risks as investments in loans directly, such as interest rate risk, credit and liquidity and valuation risks, and the risk of default. These investments are also subject to the risks associated with a decrease of market value due to collateral defaults and disappearance of subordinate tranches, market anticipation of defaults, and investor aversion to these types of securities as a class. CLOs issue classes or “tranches” that vary in risk and yield. Losses caused by defaults on underlying assets are borne first by the holders of subordinate tranches. A CLO may experience substantial losses attributable to loan defaults. The Fund’s investment in a CLO may decrease in market value because of (i) loan defaults or credit impairment, (ii) the disappearance of subordinate tranches, (iii) market anticipation of defaults, and (iv) investor aversion to CLO securities as a class. These risks may be magnified depending on the tranche of CLO securities in which the Fund invests. For example, investments in a junior tranche of CLO securities will likely be more sensitive to loan defaults or credit impairment than investments in more senior tranches. Collateralized debt obligations (“CDOs”) are structured similarly to CLOs, but are backed by pools of assets that are debt securities rather than only loans, typically including bonds, other structured finance securities (including other ABS and other CLOs) and/or synthetic instruments. CDOs are often highly leveraged, and like CLOs, the risks of investing in CDOs may be magnified depending on the tranche of CDO securities held by the Fund. The nature of the risks of CDOs depends largely on the type and quality of the underlying collateral and the tranche of CDOs in which the Fund may invest. CDOs collateralized by pools of ABS carry the same risks as investments in ABS directly, including losses with respect to the collateral underlying those ABS. In addition, certain CDOs may not hold their underlying collateral directly, but rather, use derivatives such as swaps to create “synthetic” exposure to the collateral pool. Such CDOs entail the risks associated with derivative instruments.



12						Litman Gregory Funds Trust


Convertible Securities Risk		Convertible securities generally offer lower interest or dividend yields than non-convertible securities of similar quality. Because convertible securities are higher in an issuer’s capital structure than equity securities, convertible securities are generally not as risky as the equity securities of the same issuer. However, convertible securities may gain or lose value due to changes in, among other things, interest rates; other general economic conditions; industry fundamentals; market sentiment; and the issuer’s operating results, financial statements and credit ratings. The value of convertible securities also tends to change whenever the market value of the underlying common or preferred stock fluctuates.
Credit Risk		Credit risk is the risk that the issuer or the guarantor of a fixed income security, or the counterparty to a derivatives contract or other transaction, is unable or unwilling (or is perceived to be unable or unwilling) to make timely payments of principal and/or interest, or to otherwise honor its obligations. The High Income Alternatives Fund will be subject to credit risks with respect to the counterparties of its derivative transactions. Many of the protections afforded to participants on organized exchanges, such as the performance guarantee of an exchange clearing house, are not available in connection with over-the-counter (“OTC”) derivative transactions, such as foreign currency transactions. As a result, in instances where the High Income Alternatives Fund enters into OTC derivative transactions, the High Income Alternatives Fund will be subject to the risk that its direct counterparties will not perform their obligations under the transactions and that the High Income Alternatives Fund will sustain losses or be unable to realize gains.
Currency Risk		Investing in foreign currencies exposes the fund to fluctuations in currency exchange rates. Fluctuations in the exchange rates between different currencies may negatively affect an investment. The High Income Alternatives Fund may be subject to currency risk because it may invest a significant portion of its assets in currency-related instruments, such as forward currency exchange contracts, foreign currency futures contracts, options on foreign currencies and foreign currency futures, cross-currency instruments (such as swaps) and direct investments in foreign currencies. The High Income Alternatives Fund also is subject to currency risk because it may invest in securities or other instruments denominated in, or receive revenues in, foreign currencies. The sub-advisors may elect not to hedge currency risk, which may cause the High Income Alternatives Fund to incur losses that would not have been incurred had the risk been hedged.
Debt Securities Risk		The value and liquidity of debt securities may be reduced under certain circumstances. The value of debt securities can fluctuate, sometimes rapidly, in response to issuer activity and changes in general economic and credit market conditions, including changes in interest rates. The prices of debt securities can be volatile, and there can be severe limitations in the ability to value or sell certain debt securities, including those that are of higher credit quality, during periods of reduced credit market liquidity such as the one that the market experienced in 2008 and 2009.



Description of Principal Investment Risks						13

Description of Principal Investment Risks — (Continued)

Derivatives Risk

Use of derivatives is a highly specialized activity that can involve investment techniques and risks different from, and in some respects greater than, those associated with investing in more traditional investments, such as stocks and bonds. Derivatives can be highly complex and highly volatile and may perform in unanticipated ways. Derivatives can create leverage, which can magnify the impact of a decline in the value of the reference instrument underlying the derivative, and the Fund could lose more than the amount it invests. Derivatives can have the potential for unlimited losses, for example, where the Fund may be called upon to deliver a security it does not own. Derivatives may at times be highly illiquid, and the Fund may not be able to close out or sell a derivative at a particular time or at an anticipated price. Derivatives can be difficult to value and valuation may be more difficult in times of market turmoil. There may be imperfect correlation between the behavior of a derivative and that of the reference instrument, and the reference instrument may not perform as anticipated. Suitable derivatives may not be available in all circumstances, and there can be no assurance that the Fund will use derivatives to reduce exposure to other risks when that might have been beneficial. Derivatives may involve fees, commissions, or other costs that may reduce the Fund’s gains or exacerbate losses from the derivatives. In addition, the Fund’s use of derivatives may have different tax consequences for the Fund than an investment in the reference instruments, and those differences may increase the amount and affect the timing of income recognition and character of taxable distributions payable to shareholders. Certain aspects of the regulatory treatment of derivative instruments, including federal income tax, are currently unclear and may be affected by changes in legislation, regulations, or other legally binding authority.

Derivatives involve counterparty risk, which is the risk that the other party to the derivative will fail to make required payments or otherwise comply with the terms of the derivative. Counterparty risk may arise because of market activities and developments, the counterparty’s financial condition (including financial difficulties, bankruptcy, or insolvency), or other reasons. Not all derivative transactions require a counterparty to post collateral, which may expose the Fund to greater losses in the event of a default by a counterparty. Counterparty risk is generally thought to be greater with OTC derivatives than with derivatives that are centrally cleared. However, derivatives that are traded on organized exchanges and/or through clearing organizations involve the possibility that the futures commission merchant or clearing organization will default in the performance of its obligations.

When the Fund uses derivatives, it will likely be required to provide margin or collateral and/or segregate cash or other liquid assets; these practices are intended to satisfy contractual undertakings and regulatory requirements and will not prevent the Fund from incurring losses on derivatives. The need to provide margin or collateral and/or segregate assets could limit the Fund’s ability to pursue other opportunities as they arise. Segregated assets are not available to meet redemptions. The amount of assets required to be segregated will depend on the type of derivative the Fund uses and the nature of the contractual arrangement. If the Fund is required to segregate assets equal to only the current market value of its obligation under a derivative, the Fund may be able to use derivatives to a greater extent than if it were required to segregate assets equal to the full notional value of such derivative, which would increase the degree of leverage the Fund could undertake through derivatives and otherwise. Derivatives that have margin requirements involve the risk that if the Fund has insufficient cash or eligible margin securities to meet daily variation margin requirements, it may have to sell securities or other instruments from its portfolio at a time when it may be disadvantageous to do so. The Fund may remain obligated to meet margin requirements until a derivatives position is closed.

Although the Fund may use derivatives to attempt to hedge against certain risks, the hedging instruments may not perform as expected and could produce losses.



14						Litman Gregory Funds Trust


		Additional risks associated with certain types of derivatives are discussed below: Options Risk. When the Fund writes a covered call option, it assumes the risk that it will have to sell the underlying instrument at an exercise price that may be lower than the market price of the instrument, and it gives up the opportunity to profit from a price increase in the underlying instrument above the exercise price. If a call option that the Fund has written is exercised, the Fund will experience a gain or loss from the sale of the underlying instrument, depending on the price at which the Fund purchased the instrument. In the case of an uncovered call option, there is a risk of unlimited loss. When an uncovered call is exercised, the Fund must purchase the underlying instrument to meet its call obligations and the necessary instruments may be unavailable for purchase. If a call option that the Fund has written expires unexercised, the Fund will experience a gain in the amount of the premium it received; however, in the case of a covered call, that gain may be offset by a decline in the market value of the underlying instrument during the option period. When the Fund writes a put option, it assumes the risk that it will have to purchase the underlying instrument at an exercise price that may be higher than the market price of the instrument and the possibility of a loss up to the entire exercise price of each option it sells but without the corresponding opportunity to benefit from potential increases in the value of the underlying instrument. If the market price of the underlying instrument declines, the Fund would expect to suffer a loss. However, the premium the Fund received for writing the put should offset a portion of the decline. If an option that the Fund has purchased expires unexercised, the Fund will experience a loss in the amount of the premium it paid and the use of those funds.

		Forward Contracts Risk. There are no limitations on daily price movements of forward contracts. Changes in foreign exchange regulations by governmental authorities might limit the trading of forward contracts. To the extent the Fund enters into non-U.S. currency forward contracts with banks, the Fund is subject to the risk of bank failure or the inability of or refusal by a bank to perform such contracts. There have been periods during which certain banks have refused to continue to quote prices for forward contracts or have quoted prices with an unusually wide spread (the difference between the price at which the bank is prepared to buy and the price at which it is prepared to sell).

		Futures Contracts Risk. The High Income Alternatives Fund may invest in futures contracts. The loss that may be incurred by entering into futures contracts could exceed the amount of the premiums paid and may be potentially unlimited. Futures markets are highly volatile, and the use of futures may increase the volatility of the Fund’s net asset value (“NAV”). Additionally, as a result of the low collateral deposits normally involved in futures trading, a relatively small movement in the price or value of a futures contract increases the risk of losing more than the amount initially invested by the Fund. Furthermore, exchanges may limit fluctuations in futures contract prices during a trading session by imposing a maximum permissible price movement on each futures contract. The Fund may be disadvantaged if it is prohibited from executing a trade outside the daily permissible price movement. Futures contracts executed on foreign exchanges may not be provided the same protections as provided by U.S. exchanges.



Description of Principal Investment Risks						15

Description of Principal Investment Risks — (Continued)


		P-Notes Risk. The High Income Alternatives Fund may invest in P-Notes. P-Notes are a type of equity-linked derivative generally issued by banks or broker-dealers and are designed to replicate the performance of the underlying equity securities. P-Notes are typically utilized to obtain exposure in certain non-U.S. markets where direct investment in a company’s equity is not permitted or otherwise feasible. Even though a P-Note is intended to reflect the performance of the underlying equity securities on a one-to-one basis so that investors will not normally gain or lose more in absolute terms than they would have made or lost had they invested in the underlying securities directly, the performance results of P-Notes will not replicate exactly the performance of the issuers or markets that the P-Notes seek to replicate due to transaction costs and other expenses. P-Notes represent unsecured, unsubordinated contractual rights of the issuer and do not confer any right, title or interest in respect to the underlying equity securities or provide rights against the issuer of the underlying securities. For this reason, in addition to the risks normally associated with a direct investment in the underlying securities, P-Notes are subject to counterparty risk if the issuer of the P-Note is unable or refuses to perform under the terms of the P-Note and must rely on the creditworthiness of the counterparty for its investment returns on the P-Notes. While the holder of a P-Note is entitled to receive from the bank or broker-dealer any dividends or other distributions paid on the underlying securities, the holder is not entitled to the same rights as an owner of the underlying securities, such as voting rights. P-Notes are also not traded on exchanges, are privately issued, and may be illiquid. There can be no assurance that the trading price or value of P-Notes will equal the value of the underlying value of the equity securities they seek to replicate.

		Credit Default Swaps Risk. The High Income Alternatives Fund may enter into credit default swap agreements. The “buyer” in a credit default swap contract is obligated to pay the “seller” a periodic stream of payments over the term of the contract, provided no event of default has occurred. In the event of default, the seller must pay the buyer the “par value” (full notional value) of the reference obligation in exchange for the reference obligation. The Fund may be either the buyer or seller in the transaction. If the Fund is a buyer and no event of default occurs, the Fund loses its investment and recovers nothing. However, if an event of default occurs, the buyer receives full notional value for a reference obligation that may have little or no value. As a seller, the Fund receives a fixed rate of income throughout the term of the contract, provided there is no default event. If an event of default occurs, the seller is normally obligated to pay the notional value of the reference obligation. The value of the reference obligation received by the seller, coupled with the periodic payments previously received may be less than the full notional value it pays to the buyer, resulting in a loss of value to the Fund. Credit default swaps involve greater risks than if the Fund had invested in the reference obligation directly. In addition to general market risks, credit default swaps are subject to illiquidity risk, counterparty risk and credit risks. If the Fund writes a credit default swap, it would normally be required to segregate liquid assets equal in value to the notional value of the reference obligation.

		Total Return Swaps Risk. The High Income Alternatives Fund may enter into total return swap agreements. Total return swap is the generic name for any non-traditional swap where one party agrees to pay the other the “total return” of a defined underlying asset, usually in return for receiving a stream of London Interbank Offered Rate (“LIBOR”) based cash flows. A total return swap may be applied to any underlying asset but is most commonly used with equity indices, single stocks, bonds and defined portfolios of loans and mortgages. Total return swap is a mechanism for the user to accept the economic benefits of asset ownership without utilizing the balance sheet. The other leg of the swap, usually LIBOR, is spread to reflect the non-balance sheet nature of the product. No notional amounts are exchanged with total return swaps. The total return receiver assumes the entire economic exposure – that is, both market and credit exposure – to the reference asset. The total return payer – often the owner of the reference obligation – gives up economic exposure to the performance of the reference asset and in return takes on counterparty credit exposure to the total return receiver in the event of a default or fall in value of the reference asset.



16						Litman Gregory Funds Trust


Distressed Companies Risk		Investments in distressed companies typically involve the purchase of high-yield bonds (also known as “junk bonds”), or comparable unrated debt securities, or the purchase of direct indebtedness (or participations in the indebtedness) of such companies. Indebtedness generally represents a specific commercial loan or portion of a loan made to a company by a financial institution such as a bank or insurance company. Loan participations represent fractional interests in a company’s indebtedness and are generally made available by banks or insurance companies. By purchasing all or a part of a company’s direct indebtedness, a Fund, in effect, steps into the shoes of the lender. If the loan is secured, the High Income Alternatives Fund will have a priority claim to the assets of the company ahead of unsecured creditors and stockholders. The High Income Alternatives Fund also may purchase trade claims and other similar direct obligations or claims against companies in bankruptcy. Trade claims are generally purchased from creditors of the bankrupt company and typically represent money due to a supplier of goods or services to the company. The purchase of indebtedness or loan participations of a troubled company always involves the risk as to the creditworthiness of the issuer and the possibility that principal invested may be lost. Purchasers of participations, such as the High Income Alternatives Fund, must rely on the financial institution issuing the participation to assert any rights against the borrower with respect to the underlying indebtedness. In addition, the High Income Alternatives Fund takes on the risk as to the creditworthiness of the bank or other financial intermediary issuing the participation, as well as that of the company issuing the underlying indebtedness. When the High Income Alternatives Fund purchases a trade claim, there is no guarantee that the debtor will ever be able to satisfy the obligation on the trade claim.
Emerging Markets Risk		Emerging market countries are those with immature economic and political structures, and investing in emerging markets entails greater risk than in developed markets. Emerging markets may be under-capitalized, have less developed legal and financial systems or have less stable currencies than markets in the developed world. Emerging market securities are securities that are issued by companies with their principal place of business or principal office in an emerging market country; or securities issued by companies for which the principal securities trading market is an emerging market country. Emerging market securities typically present even greater exposure to the risks described under “Foreign Investment and Emerging Markets Risk” and may be particularly sensitive to certain economic changes. For example, emerging market countries are more often dependent on international trade and are therefore often vulnerable to recessions in other countries. Emerging markets may have obsolete financial systems and volatile currencies, and may be more sensitive than more mature markets to a variety of economic factors. Emerging market securities also may be less liquid than securities of more developed countries and could be difficult to sell, particularly during a market downturn. The Fund defines an emerging market country as any country that is included in the MSCI Emerging Markets Index.
Equity Securities Risk		The value of equity securities may fluctuate, sometimes rapidly and unexpectedly, due to various factors, including factors affecting the general market, such as adverse changes in economic conditions, the general outlook for corporate earnings, interest rates or investor sentiment. Equity securities may also lose value because of factors affecting an entire industry or sector, such as increases in production costs, and factors directly related to a specific company, such as significant decisions made by its management. Certain equity securities may decline in value even during periods when the prices of equity securities in general are rising, or may not perform as well as the market in general. The prices of equity securities may also experience greater volatility during periods of challenging market conditions such as the one that the market recently experienced. This risk is greater for small- and medium-sized companies, which tend to be more vulnerable to adverse developments than larger companies.



Description of Principal Investment Risks						17

Description of Principal Investment Risks — (Continued)


Foreign Investment and Emerging Markets Risk		Investing in foreign (non-U.S) securities may expose the High Income Alternatives Fund to risks not typically associated with U.S. investments. These risks include, among others, adverse fluctuations in currency conversion rate, currency blockages, and adverse political, social and economic developments affecting a foreign country. In addition, foreign securities may have less publicly available information and may be more volatile and/or less liquid. Investments in foreign securities could also be affected by factors such as differences in financial reporting, accounting and auditing standards, nationalization, expropriation or confiscatory taxation, smaller and less-strict regulation of securities markets, restrictions on receiving investment proceeds from a foreign country, and potential difficulties in enforcing contractual obligations. These risks are greater in the emerging markets. Additional information about the risks of emerging markets is described under “Emerging Markets Risk.”
Interest Rate Risk		Changes in interest rates may cause the value of debt securities to decline. Generally, the value of debt securities rise when prevailing interest rates fall, and fall when prevailing interest rates rise. A fund with a longer average portfolio duration will be more sensitive to changes in interest rates than a fund with a shorter average portfolio duration.
Investment in Investment Companies Risk		The Fund and its shareholders may incur its pro rata share of the expenses of the underlying investment companies or vehicles in which the Fund invests, such as investment advisory and other management expenses, and shareholders will incur the operating expenses of these investment vehicles. In addition, the Fund will be subject to those risks affecting the investment vehicle, including the effects of business and regulatory developments that affect an underlying investment company or vehicle or the investment company industry generally as well as the possibility that the value of the underlying securities held by the investment vehicle could decrease or the portfolio becomes illiquid. Shares of investment vehicles that trade on an exchange may trade at a discount or premium from their net asset value. The purchase of shares of some investment companies (such as CEFs and ETFs) may require the payment of substantial premiums above the value of such companies’ portfolio securities or net asset values. The Fund may, from time to time, invest a portion of its assets in investment companies advised by a sub-advisor, or an affiliate of the sub-advisor. An underlying investment vehicle may buy the same securities that another underlying investment vehicle sells. If this happens, an investor in the Fund would indirectly bear the costs of these trades without accomplishing any investment purpose. In addition, certain of the underlying investment vehicles may hold common portfolio positions, thereby reducing the diversification benefits of an asset allocation style. The underlying investment vehicles may engage in investment strategies or invest in specific investments in which the Fund would not engage or invest directly. The performance of those underlying investment vehicles, in turn, depends upon the performance of the securities in which they invest. The underlying investment companies or other investment vehicles in which the Fund invests are often institutional funds owned by a small number of shareholders and are thus also subject to the risk that shareholders redeem their shares rapidly, which may adversely affect the performance and liquidity of the underlying investment vehicles and the Fund. An investment by the Fund in ETFs generally presents the same primary risks as an investment in a mutual fund. In addition, an investment in an ETF may be subject to additional risk, including: the ETF’s shares may trade at a discount or premium relative to the net asset value of the shares; an active trading market may not develop for the ETF’s shares; the listing exchange may halt trading of the ETF’s shares; the ETF may fail to correctly track the referenced asset (if any); and the ETF may hold troubled securities in the referenced index or basket of investments. Shares of CEFs frequently trade at a discount to their net asset value. Investments in CEFs that elect to be regulated as BDCs may be subject to a high degree of risk.



18						Litman Gregory Funds Trust

BDCs typically invest in and lend to small and medium-sized private and certain public companies that may not have access to the public equity markets or capital raising. As a result, a BDC’s portfolio typically will include a substantial amount of securities purchased in private placements, and its portfolio may carry risks similar to those of a private equity or private debt fund. Securities that are not publicly registered may be difficult to value and may be difficult to sell at a price representative of their intrinsic value. Small and medium-sized companies also may have fewer lines of business so that changes in any one line of business may have a greater impact on the value of their stock than is the case with a larger company. Some BDCs invest substantially, or even exclusively, in one sector or industry group and therefore carry risk of that particular sector or industry group. To the extent a BDC focuses its investments in a specific sector, the BDC will be susceptible to adverse conditions and economic or regulatory occurrences affecting the specific sector or industry group, which tends to increase volatility and result in higher risk. Investments in BDCs are subject to various other risks, including management’s ability to meet the BDC’s investment objective and to manage the BDC’s portfolio when the underlying securities are redeemed or sold, during periods of market turmoil and as investors’ perceptions regarding a BDC or its underlying investments change. BDC shares are not redeemable at the option of the BDC shareholder and, as with shares of other closed-end funds, they may trade in the secondary market at a discount to their NAV.

Investment in Loans Risk

Loans, such as syndicated bank loans and other direct lending opportunities, senior floating rate loans, secured and unsecured loans, second lien or more junior loans, bridge loans, revolving credit facilities and unfunded commitments, may incur some of the same risks as other debt securities, such as prepayment risk, credit risk, interest rate risk, liquidity risk and risks found with high yield securities. The terms of certain loan agreements may cause certain loans to be particularly sensitive to changes in benchmark interest rates. Although some loans are secured by collateral, the collateral may be difficult to liquidate and the value of the collateral can decline or be insufficient or unavailable to meet the obligation of the borrower. Certain loans have the benefit of restrictive covenants that limit the ability of the borrower to further encumber its assets or incur other debt obligations. To the extent a loan does not have such covenants, an investment in the loan may be particularly sensitive to the risks associated with loan investments. The Fund’s interest in a particular loan and/or in a particular collateral securing a loan may be subordinate to the interests of other creditors of the obligor. As a result, a loan may not be fully collateralized (and may be uncollateralized) and can decline significantly in value, which may result in the Fund not receiving payments to which it is entitled on a timely basis or at all. In addition, the Fund may have limited rights to exercise remedies against collateral or against an obligor when payments are delayed or missed.

Loans may offer a fixed rate or floating rate of interest. Loans may decline in value if their interest rates do not rise as much or as fast as interest rates in general. In addition, to the extent the Fund holds a loan through a financial intermediary, or relies on a financial intermediary to administer the loan, the Fund’s investment, including receipt of principal and interest relating to the loan, will be subject to the credit risk of the intermediary.

Loans are subject to the risk that the scheduled interest or principal payments will not be paid. Lower-rated loans and debt securities (those of less than investment grade quality) involve greater risk of default on interest and principal payments than higher-rated loans and securities. In the event that a non-payment occurs, the value of that obligation likely will decline. Loans and other debt instruments rated below “BBB” category by S&P or “Baa” category by Moody’s or unrated but assessed of similar quality are considered to have speculative characteristics and are commonly referred to as “junk bonds.” Junk bonds entail default and other risks greater than those associated with higher-rated securities.



Description of Principal Investment Risks						19

Description of Principal Investment Risks — (Continued)

Loans are vulnerable to market sentiment such that economic conditions or other events may reduce the demand for loans and cause their value to decline rapidly and unpredictably. Many loan interests are subject to restrictions on transfer that may limit the ability of the Fund to sell the interests at an advantageous time or price. Furthermore, while the resale, or secondary, market for loans is growing, it is currently limited. There is no organized exchange or board of trade on which loans are traded. Loans often trade in large denominations (typically $1 million and higher), and trades can be infrequent. The market has limited transparency so that information about actual trades may be difficult to obtain. Accordingly, some of the loans in which the Fund may invest will be relatively illiquid and difficult to value. Loans are often subject to restrictions on resale or assignment. The Fund may have difficulty in disposing of loans in a favorable or timely fashion, which could result in losses to the Fund. Transactions in loans are often subject to long settlement periods (in excess of the standard T+2 days settlement cycle for most securities and often longer than seven days). As a result, sale proceeds potentially will not be available to the Fund to make additional investments or to use proceeds to meet its current redemption obligations. The Fund thus is subject to the risk of selling other investments at disadvantageous times or prices, taking other actions necessary to raise cash to meet its redemption obligations such as borrowing from a bank or holding additional cash.

Loans may be issued in connection with highly leveraged transactions, such as restructurings, leveraged buyouts, leveraged recapitalizations and acquisition financing. In such highly leveraged transactions, the borrower assumes large amounts of debt in order to have the financial resources to attempt to achieve its business objectives. Accordingly, such loans may be part of highly leveraged transactions and involve a significant risk that the borrower may default or go into bankruptcy or become insolvent. Bankruptcy or other court proceedings may delay, limit or negate the Fund’s ability to collect payments on its loan investments or otherwise adversely affect the Fund’s rights in collateral relating to the loan and the Fund may need to retain legal or similar counsel to help in seeking to enforce its rights. In addition, if the Fund holds certain loans, the Fund may be required to exercise its rights collectively with other creditors or through an agent or other intermediary acting on behalf of multiple creditors, and the value of the Fund’s investment may decline or otherwise be adversely affected by delays or other risks associated with such collective procedures.

The Fund values its assets on each business day that the New York Stock Exchange is open. However, because the secondary market for loans is limited and trading may be irregular, they may be difficult to value. Market quotations may not be readily available for some loans or may be volatile and/or subject to large spreads between bid and ask prices, and valuation may require more research than for other securities. In addition, elements of judgment may play a greater role in valuation than for securities with a more active secondary market, because there is less reliable, objective market value data available. In certain circumstances, the sub-advisor or its affiliates (including on behalf of clients other than the Fund) or the Fund may be in possession of material non-public information about a borrower as a result of its ownership of a loan and/or corporate debt security of a borrower. Because U.S. laws and regulations generally prohibit trading in securities of issuers while in possession of material, non-public information, the Fund might be unable to trade securities or other instruments issued by the borrower when it would otherwise be advantageous to do so and, as such, could incur a loss. In circumstances when the sub-advisor or the Fund determines not to receive non-public information about a borrower for loan investments, the Fund may be disadvantaged relative to other investors and the Fund may not take advantage of other investment opportunities that it may otherwise have. In addition, loans and other similar instruments may not be considered “securities” and, as a result, the Fund may not be entitled to rely on the anti-fraud protections under the federal securities laws and instead may have to resort to state law and direct claims. The sub-advisor or its affiliates may participate in the primary and secondary market for loans or other transactions with possible borrowers. As a result, the Fund may be legally restricted from acquiring some loans and from participating in a restructuring of a loan or other similar instrument.



20						Litman Gregory Funds Trust


Leverage Risk		Leverage may result from certain transactions, including the use of derivatives and borrowing. Although leverage creates an opportunity for increased income and gain, it also creates certain risks. For example, the use of leverage may cause the effect of an increase or decrease in the value of the High Income Alternatives Fund’s portfolio securities to be magnified and the High Income Alternatives Fund to be more volatile than if leverage was not used. Under normal circumstances, the High Income Alternatives Fund may borrow amounts up to one third of the value of its total assets except that it may exceed this limit to satisfy redemption requests or for other temporary purposes.
Market Risk		The market prices of securities owned by the High Income Alternatives Fund may go up or down, sometimes rapidly or unpredictably. Securities may decline in value or become illiquid due to factors affecting securities markets generally or particular industries represented in the securities markets. The value or liquidity of a security may decline due to general market conditions that are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. Securities may also decline or become illiquid due to factors that affect a particular industry or industries, such as labor shortages or increased production costs and competitive conditions within an industry. During a general downturn in the securities markets, multiple asset classes may decline or become illiquid in value simultaneously.
MLP Risk		An investment in MLP units involves some risks which differ from Equity Securities Risk. Holders of MLP units have limited control and voting rights on matters affecting the partnership. Holders of units issued by an MLP are exposed to a remote possibility of liability for all of the obligations of that MLP in the event that a court determines that the rights of the holders of MLP units to vote to remove or replace the general partner of that MLP, to approve amendments to that MLP’s partnership agreement, or to take other action under the partnership agreement of that MLP would constitute “control” of the business of that MLP, or a court or governmental agency determines that the MLP is conducting business in a state without complying with the partnership statute of that state. Holders of MLP units are also exposed to the risk that they will be required to repay amounts to the MLP that are wrongfully distributed to them. • MLP Common Units. MLP common units can be affected by macro-economic and other factors affecting the stock market in general, expectations of interest rates, investor sentiment toward MLPs or the energy sector, changes in a particular issuer’s financial condition, or unfavorable or unanticipated poor performance of a particular issuer (generally measured in terms of distributable cash flow). Prices of common units of individual MLPs also can be affected by fundamentals unique to the partnership, including earnings power and coverage ratios. • MLP I-Shares. MLP I-Shares represent an ownership interest issued by an MLP affiliate, typically an LLC, which owns an interest in and manages the MLP. MLP I-Shares may be subject to illiquid securities risk because of their potentially relatively smaller size. I-Shares may trade at a discount to their related MLP units, despite having an economic value equivalent to an MLP unit and an equal claim on the cash flows underlying the investment. • General partner interests in MLPs are typically retained by the original sponsors of an MLP, such as its founders, corporate partners and entities that sell assets to the MLP. The holders of a general partner interest can be liable in certain circumstances for amounts greater than the amount of the holder’s investment. General partner interests often confer direct board participation rights in, and in many cases control over the operations of, the MLP. Conflicts of interest may arise between the general partners or managing member on the one hand, and the limited partners or members on the other hand, including those arising from incentive distribution payments or corporate opportunities.



Description of Principal Investment Risks						21

Description of Principal Investment Risks — (Continued)


MLP Tax Risk		The Fund’s ability to meet its investment objectives depends, in large measure, on the level of dividends, distributions or income it receives from the MLPs in which it invests and on the MLPs’ continued treatment as partnerships for U.S. federal income tax purposes. If an MLP does not meet current legal requirements to maintain its partnership status, or if it is unable to do so because of tax or other law changes, it would be treated as a corporation for U.S. federal income tax purposes. In that case, the MLP would be obligated to pay U.S. federal income tax (as well as state and local taxes) at the entity level on its taxable income and distributions received by the Fund would be taxable to the Fund as dividend income to the extent of the MLP’s current and accumulated earnings and profits for federal tax purposes. In addition, any distributions that the Fund receives from an MLP that were treated as dividends in the hands of the Fund could materially affect the tax character of the Fund’s distributions to shareholders. Moreover, in the case of an MLP treated as a corporation for U.S. federal income tax purposes, any items of loss or deduction in excess of such MLP’s items of income or gain would not be treated as incurred directly by the Fund and would be permitted to be used only by such MLP. Therefore, in general, the classification of a MLP as a corporation for U.S. federal income tax purposes could adversely affect the Fund and its shareholders, including by (i) reducing the amount of cash available for distribution by the MLP to the Fund and, in turn, for distribution by the Fund to the Fund’s shareholders and (ii) reducing the value of the Fund’s investment in any such MLP and, in turn, the value of the Fund’s shares.
Mortgage-Backed Securities Risk		Mortgage-backed securities represent participation interests in pools of residential mortgage loans purchased from individual lenders by a federal agency or originated and issued by private lenders. The values of some mortgage-backed securities may expose the High Income Alternatives Fund to a lower rate of return upon reinvestment of principal. When interest rates rise, the value of mortgage-related securities generally will decline; however, when interest rates are declining, the value of mortgage related-securities with prepayment features may not increase as much as other fixed income securities. The rate of prepayments on underlying mortgages will affect the price and volatility of a mortgage-related security, and may shorten or extend the effective maturity of the security beyond what was anticipated at the time of purchase. If unanticipated rates of prepayment on underlying mortgages increase the effective maturity of a mortgage-related security, the volatility of the security can be expected to increase. The value of these securities may fluctuate in response to the market’s perception of the creditworthiness of the issuers. Additionally, although mortgages and mortgage-related securities are generally supported by some form of government or private guarantee and/or insurance, there is no assurance that private guarantors or insurers will meet their obligations. Mortgage-backed securities that are collateralized by a portfolio of mortgages or mortgage-related securities depend on the payments of principal and interest made by or through the underlying assets, which may not be sufficient to meet the payment obligations of the mortgage-backed securities.
Mortgage REIT Risk		Mortgage REITs (“mREITs”) are pooled investment vehicles that invest the majority of their assets in real property mortgages and which generally derive income primarily from interest payments thereon. Investing in mREITs involves certain risks related to investing in real property mortgages. In addition, mREITs must satisfy highly technical and complex requirements in order to qualify for the favorable tax treatment accorded to REITs under the Code. No assurances can be given that a mREIT in which the Fund invests will be able to continue to qualify as a REIT or that complying with the REIT requirements under the Code will not adversely affect such REIT’s ability to execute its business plan.



22						Litman Gregory Funds Trust


Municipal Securities Risk		The municipal securities market could be significantly affected by adverse political and legislative changes or litigation at the federal or state level, as well as uncertainties related to taxation or the rights of municipal security holders. Changes in the financial health of a municipality may hinder its ability to pay interest and principal. To the extent that the Fund invests a significant portion of its assets in the municipal securities of a particular state or U.S. territory or possession, there is greater risk that political, regulatory, economic or other developments within that jurisdiction may have a significant impact on the Fund’s investment performance. The amount of public information available about municipal securities is generally less than that available about corporate securities. In the case of insured municipal securities, insurance supports the commitment that interest payments will be made on time and the principal will be repaid at maturity. Insurance does not, however, protect the Fund or its shareholders against losses caused by declines in a municipal security’s market value. The sub-advisor generally looks to the credit quality of the issuer of a municipal security to determine whether the security meets the Fund’s quality restrictions, even if the security is covered by insurance. However, a downgrade in the claims-paying ability of an insurer of a municipal security could have an adverse effect on the market value of the security. Municipal issuers may be adversely affected by high labor costs and increasing unfunded pension liabilities, and by the phasing out of federal programs providing financial support. In addition, changes in the financial condition of one or more individual municipal issuers or insurers of municipal issuers can affect the overall municipal securities market. The secondary market for municipal securities may not be very liquid, which could limit the Fund’s ability to sell securities it is holding. Declines in real estate prices and general business activity may reduce the tax revenues of state and local governments. Municipal issuers have on occasion defaulted on obligations, been downgraded, or commenced insolvency proceedings. Financial difficulties of municipal issuers may continue or get worse. Because many municipal securities are issued to finance similar types of projects, especially those related to education, health care, housing, transportation and utilities, conditions in those sectors can affect the overall municipal securities market. Interest on municipal securities paid out of current or anticipated revenues from a specific project or specific asset (so-called “private activity bonds”) may be adversely impacted by declines in revenue from the project or asset. Declines in general business activity could affect the economic viability of facilities that are the sole source of revenue to support private activity bonds.
Multi-Style Management Risk		Because portions of the High Income Alternatives Fund’s assets are managed by different portfolio managers using different styles/strategies, the Fund could experience overlapping security transactions. Certain portfolio managers may be purchasing securities at the same time that other portfolio managers may be selling those same securities, which may lead to higher transaction expenses compared to a Fund using a single investment management style. Litman Gregory’s and the sub-advisors’ judgments about the attractiveness, value and potential appreciation of a particular asset class or individual security in which the Fund invests may prove to be incorrect, and there is no guarantee that Litman Gregory’s judgment will produce the desired results. In addition, the High Income Alternatives Fund may allocate its assets so as to under- or over-emphasize certain strategies or investments under market conditions that are not optimal, in which case the Fund’s value may be adversely affected.
Portfolio Turnover Risk		High portfolio turnover involves correspondingly greater expenses, including brokerage commissions or dealer mark-ups and other transaction costs on the sale of securities and reinvestments in other securities, which may result in adverse tax consequences to a Fund’s shareholders. Certain of the High Income Alternatives Fund’s investment strategies may result in it having higher portfolio turnover rates. Higher portfolio turnover may cause the Fund to experience increased transaction costs, dealer markups, brokerage expenses and other acquisition costs, and may cause shareholders to incur increased taxes on their investment in the Fund as compared to shareholders in investment companies that hold investments for longer periods. The portfolio managers do not consider portfolio turnover rate a limiting factor in making investment decisions on behalf of the Fund, consistent with its investment objective and policies. Variations in portfolio turnover rates may be due to fluctuations in shareholder purchase, exchange and redemption transactions, market conditions or changes in the portfolio manager’s outlook.



Description of Principal Investment Risks						23

Description of Principal Investment Risks — (Continued)


Short Sale Risk		The High Income Alternatives Fund may suffer a loss if it sells a security short and the value of the security does not go down as expected. The risk of loss is theoretically unlimited if the value of the security sold short continues to increase. Short sales expose the High Income Alternatives Fund to the risk that it may be compelled to buy the security sold short (also known as “covering” the short position) at a time when the security has appreciated in value, thus resulting in a loss to the High Income Alternatives Fund. The High Income Alternatives Fund’s investment performance may also suffer if it is required to close out a short position earlier than it had intended. In addition, the High Income Alternatives Fund may be subject to expenses related to short sales that are not typically associated with investing in securities directly, such as costs of borrowing. These expenses may negatively impact the performance of the High Income Alternatives Fund. To meet current margin requirements, the High Income Alternatives Fund is required to deposit with the broker additional cash or securities so that the total deposit with the broker is maintained daily at 150% of the current market value of the securities sold short.
Smaller Companies Risk		Securities of companies with smaller market capitalizations are generally more volatile and less liquid than the securities of large-capitalization companies. Small- and mid-sized companies may be more reliant on a few products, services or key personnel, which can make it riskier than investing in larger companies with more diverse product lines and structured management. Smaller companies may have no or relatively short operating histories or may be newer public companies. Some of these companies have aggressive capital structures, including high debt levels, or are involved in rapidly growing or changing industries and/or new technologies, which pose additional risks.
Unfavorable Tax Treatment Risk		Various types of investments in which the High Income Alternatives Fund may invest, including derivatives, mortgage related securities, and REITs, may cause the High Income Alternatives Fund’s returns to be in the form of net investment income or short-term capital gains, some of which may be distributed to shareholders and taxed at ordinary income tax rates. Therefore, shareholders may have a greater need to pay regular taxes than compared to other investment strategies that hold investments longer. Due to this investment strategy, it may be preferable for certain shareholders to invest in the Fund through pre-tax or tax-deferred accounts as compared to investment through currently taxable accounts. Potential shareholders are encouraged to consult their tax advisors in this regard.



24						Litman Gregory Funds Trust

Fund Management and Investment Styles

The Advisor

The High Income Alternatives Fund is managed by Litman Gregory Fund Advisors, LLC (“Litman Gregory”), 1676 N. California Blvd., Suite 500, Walnut Creek, California 94596. Litman Gregory has overall responsibility for assets under management, recommends the selection of managers as sub-advisors of the Fund (each, a “manager” or “sub-advisor”) to the Board of Trustees (the “Board”) of the Litman Gregory Funds Trust (the “Trust”), evaluates the performance of the managers, monitors changes at the managers’ organizations that may impact their abilities to deliver superior future performance, determines when to rebalance the managers’ assets and the amount of cash equivalents (if any) that may be held in addition to cash in each of the managers’ sub-portfolios, coordinates with the managers with respect to diversification and tax issues and oversees the operational aspects of the Fund.

Jeremy DeGroot is a Trustee and President of the Trust and the Portfolio Manager of the High Income Alternatives Fund. He is also a Principal and Member of Litman Gregory Asset Management, LLC (“LGAM”), a research-oriented money management firm that wholly owns and provides research to Litman Gregory, and serves as its Chief Investment Officer. Prior to joining LGAM in 1999, DeGroot was a Manager in KPMG Peat Marwick’s Economic Consulting Services practice in 1998. From 1989 to 1997, he was a Senior Economist with the Law & Economics Consulting Group, Inc., providing economics and financial analysis to Fortune 500 clients. He has a Master’s degree in Economics from the University of California Berkeley.

Jack Chee is an Assistant Secretary of the Trust. He is also a Principal and Member of LGAM and serves as a Senior Research Analyst at the Advisor. Prior to joining LGAM in 2000, Chee was a Mutual Fund Analyst with Value Line Mutual Fund Survey. He has a BS degree in Mechanical Engineering from Drexel University.

Jason Steuerwalt is a senior Research Analyst at the Advisor. Prior to joining LGAM in 2013, Steuerwalt was a Vice President with Hall Capital Partners, focusing on absolute return hedge funds and opportunistic/private credit strategies.

DeGroot, Chee and Steuerwalt are the individuals at Litman Gregory primarily responsible for monitoring the day-to-day activities of the portfolio managers at the sub-advisors and for overseeing all aspects of Litman Gregory’s responsibilities with respect to the Fund.

Asset Level Limitations

Litman Gregory believes that high levels of assets under management can be detrimental to certain investment strategies. Litman Gregory also believes that relatively low levels of assets under management can provide flexibility to skilled investment managers that under certain circumstances may contribute positively to returns. The High Income Alternatives Fund may be closed to new shareholders, with certain exceptions approved by

the Board, at asset levels that Litman Gregory and the sub-advisors believe to be optimal in allowing for a high degree of flexibility on a per-sub-advisor basis.

Sub-Advisor Evaluation and Selection

Litman Gregory is responsible for hiring and removing sub-advisors. Before hiring a sub-advisor, Litman Gregory performs extensive due diligence. This includes quantitative and qualitative analysis, including (but not limited to) an evaluation of: the investment process, the consistency of its execution and discipline; individual holdings; strategies employed, past mistakes, risk controls, team depth and quality; operations and compliance; and business focus and vision. Litman Gregory’s evaluation process includes review of literature and documents, quantitative historical performance evaluation, extensive discussions with members of the investment team and firm management and background checks through industry contacts. Each of the sub-advisor’s management fee is also an important consideration. It is Litman Gregory’s objective to hire sub-advisors who it believes are skilled and can deliver strong market cycle returns when taking risk into account. For the High Income Alternatives Fund, Litman Gregory will favor managers who it believes focus on markets or investment strategies that are inherently low risk on an absolute basis or relative to their return potential; and managers who have a clearly risk-sensitive mindset in executing their portfolio strategy. Generally, Litman Gregory prefers managers who it believes will be able to add value through security selection and from tactical allocations to securities, markets or strategies at times when it believes such allocations are compelling from a risk/return perspective. Litman Gregory is responsible for the general overall supervision of the sub-advisors along with allocating the portfolio’s assets for their investment decisions as well as rebalancing the portfolio as necessary from time to time.

Multi-Manager Issues

More on Multi-Style Management: The investment methods used by the managers in selecting securities for the High Income Alternatives Fund vary. The segment of the Fund’s portfolio managed by a manager will, under normal circumstances, differ from the segments managed by the other managers with respect to portfolio composition, turnover, issuer capitalization and issuer financial condition. Because security selections are made independently by each manager, it is possible that a security held by one portfolio segment may also be held by other portfolio segments of the Fund or that several managers may simultaneously favor the same industry segment. Litman Gregory monitors the overall portfolio on an ongoing basis to ensure that such overlaps do not create an unintended industry concentration or result in lack of diversification.

Litman Gregory is responsible for establishing the target allocation of Fund assets to each manager and may adjust the target allocations at its discretion. Market performance may result in allocation drift among the managers of the Fund. Litman Gregory is responsible for periodically rebalancing the portfolios, the timing and degree of which will be determined by



Fund Management and Investment Styles						25

Fund Management and Investment Styles — (Continued)

Litman Gregory. Each manager independently selects the brokers and dealers to execute transactions for the segment of the Fund being managed by that manager.

At times, allocation adjustments in the High Income Alternatives Fund may be considered tactical with over- or under-allocations to certain managers based on Litman Gregory’s assessment of the risk and return potential of each manager’s strategy at that point in time. Manager allocations are also influenced by each manager’s historical returns and volatility, which are assessed by examining the performance of strategies run by the managers in their private (hedge) funds or other accounts that Litman Gregory believes to be similar to those that will be used for the High Income Alternatives Fund. Litman Gregory has analyzed the individual and combined performance of the High Income Alternatives Fund’s managers in a variety of investment environments.

In the event a manager ceases to manage a segment of the Fund’s portfolio, Litman Gregory will select a replacement manager or allocate the assets among the remaining managers. The securities that were held in the departing manager’s segment of the Fund’s portfolio may be allocated to and retained by another manager of the Fund or will be liquidated in an orderly manner, taking into account various factors, which may include but are not limited to the market for the security and the potential tax consequences. Litman Gregory may also add additional managers in order to increase Fund diversification or capacity.

The SAI provides additional information about the compensation of each portfolio manager at each sub-advisor, other accounts managed by each portfolio manager, and each such portfolio manager’s ownership of securities of the Fund.

Temporary Defensive Positions: Under unusual market conditions or for temporary defensive purposes, a substantial part of the Fund’s total assets may be invested in cash or short-term, high-quality debt securities. To the extent that the Fund assumes a temporary defensive position, it may not achieve its investment objective during that time. Defensive positions may be initiated by the individual portfolio managers or by Litman Gregory.

Multi-Manager Exemptive Order: The Trust and Litman Gregory have obtained an exemptive order from the SEC that permits Litman Gregory, subject to certain conditions, to hire, terminate and replace managers with the approval of the Board only and without shareholder approval. Within 60 days of the hiring of any new manager or the implementation of any proposed material change in a sub-advisory agreement with an existing manager, shareholders will be furnished information about the new manager or sub-advisory agreement that would be included in a proxy statement. The order also permits the Fund to disclose sub-advisory fees only in the aggregate in its registration statement. Pursuant to the order, shareholder approval is required before Litman Gregory enters into any sub-advisory agreement with a manager that is affiliated with the Fund or Litman Gregory.

Portfolio Holdings Information

A description of the High Income Alternatives Fund’s policies and procedures regarding disclosure of the Fund’s portfolio holdings can be found in the SAI, which can be obtained free of charge by contacting the Fund’s transfer agent (the “Transfer Agent”) at 1-800-960-0188.

Advisory Fees

The High Income Alternatives Fund pays a monthly investment advisory fee to Litman Gregory based on the Fund’s average daily net assets. The table below illustrates the base fee rates payable to Litman Gregory and the reduced fee rates payable on assets in excess of certain levels (breakpoints).


Fund	Advisory Fee (as a percentage of net assets)
High Income Alternatives Fund	Up to $1 billion	0.95%
	Between $1 billion and $2 billion	0.925%
	Between $2 and $3 billion	0.90%
	Between $3 and $4 billion	0.875%
	Over $4 billion	0.85%

Litman Gregory, not the Fund, is responsible for payment of the sub-advisory fees to the managers, each of whom is compensated monthly on the basis of the assets committed to its individual discretion.

Pursuant to an Operating Expenses Limitation Agreement (the “Expenses Limitation Agreement”), Litman Gregory has agreed to limit the operating expenses of the High Income Alternatives Fund, through April 30, 2020 (unless otherwise sooner terminated), to an annual rate of 0.98% for the Institutional Class and 1.23% for the Investor Class. Such annual rates are expressed as a percentage of the daily net assets of the Fund attributable to the applicable class. Any fee waiver or expense reimbursement made by Litman Gregory pursuant to the Expenses Limitation Agreement is subject to the repayment by the High Income Alternatives Fund within three (3) years of the date such amounts were waived or reimbursed, but only if the High Income Alternatives Fund, as appropriate, is able to make the repayment without exceeding the expense limitation in effect at the time of such waiver/reimbursement and the time of recoupment, and the repayment is approved by the Board. Operating expenses referred to in this paragraph includes management fees payable to Litman Gregory but exclude any taxes, interest, brokerage commissions, expenses incurred in connection with any merger or reorganization, borrowing costs (including commitment fees), dividend expenses, acquired fund fees and expenses and extraordinary expenses such as but not limited to litigation costs. Litman Gregory Fund Advisors LLC has contractually agreed through April 30, 2020, to waive a portion of its advisory fees so that after paying all of the sub-advisory fees, the net advisory fee as a percentage of the High Income Alternative Fund’s daily net assets retained by Litman Gregory is 0.40% on the first $1 billion of assets, 0.375% on the next $1 billion of assets, 0.35% on the next $1 billion of



26						Litman Gregory Funds Trust

assets, 0.325% on the next $1 billion of assets and 0.30% on assets in excess of $4 billion. This agreement may be terminated at any time by the Board of Trustees of the Litman Gregory Funds Trust (the “Trust”) upon sixty (60) days’ written notice to Litman Gregory, and Litman Gregory may decline to renew this agreement at its expiration on April 30, 2020 by written notice to the Trust at least thirty (30) days before the agreement’s annual expiration date. While Litman Gregory has waived its right to receive reimbursement of the portion of its advisory fees waived pursuant to this agreement, Litman Gregory may be reimbursed for non-advisory related expenses.

A discussion regarding the Board’s basis for approving the High Income Alternatives Fund’s investment advisory agreement with Litman Gregory and each sub-advisor will be available in the Fund’s first Annual Report or Semi-Annual Report to Shareholders following the effective date of the Fund’s registration statement.



Fund Management and Investment Styles						27

Litman Gregory Masters High Income Alternatives Fund – Sub-Advisors

Litman Gregory’s strategy is to allocate the portfolio’s assets among the High Income Alternatives Fund’s four sub-advisors to provide investors a mix of strategies that Litman Gregory believes offer risk-return characteristics that are attractive individually and even more compelling collectively. Allocations among sub-advisors are based on several factors, including Litman Gregory’s expectation for the risk-adjusted return potential of each sub-advisor’s strategy and the impact on overall portfolio risk, with the objective of maximizing return subject to the goal of high income relative to investment-grade, fixed income portfolios without taking undue risk. Litman Gregory may at times adjust the allocations of capital to sub-advisors if it believes there is a highly compelling tactical opportunity in a particular sub-advisor’s strategy. Portfolio assets will be tactically allocated to the sub-advisors in accordance with the target allocation range for each sub-advisor specified in the table below, as measured at the time of allocation.

including short positions of any of the foregoing, within their respective segments of the High Income Alternatives Fund. They may also write options, invest in derivatives, including, without limitation, options, futures contracts, participatory notes (“P-Notes”) and swaps, to manage risk or enhance return and can also borrow amounts up to one third of the value of the High Income Alternatives Fund’s total assets (except that the High Income Alternatives Fund may exceed this limit to satisfy redemption requests or for other temporary purposes). Each of the managers may invest in illiquid securities; however, the High Income Alternatives Fund as a whole may not hold more than 15% of its net assets in illiquid securities.

Each sub-advisor will have an investment approach that generally focuses on a particular asset class or specific strategies. Currently, the strategies the sub-advisors focus on are as follows: (1) an equity income strategy, (2) a credit value strategy, (3) a multi credit strategy, and (4) an option income strategy. Other appropriate strategies may also be considered and added to (or removed from) the High Income Alternatives Fund.

The following table provides a description of the High Income Alternatives Fund’s strategies and their target levels of assets. Asset levels will fluctuate, and it is at the discretion of Litman Gregory to re-balance the asset allocations. A detailed discussion of the management structure of the High Income Alternatives Fund follows the table.


PORTFOLIO MANAGER(S)/SUB-ADVISOR	CURRENT TARGET ALLOCATION AND TARGET ASSET ALLOCATION RANGE	STRATEGY
Greg Mason, CFA Troy Ward Ares Management LLC	15% 10-20%	Equity Income
Andrew P. Hofer Neil Hohmann Paul Kunz, CFA Brown Brothers Harriman & Co.	32.5% 22.5-42.5%	Credit Value
Scott Minerd Anne Walsh, CFA Steven Brown, CFA Adam Bloch Guggenheim Partners Investment Management, LLC	32.5% 22.5-42.5%	Multi Credit
Derek Devens, CFA Neuberger Berman Investment Advisers LLC	20% 15-25%	Option Income



28						Litman Gregory Funds Trust

Litman Gregory Masters High Income Alternatives Fund Portfolio Managers

Equity Income Strategy

Greg Mason, CFA

Troy Ward

Ares Management LLC

2000 Avenue of the Stars, 12th Floor

Los Angeles, CA 90067

Greg Mason and Troy Ward are the co-portfolio managers responsible for the equity income strategy (the “Equity Income Strategy”), which is the segment of the High Income Alternatives Fund’s assets managed by Ares Management LLC (“Ares”). Mason is a Managing Director and Portfolio Manager in the Ares Credit Group, where he focuses on investing capital in publicly traded equities. Prior to joining Ares in 2016, Mason was a Managing Director at KBW and Stifel Financial where he was a Senior Equity Analyst with a focus on business development companies (“BDCs”). Previously, he was a Senior Equity Analyst at A.G. Edwards where he focused on BDCs, mortgage servicers, asset managers and life insurance companies. Ward is a Managing Director and Portfolio Manager in the Ares Credit Group, where he focuses on investing capital in publicly traded equities. Prior to joining Ares in 2016, Ward was a Managing Director at KBW and Stifel Financial where he was a Senior Equity Analyst with a focus on BDCs. Previously, he was a Senior Equity Analyst at A.G. Edwards where he focused on BDCs, specialty finance and small-cap banks.

The managers of the Equity Income Opportunity strategy attempt to generate attractive total returns across market cycles, with a majority of that return coming from current portfolio income. The managers invest across a variety of publicly-traded income producing asset classes where Ares has specific expertise. Targeted investments include publicly traded BDCs, mortgage REITs (“mREITS”), master limited partnerships (“MLPs”), and selectively, credit-based closed-end funds (“CEFs”) trading at discounts to net asset value and other opportunistic income investments like preferred equity. The team actively seeks to add value by finding positions with capital appreciation potential and adjusting capital allocation across sectors based on relative value. Risk management on a position and portfolio level is designed to avoid significant losses from individual company developments, as well as from negative sector or macro events.

The team’s investment philosophy is best described as “bottom-up” with a “top-down” macro overlay. The research and analysis processes seek to identify attractive opportunities that may provide upside potential while capturing the existing yield and managing downside risk. They prefer to invest in companies with high quality management teams that have a history of investment discipline and strong operating performance, although they will opportunistically invest in lower quality assets and/or management teams if the valuation offers sufficient compensation. The managers believe long-term successful equity income investing is best achieved through

fundamental company-specific research (including detailed credit and cash flow analysis), combined with deep industry knowledge and an understanding of management incentives and capabilities.

The managers believe that many income-oriented asset classes are more retail-investor owned (and thus likely to be less efficiently priced). For example, investor over-emphasis on one particular aspect of a company such as sensitivity to interest rates can trigger upside or downside as investors fall into group think, causing a stock or group of stocks to deviate materially from intrinsic value. Similarly, event-specific fear of a negative development may be over-emphasized and can drive stock prices well below intrinsic value. In the managers’ experience, often the realization of the event can provide upside as the cloud of fear and uncertainty is removed. BDCs especially were traditionally under-followed by institutional investors, a dynamic that has been exacerbated over the past several years after the BDCs were removed from the S&P and Russell indexes, creating a more attractive opportunity set for professional active managers.

The investment process begins with the assessment of company management. The managers believe that long-term performance of income-oriented value stocks is heavily impacted by management quality. The strategy’s heightened focus on management and portfolio analysis has been refined over time and the managers believe they have an informational advantage derived from their 15 years of closely following the company management teams within BDCs and mREITs (along with 8 years of MLP sector coverage). If management is poor, there must be a significant valuation discount or outside catalysts to drive value.

The team performs “surface level” financial analysis, using standard metrics to identify differentiation within sectors, helping them effectively target potential investments for further research. Considerations at this stage include return on equity (ROE), EPS growth, dividend coverage and outlook, asset valuations, balance sheet stability, historical and current credit metrics, and new loan origination capacity (or new project backlog and underlying producer activity in the case of MLPs). Companies that appear attractive are subject to deeper analysis, in which the managers attempt to add value through more detailed assessment of the companies’ assets (they have tracked portfolios at the loan level since inception for most finance companies in their universe, and maintain pipeline-level models of the relevant MLPs) and the identification of potential industry or company-level catalysts. At this stage, the broader Ares platform often proves valuable to the investment process, given the additional industry knowledge and research capabilities available to the investment team across public and private credit, real estate, and energy. Over time, the managers have refined their approach to more thoroughly include industry specific catalysts, market sentiment, regulatory risks, and macro-economic trends.

Valuation is the final component of the investment process, and the managers are disciplined about the prices they will pay, as entry valuation is ultimately one of the most important factors in



Litman Gregory Masters High Income Alternatives Fund – Sub-Advisors						29

Litman Gregory Masters High Income Alternatives Fund – Sub-Advisors — (Continued)

mitigating risk over reasonable holding periods, although changes in investor sentiment can of course cause losses in the short- or even medium-term. The team will estimate upside and downside for potential investments using standard valuation processes and metrics, including price/book (P/B), price/earnings (P/E), dividend yield, enterprise value/EBITDA, etc. The team is willing to think somewhat differently than consensus in the past to account for economic reality not reflected in the traditional metrics, such as using adjusted EBITDA numbers to reflect the fact that MLPs had to pay an increasing portion of their earnings to their general partner parent company, which reduced cash available for unitholders.

The managers have a target price and forward looking expected return for every position in the portfolio. Target prices take into account expected P/B values, earnings yields, and dividend yields, with an overlay using of expected earnings and dividend growth, book value stability, credit quality and qualitative management analysis. Downside risk, particularly in the BDC industry, may be assessed by understanding worst case book value, cash flow generation, and reasonable P/B multiples during a recession. The managers prefer to see 10-20 percentage points more upside than downside; however, these ratios are often significantly influenced by the timing of market cycles, probabilities of various macro-economic conditions and company-specific situations.

Credit Value Strategy

Andrew P. Hofer

Neil Hohmann

Paul Kunz, CFA

Brown Brothers Harriman & Co.

140 Broadway

New York, NY 10005

Andrew Hofer, Neil Hohmann and Paul Kunz are the portfolio managers primarily responsible for the credit value strategy (the “Credit Value Strategy”), which is the segment of the High Income Alternatives Fund’s assets managed by Brown Brothers Harriman & Co. (“BBH”) through its separately identifiable department known as the BBH Mutual Fund Advisory Department. Hofer is a Managing Director of BBH with 29 years of combined industry and investment experience. He joined BBH in 1988. Hofer has served as a Managing Director since 2000. Hohmann is a Managing Director of BBH with 20 years of investment experience. Hohmann served as a Senior Vice President from 2010-2017. Kunz is a Senior Vice President of BBH with 20 years of investment experience. He has earned the right to use the Chartered Financial Analyst designation.

The sub-advisor seeks to achieve the fund’s investment objective by investing its segment of the fund in fixed-income securities it believes to have the potential for excess return. The sub-advisor’s investment strategy will be to invest in fixed income securities from a wide variety of sectors, including asset-backed securities (ABS), commercial mortgage-backed securities (CMBS), corporate bonds, floating-rate loans and municipal bonds. The sub-advisor expects to invest in

structured and corporate securities. The sub-advisor’s emphasis is expected to be on A/BBB-rated asset backed securities and BBB/BB-rated corporate securities, as these ratings segments have historically offered attractive risk-adjusted returns, along with low default rates. The sub-advisor will also invest in U.S. Treasury futures to manage duration of the portfolio, which allows individual security selection to be managed without regard to portfolio duration. The sub-advisor will not typically own CCC rated or distressed securities.

The sub-advisor will consider investments based on a bottom-up assessment of opportunities and the risk/return potential of the yield curve. The investment strategy’s duration is flexible and the sub-advisor seeks to maintain a duration that is consistent with positive returns over longer time periods. The sub-advisor will consider the macroeconomic environment from the perspective of risk-management through economic cycles. The sub-advisor’s valuation process starts with the concept that credit spreads revert to the mean and that spread deviations relative to a long-term average indicate potential spread compression or spread widening. The sub-advisor applies this valuation framework to all economic sectors by credit rating and maturity.

The sub-advisor’s investment process is based on fundamental credit research. The sub-advisor identifies fixed income securities for potential purchase for the portfolio based on four fundamental criteria: a durable operating model, effective management, attractive/appropriate structure, and transparency. A durable credit is one where the sub-advisor believes an issuer’s revenue stream and its financial structure can withstand a wide range of economic and regulatory scenarios. When assessing management, the sub-advisor looks for issuers with a long, proven track record of execution (especially through a downturn), commitment to capital markets access, and incentives that are aligned with creditors’ interests. With regard to appropriate bond structures, the sub-advisor requires the level and variability of an issuer’s revenues to comfortably support ongoing operations and the capital structure.

The sub-advisor’s assumption of credit risk is valuation driven. When valuing securities/credits, and assessing an attractive margin of safety, the sub-advisor applies the same valuation approach across all sectors (ABS, CMBS, corporate credit, and municipal bonds). The sub-advisor seeks to buy securities at discounted valuations, inclusive of a sufficient margin of safety, that are created by excess short-term price volatility. The sub-advisor will make investments when it believes a security’s potential excess return more than compensates the fund for default risk, liquidity risk, and the embedded optionality of a bond. The sub-advisor may sell securities for several reasons including to adjust the portfolio’s average maturity, move into more attractively valued securities, take gains, the investment thesis changed, or to meet redemption requests.



30						Litman Gregory Funds Trust

Multi Credit Strategy

Scott Minerd

Anne Walsh, CFA

Steven Brown, CFA

Adam Bloch

Guggenheim Partners Investment Management, LLC

100 Wilshire Boulevard, 5th Floor

Santa Monica, CA 90401

Scott Minerd, Anne Walsh, Steven Brown and Adam Bloch are the co-portfolio managers responsible for the multi credit strategy (the “Multi Credit Strategy”), which is the segment of the High Income Alternatives Fund’s assets managed by Guggenheim Partners Investment Management, LLC (“Guggenheim”). Minerd is Chairman of Investments, Global Chief Investment Officer, Managing Partner and Portfolio Manager of Guggenheim. Minerd joined Guggenheim (or its affiliate or predecessor) in May 1998. Minerd guides the firm’s investment strategies and oversees client accounts across a broad range of fixed-income and equity securities. Previously, Minerd was a Managing Director with Credit Suisse First Boston in charge of trading and risk management for the Fixed Income Credit Trading Group. In this position, he was responsible for the corporate bond, preferred stock, money markets, U.S. government agency and sovereign debt, derivatives securities, structured debt and interest rate swaps trading business units. Prior to that, Minerd was Morgan Stanley’s London based European Capital Markets Products Trading and Risk Manager responsible for Eurobonds, Euro-MTNs, domestic European Bonds, FRNs, derivative securities and money market products in 12 European currencies and Asian markets. Minerd has also held capital markets positions with Merrill Lynch and Continental Bank. Prior to that, he was a Certified Public Accountant and worked for the public accounting firm of Price Waterhouse. Minerd is a member of the Federal Reserve Bank of New York’s Investor Advisory Committee on Financial Markets, helping advise the NY Fed President and senior management at the bank about the current financial markets and ways the public and private sectors can better understand and mitigate systematic risks. Minerd also works with the Organization for Economic Cooperation and Development (OECD), advising on research and analysis of private sector infrastructure investment, and is a contributing member of the World Economic Forum (WEF). Walsh is Chief Investment Officer, Fixed Income, Senior Managing Director and Portfolio Manager of Guggenheim. Walsh joined Guggenheim (or its affiliate or predecessor) in 2007 and in her role as CIO-Fixed Income, she is head of the Portfolio Construction Group and Portfolio Management. She oversees more than $185 billion in fixed income investments including Agencies, Credit, Municipals, Residential Mortgage Backed Securities, Commercial Mortgage Backed Securities and Asset Backed Securities. In her role, she is responsible for portfolio design and strategy, sector allocation and risk management for client portfolios, and conveying Guggenheim’s macro-economic outlook to Portfolio Managers and fixed income Sector Specialists. Prior to joining Guggenheim, Walsh served as Chief Investment Officer at Reinsurance Group of America (“RGA”), Incorporated, a

recognized leader in the global life reinsurance industry. Prior to joining RGA in 2000, Walsh served as Vice President and Senior Investment Consultant for Zurich Scudder Investments. Earlier, she held roles at Lincoln Investment Management and American Bankers Insurance Group. She has earned the right to use the Chartered Financial Analyst^® designation and is a member of the CFA Institute. Brown is Managing Director and Portfolio Manager of Guggenheim. Brown joined Guggenheim (or its affiliate or predecessor) in 2010. Brown is involved in all facets of portfolio management including working with the senior Portfolio Managers and CIOs to develop and apply the macro and sector level views at the individual portfolio level. Additionally, he works closely with the sector teams and portfolio construction to implement trades and optimize portfolios. Prior to joining the portfolio management team in 2012 Brown worked in the non-mortgage asset backed securities group. His responsibilities on that team included trading, sourcing and evaluating investment opportunities and monitoring credits. Prior to joining Guggenheim Brown held roles within treasury services and structured products at ABN AMRO and Bank of America in Chicago and London. He has earned the right to use the Chartered Financial Analyst^® designation and is a member of the CFA Institute. Bloch is Director and Portfolio Manager at Guggenheim. Bloch joined Guggenheim in 2012. He works directly with sector traders, research heads, and risk managers and is responsible for buy and sell recommendations, day-to-day risk monitoring, and various special projects for Guggenheim’s Total Return mandates. In addition to his fixed-income responsibilities, Bloch helps with implementation of various macro overlays on certain portfolios. Prior to joining Guggenheim, he worked in Leveraged Finance at Bank of America Merrill Lynch in New York where he structured high- yield bonds and leveraged loans for leveraged buyouts, restructurings, and corporate refinancing across multiple industries.

The managers of the Multi Credit Strategy seek to maximize total return through a combination of current income and capital appreciation. The team seeks to achieve its investment objective by investing in a wide range of fixed-income assets selected from a variety of credit sectors including, but not limited to, corporates, structured credit, U.S. government and agency, municipals, and other credit sectors. The investments can be across the capital structure including but not limited to senior secured, unsecured, second lien, other mezzanine including preferred, and equity. The strategy seeks opportunities across fixed-income market sectors, especially in non-index-eligible securities. In addition, the team may invest in derivatives or other asset classes to meet its investment objective. The strategy is flexible and is not constrained by duration, sector, issuer, or credit quality. As such, the strategy does not target any specific benchmark exposure to sectors, security weightings, and credit quality.

Guggenheim believes that an emphasis on capital preservation, while capturing attractive yields and a sustainable income component, is the surest path to superior long-term investment results. The firm strongly believes that fixed-income markets are inefficient, and as a result Guggenheim focuses on bottom-up,



Litman Gregory Masters High Income Alternatives Fund – Sub-Advisors						31

Litman Gregory Masters High Income Alternatives Fund – Sub-Advisors — (Continued)

fundamental research to identify securities with attractive relative value, where prices do not accurately reflect a security’s intrinsic value for a given risk profile. In-house macroeconomic views serve as a “roadmap” to inform and guide portfolio construction considerations such as duration and credit quality, as well as sector weightings.

Credit selection is conducted by a deep team of sector and security analysts. The focus is on understanding the underlying business, issuer financial strength, risks pertaining to cash flows, the capital structure (seniority of payments), debt covenants, among other considerations. This analysis involves comprehensive industry analysis that incorporates inputs from industry experts, competitors, suppliers, servicers, and customers. It also integrates a thorough analysis of creditworthiness under a variety of downside stress-test scenarios and leverages a dedicated legal team to assist in examining and assessing pertinent covenants and terms that may affect issues.

Risk management plays a prominent role in the investment process. At a high-level, the team studies a wide range of economic and market scenarios, and assesses the possible impact these scenarios could have on the portfolio. Scenarios can include those driven by macroeconomic risks, changes in regulation, broad sector trends, or an assessment of liquidity at the sector, security, and industry levels. Moreover, the team seeks to understand how specific changes in portfolio composition would lessen the downside, such as upgrading credit quality or including different types of security structures. Scenario analysis at the portfolio level also includes the impact of various interest-rate changes along different tenors of the curve.

At the portfolio level, the team might examine the effect of sudden mark-to-market shocks on the portfolio by assuming widening yield spreads for specific portfolio exposures. The team will also examine risks to specific sectors under a given stress-test scenario to quantify the potential downside risk. Risk management is also expressed through portfolio diversification, both across and within fixed-income sectors, position size limits, prudent yield-curve positioning, loss thresholds, and other measures.

Securities may be sold for several reasons including to adjust the portfolio’s average maturity, shift assets into or out of higher-quality securities, move into more attractively valued securities, take gains, or to meet redemption requests.

Option Income Strategy

Derek Devens, CFA

Neuberger Berman Investment Advisers LLC

1290 Avenue of the Americas

New York, NY 10104

Derek Devens is the portfolio manager responsible for the option income strategy (the “Option Income Strategy”), which is the segment of the High Income Alternatives Fund’s assets managed by Neuberger Berman Investment Advisers LLC (“Neuberger Berman”). Devens joined Neuberger Berman in

2016 and is a Managing Director and Senior Portfolio Manager of the Option Group. Prior to Neuberger Berman, he was responsible for both Research and Portfolio Management at Horizon Kinetics. Devens was a member of the Investment Committee and responsible for co-managing the Kinetics Alternative Income Fund and various separate account strategies. Prior to Horizon Kinetics, he was a Vice President with Goldman Sachs’ Global Manager Strategies Group where he was responsible for conducting investment manager research. He has been awarded the Chartered Financial Analyst designation.

In executing the Option Income Strategy, Devens writes put options on U.S. equity indexes, a strategy conceptually similar to that utilized by the Chicago Board Options Exchange (CBOE) S&P 500 PutWrite Index (the “Put Index”). However, by utilizing thoughtful active management, he seeks to reduce the path dependence of the Put Index, as well as manage risk and seek attractive returns relative to the Put Index. While the Put Index writes one at-the-money (ATM) put option on the S&P 500 Index each month, Devens will seek to diversify the underlying options held by the strategy by strike price and expiration date by writing a series of short dated put options on diversified U.S. equity indexes, laddered across expiration dates, intending for option exposures to be relatively consistent across options tenors (i.e., the time left until an option contract expires). Options are rolled in a manner that seeks to preserve this laddered structure. This diversification is intended to seek to reduce the likelihood of a series of negative short-term outcomes in a row that could result from selling only one put per month.

Another critically important difference between the Put Index and the strategy Devens will manage for the fund is the selection of the level of ‘moneyness’ of the options sold (ATM versus out-of-the money, or “OTM”). The fund’s options will primarily be OTM, vs the Put Index selling ATM options. The fund attempts to generate returns through the receipt of option premiums from selling puts, as well as through investments in fixed income instruments, which collectively are intended to reduce volatility relative to what it would be if the fund held the underlying equity index on which the options are written. The fund’s investments in fixed income instruments will typically be in short duration U.S. Treasuries and are intended to provide liquidity and preserve capital and will serve as collateral for the fund’s investments in options.

Risk management is a function of a number of factors, one being the overall sizing of the allocation at the fund level, since the strategy can have significant equity correlation (but has historically exhibited lower beta than broad-based U.S. equity indices as demonstrated by the PUT Index compared to the S&P 500 Index). Secondly, the selection of ATM or OTM, and how far OTM, influences the level of risk materially. Lastly, Devens seeks to actively reduce downside exposures to mitigate equity risk by buying back a portion of the put options that are underwater and selling new put options at higher premiums. Put writing is not a strategy built on a philosophy of explicit risk avoidance; rather, it is rooted in seeking receipt of



32						Litman Gregory Funds Trust

option premiums in exchange for taking on the risk of a decline in U.S. broad based equity indices. As such, investors in the strategy accept limited upside returns relative to U.S. broad-based equity indices in exchange for the potential for option premiums to mitigate equity risk.

In a put writing strategy, the fund (as the seller of the option) receives premiums from the purchaser of the option in exchange for providing the purchaser with the right to sell the underlying instrument to the fund at a specific price (i.e., the strike price). If the market price of the instrument underlying the option exceeds the strike price, it is anticipated that the option would go unexercised and the fund would earn the full premium upon the option’s expiration or a portion of the premium upon the option’s early termination. If the market price of the instrument underlying the option drops below the strike price, it is anticipated that the option would be exercised and the fund would pay the option buyer the difference between the market value of the underlying instrument and the strike price. The amount of premium varies according to a number of factors, including the market perception of risk, the length of the option, and whether the option is ATM when written (riskier for the seller, which necessitates a higher premium) or OTM and by how much. The further OTM the option is, the less likely the index is to decline below the strike price, and thus the less likely the option seller is to be required to make a payment to the option buyer, thus the premium collected by the seller necessarily is lower.

The potential returns to equity index put writing come from two risk premia plus the return on collateral, which is typically invested in relatively conservative, short-duration fixed income. The first is the equity risk premium, or the return investors earn for holding equity risk. Devens believes that investors should also acknowledge the natural corollary related to options on stock indexes. Devens believes that for equity markets to be efficient, investors who assume exposure to the downside risk of an equity index should seek to earn a portion of the long-term equity risk premium over longer investment periods. Essentially, in Devens’ view, the underwriters of equity risk should earn the equity risk premium over the long term regardless of how the risk is assumed, whether through direct ownership of the index, or seeking to offset its downside. If this was not the case, then in Devens’ view, equity markets would demonstrate a massive inefficiency, as investors could own the equity index and buy puts to protect the full value of their investment from any loss while still earning positive returns. Therefore, Devens believes that for markets to be efficient, a portion of put option premium collected from writing put options must therefore compensate the put seller for the equity sensitivity of the option. The portion of the equity risk premium earned through put writing is a function of the moneyness of the put option written.

The second risk premium is the volatility risk premium. In addition to earning premiums on the put options written, Devens believes the option seller must be compensated further for the added risk associated with a decline in the broad-based U.S. equity markets for some period in the future in an unpredictable world. Investors do not generally assume risk with the intention

of losing money over time, and option markets are not an exception. Because of the high degree of uncertainty, and the negatively skewed risk/return profile to which they are exposed, sellers of put options generally build in a cushion (or expected profit margin) to the premiums they collect from option buyers. Over time, Devens believes this concept has the potential to allow sellers of ATM puts to generate returns similar to owning the index over long-term investment horizons.

The return profile of selling ATM U.S. equity index puts has historically tended to be more stable than owning the underlying equity index outright as demonstrated by the PUT Index compared to the S&P 500 Index. In converting traditional equity investment return potential (capital appreciation and dividends) into up-front cash flows via the consistent collection of option premiums and interest income, put writing strategies make an explicit trade-off between up-market participation and down-market participation, while still seeking reasonable returns in flat markets. As such, it is anticipated that the strategy will not participate in the full upside of the index, but it also has the potential to mitigate a portion of losses when the index suffers negative performance, due to the offsetting effect of the premium cash flows. The premiums the strategy collects may decrease during up markets, however, Devens would expect premiums to materially ratchet up during periods of market losses, a feature which may help the strategy recover from drawdowns more quickly than the underlying equity index.

The SAI provides additional information about each sub-advisor’s method of compensation for its portfolio managers, other accounts managed by the portfolio managers, and the portfolio managers’ ownership of securities in the Fund.



Litman Gregory Masters High Income Alternatives Fund – Sub-Advisors						33

Shareholder Services

The Fund is a no-load fund, which means that you pay no sales commissions of any kind. Each business day that the New York Stock Exchange (“NYSE”) is open, the Fund calculates its share price, which is also called the Fund’s NAV per share. Shares are purchased at the next share price calculated after your accepted investment is received. Share price is calculated as of the close of the NYSE, normally 4:00 p.m. Eastern Time.

Eligibility

The Fund is not registered for sale outside of the United States and is available for purchase only by residents of the United States of America, the District of Columbia, Puerto Rico, Guam and the U.S. Virgin Islands.

Description of Classes

The Trust has adopted a multiple class plan. The Fund offers two classes of shares – Institutional Class shares and Investor Class shares – in this Prospectus. The two different classes of shares represent investments in the same portfolio of securities, but the classes are subject to different expenses and may have different share prices as outlined below:

•

Institutional Class shares are not charged a Rule 12b-1 distribution and servicing fee, and are sold with no sales load.

•

Investor Class shares are charged a 0.25% Rule 12b-1 distribution and servicing fee, and are sold with no sales load.

How to Buy Shares

Step 1

The first step is to determine the type of account you wish to open. The following types of accounts are available to investors:

Individual or Joint Accounts

For your general investment needs:

Individual accounts are owned by one person. Joint accounts can have two or more owners (tenants).

Retirement Accounts

Retirement accounts allow individuals to shelter investment income and capital gains from current taxes. In addition, contributions to these accounts may be tax deductible. Retirement accounts (such as individual retirement accounts (“IRAs”), rollover IRAs, Simplified Employee Pension (SEP) plans and Roth IRAs) require specific applications and typically have lower minimums.

Other retirement plans, such as Keogh or corporate profit-sharing plans, 403(b) plans and 401(k) plans, may invest in the Fund. All of these accounts need to be established by the plan’s trustee. The Fund does not offer versions of these plans.

If you are investing through a tax-sheltered retirement plan, such as an IRA, for the first time, you will need an IRA Application and Adoption Agreement. Retirement investing also involves separate investment procedures.

Gifts or Transfers to Minors (UGMA and UTMA)

To invest for a child’s education or other future needs:

These custodial accounts provide a way to give money to a child and obtain tax benefits. An individual can give up to statutorily-defined amount per year per child without paying a federal gift tax. Such amount is subject to change each year. For 2018, the amount is $15,000. Depending on state laws, you can set up a custodial account under the Uniform Gifts to Minors Act (“UGMA”) or the Uniform Transfers to Minors Act (“UTMA”).

Trust

For money being invested by a trust:

The trust must be established before an account can be opened. The Fund may require additional documentation regarding the formation of the trust prior to establishing an account.

Business or Organization

For investment needs of corporations, associations, partnerships or other groups:

The Fund does not require a special application. However, the Fund may require additional information prior to establishing an account.

Step 2

How to Choose a Share Class

Before you buy shares in the Fund, you need to decide which class of shares best suits your needs. The Fund offers two classes of shares – Institutional Class shares and Investor Class shares – in this Prospectus. Each class is essentially identical in legal rights and invests in the same portfolio of securities. The difference in the fee structures between the classes for the Fund is primarily the result of their separate arrangements for shareholder and distribution services and is not the result of any difference in the amounts charged by Litman Gregory for investment advisory services. Accordingly, the investment advisory expenses do not vary by class for the Fund.

Conversion Feature

Subject to Litman Gregory’s approval and based on current Internal Revenue Service (“IRS”) guidance, if investors currently holding Investor Class shares meet the criteria for eligible investors and would like to convert to Institutional Class shares, there should be no tax consequences to the converting investor and investors are not subject to the redemption/exchange fees. To inquire about converting your Investor Class shares to Institutional Class shares, please call 1-800-960-0188.

Investor Class Shares

Investor Class shares may be appropriate if you intend to retain the services of a financial adviser, mutual fund supermarket, retirement plan or other financial intermediary. Investor Class shares cannot be purchased directly from the Fund. Investor Class shares have adopted a Distribution and



34						Litman Gregory Funds Trust

Shareholder Servicing Plan (the “Distribution Plan”), pursuant to which each Investor Class may pay up to 0.25% of its average annual net assets to financial planners, mutual fund supermarkets, or any other persons that render assistance in distributing or promoting the sale of shares or that provide certain shareholder services.

Institutional Class Shares

Institutional Class shares may be appropriate if you intend to make your own investment decisions and will invest directly with the Fund. The Distribution Plan does not apply to the Institutional Class shares, and as a result, the Institutional Class of the Fund has a lower expense ratio than the Investor Class of the Fund, which will result in higher investment returns for the Institutional Class over time.

Step 3

The third step involves determining the amount of your investment. The Fund has established the following minimum investment levels for your initial investment, additional investments and ongoing account balances for Institutional Class shares and Investor Class shares:


High Income Alternatives Fund
Type of Account	Minimum Initial Investment		Minimum Additional Investment		Minimum Account Balance
Regular
- Institutional Class	$	100,000	$	250	$	2,500
- Investor Class	$	1,000	$	100	$	250
Retirement Account
- Institutional Class	$	5,000	$	100	$	250
- Investor Class	$	500	$	100	$	250
Automatic Investment Account
- Institutional Class	$	2,500	$	250	$	2,500
- Investor Class	$	2,500	$	250	$	2,500

Litman Gregory may waive the minimum investment from time to time in its discretion.

Step 4

The fourth step involves completing your application to open your account. All shareholders must complete and sign an application in order to establish their account. The type of application depends on the type of account you chose to open. Regular investment accounts, including individual, joint tenant, UGMA, UTMA, business, or trust accounts, must complete the Fund’s standard account application. Shareholders who wish to establish retirement accounts must complete the IRA application and adoption agreement. Shareholders who wish to transfer retirement holdings from another custodian must also complete the IRA Transfer of Assets Form. Be sure to complete the section of the account application indicating the amount you are investing in the Fund.

Step 5

The final step in opening your account is to mail the completed account application, along with your check payable to the Litman Gregory Masters Funds. The Fund does not accept third-party checks, money orders, cashiers checks, starter checks, official bank checks, credit cards, cash or checks or wires from foreign financial institutions. If you send any of these instruments, your purchase order will be rejected, and your investment in the Fund will be delayed.

The mailing addresses for the Fund are:

For Regular Delivery:

Litman Gregory Funds Trust

c/o	DST Asset Manager Solutions, Inc.

P.O. Box 219922

Kansas City, MO 64121-9922

For Overnight Delivery:

Litman Gregory Funds Trust

c/o	DST Asset Manager Solutions, Inc.

330 West Ninth Street

Kansas City, MO 64105

In compliance with the USA PATRIOT Act of 2001, please note that the Transfer Agent will verify certain information on your account application as part of the Fund’s Anti-Money Laundering Compliance Program. Until such verification is made, the Fund may temporarily limit share purchases. As requested on the application, you should supply your full name, date of birth, social security number and permanent street address. Mailing addresses containing only a P.O. Box will not be accepted. Your information will be handled by us as discussed in our privacy notice. Please contact the Transfer Agent at 1-800-960-0188 if you need additional assistance when completing your application.

If you wish to open or add to your account by wire, please call 1-800-960-0188 for instructions.

After your account is open, you may increase the amount of your investment by:

•

Mailing a check to the above addresses along with a letter or the form at the bottom of your account statement. Be sure to put your account number on your check and in your letter, and please refer to Step 4 above for a list of instruments that will not be accepted for investment.

•

Wiring money from your bank. Call 1-800-960-0188 for instructions.

•

Making automatic investments if you signed up for the Automatic Investment Plan when you opened your account.

How to Sell Shares

You can arrange to take money out of your account at any time by selling (redeeming) some or all of your shares. Your shares will be sold at the next NAV per share (share price) calculated after your order is received.

To sell shares in a non-retirement account, you may use any of the methods described in this section. To sell shares in a retirement account, your request must be made in writing.



Shareholder Services						35

Shareholder Services — (Continued)

Certain requests must include a medallion guarantee. This is designed to protect you and the Fund from fraud. Your request must be made in writing and include a medallion guarantee if any of the following situations apply:

•

You wish to redeem more than $25,000 worth of shares.

•

Your account registration information has changed within the past 30 days.

•

The redemption check is being mailed to a different address from the one on your account (address of record).

•

The check is being made payable to someone other than the account owner.

Please note that there may be other special cases in which a Medallion Guarantee may be required. Each signature must be guaranteed by an eligible signature guarantor, which must participate in the Securities Transfer Agents Medallion Program (STAMP), the leading signature guarantee program recognized by all major financial service associations throughout the United States and Canada. You should be able to obtain a medallion guarantee from a bank, broker-dealer, credit union (if authorized under state law), securities exchange or association, clearing agency or savings association. A notary public cannot provide a medallion guarantee.

Selling Shares by Letter

Write and sign a “letter of instruction” with:

Your Name

Your Fund’s account number

The dollar amount or number of shares to be redeemed

Please note the following special requirements for redeeming shares for different types of accounts:

•

Individual, Joint Tenant, Sole Proprietorship, UGMA or UTMA Accounts: The letter of instruction must be signed by all persons required to sign for transactions, exactly as their names appear on the account.

•

Retirement Account: The account owner should complete a Retirement Distribution Form. Call 1-800-960-0188 to request one.

•

Trust Account: The trustee must sign the letter indicating capacity as trustee. If a trustee’s name is not in the account registration, provide a copy of the trust document certified within the past 60 days.

•

Business or Organization: At least one person authorized by corporate resolutions to act on the account must sign the letter. Include a corporate resolution (certified within the past 6 months) with corporate seal or medallion guarantee.

•

Executor, Administrator, Conservator or Guardian: Call 1-800-960-0188 for instructions.

Unless otherwise instructed, the Fund will send a check to the address of record.

Mail your letter to:

For Regular Delivery:

Litman Gregory Funds Trust

c/o	DST Asset Manager Solutions, Inc.

P.O. Box 219922

Kansas City, MO 64121-9922

For Overnight Delivery:

Litman Gregory Funds Trust

c/o	DST Asset Manager Solutions, Inc.

330 West Ninth Street

Kansas City, MO 64105

Selling Shares by Telephone

You must select this option on your account application if you wish to use telephone redemption; it is not automatically available. If you selected the telephone redemption option on your account application, you can sell shares simply by calling 1-800-960-0188. If you wish to add this feature to your account, you must do so in writing at least 30 days in advance of any telephonic redemption. The amount you wish to redeem (up to $25,000) will be sent by check to the address of record. This option is not available for retirement accounts.

Selling Shares by Wire

You must sign up for the wire feature before using it. To verify that it is in place, please call 1-800-960-0188. Wire redemptions may be processed for amounts between $5,000 and $25,000. Your wire redemption request must be received by the Fund before 4:00 p.m., Eastern Time for money to be wired the next business day. This option is not available for retirement accounts.

Shareholder and Account Policies

Statements, Reports, and Inquiries

Statements and reports that the Fund sends you include the following:

•

Confirmation statements (after every transaction that affects your account balance or your account registration)

•

Financial reports (every six months)

•

Account statements (every six months)

DST Asset Manager Solutions, Inc., the Fund’s transfer agent, is located at 330 West Ninth Street, Kansas City, Missouri, 64105. You may call the Transfer Agent at 1-800-960-0188 if you have questions about your account.

ALPS Distributors, Inc., the Fund’s principal underwriter, is located at 1290 Broadway, Suite 1100, Denver, Colorado 80203.

Exchange Privilege

Exchanges of shares between classes are permitted only as follows: (i) a class of shares of the Fund may be exchanged for the same class of shares of any series of the Trust; and (ii) the Investor Class shares of the Fund may be exchanged for the Institutional Class shares of the Fund, if the investor is eligible to invest in the Institutional Class shares of the Fund. Shareholders may exchange shares by mailing or delivering written instructions to the Transfer Agent. Such exchange will be treated as a sale of shares and may result in taxable gains. Please specify the names and class of the applicable Fund(s), the number of shares or dollar amount to be exchanged, and your name and account number. You may not utilize an exchange to establish an account into a closed fund.



36						Litman Gregory Funds Trust

Exchanging Shares by Telephone

You must select this option on your account application if you wish to use telephone exchange; it is not automatically available. If you selected the telephone exchange option on your account application, you may also exchange shares (maximum $25,000 worth) by calling the Transfer Agent at 1-800-960-0188 between 9:00 a.m. and 4:00 p.m. Eastern Time on a day that the NYSE is open for normal trading. The Fund will suspend, without notice, the exchange privilege on any accounts it reasonably believes are being used by “market timers.”

Automatic Investment/Withdrawal Plans

One easy way to pursue your financial goals is to invest money regularly. The Fund offers a convenient service that lets you transfer money into your Fund account automatically. Although Automatic Investment Plans do not guarantee a profit and will not protect you against loss in a declining market, they can be an excellent way to invest for retirement, a home, educational expenses and other long-term financial goals. The investment will automatically be processed through the Automated Clearing House (ACH) system. Shares will be issued at the NAV per share after the Fund accepts your order, which will typically be the day after you provide proper instructions to the Transfer Agent (assuming you do so prior to the close of the NYSE).

A systematic withdrawal plan permits you to receive a fixed sum on a monthly, quarterly or annual basis from accounts with a value of $5,000 or more. Payments may be sent electronically to your bank of record or to you in check form. Certain restrictions apply for retirement accounts. Call 1-800-960-0188 for more information.

Share Price

The Fund is open for business each day the NYSE is open. The Fund calculates its NAV per share as of the close of business of the NYSE, normally 4:00 p.m., Eastern time.

The Fund’s NAV per share is the value of a single share. The NAV per share is computed by adding the value of the Fund’s investments, cash and other assets, subtracting its liabilities and then dividing the result by the number of shares outstanding. The NAV per share is also the redemption price (price to sell one share).

The Fund’s assets are valued primarily on the basis of market quotations. Securities and other assets for which reliable market quotations are not readily available will be valued at their fair value as determined under the guidelines established by, and under the general supervision and responsibility of, the Board. Fair value pricing is intended to be used as necessary in order to accurately value the Fund’s portfolio securities and its NAV. The SAI further describes the Fund’s valuation procedures. Since securities that are primarily listed on foreign exchanges may trade on weekends or other days when the Fund does not price its shares, the value of the Fund’s securities (and thereby its NAV) may change on days when shareholders will not be able to purchase or redeem the Fund’s shares.

General Purchase Information

•

All of your purchases must be made in U.S. dollars, and checks must be drawn on U.S. banks.

•

The Fund does not accept cash, money orders, cashiers checks, starter checks, official bank checks, credit cards or third-party checks. If you send any of these instruments, your purchase order will be rejected, and your investment in the Fund will be delayed.

•

If your check does not clear, your purchase will be canceled and you will be liable for any losses or fees the Fund or the Transfer Agent incur.

•

Your ability to make automatic investments may be immediately terminated if any item is unpaid by your financial institution.

•

The Fund reserves the right to reject any purchase order. For example, a purchase order may be refused if, in Litman Gregory’s opinion, it is so large that it would disrupt management of the Fund. Orders will also be rejected from persons believed by the Fund to be “market timers.”

12b-1 Plan

The Trust has adopted the “Distribution Plan” under the Investment Company Act of 1940, as amended, on behalf of the Fund. Under the Distribution Plan, the Fund is authorized to pay the Fund’s distributor a fee for the sale and distribution of the Investor Class shares of the Fund and for related services the Fund’s distributor provides to shareholders of the Investor Class shares. The maximum amount of the fee authorized under the Distribution Plan is 0.25% of average daily net assets attributable to Investor Class shares for the Fund. Because this fee is paid out of the assets of the Investor Class of the Fund on an on-going basis, over time these fees will increase the cost of your investment in the Fund shares and may cost you more than paying other types of sales charges. Institutional Class shares are not subject to the Distribution Plan.

Buying and Selling Shares through Financial Intermediaries

You may buy and sell shares of the Fund through certain financial intermediaries (and their agents) that have made arrangements with the Fund to sell their shares. When you place your order with such a financial intermediary or its authorized agent, your order is treated as if you had placed it directly with the Transfer Agent, and you will pay or receive the next price calculated by the Fund. The financial intermediary (or agent) may hold your shares in an omnibus account in the financial intermediary’s (or agent’s) name, and the financial intermediary (or agent) maintains your individual ownership records. The Fund may pay the financial intermediary (or agent) a fee for performing this account maintenance service. The financial intermediary (or agent) may charge you a fee for handling your order, which may be in addition to the fees described in this Prospectus. The financial intermediary (or agent) is responsible for processing your order correctly and promptly, keeping you advised regarding the status of your individual account, confirming your transactions and ensuring that you receive copies of the Fund’s Prospectus.



Shareholder Services						37

Shareholder Services — (Continued)

Redemptions

•

After the Trust has received your redemption request and all proper documents, payment for shares tendered will generally be made within (i) one to three business days for redemptions made by wire, and (ii) three to five business days for ACH redemptions. Normally, redemption payments by check will be mailed to you on the next business day, but your actual receipt of a check will be subject to postal delivery schedules and timing. If making immediate payment could adversely affect the Fund, it may take up to seven days to pay you. The Fund may also delay payment if there have been changes in your mailing address or account registration within 30 days of the date of the redemption.

•

The Fund typically expects to meet redemptions with positive cash flows. When that cash is not available, the Fund will seek to maintain its portfolio weightings by selling a cross-section of the Fund’s holdings to meet redemptions.

•

During conditions that make the payment of cash unwise and/or in order to protect the interests of the Fund’s remaining shareholders, you could receive your redemption proceeds in the form of readily marketable securities. Receiving securities instead of cash is called “redemption in kind.” The Fund may redeem shares in kind during both normal and stressed market conditions, including when the amount you are redeeming from the Fund exceeds 1% of the Fund’s net assets or $250,000 during any 90-day period. Generally, in-kind redemptions will be effected through a pro rata distribution of the Fund’s portfolio securities. You may incur brokerage and other costs in converting to cash any securities distributed. It may take up to several weeks for the initial portion of the in-kind securities to be delivered to you, and substantially longer periods for the remainder of the in-kind securities to be delivered to you, in payment of your redemption in kind.

•

Under certain circumstances, including stressed market conditions, the Fund may also borrow money (subject to certain regulatory conditions) through a bank line of credit, including from a joint credit facility, in order to meet redemption requests.

•

Redemptions may be suspended or payment dates postponed when the NYSE is closed (other than weekends or holidays), when trading on the NYSE is restricted or as permitted by the SEC.

Policy Regarding Excessive Trading and Market Timing

The Board has adopted policies and procedures with respect to frequent purchases and redemptions of Fund shares by Fund shareholders. These policies are summarized below.

Purchases and exchanges of shares of the Fund should be made for long-term investment purposes only. The Fund, as a matter of policy, actively discourages market timing and excessive short term trading and may block accounts or take other action to prevent this type of activity.

Investors seeking to engage in excessive trading or market timing practices may deploy a variety of strategies to avoid detection and, despite the efforts of the Fund to prevent such

trading, there is no guarantee that the Fund or its agents will be able to identify such investors or curtail their practices. The ability of the Fund and its agents to detect and curtail excessive trading or short term trading practices may also be limited by operational systems and technological limitations. In addition, the Fund receives purchase, exchange and redemption orders through financial intermediaries and cannot always know or reasonably detect excessive trading that may be facilitated by these intermediaries or by the use of omnibus account arrangements. Omnibus accounts are common forms of holding Fund shares. Entities utilizing omnibus account arrangements may not identify customers’ trading activity in shares of the Fund on an individual basis (although in order for financial intermediaries to purchase Fund shares in nominee name on behalf of other persons, the Fund is required to enter into shareholder information agreements with the financial intermediaries, which may result in the disclosure of certain identifying information about shareholders to the Fund). Consequently, the Fund may not be able to detect frequent or excessive trading in Fund shares attributable to a particular investor who effects purchase and/or exchange activity in Fund shares through a broker, dealer or other financial intermediary acting in an omnibus capacity. Also, there may be multiple tiers of these entities, each utilizing an omnibus account arrangement, which may further compound the difficulty to the Fund of detecting excessive or short duration trading activity in Fund shares. In seeking to prevent disruptive trading practices in the Fund, the Fund and its agents consider the information actually available to them at the time.

The Fund reserves the right in its discretion to reject any purchase, in whole or in part (including, without limitation, purchases by persons whose trading activity in Fund shares Litman Gregory believes could be harmful to the Fund). The Fund may decide to restrict purchase and sale activity in its shares based on various factors, including whether frequent purchase and sale activity will disrupt portfolio management strategies and adversely affect Fund performance.

Frequent purchases and redemptions of the Fund’s shares may present certain risks for the Fund and its shareholders. These risks may include, among other things, dilution in the value of Fund shares held by long-term shareholders, interference with the efficient management of the Fund’s portfolios and increased brokerage and administrative costs. The Fund may have difficulty implementing long-term investment strategies if it is unable to anticipate what portion of its assets it should retain in cash to provide liquidity to its shareholders. The Fund may invest in non-U.S. securities; accordingly, there is an additional risk of undetected frequent trading in Fund shares by investors who attempt to engage in time zone arbitrage. There can be no assurance that the Fund or Litman Gregory will identify all frequent purchase and sale activity affecting the Fund.

The Fund May Close Small Accounts. Due to the relatively high cost of maintaining smaller accounts, the shares in your account (unless it is a retirement plan or custodial account) may be redeemed by the Fund if, due to redemptions you have made, the total value of your account is reduced to less than $2,500 (unless you invest in Investor Class shares only, in which



38						Litman Gregory Funds Trust

case less than $250). If the Fund decides to make such an involuntary redemption, you will first be notified that the value of your account is less than $2,500 (or $250, as applicable), and you will be allowed 30 days to make an additional investment to bring the value of your account to at least $2,500 (or $250, as applicable) before the Fund takes any action. Unless you are a tax-exempt investor or investing through a tax-deferred retirement plan or other tax-advantaged arrangement, a redemption of shares is generally a taxable event, and you may realize a gain or a loss for U.S. federal income tax purposes (see “Taxes on Transactions” below).

Unclaimed Property. Your mutual fund account may be transferred to your state of residence if no activity occurs within your account during the “inactivity period” specified in your state’s abandoned property laws.

Dividends, Capital Gains and Taxes

Dividends, if any, of net investment income are declared and paid monthly. The Fund intends to distribute capital gains, if any, to shareholders on a quarterly basis.

Distribution Options

When you open an account, specify on your application how you want to receive your distributions. If the option you prefer is not listed on the application, call 1-800-960-0188 for instructions. The Fund offers three options:

•

Reinvestment Option. Your dividend and capital gains distributions will be reinvested automatically in additional shares of the Fund. If you do not indicate a choice on your application, you will be assigned this option.

•

Income-Earned Option. Your capital gains distributions will be reinvested automatically, but you will be sent a check for each dividend distribution.

•

Cash Option. You will be sent a check for your dividend and capital gains distributions ($10 minimum check amount). The Fund will automatically reinvest all distributions under $10 in additional shares of the Fund, even if you have elected the cash option. If the U.S. Postal Service cannot deliver your check or if your check remains uncashed for six months, the Fund reserves the right to reinvest the distribution check in your account at the Fund’s then current NAV and to reinvest all subsequent distributions.

For retirement accounts, all distributions are automatically reinvested. When you are over 59¹⁄₂ years old, you can receive distributions in cash.

When the Fund deducts a distribution from its NAV, the reinvestment price is the Fund’s NAV per share at the close of business that day. Cash distribution checks will be mailed within seven days.

Understanding Distributions

As a Fund shareholder, you are entitled to your share of the Fund’s net income and gains on its investments. The Fund passes its earnings along to investors as distributions. The Fund

earns dividends from stocks and interest from short-term investments. These are passed along as dividend distributions. The Fund realizes capital gains whenever it sells securities for a higher price than it paid for them. These are passed along as capital gains distributions.

Taxes

As with any investment, you should consider how your investment in the Fund will be taxed. If your account is not a tax-deferred retirement account, you should be aware of these tax implications.

Taxes on Distributions. Distributions are subject to federal income tax and may also be subject to state and local taxes. If you live outside of the United States, your distributions could also be taxed by the country in which you reside, as well as potentially subject to U.S. withholding taxes. Your distributions are taxable when they are paid, whether you take them in cash or reinvest them. Distributions declared in December and paid in January, however, are taxable as if they were paid on December 31.

For federal income tax purposes, the Fund’s income and short-term capital gains distributions are taxed as regular or “qualified” dividends; long-term capital gains distributions are taxed as long-term capital gains. Every January, the Fund will send you and the IRS a statement showing the taxable distributions.

Taxes on Transactions. Your redemptions, including transfers between Litman Gregory Masters Funds, are subject to capital gains tax. A capital gain or loss is the difference between the cost of your shares and the price you receive when you sell them. Whenever you sell shares of the Fund, the Fund will send you a confirmation statement showing how many shares you sold and at what price. You will also receive a consolidated transaction statement every January. It is up to you or your tax preparer, however, to determine whether the sales resulted in a capital gain and, if so, the amount of the tax to be paid. Be sure to keep your regular account statements; the information they contain will be essential in calculating the amount of your capital gains.

“Buying a Dividend.” If you buy shares just before the Fund deducts a distribution from its NAV, you will pay the full price for the shares and then receive a portion of the price back in the form of a taxable distribution.

There are tax requirements that all funds must follow in order to avoid federal income taxation. In their efforts to adhere to these requirements, the Fund may have to limit its investment activity in some types of instruments.

When you sign your account application, you will be asked to certify that your Social Security or Taxpayer Identification number is correct and that you are not subject to 28% withholding for failing to report income to the IRS. If you violate IRS regulations, the IRS can require the Fund to withhold 28% of your taxable distributions and redemptions.



Shareholder Services						39

Index Descriptions

The Bloomberg Barclays U.S. Aggregate Bond Index is an unmanaged index that measures the investment grade, U.S. dollar-denominated, fixed-rate, taxable bond market and includes Treasuries, government-related and corporate securities, mortgage-backed securities (MBS) (agency fixed-rate and hybrid adjustable rate mortgage (ARM) pass-throughs), asset-backed securities (ABS), and commercial mortgage-backed securities (CMBS) (agency and non-agency).

The HFRX Fixed Income – Credit Index is an unmanaged index that includes strategies with exposure to credit across a broad continuum of credit sub-strategies, including Corporate, Sovereign, Distressed, Convertible, Asset Backed, Capital Structure Arbitrage, Multi-Strategy and other Relative Value and Event Driven sub-strategies. The investment thesis across all strategies is predicated on realization of a valuation discrepancy between the related credit instruments. Strategies may also include and utilize equity securities, credit derivatives, government fixed income, commodities, currencies or other hybrid securities. Constituent funds are selected from an eligible pool of the more than 7,500 funds worldwide that report to the

Hedge Fund Research (HFR) Database. Constituent funds must meet all of the following criteria: report monthly; report performance net of all fees; be U.S. dollar denominated; be active and accepting new investments; have a minimum 24 months track record; and the fund’s manager must have at least $50 million in assets under management. Constituents are weighted by a representative optimization methodology. The index is rebalanced quarterly.

The ICE BofAML U.S. High Yield TR USD Index is an unmanaged index that measures the performance of short-term U.S. dollar denominated below investment grade corporate debt publicly issued in the U.S. domestic market. Qualifying securities must have at least 18 months to final maturity at the time of issuance, at least one year remaining term to final maturity as of the rebalancing date, a fixed coupon schedule and a minimum amount outstanding of $100 million. It is capitalization weighted.

Direct investment in an index is not possible.



40						Litman Gregory Funds Trust

Financial Highlights

The Trust’s registration statement with respect to the High Income Alternatives Fund became effective on September 7, 2018, as a result, audited financial highlights are not available for the Fund and financial statements for the Fund are not included in the Trust’s shareholder reports.



Financial Highlights						41

For More Information

Statement of Additional Information:

The SAI contains additional information about the Fund.

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. 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 the last fiscal year.

The SAI and the Fund’s Annual and Semi-Annual Reports to Shareholders are available, without charge, upon request. To request an SAI or the Fund’s Annual or Semi-Annual Reports to Shareholders, or to make shareholder inquiries or to obtain other information about the Fund, please call 1-800-960-0188. You may also obtain a copy of the SAI or Annual or Semi-Annual Reports, free of charge, by accessing the Fund’s website (http://www.mastersfunds.com), or by writing to the Fund.

SEC Contact Information:

If you have access to the Internet, you can view the SAI, the Fund’s Annual or Semi-Annual Reports to Shareholders and other information about the Fund on the EDGAR Database at the Securities and Exchange Commission’s (“SEC”) internet site at www.sec.gov. You may also visit the SEC’s Public Reference Room in Washington, D.C. to review and copy information about the Fund (including the SAI). Information on the operation of the Public Reference Room can be obtained by calling the SEC at (202) 551-8090. You may request copies of information available on the EDGAR Database by writing to the SEC’s Public Reference Section, Washington, D.C. 20549-1520 or by an electronic request at the following E-mail address: [email protected]. The SEC charges a duplicating fee for this service.

Fund Information:

Fund

Abbreviation

Symbol

CUSIP

Fund Number

High Income Alternatives Fund

High Income

Institutional Class

MAHIX

53700T876

1478

Investor Class

MAHNX

53700T868

1479

Website:

www.mastersfunds.com

Litman Gregory Funds Trust

P.O. Box 219922

Kansas City, MO 64121-9922

1-800-960-0188

ALPS Distributors, Inc. Denver, Colorado 80203

Investment Company Act File No: 811-07763

LITMAN GREGORY FUNDS TRUST

Litman Gregory Masters High Income Alternatives Fund - Institutional Class – MAHIX

Investor Class – MAHNX

STATEMENT OF ADDITIONAL INFORMATION

Dated September 7, 2018

This Statement of Additional Information (“SAI”) is not a prospectus, and it should be read in conjunction with the prospectus dated September 7, 2018, as it may be amended from time to time, of Litman Gregory Masters High Income Alternatives Fund (the “High Income Alternatives Fund”), a series of the Litman Gregory Funds Trust (the “Trust”), formerly known as the Masters’ Select Funds Trust until August 2011 and the Masters’ Select Investment Trust until December 1997. Litman Gregory Fund Advisors, LLC (the “Advisor” or “Litman Gregory”) is the investment advisor of the Fund. The Advisor has retained certain investment managers as sub-advisors (each, a “Sub-Advisor,” and collectively, the “Sub-Advisors”), each responsible for portfolio management of a segment of the Fund’s total assets. A copy of the Fund’s prospectus and most recent annual report may be obtained from the Trust without charge at 1676 N. California Blvd., Suite 500, Walnut Creek, California 94596, telephone 1-800-960-0188.

The Trust’s audited financial statements for the fiscal year ended December 31, 2017 are incorporated by reference to the Trust’s Annual Report for the fiscal year ended December 31, 2017. The High Income Alternatives Fund is not included in the Trust’s most recent Annual Report because it commenced investment operations after December 31, 2017, but will be included in the Trust’s next Annual Report to shareholders following such date.

TABLE OF CONTENTS (to be updated)


FUND HISTORY			3

INVESTMENT OBJECTIVES, POLICIES AND RISKS			3

BOARD OF TRUSTEES			35

PORTFOLIO HOLDINGS DISCLOSURE POLICIES AND PROCEDURES			42

THE ADVISOR AND THE SUB-ADVISORS			43

ADDITIONAL PORTFOLIO MANAGER INFORMATION			45

PROXY VOTING POLICIES AND PROCEDURES			62

ADMINISTRATOR			64

PORTFOLIO TRANSACTIONS AND BROKERAGE			65

PORTFOLIO TURNOVER			67

NET ASSET VALUE			67

TAXATION			69

DIVIDENDS AND DISTRIBUTIONS			72

ANTI-MONEY LAUNDERING PROGRAM			72

GENERAL INFORMATION			73

FINANCIAL STATEMENTS			74

APPENDIX			75

FUND HISTORY

The Trust was organized as a Delaware statutory trust on August 1, 1996 and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The Trust consists of five separate series: the Litman Gregory Masters Equity Fund, the Litman Gregory Masters International Fund, the Litman Gregory Masters Smaller Companies Fund, the Litman Gregory Masters Alternative Strategies Fund, and the Litman Gregory Masters High Income Alternatives Fund (the “High Income Alternatives Fund”). This SAI relates only to the High Income Alternatives Fund and not to the other series of the Trust (collectively, the “Funds”).

The High Income Alternatives Fund is anticipated to commence operations on September 28, 2018. Both the Institutional Class and the Investor Class are anticipated to commence operations on that date.

INVESTMENT OBJECTIVES, POLICIES AND RISKS

The investment objective of the High Income Alternatives Fund is fundamental and therefore may be changed only with the favorable vote of the holders of a majority of the outstanding voting securities (as defined in the 1940 Act) of the Fund. The Fund’s investment objective is set forth in the Fund’s prospectus. There is no assurance that the Fund will achieve its investment objective. The discussion below supplements information contained in the prospectus as to the investment policies of the Fund.

Investment policies or descriptions that are described as percentages of “the Fund’s net assets” are measured as percentages of the Fund’s net assets plus borrowings for investment purposes.

Cash Position

When the Fund’s Sub-Advisor believes that market conditions are unfavorable for profitable investing, or when the Sub-Advisor is otherwise unable to locate attractive investment opportunities, the Fund’s cash or similar investments may increase. In other words, the Fund does not always stay fully invested in stocks and bonds. Cash or similar investments generally are a residual - they represent the assets that remain after a portfolio manager has committed available assets to desirable investment opportunities. However, the Advisor or the Fund’s Sub-Advisor may also temporarily increase the Fund’s cash position to protect its assets or maintain liquidity. Partly because the Sub-Advisors act independently of each other, the cash position of the Fund may vary significantly.

When the Fund’s investments in cash or similar investments increase, it may not participate in market advances or declines to the same extent that it would if the Fund remained more fully invested in stocks or bonds.

Equity Securities

The Fund may invest in equity securities consistent with its investment objective and strategies. Common stocks, preferred stocks and convertible securities are examples of equity securities.

All investments in equity securities are subject to market risks that may cause their prices to fluctuate over time. Historically, the equity markets have moved in cycles and the value of the securities in the Fund’s portfolio may fluctuate substantially from day to day. Owning an equity security can also subject the Fund to the risk that the issuer may discontinue paying dividends.

To the extent the Fund invests in the equity securities of small- or medium-size companies, it will be exposed to the risks of small- and medium-size companies. Such companies often have limited product lines or services, have narrower markets for their goods and/or services, and more limited managerial and financial resources than larger, more established companies. In addition, because these companies are not well-known to the investing public, they may not have significant institutional ownership and may be followed by relatively few security

analysts, and there will normally be less publicly available information when compared to larger companies. Adverse publicity and investor perceptions, whether or not based on fundamental analysis, can decrease the price and liquidity of securities held by the Fund. As a result, as compared to larger-sized companies, the performance of smaller-sized companies can be more volatile and they face greater risk of business failure, which could increase the volatility of the Fund’s portfolio.

Common Stock. A common stock represents a proportionate share of the ownership of a company and its value is based on the success of the company’s business, the cash a company generates, and the value of a company’s assets. However, over short periods of time, the price of any company, whether successful or not, may increase or decrease in price by a meaningful percentage. In addition to the general risks set forth above, investments in common stocks are subject to the risk that in the event a company in which the Fund invests is liquidated, the holders of preferred stock and creditors of that company will be paid in full before any payments are made to the Fund as a holder of that company’s common stock. It is possible that all assets of that company will be exhausted before any payments are made to the Fund.

Preferred Stock. Preferred stocks are equity securities that often pay dividends at a specific rate and have a preference over common stocks in dividend payments and liquidation of assets. A preferred stock has a blend of the characteristics of a bond and common stock. It can offer the higher yield of a bond and has priority over common stock in equity ownership, but does not have the seniority of a bond and, unlike common stock, its participation in the issuer’s growth may be limited. Although the dividend is set at a fixed annual rate, in some circumstances it can be changed or omitted by the issuer.

Convertible Securities and Warrants

The Fund may invest in convertible securities and warrants. A convertible security is a fixed-income security (a debt instrument or a preferred stock) which may be converted at a stated price within a specified period of time into a certain quantity of the common stock of the same or a different issuer. Convertible securities are senior to common stock in an issuer’s capital structure, but are usually subordinated to similar non-convertible securities. While providing a fixed-income stream (generally higher in yield than the income derivable from common stock but lower than that afforded by a similar non-convertible security), a convertible security also affords an investor the opportunity, through its conversion feature, to participate in the capital appreciation upon a market price advance in the convertible security’s underlying common stock.

A warrant gives the holder the right to purchase at any time during a specified period a predetermined number of shares of common stock at a fixed price. Unlike convertible debt securities or preferred stock, warrants do not pay a fixed dividend. Investments in warrants involve certain risks, including the possible lack of a liquid market for resale of the warrants, potential price fluctuations as a result of speculation or other factors, and failure of the price of the underlying security to reach or have reasonable prospects of reaching a level at which the warrant can be prudently exercised (in which event the warrant may expire without being exercised, resulting in a loss of the Fund’s entire investment therein).

Other Corporate Debt Securities

The Fund may invest in non-convertible debt securities of foreign and domestic companies over a cross-section of industries. The debt securities in which the Fund may invest will be of varying maturities and may include corporate bonds, debentures, notes and other similar corporate debt instruments. The value of a longer-term debt security fluctuates more widely in response to changes in interest rates than do shorter-term debt securities.

Risks of Investing in Debt Securities

There are a number of risks generally associated with an investment in debt securities (including convertible securities). Yields on short-, intermediate-, and long-term securities depend on a variety of factors, including the general condition of the money and bond markets, the size of a particular offering, the maturity of the obligation, and the rating of the issue.

Debt securities with longer maturities tend to produce higher yields and are generally subject to potentially greater capital appreciation and depreciation than obligations with short maturities and lower yields. The market prices of debt securities usually vary, depending upon available yields. An increase in interest rates will generally reduce the value of such portfolio investments, and a decline in interest rates will generally increase the value of such portfolio investments. The ability of the Fund to achieve its investment objective also depends on the continuing ability of the issuers of the debt securities in which the Fund invests to meet their obligations for the payment of interest and principal when due.

Risks of Investing in Lower-Rated Debt Securities

The Fund may invest a portion of its net assets in debt securities rated below “Ba1” by Moody’s, below “BB+” by Standard & Poor’s (“S&P”) or below investment grade by other recognized rating agencies, or in unrated securities of comparable quality under certain circumstances. Securities with ratings below “Baa” by Moody’s and/or “BBB” by S&P are commonly referred to as “junk bonds.” Such bonds are subject to greater market fluctuations and risk of loss of income and principal than higher rated bonds for a variety of reasons, including the following:

Sensitivity to Interest Rate and Economic Changes. The economy and interest rates affect high yield securities differently from other securities. For example, the prices of high yield bonds have been found to be less sensitive to interest rate changes than higher-rated investments, but more sensitive to adverse economic changes or individual corporate developments. Also, during an economic downturn or substantial period of rising interest rates, highly leveraged issuers may experience financial stress which would adversely affect their ability to service their principal and interest obligations, to meet projected business goals, and to obtain additional financing. If the issuer of a bond defaults, the Fund may incur additional expenses to seek recovery. In addition, periods of economic uncertainty and changes can be expected to result in increased volatility of market prices of high yield bonds and the Fund’s asset values.

Payment Expectations. High yield bonds present certain risks based on payment expectations. For example, high yield bonds may contain redemption and call provisions. If an issuer exercises these provisions in a declining interest rate market, the Fund would have to replace the security with a lower yielding security, resulting in a decreased return for investors. Conversely, a high yield bond’s value will decrease in a rising interest rate market, as will the value of the Fund’s assets. If the Fund experiences unexpected net redemptions, it may be forced to sell its high yield bonds without regard to their investment merits, thereby decreasing the asset base upon which the Fund’s expenses can be spread and possibly reducing the Fund’s rate of return.

Liquidity and Valuation. To the extent that there is no established retail secondary market, there may be thin trading of high yield bonds, and this may impact a Sub-Advisor’s ability to accurately value high yield bonds and the Fund’s assets and hinder the Fund’s ability to dispose of the bonds. Adverse publicity and investor perceptions, whether or not based on fundamental analysis, may decrease the values and liquidity of high yield bonds, especially in a thinly traded market.

Credit Ratings. Credit ratings evaluate the safety of principal and interest payments, not the market value risk of high yield bonds. Also, since credit rating agencies may fail to timely change the credit ratings to reflect subsequent events, a Sub-Advisor must monitor the issuers of high yield bonds in the Fund’s portfolio to determine if the issuers will have sufficient cash flow and profits to meet required principal and interest payments, and to assure the bonds’ liquidity so the Fund can meet redemption requests. The Fund will not necessarily dispose of a portfolio security when its rating has been changed.

Exchange-Traded Notes

The Fund may invest in exchange-traded notes (“ETNs”). ETNs are senior, unsecured, unsubordinated debt securities whose returns are linked to the performance of a particular market benchmark or strategy minus applicable fees. ETNs are traded on an exchange (e.g., the New York Stock Exchange (“NYSE”)) during normal trading hours. However, investors can also hold the ETN until maturity. At maturity, the issuer pays to the investor a cash amount equal to the principal amount, subject to the day’s market benchmark or strategy factor.

ETNs do not make periodic coupon payments or provide principal protection. ETNs are subject to credit risk and the value of the ETN may drop due to a downgrade in the issuer’s credit rating, despite the underlying market benchmark or strategy remaining unchanged. The value of an ETN may also be influenced by time to maturity, level of supply and demand for the ETN, volatility and lack of liquidity in underlying assets, changes in the applicable interest rates, changes in the issuer’s credit rating, and economic, legal, political, or geographic events that affect the referenced underlying asset. When the Fund invests in ETNs, it will bear its proportionate share of any fees and expenses borne by the ETN. The Fund’s decision to sell its ETN holdings may be limited by the availability of a secondary market. In addition, although an ETN may be listed on an exchange, the issuer may not be required to maintain the listing and there can be no assurance that a secondary market will exist for an ETN.

ETNs are also subject to tax risk. The tax treatment of ETNs is unclear. No statutory, juridical or administrative authority directly discusses how ETNs should be treated in this context for U.S. federal income tax purposes. No assurance can be given that the Internal Revenue Service (the “IRS”) will accept, or a court will uphold, how the Fund characterizes and treats ETNs for tax purposes. Further, the IRS and Congress are considering proposals that would change the timing and character of income and gains from ETNs.

An ETN that is tied to a specific market benchmark or strategy may not be able to replicate and maintain exactly the composition and relative weighting of securities, commodities or other components in the applicable market benchmark or strategy. 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. Leveraged ETNs are subject to the same risk as other instruments that use leverage in any form.

The market value of ETN shares may differ from their market benchmark or strategy. 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 securities, commodities or other components underlying the market benchmark or strategy that the ETN seeks to track. As a result, there may be times when an ETN share trades at a premium or discount to its market benchmark or strategy.

Participation Notes

The Fund may invest in participation notes (“P-Notes”). Some countries, especially emerging markets countries, do not permit foreigners to participate directly in their securities markets or otherwise present difficulties

for efficient foreign investment. The Fund may use P-Notes to establish a position in such markets as a substitute for direct investment. The Fund may also invest in P-Notes, as an alternative to investing directly in the underlying security, if Litman Gregory determines that P-Notes offer greater liquidity than the underlying security. P-Notes are issued by banks or broker-dealers and are designed to track the return of a particular underlying equity or debt security, currency, or market. When the P-Note matures, the issuer of the P-Note will pay to, or receive from, the Fund the difference between the nominal value of the underlying instrument at the time of purchase and that instrument’s value at maturity. Investments in P-Notes involve the same risks associated with a direct investment in the underlying security, currency, or market that they seek to replicate, including, as applicable, foreign, emerging, and frontier risks. In addition, P-Notes are generally traded over-the-counter and are subject to counterparty risk. Counterparty risk is the risk that the issuer of the P-Note will not fulfill its contractual obligation to complete the transaction with Fund. P-Notes constitute general unsecured contractual obligations of the banks or broker-dealers that issue them, and the Fund would be relying on the creditworthiness of such banks or broker-dealers and would have no rights under a P-Note against the issuer of the underlying assets. In addition, P-Notes may trade at a discount to the value of the underlying securities or markets that they seek to replicate.

Short-Term Investments

The Fund may invest in any of the following short-term securities and instruments:

Bank Certificates or Deposits, Bankers’ Acceptances and Time Deposits. The Fund may acquire certificates of deposit, bankers’ acceptances and time deposits. Certificates of deposit are negotiable certificates issued against funds deposited in a commercial bank for a definite period of time and earning a specified return. Bankers’ acceptances are negotiable drafts or bills of exchange, normally drawn by an importer or exporter to pay for specific merchandise, which are “accepted” by a bank, meaning in effect that the bank unconditionally agrees to pay the face value of the instrument on maturity. Certificates of deposit and bankers’ acceptances acquired by the Fund will be dollar-denominated obligations of domestic or foreign banks or financial institutions which at the time of purchase have capital, surplus and undivided profits in excess of $100 million (including assets of both domestic and foreign branches), based on latest published reports, or less than $100 million if the principal amount of such bank obligations are fully insured by the U.S. Government. If the Fund holds instruments of foreign banks or financial institutions, it may be subject to additional investment risks that are different in some respects from those incurred by a fund that invests only in debt obligations of U.S. domestic issuers. See “Foreign Investments” below. Such risks include those related to future political and economic developments, the possible imposition of withholding taxes by the particular country in which the issuer is located on interest income payable on the securities, the possible seizure or nationalization of foreign deposits, the possible establishment of exchange controls and the possible adoption of other foreign governmental restrictions that might adversely affect the payment of principal and interest on these securities.

Domestic banks and foreign banks are subject to different governmental regulations with respect to the amount and types of loans that may be made and interest rates that may be charged. In addition, the profitability of the banking industry depends largely upon the availability and cost of funds for the purpose of financing lending operations under prevailing money market conditions. General economic conditions as well as exposure to credit losses arising from possible financial difficulties of borrowers play an important part in the operations of the banking industry.

As a result of federal and state laws and regulations, domestic banks are, among other things, required to maintain specified levels of reserves, limited in the amount they can loan to a single borrower, and subject to other regulations designed to promote financial soundness. However, such laws and regulations do not necessarily apply to foreign bank obligations that the Fund may acquire.

In addition to purchasing certificates of deposit and bankers’ acceptances, to the extent permitted under its investment objectives and policies stated above and in its prospectus, the Fund may make interest-bearing time or other interest-bearing deposits in commercial or savings banks. Time deposits are non-negotiable deposits maintained at a banking institution for a specified period of time at a specified interest rate.

Savings Association Obligations. The Fund may invest in certificates of deposit (interest-bearing time deposits) issued by savings banks or savings and loan associations that have capital, surplus and undivided profits in excess of $100 million, based on latest published reports, or less than $100 million if the principal amount of such obligations is fully insured by the U.S. Government.

Commercial Paper, Short-Term Notes and Other Corporate Obligations. The Fund may invest a portion of its assets in commercial paper and short-term notes. Commercial paper consists of unsecured promissory notes issued by corporations. Issues of commercial paper and short-term notes will normally have maturities of less than nine months and fixed rates of return, although such instruments may have maturities of up to one year.

Commercial paper and short-term notes in which the Fund may invest will consist of issues rated at the time of purchase “AA-2” or higher by S&P, “Prime-1” or “Prime-2” by Moody’s, or similarly rated by another nationally recognized statistical rating organization or, if unrated, will be determined by a Sub-Advisor to be of comparable quality. These rating symbols are described in Appendix A.

Corporate obligations include bonds and notes issued by corporations to finance longer-term credit needs than supported by commercial paper. While such obligations generally have maturities of ten years or more, the Fund may purchase corporate obligations that have remaining maturities of one year or less from the date of purchase and that are rated “AA” or higher by S&P or “Aa” or higher by Moody’s.

Loan Participations and Assignments (Bank Debt)

The Fund may invest in bank debt, which includes interests in loans to companies or their affiliates undertaken to finance a capital restructuring or in connection with recapitalizations, acquisitions, leveraged buyouts, refinancings or other financially leveraged transactions and may include loans which are designed to provide temporary or bridge financing to a borrower pending the sale of identified assets, the arrangement of longer-term loans or the issuance and sale of debt obligations. These loans, which may bear fixed or floating rates, have generally been arranged through private negotiations between a corporate borrower and one or more financial institutions (“Lenders”), including banks. The Fund’s investment may be in the form of participations in loans (“Participations”) or of assignments of all or a portion of loans from third parties (“Assignments”).

The Fund has the right to receive payments of principal, interest and any fees to which it is entitled only from the Lender selling a Participation and only upon receipt by the Lender of the payments from the borrower. In connection with purchasing Participations, the Fund generally will have no right to enforce compliance by the borrower with the terms of the loan agreement relating to the loan, nor any rights of set-off against the borrower, and the Fund may not benefit directly from any collateral supporting the loan in which it has purchased the Participation. Thus, the Fund assumes the credit risk of both the borrower and the Lender that is selling the Participation. In addition, in connection with purchasing Participations, the Fund generally will have no role in terms of negotiating or effecting amendments, waivers and consents with respect to the loans underlying the Participations. In the event of the insolvency of the Lender, the Fund may be treated as a general creditor of the Lender and may not benefit from any set-off between the Lender and the borrower.

In certain cases, the rights and obligations acquired by the Fund through the purchase of an Assignment may differ from, and be more limited than, those held by the assigning selling institution. Assignments are sold strictly without recourse to the selling institutions, and the selling institutions will generally make no representations or warranties to the Fund about the underlying loan, the borrowers, the documentation of the loans or any collateral securing the loans.

Investments in Participations and Assignments involve additional risks, including the risk of nonpayment of principal and interest by the borrower, the risk that any loan collateral may become impaired and that the Fund may obtain less than the full value for the loan interests sold because they may be illiquid. Purchasers of loans depend primarily upon the creditworthiness of the borrower for payment of interest and repayment of principal. If scheduled interest or principal payments are not made, the value of the instrument may be adversely affected.

Investments in loans through direct assignment of a financial institution’s interests with respect to a loan may involve additional risks. For example, if a loan is foreclosed, the Fund could become part owner of any collateral, and would bear the costs and liabilities associated with owning and disposing of the collateral.

A loan is often administered by a bank or other financial institution that acts as agent for all holders. The agent administers the terms of the loan, as specified in the loan agreement. Unless, under the terms of the loan or other indebtedness, the Fund has direct recourse against the borrower, the Fund may have to rely on the agent to apply appropriate credit remedies against a borrower. If assets held by the agent for the benefit of the Fund were determined to be subject to the claims of the agent’s general creditors, the Fund might incur certain costs and delays in realizing payment on the loan or loan participation and could suffer a loss of principal or interest.

Interests in loans are also subject to additional liquidity risks. Loans are generally subject to legal or contractual restrictions on resale. Loans are not currently listed on any securities exchange or automatic quotation system, but are traded by banks and other institutional investors engaged in loan syndication. As a result, no active market may exist for some loans, and to the extent a secondary market exists for other loans, such market may be subject to irregular trading activity, wide bid/ask spreads and extended trade settlement periods. Consequently, the Fund may have difficulty disposing of Assignments or Participations in response to a specific economic event such as deterioration in the creditworthiness of the borrower, which can result in a loss. In such market situations, it may be more difficult for the Fund to assign a value to Assignments or Participations when valuing the Fund’s securities and calculating its net asset value (“NAV”).

The Fund limits the amount of its assets that it will invest in any one issuer or in issuers within the same industry (see “Investment Restrictions” below). For purposes of these limits, the Fund will generally treat the corporate borrower as the “issuer” of indebtedness held by the Fund. In the case of Participations where a bank or other lending institution serves as a financial intermediary between the Fund and the corporate borrower, if the Participation does not shift to the Fund the direct debtor-creditor relationship with the corporate borrower, U.S. Securities and Exchange Commission (the “SEC”) interpretations require the Fund, in appropriate circumstances, to treat both the lending bank or other lending institution and the corporate borrower as “issuers” for the purpose of determining whether the Fund has invested more than 5% of its total assets in a single issuer. Treating a financial intermediary as an issuer of indebtedness may restrict the Fund’s ability to invest in indebtedness related to a single financial intermediary, or a group of intermediaries engaged in the same industry, even if the underlying borrowers represent many different companies and industries.

Money Market Funds

The Fund may under certain circumstances invest a portion of its assets in money market funds. The 1940 Act generally prohibits the Fund from investing more than 5% of the value of its total assets in any one investment company or more than 10% of the value of its total assets in investment companies as a group, and also restricts its investment in any investment company to 3% of the voting securities of such investment company. There are some exceptions, however, to these limitations pursuant to various rules promulgated by the SEC. For example, Section 12(d)(1)(F) of the 1940 Act provides that the limitations set forth above do not apply to securities purchased or otherwise acquired by the Fund if immediately after such purchase or acquisition not more than 3% of the total outstanding stock of such investment company is owned by the Fund and all affiliated persons of the Fund. The Fund must comply with certain other administrative requirements in order to comply this exception, including, among others, that the Fund (or the Advisor or Sub-Advisor acting on behalf of the Fund) complies with certain voting restrictions when voting the shares of such investment company.

The Advisor and the Sub-Advisors will not impose advisory fees on assets of the Fund invested in a money market mutual fund. However, an investment in a money market mutual fund will involve payment by the Fund of its pro rata share of advisory and administrative fees charged by such fund.

Municipal Securities

The Fund may invest in municipal securities. Municipal securities are issued by the states, territories and possessions of the United States, their political subdivisions (such as cities, counties and towns) and various authorities (such as public housing or redevelopment authorities), instrumentalities, public corporations and special districts (such as water, sewer or sanitary districts) of the states, territories, and possessions of the United States or their political subdivisions. In addition, municipal securities include securities issued by or on behalf of public authorities to finance various privately operated facilities, such as industrial development bonds, that are backed only by the assets and revenues of the non-governmental user (such as hospitals and airports).

Municipal securities are issued to obtain funds for a variety of public purposes, including general financing for state and local governments, or financing for specific projects or public facilities. Municipal securities are classified as general obligation or revenue bonds or notes. General obligation securities are secured by the issuer’s pledge of its full faith, credit and taxing power for the payment of principal and interest. Revenue securities are payable from revenue derived from a particular facility, class of facilities, or the proceeds of a special excise tax or other specific revenue source, but not from the issuer’s general taxing power. The Fund will not invest more than 25% of its total assets in a single type of revenue bond. Private activity bonds and industrial revenue bonds do not carry the pledge of the credit of the issuing municipality, but generally are guaranteed by the corporate entity on whose behalf they are issued.

Shareholders of the Fund should be aware that certain deductions and exemptions may be designated “tax preference items,” which must be added back to taxable income for purposes of calculating a shareholder’s federal alternative minimum tax (“AMT”), if applicable to such shareholder. Tax preference items may include tax-exempt interest on private activity bonds. To the extent that the Alternative Strategies Fund invests in private activity bonds, its shareholders may be required to report that portion of the Fund’s distributions attributable to income from the bonds as a tax preference item in determining their federal AMT, if any. Shareholders are encouraged to consult their tax advisors in this regard.

Municipal leases are entered into by state and local governments and authorities to acquire equipment and facilities such as fire and sanitation vehicles, telecommunications equipment, and other assets. Municipal leases (which normally provide for title to the leased assets to pass eventually to the government issuer) have evolved as a means for governmental issuers to acquire property and equipment without meeting the constitutional and statutory requirements for the issuance of debt. The debt-issuance limitations of many state constitutions and statutes are deemed to be inapplicable because of the inclusion in many leases or contracts of “non-appropriation” clauses that provide that the governmental issuer has no obligation to make future payments under the lease or contract unless money is appropriated for such purpose by the appropriate legislative body on a yearly or other periodic basis.

Government Obligations

The Fund may make short-term investments in U.S. Government obligations. Such obligations include Treasury bills, certificates of indebtedness, notes and bonds, and issues of such entities as the Government National Mortgage Association (“GNMA”), Export-Import Bank of the United States, Tennessee Valley Authority, Resolution Funding Corporation, Farmers Home Administration, Federal Home Loan Banks, Federal Intermediate Credit Banks, Federal Farm Credit Banks, Federal Land Banks, Federal Housing Administration, Federal National Mortgage Association (“FNMA”), Federal Home Loan Mortgage Corporation (“FHLMC”), and the Student Loan Marketing Association (“SLMA”).

Some of these obligations, such as those of the GNMA, are supported by the full faith and credit of the U.S. Treasury; others, such as those of the Export-Import Bank of United States, are supported by the right of the issuer to borrow from the Treasury; others, such as those of the FNMA, are supported by the discretionary authority of the U.S. Government to purchase the agency’s obligations; still others, such as those of the SLMA, are supported only by the credit of the instrumentality. No assurance can be given that the U.S. Government would provide financial support to U.S. Government-sponsored instrumentalities if it is not obligated to do so by law.

The Fund may invest in sovereign debt obligations of foreign countries. A sovereign debtor’s willingness or ability to repay principal and interest in a timely manner may be affected by a number of factors, including its cash flow situation, the extent of its foreign reserves, the availability of sufficient foreign exchange on the date a payment is due, the relative size of the debt service burden to the economy as a whole, the sovereign debtor’s policy toward principal international lenders and the political constraints to which it may be subject. Emerging market governments could default on their sovereign debt. Such sovereign debtors also may be dependent on expected disbursements from foreign governments, multilateral agencies and other entities abroad to reduce principal and interest arrearages on their debt. The commitments on the part of these governments, agencies and others to make such disbursements may be conditioned on a sovereign debtor’s implementation of economic reforms and/or economic performance and the timely service of such debtor’s obligations. Failure to meet such conditions could result in the cancellation of such third parties’ commitments to lend funds to the sovereign debtor, which may further impair such debtor’s ability or willingness to service its debt in a timely manner.

Zero Coupon Securities

The Fund may invest up to 35% of its net assets in zero coupon securities issued by the U.S. Treasury. Zero coupon Treasury securities are U.S. Treasury notes and bonds that have been stripped of their unmatured interest coupons and receipts, or certificates representing interests in such stripped debt obligations or coupons. Because a zero coupon security pays no interest to its holder during its life or for a substantial period of time, it usually trades at a deep discount from its face or par value and will be subject to greater fluctuations of market value in response to changing interest rates than debt obligations of comparable maturities that make current distributions of interest.

Variable and Floating Rate Instruments

The Fund may acquire variable and floating rate instruments. Such instruments are frequently not rated by credit rating agencies; however, unrated variable and floating rate instruments purchased by the Fund will be determined by a Sub-Advisor under guidelines established by the Board to be of comparable quality at the time of the purchase to rated instruments eligible for purchase by the Fund. In making such determinations, a Sub-Advisor will consider the earning power, cash flow and other liquidity ratios of the issuers of such instruments (such issuers include financial, merchandising, bank holding and other companies) and will monitor their financial condition. An active secondary market may not exist with respect to particular variable or floating rate instruments purchased by the Fund. The absence of such an active secondary market could make it difficult for the Fund to dispose of the variable or floating rate instrument involved in the event that the issuer of the instrument defaults on its payment obligation or during periods in which the Fund is not entitled to exercise its demand rights, and the Fund could, for these or other reasons, suffer a loss to the extent of the default. Variable and floating rate instruments may be secured by bank letters of credit.

Asset-Backed Securities

The Fund may invest in asset-backed securities. Asset-backed securities are securities issued by trusts and special purpose entities that are backed by pools of assets, such as automobile and credit-card receivables and home equity loans, which pass through the payments on the underlying obligations to the security holders (less servicing fees paid to the originator or fees for any credit enhancement). Typically, the originator of the loan or accounts receivable paper transfers it to a specially created trust, which repackages it as securities with a minimum denomination and a specific term. The securities are then privately placed or publicly offered. For example, the Fund may invest in collateralized debt obligations (“CDOs”), which include collateralized bond obligations (“CBOs”), collateralized loan obligations (“CLOs”), and other similarly structured entities. CBOs and CLOs are types of asset-backed securities. A CBO is a trust, which is backed by a diversified pool of high-risk, below investment grade fixed-income securities. A CLO is a trust typically collateralized by a pool of loans, which may include, among others, domestic and foreign senior secured loans, senior unsecured loans, and subordinate corporate loans, including loans that may be rated below investment grade or equivalent unrated loans.

The value of an asset-backed security is affected by, among other things, changes in the market’s perception of the asset backing the security, the creditworthiness of the servicing agent for the loan pool, the originator of the loans and the financial institution providing any credit enhancement. Payments of principal and interest passed through to holders of asset-backed securities are frequently supported by some form of credit enhancement, such as a letter of credit, surety bond, limited guarantee by another entity or by having a priority to certain of the borrower’s other assets. The degree of credit enhancement varies, and generally applies to only a portion of the asset-backed security’s par value. Value is also affected if any credit enhancement has been exhausted.

Mortgage-Related Securities

The Fund may invest in mortgage-related securities. Mortgage-related securities are derivative interests in pools of mortgage loans made to U.S. residential home buyers, including mortgage loans made by savings and loan institutions, mortgage bankers, commercial banks and others. Pools of mortgage loans are assembled as securities for sale to investors by various governmental, government-related and private organizations. The Fund may also invest in debt securities which are secured with collateral consisting of U.S. mortgage-related securities, and in other types of U.S. mortgage-related securities.

The effects of the sub-prime mortgage crisis that began to unfold in 2007 continue to manifest in nearly all sub-divisions of the financial services industry. Sub-prime mortgage-related losses and write downs among investment banks and similar institutions reached significant levels in 2008. The impact of these losses among traditional banks, investment banks, broker-dealers and insurers has forced a number of such institutions into either liquidation or combination, while also drastically increasing the volatility of their stock prices. In some cases, the U.S. government has acted to bail out select institutions, such as insurers; however the risks associated with investment in stocks of such insurers has nonetheless increased substantially.

While the U.S. Department of the Treasury, Federal Reserve Board and Congress have taken steps to address problems in the financial markets and with financial institutions, there can be no assurance that the risks associated with investments in financial services company issuers will decrease as a result of these steps.

U.S. Mortgage Pass-Through Securities. Interests in pools of mortgage-related securities differ from other forms of debt securities, which normally provide for periodic payment of interest in fixed amounts with

principal payments at maturity or specified call dates. Instead, these securities provide a monthly payment that consists of both interest and principal payments. In effect, these payments are a “pass-through” of the monthly payments made by the individual borrowers on their residential mortgage loans, net of any fees paid to the issuer or guarantor of such securities. Additional payments are caused by repayments of principal resulting from the sale of the underlying residential property, refinancing or foreclosure, net of fees or costs which may be incurred. Some mortgage-related securities (such as securities issued by GNMA) are described as “modified pass-throughs.” These securities entitle the holder to receive all interest and principal payments owed on the mortgage pool, net of certain fees, at the scheduled payment dates regardless of whether or not the mortgagor actually makes the payment.

The principal governmental guarantor of U.S. mortgage-related securities is GNMA, a wholly-owned United States Government corporation within the Department of Housing and Urban Development. GNMA is authorized to guarantee, with the full faith and credit of the United States Government, the timely payment of principal and interest on securities issued by institutions approved by GNMA (such as savings and loan institutions, commercial banks and mortgage bankers) and backed by pools of mortgages insured by the Federal Housing Agency or guaranteed by the Veterans Administration.

Government-related guarantors include FNMA and FHLMC. FNMA is a government-sponsored corporation owned entirely by private stockholders and subject to general regulation by the Secretary of Housing and Urban Development. FNMA purchases conventional residential mortgages not insured or guaranteed by any government agency from a list of approved seller/services which include state and federally chartered savings and loan associations, mutual savings banks, commercial banks and credit unions and mortgage bankers. FHLMC is a government-sponsored corporation created to increase availability of mortgage credit for residential housing and owned entirely by private stockholders. FHLMC issues participation certificates which represent interests in conventional mortgages from FHLMC’s national portfolio. Pass-through securities issued by FNMA and participation certificates issued by FHLMC are guaranteed as to timely payment of principal and interest by FNMA and FHLMC, respectively, but are not backed by the full faith and credit of the United States Government.

Although the underlying mortgage loans in a pool may have maturities of up to 30 years, the actual average life of the pool certificates typically will be substantially less because the mortgages will be subject to normal principal amortization and may be prepaid prior to maturity. Prepayment rates vary widely and may be affected by changes in market interest rates. In periods of falling interest rates, the rate of prepayment tends to increase, thereby shortening the actual average life of the pool certificates. Conversely, when interest rates are rising, the rate of prepayments tends to decrease, thereby lengthening the actual average life of the certificates. Accordingly, it is not possible to predict accurately the average life of a particular pool.

Collateralized Mortgage Obligations (“CMOs”). A domestic or foreign CMO in which the Fund may invest is a hybrid between a mortgage-backed bond and a mortgage pass-through security. Like a bond, interest is paid, in most cases, semiannually. CMOs may be collateralized by whole mortgage loans, but are more typically collateralized by portfolios of mortgage pass-through securities guaranteed by GNMA, FHLMC, FNMA or equivalent foreign entities.

CMOs are structured into multiple classes, each bearing a different stated maturity. Actual maturity and average life depend upon the prepayment experience of the collateral. CMOs provide for a modified form of call protection through a de facto breakdown of the underlying pool of mortgages according to how quickly the loans are repaid. Monthly payment of principal and interest received from the pool of underlying mortgages, including prepayments, is first returned to the class having the earliest maturity date or highest maturity. Classes that have longer maturity dates and lower seniority will receive principal only after the higher class has been retired.

Real Estate Investment Trusts

The Fund may invest in real estate investment trusts (“REITs”). REITs are pooled investment vehicles that invest primarily in either real estate or real estate-related loans. REITs involve certain unique risks in addition to those risks associated with investing in the real estate industry in general (such as possible declines in the value of

real estate, lack of availability of mortgage funds, or extended vacancies of property). Equity REITs may be affected by changes in the value of the underlying property owned by the REITs, while mortgage REITs may be affected by the quality of any credit extended and changes in interest rates. REITs whose underlying assets are concentrated in properties used by a particular industry, such as health care, are also subject to risks associated with such industry. REITs are dependent upon management skills, are not diversified, and are subject to heavy cash flow dependency, risks of default by borrowers, and self-liquidation. REITs are also subject to the possibilities of failing to qualify for preferential tax treatment under the Internal Revenue Code of 1986, as amended (the “Code”), and failing to maintain their exemptions from registration under the 1940 Act.

REITs (especially mortgage REITs) are also subject to interest rate risks, including prepayment risk. When interest rates decline, the value of a REIT’s investment in fixed rate obligations can be expected to rise. Conversely, when interest rates rise, the value of a REIT’s investment in fixed rate obligations can be expected to decline. If the REIT invests in adjustable rate mortgage loans the interest rates on which are reset periodically, yields on a REIT’s investments in such loans will gradually align themselves to reflect changes in market interest rates. This causes the value of such investments to fluctuate less dramatically in response to interest rate fluctuations than would investments in fixed rate obligations. REITs may have limited financial resources, may trade less frequently and in a limited volume, and may be subject to more abrupt or erratic price movements than more widely held securities. The Fund’s investment in a REIT may require the Fund to accrue and distribute income not yet received or may result in the Fund making distributions that constitute a return of capital to the Fund’s shareholders for federal income tax purposes. In addition, distributions by the Fund from REITs will not qualify for the corporate dividends-received deduction, or, generally, for treatment as qualified dividend income.

Investments in REITs by the Fund may subject its shareholders to multiple levels of fees and expenses as the Fund’s shareholders will directly bear the fees and expenses of the Fund and will also indirectly bear a portion of the fees and expenses of the REITs in which the Fund invests.

Foreign Investments and Currencies

The Fund may invest in securities of foreign issuers that are not publicly traded in the United States. The Fund may also invest in depositary receipts and in foreign currency futures contracts and may purchase and sell foreign currency on a spot basis.

Depositary Receipts. Depositary Receipts (“DRs”) include American Depositary Receipts (“ADRs”), European Depositary Receipts (“EDRs”), Global Depositary Receipts (“GDRs”) or other forms of depositary receipts. DRs are receipts typically issued in connection with a U.S. or foreign bank or trust company which evidence ownership of underlying securities issued by a foreign corporation.

Forward Foreign Currency Exchange Contracts. The Fund may use forward foreign currency exchange contracts for hedging purposes as well as investment purposes. A forward foreign currency contract involves an obligation to purchase or sell a specific amount of currency at a future date or date range at a specific price. 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. Forward foreign currency exchange contracts differ from foreign currency futures contracts in certain respects. Unlike futures contracts, forward contracts:

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Do not have standard maturity dates or amounts (i.e., the parties to the contract may fix the maturity date and the amount).

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Are traded in the inter-bank markets conducted directly between currency traders (usually large commercial banks) and their customers, as opposed to futures contracts which are traded only on exchanges regulated by the Commodity Futures Trading Commission (“CFTC”).

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Do not require an initial margin deposit.

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May be closed by entering into a closing transaction with the currency trader who is a party to the original forward contract, as opposed to a commodities exchange.

Foreign Currency Hedging Strategies. A “settlement hedge” or “transaction hedge” is designed to protect the Fund against an adverse change in foreign currency values between the date a security is purchased or sold and the date on which payment is made or received. Entering into a forward contract for the purchase or sale of the amount of foreign currency involved in an underlying security transaction for a fixed amount of U.S. dollars “locks in” the U.S. dollar price of the security. The Fund may also use forward contracts to purchase or sell a foreign currency when it anticipates purchasing or selling securities denominated in foreign currency, even if it has not yet selected the specific investments.

The Fund may use forward contracts to hedge against a decline in the value of existing investments denominated in foreign currency. Such a hedge, sometimes referred to as a “position hedge,” would tend to offset both positive and negative currency fluctuations, but would not offset changes in security values caused by other factors. The Fund could also hedge the position by selling another currency expected to perform similarly to the currency in which the Fund’s investment is denominated. This type of hedge, sometimes referred to as a “proxy hedge,” could offer advantages in terms of cost, yield, or efficiency, but generally would not hedge currency exposure as effectively as a direct hedge into U.S. dollars. Proxy hedges may result in losses if the currency used to hedge does not perform similarly to the currency in which the hedged securities are denominated.

Transaction and position hedging do not eliminate 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 one can achieve at some future point in time. Additionally, these techniques tend to minimize the risk of loss due to a decline in the value of the hedged currency and to limit any potential gain that might result from the increase in value of such currency.

The Fund may enter into forward contracts to shift its investment exposure from one currency into another. Such transactions may call for the delivery of one foreign currency in exchange for another foreign currency, including currencies in which its securities are not then denominated. This may include shifting exposure from U.S. dollars to a foreign currency, or from one foreign currency to another foreign currency. This type of strategy, sometimes known as a “cross-hedge,” will tend to reduce or eliminate exposure to the currency that is sold, and increase exposure to the currency that is purchased. Cross-hedges protect against losses resulting from a decline in the hedged currency, but will cause the Fund to assume the risk of fluctuations in the value of the currency it purchases. Cross hedging transactions also involve the risk of imperfect correlation between changes in the values of the currencies involved.

It is difficult to forecast with precision the market value of portfolio securities at the expiration or maturity of a forward or futures contract. Accordingly, the Fund may have to purchase additional foreign currency on the spot market if the market value of a security it is hedging is less than the amount of foreign currency it is obligated to deliver. Conversely, the Fund may have to sell on the spot market some of the foreign currency it received upon the sale of a security if the market value of such security exceeds the amount of foreign currency it is obligated to deliver.

Risks of Investing in Foreign Securities. Investments in foreign securities involve certain inherent risks, including the following:

Political and Economic Factors. Individual foreign economies of certain countries may differ favorably or unfavorably from the United States’ economy in such respects as growth of gross national product, rate of inflation, capital reinvestment, resource self-sufficiency, diversification and balance of payments position. The internal politics of certain foreign countries may not be as stable as those of the United States. Governments in certain foreign countries also continue to participate to a significant degree, through ownership interest or regulation, in their respective economies. Action by these governments could include restrictions on foreign investment, nationalization, expropriation of goods or imposition of taxes, and could have a significant effect on market prices of securities and payment of interest. The economies of many foreign countries are heavily dependent upon

international trade and are accordingly affected by the trade policies and economic conditions of their trading partners. Enactment by these trading partners of protectionist trade legislation could have a significant adverse effect upon the securities markets of such countries.

The European financial markets have continued to experience volatility because of concerns about economic downturns and about high and rising government debt levels of several countries in the European Union and Europe generally. These events have adversely affected the exchange rate of the Euro and the European securities markets, and may spread to other countries in Europe, including countries that do not use the Euro. These events may affect the value and liquidity of certain of the Funds’ investments. Responses to the financial problems by European Union governments, central banks and others, including austerity measures and reforms, may not work, may result in social unrest and may limit future growth and economic recovery or have other unintended consequences. Further defaults or restructurings by governments and others of their debt could have additional adverse effects on economies, financial markets and asset valuations around the world.

In a public referendum in June 2016, the United Kingdom (“UK”) voted to leave the European Union (the “EU”), a process now commonly referred to as “Brexit”. On March 29, 2017, UK Prime Minister Theresa May delivered a letter invoking Article 50 of the Lisbon Treaty and notifying the European Council of the UK’s decision to withdraw from the EU. The letter triggered the two-year withdrawal negotiation process. It is anticipated that the UK will leave the EU on or before March 29, 2019. It is unclear how withdrawal negotiations will be conducted and what the potential consequences may be. In addition, it is possible that measures could be taken to revote on the issue of Brexit, or that portions of the UK could seek to separate and remain a part of the EU. As a result of the political divisions within the UK and between the UK and the EU that the referendum vote has highlighted and the uncertain consequences of a Brexit, the UK and European economies and the broader global economy could be significantly impacted, which may result in increased volatility and illiquidity, and potentially lower economic growth on markets in the UK, Europe and globally that could potentially have an adverse effect on the value of the Funds’ investments.

Currency Fluctuations. The Fund may invest in securities denominated in foreign currencies. Accordingly, a change in the value of any such currency against the U.S. dollar will result in a corresponding change in the U.S. dollar value of the Fund’s assets denominated in that currency. Such changes will also affect the Fund’s income. The value of the Fund’s assets may also be affected significantly by currency restrictions and exchange control regulations enacted from time to time.

Market Characteristics. The Sub-Advisors expect that many foreign securities in which the Fund invests will be purchased in over-the-counter markets or on exchanges located in the countries in which the principal offices of the issuers of the various securities are located, if that is the best available market. Foreign exchanges and markets may be more volatile than those in the United States. While growing in volume, they usually have substantially less volume than U.S. markets, and the Fund’s portfolio securities may be less liquid and more volatile than U.S. Government securities. Moreover, settlement practices for transactions in foreign markets may differ from those in United States markets, and may include delays beyond periods customary in the United States. Foreign security trading practices, including those involving securities settlement where Fund assets may be released prior to receipt of payment or securities, may expose the Fund to increased risk in the event of a failed trade or the insolvency of a foreign broker-dealer.

Transactions in options on securities, futures contracts, futures options and currency contracts may not be regulated as effectively on foreign exchanges as similar transactions in the United States, and may not involve clearing mechanisms and related guarantees. The value of such positions also could be adversely affected by the imposition of different exercise terms and procedures and margin requirements than in the United States. The value of the Fund’s positions may also be adversely impacted by delays in its ability to act upon economic events occurring in foreign markets during non-business hours in the United States.

Legal and Regulatory Matters. Certain foreign countries may have less supervision of securities markets, brokers and issuers of securities, and less financial information available to issuers, than is available in the United States.

Taxes. The interest payable on certain of the Fund’s foreign portfolio securities may be subject to foreign withholding or other taxes, thus reducing the net amount of income available for distribution to the Fund’s shareholders.

Costs. To the extent that the Fund invests in foreign securities, its expense ratio is likely to be higher than those of investment companies investing only in domestic securities, since the cost of maintaining the custody of foreign securities is higher.

Emerging markets. Some of the securities in which the Fund may invest may be located in developing or emerging markets, which entail additional risks, including less social, political and economic stability; smaller securities markets and lower trading volume, which may result in a less liquidity and greater price volatility; national policies that may restrict the Fund’s investment opportunities, including restrictions on investment in issuers or industries, or expropriation or confiscation of assets or property; and less developed legal structures governing private or foreign investment.

In considering whether to invest in the securities of a foreign company, a Sub-Advisor considers such factors as the characteristics of the particular company, differences between economic trends and the performance of securities markets within the U.S. and those within other countries, and also factors relating to the general economic, governmental and social conditions of the country or countries where the company is located. The extent to which the Fund will be invested in foreign companies and countries and depository receipts will fluctuate from time to time within the limitations described in the prospectus, depending on a Sub-Advisor’s assessment of prevailing market, economic and other conditions.

Master Limited Partnerships

The Fund may invest in or be exposed to master limited partnerships (“MLPs”), which are formed as limited partnerships or limited liability companies under state law and are treated as partnerships for U.S. federal income tax purposes. The equity securities issued by many MLPs (typically general partner and limited partner interests) are publicly traded and listed and traded on a U.S. securities exchange. Certain MLP securities may trade in lower volumes due to their smaller capitalizations. Accordingly, those MLPs may be subject to more abrupt or erratic price movements, may lack sufficient market liquidity to enable the Fund to effect sales at an advantageous time or without a substantial drop in price, and investment in those MLPs may restrict the Fund’s ability to take advantage of other investment opportunities. The amount of cash that the Fund has available to distribute to shareholders will depend on the ability of the companies in which the Fund has an interest to make distributions or pay dividends to their investors, as well as the tax character of those distributions or dividends.

MLPs are subject to various risks related to the underlying operating companies they control. For example, MLPs are subject to risks and may be adversely affected by a variety of events, including, but not limited to: fluctuations in the prices of commodities; the highly cyclical nature of the energy sector, which may adversely affect the earnings or operating cash flows of the issuers in which the Fund will invest; extreme weather conditions that could result in substantial damage to the facilities of certain MLPs; and significant volatility in the supply of natural resources, energy assets, commodity prices and the earnings of such companies, which could adversely affect their securities. A significant decrease in the production of energy commodities would reduce the revenue, operating income and operating cash flows of MLPs and, therefore, their ability to make distributions or pay dividends and a sustained decline in demand for energy commodities, which could adversely affect the revenues and cash flows of MLPs. MLPs also may be subject to construction risk, development risk, acquisition risk or other risks arising from their specific business strategies and risks associated with changing foreign, federal, state and local regulations. There is an inherent risk that MLPs may incur environmental costs and liabilities because of the nature of their

businesses and the substances they handle and the possibility exists that stricter laws, regulations or enforcement policies could significantly increase the compliance costs of MLPs, and the cost of any remediation that may become necessary, which MLPs may not be able to recover from insurance. An MLP may be dependent on its parent(s) or sponsor(s) for a majority of its revenues and any failure by the parent(s) or sponsor(s) to satisfy payments or obligations would impact the company’s revenues and cash flows and ability to make distributions. The terms of an MLP’s transactions with its parent or sponsor are typically not arrived at on an arm’s-length basis, and may not be as favorable to the MLP as a transaction with a non-affiliate.

As partnerships, MLPs may be subject to less regulation (and less protection for investors) under state laws than corporations. In an MLP, the general partner (which may be structured as a private or publicly-traded corporation or other entity) manages and often controls, has an ownership stake in, and is normally eligible to receive incentive distribution payments from, the MLP. The general partner typically controls the operations and management of the entity through an up to 2% general partner interest in the entity plus, in many cases, ownership of some percentage of the outstanding limited partner interests. The limited partners, through their ownership of limited partner interests, provide capital to the entity, are intended to have no role in the operation and management of the entity and receive cash distributions.

Moreover, because the partnership units or limited liability interests of MLPs are listed and traded on a U.S. securities exchange, MLPs need to be operate in such a manner so as to be treated as partnerships for U.S. tax purposes. To be treated as a partnership for U.S. federal income tax purposes, an MLP must derive at least 90% of its gross income for each taxable year from certain qualifying sources as described in Section 7704(d) of Code, including energy infrastructure assets and natural resources-based activities such as the exploration, development, mining, production, processing, refining, transportation, storage and certain marketing of mineral or natural resources. Due to their structure as partnerships for U.S. federal income tax purposes and the expected character of their income, MLPs generally are not subject to U.S. federal income taxes. However, MLPs may be subject to state taxation in certain jurisdictions, which may reduce the amount of income an MLP pays to its investors. Thus, unlike investors in corporate securities, direct MLP investors are generally not subject to double taxation (i.e., corporate-level tax and tax on corporate dividends). The Fund will invest no more than 25% of its total assets in securities of MLPs that are qualified publicly traded partnerships, which are treated as partnerships for U.S. federal income tax purposes. Under new tax legislation, individuals with taxable income from a direct interest in an MLP will be entitled to a 20% deduction with respect to such income. Currently, there is not a statutory or regulatory mechanism for the Fund to pass through such a deduction to its shareholders.

Options on Securities and Securities Indices

Purchasing Put and Call Options. The Fund may purchase covered “put” and “call” options with respect to securities which are otherwise eligible for purchase by the Fund and with respect to various stock indices subject to certain restrictions. The Fund will engage in trading of such derivative securities primarily for hedging purposes.

If the Fund purchases a put option, the Fund acquires the right to sell the underlying security at a specified price at any time during the term of the option (for “American-style” options) or on the option expiration date (for “European-style” options). Purchasing put options may be used as a portfolio investment strategy when a Sub-Advisor perceives significant short-term risk but substantial long-term appreciation for the underlying security. The put option acts as an insurance policy, as it protects against significant downward price movement while it allows full participation in any upward movement. If the Fund is holding a stock which it feels has strong fundamentals, but for some reason may be weak in the near term, the Fund may purchase a put option on such security, thereby giving itself the right to sell such security at a certain strike price throughout the term of the option. Consequently, the Fund will exercise the put only if the price of such security falls below the strike price of the put. The difference between the put’s strike price and the market price of the underlying security on the date the Fund exercises the put, less transaction costs, will be the amount by which the Fund will be able to hedge against a decline in the underlying

security. If during the period of the option the market price for the underlying security remains at or above the put’s strike price, the put will expire worthless, representing a loss of the price the Fund paid for the put, plus transaction costs. If the price of the underlying security increases, the profit the Fund realizes on the sale of the security will be reduced by the premium paid for the put option less any amount for which the put may be sold.

If the Fund purchases a call option, it acquires the right to purchase the underlying security at a specified price at any time during the term of the option. The purchase of a call option is a type of insurance policy to hedge against losses that could occur if the Fund has a short position in the underlying security and the security thereafter increases in price. The Fund will exercise a call option only if the price of the underlying security is above the strike price at the time of exercise. If during the option period the market price for the underlying security remains at or below the strike price of the call option, the option will expire worthless, representing a loss of the price paid for the option, plus transaction costs. If the call option has been purchased to hedge a short position of the Fund in the underlying security and the price of the underlying security thereafter falls, the profit the Fund realizes on the cover of the short position in the security will be reduced by the premium paid for the call option less any amount for which such option may be sold.

Prior to exercise or expiration, an option may be sold when it has remaining value by a purchaser through a “closing sale transaction,” which is accomplished by selling an option of the same series as the option previously purchased. The Fund generally will purchase only those options for which a Sub-Advisor believes there is an active secondary market to facilitate closing transactions.

Writing Call Options. The Fund may write covered call options. A call option is “covered” if the Fund owns the security underlying the call or has an absolute right to acquire the security without additional cash consideration (or, if additional cash consideration is required, cash or cash equivalents in such amount as are held in a segregated account by the Custodian). The writer of a call option receives a premium and gives the purchaser the right to buy the security underlying the option at the exercise price. The writer has the obligation upon exercise of the option to deliver the underlying security against payment of the exercise price during the option period. If the writer of an exchange-traded option wishes to terminate his obligation, he may effect a “closing purchase transaction.” This is accomplished by buying an option of the same series as the option previously written. A writer may not effect a closing purchase transaction after it has been notified of the exercise of an option.

Effecting a closing transaction in the case of a written call option will permit the Fund to write another call option on the underlying security with either a different exercise price, expiration date or both. Also, effecting a closing transaction will permit the cash or proceeds from the concurrent sale of any securities subject to the option to be used for other investments of the Fund. If the Fund desires to sell a particular security from its portfolio on which it has written a call option, it will effect a closing transaction prior to or concurrent with the sale of the security.

The Fund will realize a gain from a closing transaction if the cost of the closing transaction is less than the premium received from writing the option or if the proceeds from the closing transaction are more than the premium paid to purchase the option. The Fund will realize a loss from a closing transaction if the cost of the closing transaction is more than the premium received from writing the option or if the proceeds from the closing transaction are less than the premium paid to purchase the option. However, because increases in the market price of a call option will generally reflect increases in the market price of the underlying security, any loss to the Fund resulting from the repurchase of a call option is likely to be offset in whole or in part by appreciation of the underlying security owned by the Fund.

Stock Index Options. The Fund may also write (sell) and purchase put and call options with respect to the S&P 500 and other stock indices. Such options may be written or purchased as a hedge against changes resulting from market conditions in the values of securities which are held in the Fund’s portfolio or which it intends to purchase or sell, or when they are economically appropriate for the reduction of risks inherent in the ongoing management of the Fund.

The distinctive characteristics of options on stock indices create certain risks that are not present with stock options generally. Because the value of an index option depends upon movements in the level of the index rather than the price of a particular stock, whether the Fund will realize a gain or loss on the purchase or sale of an option on an index depends upon movements in the level of stock prices in the stock market generally rather than movements in the price of a particular stock. Accordingly, successful use by the Fund of options on a stock index would be subject to a Sub-Advisor’s ability to predict correctly movements in the direction of the stock market generally. This requires different skills and techniques than predicting changes in the price of individual stocks.

Index prices may be distorted if trading of certain stocks included in the index is interrupted. Trading of index options also may be interrupted in certain circumstances, such as if trading were halted in a substantial number of stocks included in the index. If this were to occur, the Fund would not be able to close out options which it had purchased, and if restrictions on exercise were imposed, the Fund might be unable to exercise an option it holds, which could result in substantial losses to the Fund. It is the policy of the Fund to purchase put or call options only with respect to an index which a Sub-Advisor believes includes a sufficient number of stocks to minimize the likelihood of a trading halt in the index.

Risks of Investing in Options. There are several risks associated with transactions in options on securities and indices. Options may be more volatile than the underlying instruments and, therefore, on a percentage basis, an investment in options may be subject to greater fluctuation than an investment in the underlying instruments themselves. There are also significant differences between the securities and options markets that could result in an imperfect correlation between these markets, causing a given transaction not to achieve its objective. In addition, a liquid secondary market for particular options may be absent for reasons which include the following: there may be insufficient trading interest in certain options; restrictions may be imposed by an exchange on opening transactions or closing transactions or both; trading halts, suspensions or other restrictions may be imposed with respect to particular classes or series of option of underlying securities; unusual or unforeseen circumstances may interrupt normal operations on an exchange; the facilities of an exchange or clearing corporation may not at all times be adequate to handle current trading volume; or one or more exchanges could, for economic or other reasons, decide or be compelled at some future date to discontinue the trading of options (or a particular class or series of options), in which event the secondary market on that exchange (or in that class or series of options) would cease to exist, although outstanding options that had been issued by a clearing corporation as a result of trades on that exchange would continue to be exercisable in accordance with their terms.

A decision as to whether, when and how to use options involves the exercise of skill and judgment, and even a well-conceived transaction may be unsuccessful to some degree because of market behavior or unexpected events. The extent to which the Fund may enter into options transactions may be limited by the requirements of the Code with respect to qualification of the Fund as a regulated investment company. See “Dividends and Distributions” and “Taxation.”

In addition, when trading options on foreign exchanges, many of the protections afforded to participants in United States option exchanges will not be available. For example, there may be no daily price fluctuation limits in such exchanges or markets, and adverse market movements could therefore continue to an unlimited extent over a period of time. Although the purchaser of an option cannot lose more than the amount of the premium plus related transaction costs, this entire amount could be lost. Moreover, the Fund as an option writer could lose amounts substantially in excess of its initial investment, due to the margin and collateral requirements typically associated with such option writing. See “Dealer Options” below.

Dealer Options. The Fund may engage in transactions involving dealer options as well as exchange-traded options. Certain risks are specific to dealer options. While the Fund might look to a clearing corporation to exercise exchange-traded options, if the Fund were to purchase a dealer option it would need to rely on the dealer from which it purchased the option to perform if the option were exercised. Failure by the dealer to do so would result in the loss of the premium paid by the Fund as well as loss of the expected benefit of the transaction.

Exchange-traded options generally have a continuous liquid market while dealer options may not. Consequently, the Fund may generally be able to realize the value of a dealer option it has purchased only by exercising or reselling the option to the dealer who issued it. Similarly, when the Fund writes a dealer option, the Fund may generally be able to close out the option prior to its expiration only by entering into a closing purchase transaction with the dealer to whom the Fund originally wrote the option. While the Fund will seek to enter into dealer options only with dealers who will agree to and which are expected to be capable of entering into closing transactions with the Fund, there can be no assurance that the Fund will at any time be able to liquidate a dealer option at a favorable price at any time prior to expiration. Unless the Fund, as a covered dealer call option writer, is able to effect a closing purchase transaction, it will not be able to liquidate securities (or other assets) used as cover until the option expires or is exercised. In the event of insolvency of the other party, the Fund may be unable to liquidate a dealer option. With respect to options written by the Fund, the inability to enter into a closing transaction may result in material losses to the Fund. For example, because the Fund must maintain a secured position with respect to any call option on a security it writes, the Fund may not sell the assets which it has segregated to secure the position while it is obligated under the option. This requirement may impair the Fund’s ability to sell portfolio securities at a time when such sale might be advantageous.

The Staff of the SEC has taken the position that purchased dealer options are illiquid securities. The Fund may treat the cover used for written dealer options as liquid if the dealer agrees that the Fund may repurchase the dealer option it has written for a maximum price to be calculated by a predetermined formula. In such cases, the dealer option would be considered illiquid only to the extent the maximum purchase price under the formula exceeds the intrinsic value of the option. Accordingly, the Fund will treat dealer options as subject to the Fund’s limitation on illiquid securities. If the SEC changes its position on the liquidity of dealer options, the Fund will change its treatment of such instruments accordingly.

Foreign Currency Options. The Fund may buy or sell put and call options on foreign currencies. A put or call option on a foreign currency gives the purchaser of the option the right to sell or purchase a foreign currency at the exercise price until the option expires. The Fund will use foreign currency options separately or in combination to control currency volatility. Among the strategies employed to control currency volatility is an option collar. An option collar involves the purchase of a put option and the simultaneous sale of call option on the same currency with the same expiration date but with different exercise (or “strike”) prices. Generally, the put option will have an out-of-the-money strike price, while the call option will have either an at-the-money strike price or an in-the-money strike price. Foreign currency options are derivative securities. Currency options traded on U.S. or other exchanges may be subject to position limits that may limit the ability of the Fund to reduce foreign currency risk using such options.

As with other kinds of option transactions, the writing of an option on foreign currency will constitute only a partial hedge, up to the amount of the premium received. The Fund could be required to purchase or sell foreign currencies at disadvantageous exchange rates, thereby incurring losses. The purchase of an option on foreign currency may constitute an effective hedge against exchange rate fluctuations; however, in the event of exchange rate movements adverse to the Fund’s position, the Fund may forfeit the entire amount of the premium plus related transaction costs.

Spread Transactions. The Fund may purchase covered spread options from securities dealers. These covered spread options are not presently exchange-listed or exchange-traded. The purchase of a spread option gives the Fund the right to put a security that it owns at a fixed dollar spread or fixed yield spread in relationship to another security that the Fund does not own, but which is used as a benchmark. The risk to the Fund, in addition to the risks of dealer options described above, is the cost of the premium paid as well as any transaction costs. The purchase of spread options will be used to protect the Fund against adverse changes in prevailing credit quality spreads, i.e., the yield spread between high quality and lower quality securities. This protection is provided only during the life of the spread options.

Forward Currency Contracts

The Fund may enter into forward currency contracts in anticipation of changes in currency exchange rates. A forward currency contract is 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 agreed upon by the parties, at a price set at the time of the contract. For example, the Fund might purchase a particular currency or enter into a forward currency contract to preserve the U.S. dollar price of securities it intends to or has contracted to purchase. Alternatively, it might sell a particular currency on either a spot or forward basis to hedge against an anticipated decline in the dollar value of securities it intends to or has contracted to sell. Although this strategy could minimize the risk of loss due to a decline in the value of the hedged currency, it could also limit any potential gain from an increase in the value of the currency.

Credit Default Swap Agreements

The Fund may enter into credit default swap agreements. The “buyer” in a credit default swap contract is obligated to pay the “seller” a periodic stream of payments over the term of the contract in return for a contingent payment upon the occurrence of a credit event with respect to an underlying reference obligation. Generally, a credit event means bankruptcy, failure to pay, obligation acceleration or modified restructuring. The Fund may be either the buyer or the seller in the transaction. As a seller, the Fund receives a fixed rate of income throughout the term of the contract, which typically is between one month and five years, provided that no credit event occurs. If a credit event occurs, the Fund typically must pay the contingent payment to the buyer, which is typically the “par value” (full notional value) of the reference obligation. If the Fund writes a credit default swap, it would normally be required to segregate liquid assets equal in value to the notional value of the contract. The contingent payment may be a cash settlement or by physical delivery of the reference obligation in return for payment of the face amount of the obligation. The value of the reference obligation received by the Fund as a seller if a credit event occurs, coupled with the periodic payments previously received, may be less than the full notional value it pays to the buyer, resulting in a loss of value to the Fund. If the reference obligation is a defaulted security, physical delivery of the security will cause the Fund to hold a defaulted security. If the Fund is a buyer and no credit event occurs, the Fund will lose its periodic stream of payments over the term of the contract. However, if a credit event occurs, the buyer typically receives full notional value for a reference obligation that may have little or no value.

In a single name credit default swap the underlying asset or reference obligation is a bond of one particular issuer or reference entity. There are generally two sides to the swap trade: a buyer of protection and a seller of protection. If the reference entity of a credit default swap experiences what is known as a credit event (such as a bankruptcy, downgrade, etc.), then the buyer of protection (who pays a premium for that protection) can receive payment from the seller of protection. This is desirable because the price of those bonds will experience a decrease in value due to the negative credit event. There is also the option of physical, rather than cash, trade settlement in which the underlying bond or reference obligation actually changes hands, from buyer of protection to seller of protection.

The major tradable indexes for credit default swaps are: CDX, ABX, CMBX and LCDX. The CDX indexes are broken out between investment grade, high yield, high volatility, crossover and emerging market. For example, the CDX.NA.HY is an index based on a basket of North American (NA) single-name high yield credit default swaps. The crossover index includes names that are split rated, meaning they are rated “investment grade” by one agency, and “below investment grade” by another.

The CDX index rolls over every six months, and its 125 names enter and leave the index as appropriate. For example, if one of the names is upgraded from below investment grade to investment grade, it will move from the high yield index to the investment grade index when the rebalance occurs.

The ABX and CMBX are baskets of credit default swaps on two securitized products: asset-backed securities and commercial mortgage-backed securities. The ABX is based on asset-backed securities home equity loans and the CMBX on commercial mortgage-backed securities. There are five separate ABX indexes for ratings ranging from ‘AAA’ to ‘BBB-’. The CMBX also has the same breakdown of five indexes by ratings, but is based on a basket of 25 credit default swaps, which reference commercial mortgage-backed securities.

The LCDX is a credit derivative index with a basket made up of single-name, loan-only credit default swaps. The loans referred to are leveraged loans. The basket is made up of 100 names. Although a bank loan is considered secured debt, the names that usually trade in the leveraged loan market are lower quality credits (if they could issue in the normal investment grade markets, they would). Therefore, the LCDX index is used mostly by those looking for exposure to high-yield debt.

All of the aforementioned indexes are issued by the Credit Default Swaps Index Company and administered by Markit. For these indexes to work, they must have sufficient liquidity. Therefore, the issuer has commitments from the largest dealers (large investment banks) to provide liquidity in the market.

Total Return Swap Agreements

The Fund may enter into total return swap agreements. Total return swap agreements are contracts in which one party agrees to make periodic payments to another party based on the change in market value of the assets underlying the contract, which may include a specified security, basket of securities or securities indices during the specified period, in return for periodic payments based on a fixed or variable interest rate or the total return from other underlying assets. Total return swap agreements may be used to obtain exposure to a security or market without owning or taking physical custody of such security or investing directly in such market. Total return swap agreements may effectively add leverage to the Fund’s portfolio because, in addition to its total net assets, the Fund would be subject to investment exposure on the notional amount of the swap.

Total return swap agreements are subject to the risk that a counterparty will default on its payment obligations to the Fund thereunder. Swap agreements also bear the risk that the Fund will not be able to meet its obligation to the counterparty. Generally, the Fund will enter into total return swaps on a net basis (i.e., the two payment streams are netted against one another with the Fund receiving or paying, as the case may be, only the net amount of the two payments). The net amount of the excess, if any, of the Fund’s obligations over its entitlements with respect to each total return swap will be accrued on a daily basis, and an amount of liquid assets having an aggregate NAV at least equal to the accrued excess will be segregated by the Fund. If the total return swap transaction is entered into on other than a net basis, the full amount of the Fund’s obligations will be accrued on a daily basis, and the full amount of the Fund’s obligations will be segregated by the Fund in an amount equal to or greater than the market value of the liabilities under the total return swap agreement or the amount it would have cost the Fund initially to make an equivalent direct investment, plus or minus any amount the Fund is obligated to pay or is to receive under the total return swap agreement.

Futures Contracts and Related Options

The Fund may invest in futures contracts and options on futures contracts as a hedge against changes in market conditions or interest rates. The Fund may trade in such derivative securities for bona fide hedging purposes and otherwise in accordance with the rules of the CFTC. The Fund will segregate liquid assets in a separate account with its custodian when required to do so by CFTC guidelines in order to cover its obligation in connection with futures and options transactions.

No price is paid or received by the Fund upon the purchase or sale of a futures contract. When it enters into a domestic futures contract, the Fund will be required to deposit in a segregated account with its custodian an amount of cash or U.S. Treasury bills equal to approximately 5% of the contract amount. This amount is known as initial margin. The margin requirements for foreign futures contracts may be different.

The nature of initial margin in futures transactions is different from that of margin in securities transactions. Futures contract margin does not involve the borrowing of funds by the customer to finance the transactions. Rather, the initial margin is in the nature of a performance bond or good faith deposit on the contract which is returned to the Fund upon termination of the futures contract, assuming all contractual obligations have been satisfied. Subsequent payments (called variation margin) to and from the broker will be made on a daily basis as the price of the underlying stock index fluctuates, to reflect movements in the price of the contract making the long and short positions in the futures contract more or less valuable. For example, when the Fund has purchased a stock index futures contract and the price of the underlying stock index has risen, that position will have increased in value and the Fund will receive from the broker a variation margin payment equal to that increase in value. Conversely, when the Fund has purchased a stock index futures contract and the price of the underlying stock index has declined, the position will be less valuable and the Fund will be required to make a variation margin payment to the broker.

At any time prior to expiration of a futures contract, the Fund may elect to close the position by taking an opposite position, which will operate to terminate the Fund’s position in the futures contract. A final determination of variation margin is made on closing the position. Additional cash is paid by or released to the Fund, which realizes a loss or a gain.

In addition to amounts segregated or paid as initial and variation margin, the Fund must segregate liquid assets with its custodian equal to the market value of the futures contracts, in order to comply with SEC requirements intended to ensure that the Fund’s use of futures is unleveraged. The requirements for margin payments and segregated accounts apply to both domestic and foreign futures contracts.

Stock Index Futures Contracts. The Fund may invest in futures contracts on stock indices. Currently, stock index futures contracts can be purchased or sold with respect to the S&P 500 Stock Price Index on the Chicago Mercantile Exchange, the Major Market Index on the Chicago Board of Trade, the New York Stock Exchange Composite Index on the New York Futures Exchange and the Value Line Stock Index on the Kansas City Board of Trade. Foreign financial and stock index futures are traded on foreign exchanges including the London International Financial Futures Exchange, the Singapore International Monetary Exchange, the Sydney Futures Exchange Limited and the Tokyo Stock Exchange.

Interest Rate or Financial Futures Contracts. The Fund may invest in interest rate or financial futures contracts. Bond prices are established in both the cash market and the futures market. In the cash market, bonds are purchased and sold with payment for the full purchase price of the bond being made in cash, generally within five business days after the trade. In the futures market, a contract is made to purchase or sell a bond in the future for a set price on a certain date. Historically, the prices for bonds established in the futures markets have generally tended to move in the aggregate in concert with cash market prices, and the prices have maintained fairly predictable relationships.

The sale of an interest rate or financial futures contract by the Fund would create an obligation by the Fund, as seller, to deliver the specific type of financial instrument called for in the contract at a specific future time for a specified price. A futures contract purchased by the Fund would create an obligation by the Fund, as purchaser, to take delivery of the specific type of financial instrument at a specific future time at a specific price. The specific securities delivered or taken, respectively, at settlement date, would not be determined until at or near that date. The determination would be in accordance with the rules of the exchange on which the futures contract sale or purchase was made.

Although interest rate or financial futures contracts by their terms call for actual delivery or acceptance of securities, in most cases the contracts are closed out before the settlement date without delivery of securities.

Closing out of a futures contract sale is effected by the Fund’s entering into a futures contract purchase for the same aggregate amount of the specific type of financial instrument and the same delivery date. If the price in the sale exceeds the price in the offsetting purchase, the Fund is paid the difference and thus realizes a gain. If the offsetting purchase price exceeds the sale price, the Fund pays the difference and realizes a loss. Similarly, the closing out of a futures contract purchase is effected by the Fund’s entering into a futures contract sale. If the offsetting sale price exceeds the purchase price, the Fund realizes a gain, and if the purchase price exceeds the offsetting sale price, the Fund realizes a loss.

The Fund will deal only in standardized contracts on recognized exchanges. Each exchange guarantees performance under contract provisions through a clearing corporation, a nonprofit organization managed by the exchange membership. Domestic interest rate futures contracts are traded in an auction environment on the floors of several exchanges – principally, the Chicago Board of Trade and the Chicago Mercantile Exchange. A public market now exists in domestic futures contracts covering various financial instruments including long-term United States Treasury bonds and notes, GNMA modified pass-through mortgage-backed securities, three-month United States Treasury bills, and 90-day commercial paper. The Fund may trade in any futures contract for which there exists a public market, including, without limitation, the foregoing instruments. International interest rate futures contracts are traded on the London International Financial Futures Exchange, the Singapore International Monetary Exchange, the Sydney Futures Exchange Limited and the Tokyo Stock Exchange.

Interest Rate Caps, Floors and Collars. The Fund may use interest rate caps, floors and collars for the same purposes or similar purposes as for which it uses interest rate futures contracts and related options. Interest rate caps, floors and collars are similar to interest rate swap contracts because the payment obligations are measured by changes in interest rates as applied to a notional amount and because they are generally individually negotiated with a specific counterparty. The purchase of an interest rate cap entitles the purchaser, to the extent that a specific index exceeds a specified interest rate, to receive payments of interest on a notional principal amount from the party selling the interest rate cap. The purchase of an interest rate floor entitles the purchaser, to the extent that a specified index falls below specified interest rates, to receive payments of interest on a notional principal amount from the party selling the interest rate floor. The purchase of an interest rate collar entitles the purchaser, to the extent that a specified index exceeds or falls below a specified interest rate, to receive payments of interest on a notional principal amount from the party selling the interest rate collar.

Foreign Currency Futures Contracts. The Fund may use foreign currency future contracts for hedging purposes. A foreign currency futures contract provides for the future sale by one party and purchase by another party of a specified quantity of a foreign currency at a specified price and time. A public market exists in futures contracts covering several foreign currencies, including the Australian dollar, the Canadian dollar, the British pound, the Japanese yen, the Swiss franc, and certain multinational currencies such as the European Currency Unit (“ECU”). Other foreign currency futures contracts are likely to be developed and traded in the future. The Fund will only enter into futures contracts and futures options which are standardized and traded on a U.S. or foreign exchange, board of trade, or similar entity, or quoted on an automated quotation system.

Risks of Transactions in Futures Contracts. There are several risks related to the use of futures as a hedging device. One risk arises because of the imperfect correlation between movements in the price of the futures contract and movements in the price of the securities which are the subject of the hedge. The price of the future may move more or less than the price of the securities being hedged. If the price of the future moves less than the price of the securities which are the subject of the hedge, the hedge will not be fully effective, but if the price of the securities being hedged has moved in an unfavorable direction, the Fund would be in a better position than if it had not hedged at all. If the price of the securities being hedged has moved in a favorable direction, this advantage will be partially offset by the loss on the future. If the price of the future moves more than the price of the hedged securities, the Fund will experience either a loss or a gain on the future which will not be completely offset by movements in the price of the securities which are subject to the hedge.

To compensate for the imperfect correlation of movements in the price of securities being hedged and movements in the price of the futures contract, the Fund may buy or sell futures contracts in a greater dollar amount

than the dollar amount of securities being hedged if the historical volatility of the prices of such securities has been greater than the historical volatility over such time period of the future. Conversely, the Fund may buy or sell fewer futures contracts if the historical volatility of the price of the securities being hedged is less than the historical volatility of the futures contract being used. It is possible that, when the Fund has sold futures to hedge its portfolio against a decline in the market, the market may advance while the value of securities held in the Fund’s portfolio may decline. If this occurs, the Fund will lose money on the future and also experience a decline in value in its portfolio securities. However, the Advisor believes that over time the value of a diversified portfolio will tend to move in the same direction as the market indices upon which the futures are based.

Where futures are purchased to hedge against a possible increase in the price of securities before the Fund is able to invest its cash (or cash equivalents) in securities (or options) in an orderly fashion, it is possible that the market may decline instead. If the Fund then decides not to invest in securities or options at that time because of concern as to possible further market decline or for other reasons, it will realize a loss on the futures contract that is not offset by a reduction in the price of securities purchased.

In addition to the possibility that there may be an imperfect correlation, or no correlation at all, between movements in the futures and the securities being hedged, the price of futures may not correlate perfectly with movement in the stock index or cash market due to certain market distortions. All participants in the futures market are subject to margin deposit and maintenance requirements. Rather than meeting additional margin deposit requirements, investors may close futures contracts through offsetting transactions, which could distort the normal relationship between the index or cash market and futures markets. In addition, the deposit requirements in the futures market are less onerous than margin requirements in the securities market. Therefore, increased participation by speculators in the futures market may also cause temporary price distortions. As a result of price distortions in the futures market and the imperfect correlation between movements in the cash market and the price of securities and movements in the price of futures, a correct forecast of general trends by a Sub-Advisor may still not result in a successful hedging transaction over a very short time frame.

Positions in futures may be closed out only on an exchange or board of trade which provides a secondary market for such futures. Although the Fund may intend 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. In such event, it may not be possible to close a futures position, and in the event of adverse price movements, the Fund would continue to be required to make daily cash payments of variation margin. When futures contracts have been used to hedge portfolio securities, such securities will not be sold until the futures contract can be terminated. In such circumstances, an increase in the price of the securities, if any, may partially or completely offset losses on the futures contract. However, as described above, there is no guarantee that the price of the securities will in fact correlate with the price movements in the futures contract and thus provide an offset to losses on a futures contract.

Most United States futures exchanges limit the amount of fluctuation permitted in futures contract prices during a single trading day. The daily limit establishes the maximum amount that the price of a futures contract may vary either up or down from the previous day’s settlement price at the end of a trading session. Once the daily limit has been reached in a particular type of futures contract, no trades may be made on that day at a price beyond that limit. The daily limit governs only price movement during a particular trading day and therefore does not limit potential losses, because the limit may prevent the liquidation of unfavorable positions. Futures contract prices have occasionally moved to the daily limit for several consecutive trading days with little or no trading, thereby preventing prompt liquidation of futures positions and subjecting some futures traders to substantial losses.

Successful use of futures by the Fund is also subject to a Sub-Advisor’s ability to predict correctly movements in the direction of the market. For example, if the Fund has hedged against the possibility of a decline in the market adversely affecting stocks held in its portfolio and stock prices increase instead, the Fund will lose part or

all of the benefit of the increased value of the stocks which it has hedged because it will have offsetting losses in its futures positions. In addition, in such situations, if the Fund has insufficient cash, it may have to sell securities to meet daily variation margin requirements. Such sales of securities may be, but will not necessarily be, at increased prices which reflect the rising market. The Fund may have to sell securities at a time when it may be disadvantageous to do so.

In the event of the bankruptcy of a broker through which the Fund engages in transactions in futures contracts or options, the Fund could experience delays and losses in liquidating open positions purchased or sold through the broker, and incur a loss of all or part of its margin deposits with the broker.

Options on Futures Contracts. As described above, the Fund may purchase options on the futures contracts they can purchase or sell. A futures option gives the holder, in return for the premium paid, the right to buy (call) from or sell (put) to the writer of the option a futures contract at a specified price at any time during the period of the option. Upon exercise, the writer of the option is obligated to pay the difference between the cash value of the futures contract and the exercise price. Like the buyer or seller of a futures contract, the holder or writer of an option has the right to terminate its position prior to the scheduled expiration of the option by selling, or purchasing an option of the same series, at which time the person entering into the closing transaction will realize a gain or loss. There is no guarantee that such closing transactions can be effected.

Investments in futures options involve some of the same considerations as investments in futures contracts (for example, the existence of a liquid secondary market). In addition, the purchase of an option also entails the risk that changes in the value of the underlying futures contract will not be fully reflected in the value of the option. Depending on the pricing of the option compared to either the futures contract upon which it is based, or upon the price of the securities being hedged, an option may or may not be less risky than ownership of the futures contract or such securities. In general, the market prices of options can be expected to be more volatile than the market prices on the underlying futures contracts. Compared to the purchase or sale of futures contracts, however, the purchase of call or put options on futures contracts may frequently involve less potential risk to the Fund because the maximum amount at risk is limited to the premium paid for the options (plus transaction costs).

Restrictions on the Use of Futures Contracts and Related Options. The Fund may engage in transactions in futures contracts or related options primarily as a hedge against changes resulting from market conditions in the values of securities held in the Fund’s portfolio or which it intends to purchase and where the transactions are economically appropriate to the reduction of risks inherent in the ongoing management of the Fund. The Fund may not purchase or sell futures or purchase related options for purposes other than bona fide hedging if, immediately thereafter, more than 25% of its total assets would be hedged. The Fund also may not purchase or sell futures or purchase related options if, immediately thereafter, the sum of the amount of margin deposits on the Fund’s existing futures positions and premiums paid for such options would exceed 5% of the market value of the Fund’s total assets.

These restrictions, which are derived from current federal regulations regarding the use of options and futures by mutual funds, are not “fundamental restrictions” and may be changed by the Trustees of the Trust if applicable law permits such a change and the change is consistent with the overall investment objective and policies of the Fund.

The extent to which the Fund may enter into futures and options transactions may be limited by the Code requirements for qualification of the Fund as a regulated investment company. See “Taxation.”

Exclusion from Definition of Commodity Pool Operator

The Fund is operated by a person who has claimed an exclusion from the definition of the term “commodity pool operator” under the Commodity Exchange Act of 1936, as amended (“CEA”), pursuant to Rule 4.5 under the CEA promulgated by the CFTC. Therefore, neither the Fund nor the Advisor is subject to registrations or regulation as a commodity pool operator under the CEA. Effective December 31, 2012, in order to

claim the Rule 4.5 exclusion, the Fund is limited in its ability to invest in certain financial instruments regulated under the CEA (“commodity interests”), including futures, options and certain swaps (including securities futures, broad-based stock index futures and financial futures contracts). In the event that the Fund’s investments in commodity interests are not within the thresholds set forth in the Rule 4.5 exclusion, the Advisor may be required to register as a “commodity pool operator” and/or “commodity trading advisor” with the CFTC with respect to the Fund, which may increase the Fund’s expenses and adversely affect the Fund’s total returns. The Advisor’s eligibility to claim the 4.5 exclusion with respect to the Fund will be based upon, among other things, the level and scope of the Fund’s investments in commodity interests, the purposes of such investments and the manner in which the Fund holds out its use of commodity interests. As a result, in the future, the Fund will be more limited in its ability to invest in commodity interests than in the past, which may negatively impact on the ability of the Advisor to manage the Fund and the Fund’s performance.

Repurchase Agreements

The Fund may enter into repurchase agreements with respect to its portfolio securities. Pursuant to such agreements, the Fund acquires securities from financial institutions such as banks and broker-dealers as are deemed to be creditworthy by the Advisor or a Sub-Advisor, subject to the seller’s agreement to repurchase and the Fund’s agreement to resell such securities at a mutually agreed upon date and price. The repurchase price generally equals the price paid by the Fund plus interest negotiated on the basis of current short-term rates (which may be more or less than the rate on the underlying portfolio security). Securities subject to repurchase agreements will be held by the Custodian or in the Federal Reserve/Treasury Book-Entry System or an equivalent foreign system. The seller under a repurchase agreement will be required to maintain the value of the underlying securities at not less than 102% of the repurchase price under the agreement. If the seller defaults on its repurchase obligation, the Fund holding the repurchase agreement will suffer a loss to the extent that the proceeds from a sale of the underlying securities are less than the repurchase price under the agreement. Bankruptcy or insolvency of such a defaulting seller may cause the Fund’s rights with respect to such securities to be delayed or limited. Repurchase agreements are considered to be loans under the 1940 Act, and the total repurchase agreements of the Fund are limited to 33-1/3% of its total assets.

Reverse Repurchase Agreements

The Fund may enter into reverse repurchase agreements. The Fund typically will invest the proceeds of a reverse repurchase agreement in money market instruments or repurchase agreements maturing not later than the expiration of the reverse repurchase agreement. The Fund may use the proceeds of reverse repurchase agreements to provide liquidity to meet redemption requests when sale of the Fund’s securities is disadvantageous.

The Fund causes its custodian to segregate liquid assets, such as cash, U.S. Government securities or other high-grade liquid debt securities equal in value to its obligations (including accrued interest) with respect to reverse repurchase agreements. In segregating such assets, the custodian either places such securities in a segregated account or separately identifies such assets and renders them unavailable for investment. Such assets are marked to market daily to ensure full collateralization is maintained.

Dollar Roll Transactions

The Fund may enter into dollar roll transactions. A dollar roll transaction involves a sale by the Fund of a security to a financial institution concurrently with an agreement by the Fund to purchase a similar security from the institution at a later date at an agreed-upon price. The securities that are repurchased will bear the same interest rate as those sold, but generally will be collateralized by different pools of mortgages with different prepayment histories than those sold. During the period between the sale and repurchase, the Fund will not be entitled to receive interest and principal payments on the securities sold. Proceeds of the sale will be invested in additional portfolio securities of the Fund, and the income from these investments, together with any additional fee income received on the sale, may or may not generate income for the Fund exceeding the yield on the securities sold.

At the time the Fund enters into a dollar roll transaction, it causes its custodian to segregate liquid assets such as cash, U.S. Government securities or other high-grade liquid debt securities having a value equal to the purchase price for the similar security (including accrued interest) and subsequently marks the assets to market daily to ensure that full collateralization is maintained.

When-Issued Securities, Forward Commitments and Delayed Settlements

The Fund may purchase securities on a “when-issued,” forward commitment or delayed settlement basis. In this event, the Custodian will set aside, and the Fund will identify on its books, cash or liquid portfolio securities equal to the amount of the commitment in a separate account. Normally, the Custodian will set aside portfolio securities to satisfy a purchase commitment. In such a case, the Fund may be required subsequently to place additional assets in the separate account in order to assure that the value of the account remains equal to the amount of the Fund’s commitment. It may be expected that the Fund’s net assets will fluctuate to a greater degree when it sets aside portfolio securities to cover such purchase commitments than when it sets aside cash.

The Fund does not intend to engage in these transactions for speculative purposes but only in furtherance of its investment objectives. Because the Fund will set aside cash or liquid portfolio securities to satisfy its purchase commitments in the manner described, the Fund’s liquidity and the ability of a Sub-Advisor to manage it may be affected in the event the Fund’s forward commitments, commitments to purchase when-issued securities and delayed settlements ever exceeded 15% of the value of its net assets.

The Fund will purchase securities on a when-issued, forward commitment or delayed settlement basis only with the intention of completing the transaction. If deemed advisable as a matter of investment strategy, however, the Fund may dispose of or renegotiate a commitment after it is entered into, and may sell securities it has committed to purchase before those securities are delivered to the Fund on the settlement date. In these cases the Fund may realize a taxable capital gain or loss. When the Fund engages in when-issued, forward commitment and delayed settlement transactions, it relies on the other party to consummate the trade. Failure of such party to do so may result in the Fund’s incurring a loss or missing an opportunity to obtain a price credited to be advantageous.

The market value of the securities underlying a when-issued purchase, forward commitment to purchase securities, or a delayed settlement and any subsequent fluctuations in their market value is taken into account when determining the market value of the Fund starting on the day the Fund agrees to purchase the securities. The Fund does not earn interest on the securities it has committed to purchase until they are paid for and delivered on the settlement date.

Zero-Coupon, Step-Coupon and Pay-in-Kind Securities

The Fund may invest in zero-coupon, step-coupon and pay-in-kind securities. These securities are debt securities that do not make regular cash interest payments. Zero-coupon and step-coupon securities are sold at a deep discount to their face value. Pay-in-kind securities pay interest through the issuance of additional securities. Because these securities do not pay current cash income, the price of these securities can be volatile when interest rates fluctuate. While these securities do not pay current cash income, the Code requires the holders of these securities to include in income each year the portion of the original issue discount (or deemed discount) and other non-cash income on the securities accruing that year. The Fund may be required to distribute a portion of that discount and income and may be required to dispose of other portfolio securities, which may occur in periods of adverse market prices, in order to generate cash to meet these distribution requirements.

Inflation-Linked and Inflation-Indexed Securities

The Fund may invest in inflation-linked bonds. The principal amount of these bonds increases with increases in the price index used as a reference value for the bonds. In addition, the amounts payable as coupon interest payments increase when the price index increases because the interest amount is calculated by multiplying the principal amount (as adjusted) by a fixed coupon rate.

Although inflation-indexed securities protect their holders from long-term inflationary trends, short-term increases in inflation may result in a decline in value. The values of inflation-linked securities generally fluctuate in response to changes to real interest rates, which are in turn tied to the relationship between nominal interest rates and the rate of inflation. If inflation were to rise at a rate faster than nominal interest rates, real interest rates might decline, leading to an increase in value of the inflation-linked securities. In contrast, if nominal interest rates increased at a faster rate than inflation, real interest rates might rise, leading to a decrease in the value of inflation-linked securities. If inflation is lower than expected during a period the Fund holds inflation-linked securities, the Fund may earn less on such bonds than on a conventional bond. If interest rates rise due to reasons other than inflation (for example, due to changes in currency exchange rates), investors in inflation-linked securities may not be protected to the extent that the increase is not reflected in the price index used as a reference for the securities. There can be no assurance that the price index used for an inflation-linked security will accurately measure the real rate of inflation in the prices of goods and services. Inflation-linked and inflation-indexed securities include Treasury Inflation-Protected Securities issued by the U.S. government (see the section “U.S. Government Securities” for additional information), but also may include securities issued by state, local and non-U.S. governments and corporations and supranational entities.

Borrowing

The Fund is authorized to borrow money from banks in amounts up to 33-1/3% of its total assets. The Fund is authorized to borrow money in amounts up to 5% of the value of its total assets at the time of such borrowings for temporary purposes and is authorized to borrow money in excess of the 5% limit as permitted by the 1940 Act. The 1940 Act requires the Fund to maintain continuous asset coverage (i.e., total assets including borrowings less liabilities exclusive of borrowings) of at least 300% of the amount borrowed. If the 300% asset coverage declines as a result of market fluctuations or other reasons, the Fund may be required to sell some of its portfolio holdings within three days to reduce the debt and restore the 300% asset coverage, even though it may be disadvantageous from an investment standpoint to sell securities at that time. The use of borrowing by the Fund involves special risk considerations that may not be associated with other funds having similar objectives and policies. Since substantially all of the Fund’s assets fluctuate in value, whereas the interest obligation resulting from a borrowing will be fixed by the terms of the Fund’s agreement with its lender, the asset value per share of the Fund will tend to increase more when its portfolio securities increase in value and to decrease more when its portfolio assets decrease in value than would otherwise be the case if the Fund did not borrow funds. In addition, interest costs on borrowings may fluctuate with changing market rates of interest and may partially offset or exceed the return earned on borrowed funds. Under adverse market conditions, the Fund might have to sell portfolio securities to meet interest or principal payments at a time when fundamental investment considerations would not favor such sales.

Lending Portfolio Securities

The Fund may lend its investment securities to approved institutional borrowers who need to borrow securities in order to complete certain transactions, such as covering short sales, avoiding failures to deliver securities or completing arbitrage operations. By lending its investment securities, the Fund attempts to increase its net investment income through the receipt of interest on the loan. Any gain or loss in the market price of the securities loaned that might occur during the term of the loan would belong to the Fund. The Fund may lend its investment securities so long as the terms, structure and the aggregate amount of such loans are not inconsistent with the 1940 Act or the rules and regulations or interpretations of the SEC thereunder, which currently require that

(i) the loan collateral must be equal to at least 100% of the value of the loaned securities, and the borrower must increase such collateral such that it remains equal to 100% of the value of the loaned securities whenever the price of the loaned securities increases (i.e., mark to market on a daily basis); (ii) the Fund must be able to terminate the loan at any time; (iii) the Fund must receive reasonable interest on the loan, as well as any dividends, interest or other distributions payable on the loaned securities, and any increase in market value; (iv) the Fund may pay reasonable custodial fees in connection with the lending of portfolio securities, which fees must be negotiated by the Fund and the custodian and be approved by the Board; and (v) although the voting rights may pass with the lending of securities, the Board must be obligated to call the loan in time to vote the securities if a material event affecting the investment on loan is to occur.

The primary risk in securities lending is default by the borrower as the value of the borrowed security rises, resulting in a deficiency in the collateral posted by the borrower. The Fund seeks to minimize this risk by computing the value of the security loaned on a daily basis and requiring additional collateral if necessary.

The Board has appointed State Street Bank and Trust Company, the Fund’s custodian, as securities lending agent for the Fund’s securities lending activity. The securities lending agent maintains a list of broker-dealers, banks or other institutions that it has determined to be creditworthy. The Fund will only enter into loan arrangements with borrowers on this list and will not lend its securities to be sold short.

Short Sales

The Fund is authorized to make short sales of securities which it does not own or have the right to acquire. In a short sale, the Fund sells a security that it does not own, in anticipation of a decline in the market value of the security. To complete the sale, the Fund must borrow the security (generally from the broker through which the short sale is made) in order to make delivery to the buyer. The Fund is then obligated to replace the security borrowed by purchasing it at the market price at the time of replacement. The Fund is said to have a “short position” in the securities sold until it delivers them to the broker. The period during which the Fund has a short position can range from one day to more than a year. Until the security is replaced, the proceeds of the short sale are retained by the broker, and the Fund is required to pay to the broker a negotiated portion of any dividends or interest that accrue during the period of the loan. To meet current margin requirements, the Fund is also required to deposit with the broker additional cash or securities so that the total deposit with the broker is maintained daily at 150% of the current market value of the securities sold short (100% of the current market value if a security is held in the account that is convertible or exchangeable into the security sold short within 90 days without restriction other than the payment of money).

Short sales by the Fund create opportunities to increase the Fund’s return but, at the same time, involve specific risk considerations and may be considered a speculative technique. Since the Fund in effect profits from a decline in the price of the securities sold short without the need to invest the full purchase price of the securities on the date of the short sale, the Fund’s NAV per share will tend to increase more when the securities it has sold short decrease in value, and to decrease more when the securities it has sold short increase in value, than would otherwise be the case if it had not engaged in such short sales. The amount of any gain will be decreased, and the amount of any loss increased, by the amount of any premium, dividends or interest the Fund may be required to pay in connection with the short sale. Furthermore, under adverse market conditions the Fund might have difficulty purchasing securities to meet its short sale delivery obligations, and might have to sell portfolio securities to raise the capital necessary to meet its short sale obligations at a time when fundamental investment considerations would not favor such sales.

Illiquid Securities

The Fund may not invest more than 15% of the value of its net assets in illiquid securities, including restricted securities that are not deemed to be liquid by the Sub-Advisor. The Advisor and the Sub-Advisors will monitor the amount of illiquid securities in the Fund’s portfolio, under the supervision of the Board, to ensure compliance with the Fund’s investment restrictions. In accordance with procedures approved by the Board, these

securities may be valued using techniques other than market quotations, and the values established for these securities may be different than what would be produced through the use of another methodology or if they had been priced using market quotations. Illiquid securities and other portfolio securities that are valued using techniques other than market quotations, including “fair valued” securities, may be subject to greater fluctuation in their value from one day to the next than would be the case if market quotations were used. In addition, there is no assurance that the Fund could sell a portfolio security for the value established for it at any time, and it is possible that the Fund would incur a loss because a portfolio security is sold at a discount to its established value.

Historically, illiquid securities have included securities subject to contractual or legal restrictions on resale because they have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), securities which are otherwise not readily marketable and repurchase agreements having a maturity of longer than seven days. Securities which have not been registered under the Securities Act are referred to as private placement or restricted securities and are purchased directly from the issuer or in the secondary market. Mutual funds do not typically hold a significant amount of these restricted or other illiquid securities because of the potential for delays on resale and uncertainty in valuation. Limitations on resale may have an adverse effect on the marketability of portfolio securities and the Fund might be unable to dispose of restricted or other illiquid securities promptly or at reasonable prices and might thereby experience difficulty satisfying redemption within seven days. The Fund might also have to register such restricted securities in order to dispose of them, resulting in additional expense and delay. Adverse market conditions could impede such a public offering of securities.

In recent years, however, a large institutional market has developed for certain securities that are not registered under the Securities Act, including repurchase agreements, commercial paper, foreign securities, municipal securities and corporate bonds and notes. Institutional investors depend on an efficient institutional market in which the unregistered security can be readily resold or on an issuer’s ability to honor a demand for repayment. The fact that there are contractual or legal restrictions on resale to the general public or to certain institutions may not be indicative of the liquidity of such investments. If such securities are subject to purchase by institutional buyers in accordance with Rule 144A promulgated by the SEC under the Securities Act, the Sub-Advisor, pursuant to procedures adopted by the Board, may determine that such securities are not illiquid securities notwithstanding their legal or contractual restrictions on resale. In all other cases, however, securities subject to restrictions on resale will be deemed illiquid.

Exchange-Traded Funds

The Fund may invest in exchange-traded funds (“ETFs”), which are a type of index fund bought and sold on a securities exchange. An ETF trades like common stock and represents a fixed portfolio of securities designed to track a particular market index. The Fund could purchase an ETF to temporarily gain exposure to a portion of the U.S. or a foreign market while awaiting purchase of underlying securities. The risks of owning an ETF generally reflect the risks of owning the underlying securities they are designed to track, although lack of liquidity in an ETF could result in it being more volatile and ETFs have management fees that increase their costs. ETFs are also subject to other risks, including the risk that their prices may not correlate perfectly with changes in the underlying index and the risk of possible trading halts due to market conditions or other reasons that, in the view of the exchange upon which an ETF trades, would make trading in the ETF inadvisable. An exchange-traded sector fund may also be adversely affected by the performance of that specific sector or group of industries on which it is based. Investments in ETFs are generally subject to limits in the 1940 Act on investments in other investment companies.

Business Development Companies (“BDCs”)

The Fund may invest in BDCs, which are a type of closed-end fund regulated under the 1940 Act. BDCs are publicly-traded mezzanine/private equity funds that typically invest in and lend to small and medium-sized private companies that may not have access to public equity markets for capital raising. BDCs are unique in that at

least 70% of their investments must be made to private U.S. businesses and BDCs are required to make available significant managerial assistance to their portfolio companies. BDCs are not taxed on income distributed to shareholders provided they comply with the applicable requirements of the Code. BDCs have expenses associated with their operations. Accordingly, the Fund will indirectly bear its proportionate share of any management and other expenses, and of any performance based fees, charged by the BDCs in which it invests. Investments in BDCs are subject to various risks, including management’s ability to meet the BDC’s investment objective, and to manage the BDC’s portfolio when the underlying securities are redeemed or sold, during periods of market turmoil and as investors’ perceptions regarding a BDC or its underlying investments change. BDC shares are not redeemable at the option of the BDC shareholder and, as with shares of other closed-end funds; they may trade in the secondary market at a discount to their NAV.

Initial Public Offerings

The Fund may purchase securities of companies in initial public offerings (“IPOs”). By definition, IPOs have not traded publicly until the time of their offerings. Special risks associated with IPOs may include a limited number of shares available for trading, unseasoned trading, lack of investor knowledge of the company, and limited operating history, all of which may contribute to price volatility. Many IPOs are issued by undercapitalized companies of small- or micro-cap size. The effect of IPOs on the Fund’s performance depends on a variety of factors, including the number of IPOs the Fund invests in relative to the size of the Fund and whether and to what extent a security purchased in an IPO appreciates or depreciates in value. As the Fund’s asset base increases, IPOs often have a diminished effect on the Fund’s performance.

Risks of Investing in Small Companies

The Fund may invest in securities of small companies. Additional risks of such investments include the markets on which such securities are frequently traded. In many instances the securities of smaller companies are traded only over-the-counter or on a regional securities exchange, and the frequency and volume of their trading is substantially less than is typical of larger companies. Therefore, the securities of smaller companies may be subject to greater and more abrupt price fluctuations. When making large sales, the Fund may have to sell portfolio holdings at discounts from quoted prices or may have to make a series of small sales over an extended period of time due to the trading volume of smaller company securities. Investors should be aware that, based on the foregoing factors, an investment in the Fund may be subject to greater price fluctuations than an investment in a fund that invests exclusively in larger, more established companies. A Sub-Advisor’s research efforts may also play a greater role in selecting securities for the Fund than in a fund that invests in larger, more established companies.

Risks of Increased Reliance on Data Analytics

In recent years, the asset management business has become increasingly dependent on data analytics to support portfolio management, investment operations and compliance. The Advisor’s and Sub-Advisors’ regulators have also substantially increased the extent and complexity of the data analytic component of compliance requirements. A failure to source accurate data from third parties or to correctly analyze, integrate or apply data could result in operational, trade or compliance errors, could cause portfolio losses, and could lead to regulatory concerns.

Investment Restrictions

The Trust, on behalf of the Fund, has adopted the following restrictions as fundamental policies, which may not be changed without the favorable vote of the holders of a “majority of the outstanding voting securities,” as defined in the 1940 Act, of the Fund. Under the 1940 Act, the “vote of the holders of a majority of the outstanding voting securities” means the vote of the holders of the lesser of (i) 67% of the shares of the Fund represented at a meeting at which the holders of more than 50% of its outstanding shares are represented or (ii) more than 50% of the outstanding shares of the Fund.

As a matter of fundamental policy, the Fund is diversified; i.e., as to 75% of the value of its total assets: (i) no more than 5% of the value of its total assets may be invested in the securities of any one issuer (other than U.S. Government securities); and (ii) the Fund may not purchase more than 10% of the outstanding voting securities of an issuer. The Fund’s investment objective is also fundamental.

The following fundamental investment restrictions pertain to the Fund.

The Fund may not:

1. Issue senior securities, except as otherwise permitted by its fundamental policy on borrowing.

2. Borrow money, except that it may (a) borrow from banks (as defined in the 1940 Act) in amounts up to 33-1/3% of its total assets (including the amount borrowed), (b) borrow amounts equal to an additional 5% of its total assets for temporary purposes, (c) engage in transactions in mortgage dollar rolls and reverse repurchase agreements, make leveraged investments, and engage in other transactions that may entail the use of leverage, where, if necessary to comply with Section 18(f) of the 1940 Act, the Fund sets aside in a segregated account, and marks to market daily, liquid securities, such as cash, U.S. government securities, or high-grade debt obligations, equal to the Fund’s potential obligation or economic exposure under these transactions and instruments.

3. Purchase securities on margin, except such short-term credits as may be necessary for the clearance of transactions.

4. Act as underwriter (except to the extent the Fund may be deemed to be an underwriter in connection with the sale of securities in its investment portfolio).

5. Invest 25% or more of its net assets, calculated at the time of purchase and taken at market value, in any one industry (other than U.S. Government securities).

6. Purchase or sell real estate or interests in real estate, except that (i) the Fund may purchase securities backed by real estate or interests therein, or issued by companies, including real estate investment trusts, which invest in real estate or interests therein; and (ii) the Fund may acquire and dispose of real estate or interests in real estate acquired through the exercise of its rights as a holder of debt obligations secured by real estate or interests therein. (For purposes of this restriction, investments by the Fund in mortgage-backed securities and other securities representing interests in mortgage pools shall not constitute the purchase or sale of real estate or interests in real estate or real estate mortgage loans).

7. Purchase or sell commodities or commodity futures contracts, except that the Fund may purchase and sell stock index futures contracts and currency and financial futures contracts and related options in accordance with any rules of the CFTC.

8. Make loans of money (except for purchases of debt securities consistent with the investment policies of the Fund and except for repurchase agreements).

9. Make investments for the purpose of exercising control or management.

The Fund observes the following non-fundamental restrictions, which may be changed by a vote of the Board at any time:

The Fund may not:

1. Invest in the securities of other investment companies or purchase any other investment company’s voting securities or make any other investment in other investment companies except to the extent permitted by federal law. (Generally, the 1940 Act prohibits the Fund from investing more than 5% of the value of its total assets in any one investment company or more than 10% of the value of its total assets in investment companies as a group, and also restricts its investment in any investment company to 3% of the voting securities of such investment company. There are some exceptions, however, to these limitations pursuant to various rules promulgated by the SEC.)

2. Invest more than 15% of its net assets in securities that are restricted as to disposition or otherwise are illiquid or have no readily available market (except for securities that are determined by a Sub-Advisor, pursuant to procedures adopted by the Board, to be liquid).

BOARD OF TRUSTEES

The overall management of the business and affairs of the Trust is vested with its Board, which is responsible for protecting the interests of shareholders. The Trustees are experienced executives who meet throughout the year to oversee the activities of the Funds, review the compensation arrangements between the Advisor and the Sub-Advisors, review contractual arrangements with companies that provide services to the Funds, including the Advisor, Sub-Advisors, and the Funds’ administrator, custodian and transfer agent, and review the Funds’ performance. The day-to-day operations of the Trust are delegated to its officers, subject to the Fund’s investment objectives and policies and to general supervision by the Board. A majority of the Trustees are not otherwise affiliated with the Advisor or any of the Sub-Advisors.

Independent Trustees*


Name, Address and Year Born	Position(s) Held with the Trust	Term of Office and Length of Time Served	Principal Occupation(s) During Past Five Years	# of Portfolios in Fund Complex Overseen by Trustee	Other Directorships Held by Trustee During Past Five Years
Julie Allecta 1676 N. California Blvd., Suite 500 Walnut Creek, CA 94596 (born 1946)	Independent Trustee	Open-ended term; served since June 2013	Member of Governing Council, Policy Committee Chair and Executive Committee member, Independent Directors Council (education for investment company independent directors) since 2014; Director, Northern California Society of Botanical Artists (botanical art) since 2014; and Retired Partner, Paul Hastings LLP (law firm) from 1999 to 2009.	5	Forward Funds (17 portfolios) Salient MS Trust (4 portfolios)

Frederick A. Eigenbrod, Jr., Ph.D. 1676 N. California Blvd., Suite 500 Walnut Creek, CA 94596 (born 1941)	Independent Trustee	Open-ended term; served since inception	Vice President, RoutSource Consulting Services (organizational planning and development) since 2002.	5	None

Name, Address and

Year Born

Position(s)

Held with the

Trust

Term of

Office

and Length

Time Served

Principal Occupation(s)

During Past Five Years

# of
Portfolios
in Fund
Complex
Overseen
by
Trustee

Other

Directorships

Held by

Trustee

During

Past Five

Years

Harold M. Shefrin, Ph.D.

1676 N. California Blvd.,

Suite 500

Walnut Creek, CA 94596

(born 1948)

Independent Trustee

Open-ended term;

served since February 2005

Professor, Department of Finance, Santa Clara University since 1979.

SA Funds – Investment Trust (10 portfolios)

Interested Trustees & Officers


Name, Address and Year Born	Position(s) Held with the Trust	Term of Office and Length of Time Served	Principal Occupation(s) During Past Five Years	# of Portfolios in Fund Complex Overseen by Trustee	Other Directorships Held by Trustee/ Officer During Past Five Years
Jeremy DeGroot** 1676 N. California Blvd., Suite 500 Walnut Creek, CA 94596 (born 1963)	Chairman of the Board, Trustee and President	Open-ended term; served as a Chairman since March 2017, Trustee since December 2008 and President since 2014	Chief Investment Officer of Litman Gregory Asset Management, LLC since 2008; and Co-Chief Investment Officer of Litman Gregory Asset Management, LLC from 2003 to 2008.	5	None

Stephen Savage 1676 N. California Blvd., Suite 500 Walnut Creek, CA 94596 (born 1961)	Secretary	Open-ended term; served since 2014	Chief Executive Officer of the Advisor since 2015; Managing Partner of the Advisor since 2010; Partner of the Advisor from 2003 to 2010.	N/A	None

John Coughlan 1676 N. California Blvd., Suite 500 Walnut Creek, CA 94596 (born 1956)	Treasurer and Chief Compliance Officer	Open-ended term; served as Treasurer since inception, and as Chief Compliance Officer since September 2004	Chief Operating Officer and Chief Compliance Officer of the Advisor since 2004.	N/A	None

*	Denotes Trustees who are not “interested persons” of the Trust, as such term is defined under the 1940 Act (the “Independent Trustees”).

**	Denotes Trustees who are “interested persons” of the Trust, as such term is defined under the 1940 Act, because of their relationship with the Advisor (the “Interested Trustees”).

In addition, Jack Chee and Rajat Jain, each a Senior Research Analyst at the Advisor, are each an Assistant Secretary of the Trust.

Additional Information Concerning Our Board of Trustees

The Role of the Board

The Board oversees the management and operations of the Trust. Like most mutual funds, the day-to-day management and operation of the Trust is performed by various service providers to the Trust, such as the Advisor, the Sub-Advisors, and the Funds’ distributor, administrator, custodian, and transfer agent, each of which is discussed in greater detail in this SAI. The Board has appointed senior employees of certain of these service providers as officers of the Trust, with the responsibility to monitor and report to the Board on the Trust’s operations. In conducting this oversight, the Board receives regular reports from these officers and service providers regarding the Trust’s operations. For example, investment officers report on the performance of the Funds. The Board has appointed a Chief Compliance Officer who administers the Trust’s compliance program and regularly reports to the Board as to compliance matters. Some of these reports are provided as part of formal “Board Meetings,” which are typically held quarterly, in person, and involve the Board’s review of recent Trust operations. From time to time, one or more members of the Board may also meet with management in less formal settings, between formal “Board Meetings,” to discuss various topics. In all cases, however, the role of the Board and of any individual Trustee is one of oversight and not of management of the day-to-day affairs of the Trust and its oversight role does not make the Board a guarantor of the Trust’s investments, portfolio pricing, operations or activities.

Board Structure, Leadership

The Board has structured itself in a manner that it believes allows it to perform its oversight function effectively. It has established three standing committees, an Audit Committee, a Nominating Committee and a Qualified Legal Compliance Committee, which are discussed in greater detail under “ Board of Trustees – Board Committees” below. Each of the three standing committees of the Board is comprised entirely of Independent Trustees. The Board does not currently have a designated lead Independent Trustee. The Independent Trustees have engaged their own independent counsel to advise them on matters relating to their responsibilities in connection with the Trust. The Board reviews its leadership structure periodically as part of its annual self-assessment process and believes that its structure is appropriate to enable the Board to exercise its oversight of the Trust.

Presently, Mr. DeGroot serves as the Chairman of the Board and President of the Trust and Chief Investment Officer of the Advisor. Mr. DeGroot is an “interested person” of the Trust, as defined in the 1940 Act, by virtue of his employment relationship with the Advisor. In developing the Board’s structure, the Board has determined that Mr. DeGroot’s history with the Trust, familiarity with the Funds’ investment objectives and extensive experience in the field of investments qualifies him to serve as the Chairman of the Board. The Board has also determined that the function and composition of the Audit Committee and Nominating Committees are appropriate means to address any potential conflicts of interest that may arise from the Chairman’s status as an Interested Trustee.

Board Oversight of Risk Management

As part of its oversight function, the Board receives and reviews various risk management reports and assessments and discusses these matters with appropriate management and other personnel. Risk management is a broad concept comprised of many disparate elements (such as, for example, investment risk, issuer and counterparty risk, compliance risk, operational risk, valuation risk and business continuity risk). Consequently, Board oversight of different types of risks is handled in different ways. In the course of providing oversight, the Board and its

committees receive reports on the Trust’s activities regarding the Trust’s investment portfolios and its financial accounting and reporting. The Board also receives periodic reports as to how the Advisor conducts service provider oversight and how it monitors for other risks, such as derivatives risk, business continuity risks and risks that might be present with individual Sub-Advisors or specific investment strategies. The Audit Committee meets regularly with the Chief Compliance Officer to discuss compliance and operational risks. The Audit Committee’s meetings with the Treasurer and the Trust’s independent registered public accounting firm also contribute to its oversight of certain internal control risks. The full Board receives reports from the Advisor as to investment risks as well as other risks that may be also discussed in the Audit Committee.

The Board receives regular reports from a “Valuation Committee,” composed of the following senior employees of the Advisor: John Coughlan, Jeremy DeGroot, Jack Chee and Rajat Jain. The Valuation Committee operates pursuant to the Trust’s Valuation Procedures, as approved by the Board. The Valuation Committee reports to the Board on the valuation of the Funds’ portfolio securities, reviews the performance of each approved pricing service, and recommends to the Board for approval pricing agents for the valuation of Fund holdings.

The Trust believes that the Board’s role in risk oversight must be evaluated on a case-by-case basis and that its existing role in risk oversight is appropriate. However, not all risks that may affect the Trust can be identified or processes and controls developed to eliminate or mitigate their occurrence or effects, and some risks are beyond any control of the Trust, the Advisor or its affiliates or other service providers.

Information about Each Trustee’s Qualification, Experience, Attributes or Skills

The Board believes that each of the Trustees has the qualifications, experience, attributes and skills (“Trustee Attributes”) appropriate to their continued service as Trustees of the Trust in light of the Trust’s business and structure. Each of the Trustees has a demonstrated record of business and professional accomplishment that indicates that they have the ability to critically review, evaluate and assess information provided to them. Certain of these business and professional experiences are set forth in detail in the charts above. In addition, certain of the Trustees have served on boards for organizations other than the Trust, and each of the Trustees has served on the Board of the Trust for a number of years. They therefore have substantial boardroom experience and, in their service to the Trust, have gained substantial insight as to the operation of the Trust and have demonstrated a commitment to discharging oversight duties as Trustees in the interest of shareholders.

In addition to the information provided in the charts above, certain additional information concerning each particular Trustee and certain of their Trustee Attributes is provided below. The information provided below, and in the charts above, is not all-inclusive. Many Trustee Attributes involve intangible elements, such as intelligence, work ethic, and the ability to work together, to communicate effectively, to exercise judgment, to ask incisive questions, to manage people and problems, and to develop solutions. The Board annually conducts a self-assessment wherein the effectiveness of the Board and individual Trustees is reviewed. In conducting its annual self-assessment, the Board has determined that the Trustees have the appropriate attributes and experience to continue to serve effectively as Trustees of the Trust.

The summaries set forth below as to the qualifications, attributes, and skills of the Trustees are furnished in response to disclosure requirements imposed by the SEC, do not constitute any representation or guarantee that the Board or any Trustee has any special expertise or experience, and do not impose any greater or additional responsibility or obligation on, or change any standard of care applicable to, any such person or the Board as a whole than otherwise would be the case.

Mr. DeGroot’s Trustee Attributes include his position as principal and Chief Investment Officer of Litman Gregory Asset Management, LLC (“LGAM”). In this position, Mr. DeGroot is responsible for overseeing Sub-Advisor due diligence, asset class research and portfolio tactical allocation decisions. Mr. DeGroot is also Portfolio

Manager of the Alternative Strategies Fund and Co-Portfolio Manager of the Equity Fund, the International Fund and the Smaller Companies Fund. He is frequently quoted in the national media in the areas of asset allocation and manager selection. He holds the Chartered Financial Analyst^® (CFA^®) designation. Mr. DeGroot also has prior experience as an economics consultant and economist.

Ms. Allecta’s Trustee Attributes include her significant professional experience in the legal field as counsel to various mutual funds and private funds. Ms. Allecta also has mutual fund board experience, having served on the board of trustees of Forward Funds since 2012, the advisory board of Forward Funds since 2010, and the board of trustees of the Salient MS Trust since 2015. Ms. Allecta has also been a member of the Governing Council of the Independent Directors Council since 2014.

Mr. Eigenbrod’s Trustee Attributes include his significant business advisory experience serving on the Board of Directors for Right Management Consultants providing management and organizational development consulting service as an independent consultant and executive coach.

Mr. Shefrin’s Trustee Attributes include his distinguished academic career as a Professor at Santa Clara University, where he teaches finance. Mr. Shefrin also has a number of years of mutual fund board experience, having served on the board of trustees of SA Funds - Investment Trust since 1999.

Board Committees

The Board has three standing committees as described below:

Audit Committee

Members

Description

Committee Meetings

During Fiscal Year Ended

December 31, 2017

Julie Allecta

Frederick A. Eigenbrod, Jr., Ph.D.

Harold M. Shefrin, Ph.D. (Chairman)

Responsible for advising the full Board with respect to accounting, auditing and financial matters affecting the Trust.


Qualified Legal Compliance Committee

Members	Description	Committee Meetings During Fiscal Year Ended December 31, 2017
Julie Allecta Frederick A. Eigenbrod, Jr., Ph.D. Harold M. Shefrin, Ph.D.	Responsible for the receipt, review and consideration of any report made or referred to it by an attorney of evidence of a material violation of applicable U.S. federal or state securities law, material breach of a fiduciary duty under U.S. federal or state law or a similar material violation by the Trust or by any officer, Trustee, employee or agent of the Trust	0

Nominating Committee

Members	Description	Committee Meetings During Fiscal Year Ended December 31, 2017
Julie Allecta Frederick A. Eigenbrod, Jr., Ph.D. (Chairman) Harold M. Shefrin, Ph.D.	Responsible for evaluating the size and compensation of the Board and seeking and reviewing candidates for consideration as nominees for Trustees.	0

Trustee Ownership of Fund Shares

As of December 31, 2017, the Trustees owned the following dollar range of shares of the Funds ⁽¹⁾:


Name of Trustee	Equity Fund	International Fund	Smaller Companies Fund	Alternative Strategies Fund	Aggregate Dollar Range of Equity Securities in all Registered Investment Companies Overseen by Trustee in Family of Investment Companies ⁽²⁾
Independent Trustees
Julie Allecta	E	A	A	A	E
Frederick A. Eigenbrod, Jr., Ph.D.	E	D	A	E	E
Harold M. Shefrin, Ph.D.	A	E	A	A	E
Interested Trustees
Jeremy DeGroot	E	E	E	E	E
Taylor M. Welz⁽³⁾	E	D	D	E	E

⁽¹⁾	Dollar Range of Equity Securities in the Fund:

A=None

B=$1-$10,000

C=$10,001-$50,000

D=$50,001-$100,000

E= Over $100,000

⁽²⁾	As of December 31, 2017, the Trustees each oversaw four registered investment companies in the fund complex.

⁽³⁾	Effective December 12, 2017, Mr. Welz became an Interested Trustee; effective June 1, 2018, Mr. Welz resigned as a Trustee of the Trust.

Trustee Interest in Investment Advisor, Distributor or Affiliates

As of December 31, 2017, the Independent Trustees, and their respective immediate family members, did not own any securities beneficially or of record in the Advisor, the Sub-Advisors, ALPS Distributors, Inc. (the “Distributor”) or any of their respective affiliates. Further, the Independent Trustees and their respective immediate family members did not have a direct or indirect interest, the value of which exceeds $120,000, in the Advisor, the Sub-Advisors, the Distributor, or any of their respective affiliates during the two most recently completed calendar years.

Compensation

For the year ended December 31, 2017 each Independent Trustee received an annual fee of $90,000, allocated $9,000 per Fund with the remaining balance pro-rated quarterly based on each Fund’s assets, plus expenses incurred by the Trustees in connection with attendance at meetings of the Board and its committees.

As of the date of this SAI, to the best of the knowledge of the Trust, the Board and the officers of the Funds, as a group, owned of record less than 1% of the outstanding shares of the High Income Alternatives Fund.

The table below illustrates the annual compensation paid to each Trustee of the Trust during the fiscal year ended December 31, 2017. The High Income Alternatives Fund is not included in the table below because it had not commenced operations as of December 31, 2017.


	Aggregate Compensation from
Name of Person, Position	Equity Fund		International Fund		Smaller Companies Fund		Alternative Strategies Fund		Pension or Retirement Benefits Accrued as Part of Fund Expenses	Estimated Annual Benefits Upon Retirement	Total Compensation from Trust Paid to Trustees
Independent Trustees

Julie Allecta, Trustee	$	17,650	$	22,200	$	13,933	$	36,216	None	None	$	90,000
Frederick A. Eigenbrod, Jr., Ph.D. Trustee	$	17,650	$	22,200	$	13,933	$	36,216	None	None	$	90,000
Harold M. Shefrin, Ph.D. Trustee	$	17,650	$	22,200	$	13,933	$	36,216	None	None	$	90,000
Interested Trustees

Jeremy DeGroot, President and Trustee*		None		None		None		None	None	None		None
Taylor M. Welz, Trustee* ^	$	17,650	$	22,200	$	13,933	$	36,216	None	None	$	90,000

*	As of December 31, 2017, Messrs. DeGroot and Welz were Interested Trustees because of their relationship with the Advisor and accordingly served on the Board without compensation.

^	Effective December 12, 2017, Mr. Welz became an Interested Trustee; effective June 1, 2018, Mr. Welz resigned as a Trustee of the Trust.

Control Persons and Principal Shareholders

A principal shareholder is any person who owns (either of record or beneficially) 5% or more of the outstanding shares of any class of any of the Funds. A control person is one who owns, either directly or indirectly, more than 25% of the voting securities of the Fund or acknowledges the existence of such control. A control person can have a significant impact on the outcome of a shareholder vote. Because the High Income Alternatives Fund is newly formed, no persons own of record or beneficially 5% or more or its outstanding shares as of August 31, 2018.

PORTFOLIO HOLDINGS DISCLOSURE POLICIES AND PROCEDURES

The Board has adopted policies to ensure that any disclosure of information about the Funds’ portfolio holdings is in the best interest of Fund shareholders; and to make clear that information about the Funds’ portfolio holdings should not be distributed to any person unless:

•

The disclosure is required to respond to a regulatory request, court order or other legal proceedings;

•

The disclosure is to a mutual fund rating or statistical agency or person performing similar functions who has signed a confidentiality agreement with the Trust;

•

The disclosure is made to internal parties involved in the investment process, administration or custody of the Funds, including but not limited to the Advisor, the Sub-Advisors and the Board;

•

The disclosure is (a) in connection with a quarterly, semi-annual or annual report that is available to the public or (b) relates to information that is otherwise available to the public ( e.g., portfolio information that is available on a Fund’s website); or

•

The disclosure is made pursuant to prior written approval of the Chief Compliance Officer of the Advisor or the Funds, or the President of the Trust.

The Funds make their portfolio holdings publicly available on the Funds’ website 15 days after the end of each calendar quarter.

The Funds do not have any individualized ongoing arrangements to make available information about the Funds’ portfolio securities to any person other than the disclosures made, as described above, to internal parties

involved in the Funds’ investment process, administration or custody of the Funds. To the extent required to perform services for the Funds or the Advisor, the Funds’ or the Advisor’s legal counsel or the Funds’ auditors may obtain portfolio holdings information. Such information is provided subject to confidentiality requirements.

THE ADVISOR AND THE SUB-ADVISORS

The Advisor is a registered investment advisor with the SEC under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). The Advisor is wholly owned by LGAM. Craig Litman, Kenneth Gregory and certain other senior employees of LGAM own approximately 85% of LGAM, and the remainder of LGAM is owned by a private equity firm.

Subject to the supervision of the Board, investment management and related services are provided by the Advisor to each of the Funds, pursuant to an investment advisory agreement (the “Advisory Agreement”). The Trust, on behalf of the Funds, and the Advisor are parties to the Advisory Agreement. Shareholders are not parties to, or intended (or “third party”) beneficiaries of, the Advisory Agreement. Rather, the Trust and its respective investment series are the sole intended beneficiaries of the Advisory Agreement. Neither this SAI nor the Prospectus is intended to give rise to any contract rights or other rights in any shareholder, other than any rights conferred by federal or state securities laws that may not be waived.

In addition, the assets of each Fund are divided into segments by the Advisor, and individual selection of securities in each segment is provided by a Sub-Advisor approved by the Board pursuant, in each case, to an investment sub-advisory agreement (each, a “Management Agreement”). Under the Advisory Agreement, the Advisor has agreed to (i) furnish each Fund with advice and recommendations with respect to the selection and continued employment of Sub-Advisors to manage the actual investment of each Fund’s assets; (ii) direct the allocation of each Fund’s assets among such Sub-Advisors; (iii) oversee the investments made by such Sub-Advisors on behalf of each Fund, subject to the ultimate supervision and direction of the Board; (iv) oversee the actions of the Sub-Advisors with respect to voting proxies for each Fund, filing Section 13 ownership reports with the SEC for each Fund, and taking other actions on behalf of each Fund; (v) maintain the books and records required to be maintained by each Fund except to the extent arrangements have been made for such books and records to be maintained by the administrator, another agent of each Fund or a Sub-Advisor; (vi) furnish reports, statements and other data on securities, economic conditions and other matters related to the investment of each Fund’s assets that each Fund’s administrator or distributor or the officers of the Trust may reasonably request; and (vii) render to the Board such periodic and special reports with respect to each Fund’s investment activities as the Board may reasonably request, including at least one in-person appearance annually before the Board.

The Advisor has agreed, at its own expense, to maintain such staff and employ or retain such personnel and consult with such other persons as it shall from time to time determine to be necessary to the performance of its obligations under the Advisory Agreement. Personnel of the Advisor may serve as officers of the Trust provided they do so without compensation from the Trust. Without limiting the generality of the foregoing, the staff and personnel of the Advisor shall be deemed to include persons employed or retained by the Advisor to furnish statistical information, research, and other factual information, advice regarding economic factors and trends, information with respect to technical and scientific developments, and such other information, advice and assistance as the Advisor or the Board may desire and reasonably request. With respect to the operation of each Fund, the Advisor has agreed to be responsible for (i) providing the personnel, office space and equipment reasonably necessary for the operation of the Trust and each Fund including the provision of persons qualified to serve as officers of the Trust; (ii) compensating the Sub-Advisors selected to invest the assets of each Fund; (iii) the expenses of printing and distributing extra copies of each Fund’s prospectus, statement of additional information, and sales and advertising materials (but not the legal, auditing or accounting fees incurred thereto) to prospective investors (but not to existing shareholders); and (iv) the costs of any special Board meetings or shareholder meetings convened for the primary benefit of the Advisor or any Sub-Advisor.

Under each Management Agreement, each Sub-Advisor agrees to invest its allocated portion of the assets of each Fund in accordance with the investment objectives, policies and restrictions of each Fund as set forth in the

Trust’s and each Fund’s governing documents, including, without limitation, the Trust’s Agreement and Declaration of Trust and By-Laws; each Fund’s prospectus, statement of additional information, and undertakings; and such other limitations, policies and procedures as the Advisor or the Trustees of the Trust may impose from time to time in writing to the Sub-Advisor. In providing such services, each Sub-Advisor shall at all times adhere to the provisions and restrictions contained in the federal securities laws, applicable state securities laws, the Code, and other applicable law.

Without limiting the generality of the foregoing, each Sub-Advisor has agreed to (i) furnish each Fund with advice and recommendations with respect to the investment of the Sub-Advisor’s allocated portion of each Fund’s assets; (ii) effect the purchase and sale of portfolio securities for the Sub-Advisor’s allocated portion or determine that a portion of such allocated portion will remain uninvested; (iii) manage and oversee the investments of the Sub-Advisor’s allocated portion, subject to the ultimate supervision and direction of the Board; (iv) vote proxies and take other actions with respect to the securities in the Sub-Advisor’s allocated portion; (v) maintain the books and records required to be maintained with respect to the securities in the Sub-Advisor’s allocated portion; (vi) furnish reports, statements and other data on securities, economic conditions and other matters related to the investment of each Fund’s assets which the Advisor, Trustees or the officers of the Trust may reasonably request; and (vii) render to the Board such periodic and special reports with respect to Sub-Advisor’s allocated portion as the Board may reasonably request.

As compensation for the Advisor’s services (including payment of the Sub-Advisors’ fees), each Fund pays the Advisor an advisory fee at the rate specified in the prospectus. In addition to the fees payable to the Advisor and the Funds’ administrator, the Trust is responsible for its operating expenses, including: fees and expenses incurred in connection with the issuance, registration and transfer of its shares; brokerage and commission expenses; all expenses of transfer, receipt, safekeeping, servicing and accounting for the cash, securities and other property of the Trust for the benefit of each Fund including all fees and expenses of its custodian, shareholder services agent and accounting services agent; interest charges on any borrowings; costs and expenses of pricing and calculating its daily NAV and of maintaining its books of account required under the 1940 Act; taxes, if any; a pro rata portion of expenditures in connection with meetings of each Fund’s shareholders and the Board that are properly payable by each Fund; salaries and expenses of officers and fees and expenses of members of the Board or members of any advisory board or committee who are not members of, affiliated with or interested persons of the Advisor; insurance premiums on property or personnel of each Fund that inure to its benefit, including liability and fidelity bond insurance; the cost of preparing and printing reports, proxy statements, prospectuses and statements of additional information of each Fund or other communications for distribution to existing shareholders; legal, auditing and accounting fees; trade association dues; fees and expenses (including legal fees) of registering and maintaining registration of its shares for sale under federal and applicable state and foreign securities laws; all expenses of maintaining and servicing shareholder accounts, including all charges for transfer, shareholder recordkeeping, dividend disbursing, redemption, and other agents for the benefit of each Fund, if any; and all other charges and costs of its operation plus any extraordinary and non-recurring expenses, except as otherwise prescribed in the Advisory Agreement.

Pursuant to a separate Operating Expenses Limitation Agreement (the “Expenses Limitation Agreement”), the Advisor has also agreed to limit the ordinary operating expenses of the High Income Alternatives Fund, through April 30, 2020 (unless otherwise sooner terminated), to an annual rate of 0.98% for the Institutional Class and 1.23% for the Investor Class. Such annual rates are expressed as a percentage of the daily net assets of the High Income Alternatives Fund attributable to the applicable class. Any fee waiver or expense reimbursement made by the Advisor pursuant to the Expenses Limitation Agreement is subject to the repayment by the High Income Alternatives Fund within three (3) years of the date such amounts were waived or reimbursed, but only if the High Income Alternatives Fund is able to make the repayment without exceeding the expense limitation in effect at the time of such waiver/reimbursement and the time of recoupment, and the repayment is approved by the Board. The Advisor has waived its right to receive reimbursement of the portion of its advisory fees waived with respect to prior

periods pursuant to this agreement. The Advisor has contractually agreed through April 30, 2020, to waive a portion of its advisory fees so that after paying all of the sub-advisory fees, the net advisory fee as a percentage of the High Income Alternative Fund’s daily net assets retained by the Advisor is 0.40% on the first $1 billion of assets, 0.375% on the next $1 billion of assets, 0.35% on the next $1 billion of assets, 0.325% on the next $1 billion of assets and 0.30% on assets in excess of $4 billion. This agreement may be terminated at any time by the Board of Trustees of the Trust upon sixty (60) days’ written notice to the Advisor, and the Advisor may decline to renew this agreement by written notice to the Trust at least thirty (30) days before the agreement’s annual expiration date. Operating expenses referred to in this paragraph includes management fees payable to the Advisor but exclude any taxes, interest, brokerage commissions, expenses incurred in connection with any merger or reorganization, borrowing costs (including commitment fees), dividend expenses, acquired fund fees and expenses and extraordinary expenses such as but not limited to litigation costs.

Under the Advisory Agreement and each Management Agreement, the Advisor and the Sub-Advisors will not be liable to the Trust for any error of judgment by the Advisor or the Sub-Advisors or any loss sustained by the Trust except in the case of a breach of fiduciary duty with respect to the receipt of compensation for services (in which case any award of damages will be limited as provided in the 1940 Act) or of willful misfeasance, bad faith or gross negligence by reason of reckless disregard of its obligations and duties under the applicable agreement.

The Advisory Agreement and the Management Agreements remain in effect for an initial period not to exceed two years. Thereafter, if not terminated, the Advisory Agreement and each Management Agreement will continue automatically for successive annual periods, provided that such continuance is specifically approved at least annually (i) by a majority vote of the Independent Trustees cast in person at a meeting called for the purpose of voting on such approval, and (ii) by the Board or by vote of a majority of the outstanding voting securities of a Fund.

The Advisory Agreement and Management Agreements are terminable by vote of the Board or by the holders of a majority of the outstanding voting securities of a Fund at any time without penalty, upon 60 days’ written notice to the Advisor or a Sub-Advisor, as applicable. The Advisory Agreement and the Management Agreements also may be terminated by the Advisor or a Sub-Advisor, as applicable, upon 60 days’ written notice to the applicable Fund. The Advisory Agreement and the Management Agreements terminate automatically upon their assignment (as defined in the 1940 Act).

In determining whether to renew the Advisory Agreement and the Management Agreements each year, the Board requests and evaluates information provided by the Advisor and the Sub-Advisors, in accordance with Section 15(c) of the 1940 Act. At a Board meeting held on August 28, 2018, the Board approved the Management Agreement of the High Income Alternatives Fund for an initial two-year period from the Fund’s commencement of operations. A discussion regarding the Board’s basis for approving the High Income Alternatives Fund’s investment advisory agreement with Advisor and each Sub-Advisor will be available in the Fund’s first Annual Report or Semi-Annual Report to Shareholders following the effective date of the Fund’s registration statement.

ADDITIONAL PORTFOLIO MANAGER INFORMATION

The following section provides information regarding each portfolio manager’s compensation, other accounts managed, material conflicts of interests, and any ownership of securities in the Funds for which they sub-advise. Each portfolio manager or team member is referred to as a portfolio manager below. The portfolio managers are shown together in this section only for ease in presenting the information and should not be viewed for purposes of comparing the portfolio managers or their firms against one another. Each firm is a separate entity that may employ different compensation structures and may have different management requirements, and each portfolio manager may be affected by different conflicts of interest.

Other Accounts Managed by Portfolio Managers

The table below identifies, for each portfolio manager of the High Income Alternatives Fund, the number of accounts managed (excluding the Fund) and the total assets in such accounts, within each of the following categories: registered investment companies, other pooled investment vehicles, and other accounts. To the extent that any of these accounts are based on account performance, this information is reflected in separate tables below. Information in all tables is shown as of June 30, 2018, unless otherwise indicated. Asset amounts are approximate and have been rounded.


	Registered Investment Companies (excluding the Fund)				Other Pooled Investment Vehicles				Other Accounts
Fund and Portfolio Manager (Firm)	Number of Accounts		Total Assets in the Accounts		Number of Accounts		Total Assets in the Accounts		Number of Accounts		Total Assets in the Accounts
High Income Alternatives Fund
Jeremy D. DeGroot (Litman Gregory)		4	$	3.3 billion		0	$	0		0	$	0
Jack Chee (Litman Gregory)		2	$	375.8 million		0	$	0		0	$	0
Jason Steuerwalt (Litman Gregory)		0	$	0		0	$	0		0	$	0
Greg Mason (Ares)		0	$	0		1	$	17.0 million		2	$	335.2 million
Troy Ward (Ares)		0	$	0		1	$	17.0 million		2	$	335.2 million
Andrew P. Hofer (BBH)		3	$	8.0 billion		2	$	826 million		97	$	15.9 billion
Neil Hohmann (BBH)		2	$	6.3 billion		2	$	826 million		97	$	15.9 billion
Paul Kunz (BBH)		0	$	0		1	$	148 million		0	$	0
Scott Minerd (Guggenheim)		17	$	22.3 billion		75	$	20.3 billion		133	$	144.3 billion
Anne Walsh (Guggenheim)		18	$	26.1 billion		5	$	3.1 billion		37	$	96.3 billion
Steven Brown (Guggenheim)		14	$	22.1 billion		5	$	3.1 billion		20	$	10.3 billion
Adam Bloch (Guggenheim)		14	$	22.1 billion		5	$	3.1 billion		23	$	10.3 billion
Derek Devens (Neuberger Berman)		3	$	373 million		5	$	1.5 billion		48	$	1.8 billion

The following table reflects information regarding accounts for which the portfolio manager has day-to-day management responsibilities and with respect to which the advisory fee is based on account performance. The Fund’s portfolio managers not listed below reported that they do not provide day-to-day management of accounts with performance-based advisory fees. Information is shown as of June 30, 2018, unless otherwise indicated. Asset amounts are approximate and have been rounded.

Other Accounts That Pay Performance-Based Advisory Fees Managed by Portfolio Managers


	Registered Investment Companies				Other Pooled Investment Vehicles				Other Accounts
Fund and Portfolio Manager (Firm)	Number of Accounts		Total Assets in the Accounts		Number of Accounts		Total Assets in the Accounts		Number of Accounts		Total Assets in the Accounts
High Income Alternatives Fund
Greg Mason (Ares)		0	$	0		0	$	0		1	$	335.2 million
Troy Ward (Ares)		0	$	0		0	$	0		1	$	335.2 million
Scott Minerd (Guggenheim)		0	$	0		39	$	10.9 billion		5	$	650.4 million
Anne Walsh (Guggenheim)		0	$	0		2	$	2.2 billion		3	$	267.8 million
Steven Brown (Guggenheim)		0	$	0		2	$	2.2 billion		3	$	267.8 million
Adam Bloch (Guggenheim)		0	$	0		2	$	2.2 billion		3	$	267.8 million

Material Conflicts of Interest

Actual or apparent material conflicts of interest may arise when a portfolio manager has day-to-day management responsibilities with respect to more than one investment account or in other circumstances. Portfolio managers of each of the following Sub-Advisors who manage other investment accounts in addition to one or more of the Funds may be presented with the potential conflicts described below.

ARES MANAGEMENT LLC (“Ares”)

Sub-Advisor to the Fund

Ares and its affiliates may, from time to time, face conflicts of interest relating to their dealings with the High Income Alternatives Fund. Ares and its affiliates also provide investment advisory and management services to other investment funds and clients (“Other Ares Funds”) that use similar strategies. Ares may give advice and recommend securities to others, which advice or securities may be identical to, or differ from, advice given to, or securities recommended or bought for, the High Income Alternatives Fund, even though their investment objectives may be the same or similar. Such other funds and accounts may be subject to different fees and expenses, and Ares or its affiliates may own interests in some of such other funds and accounts. In the ordinary course of its activities, Ares and its affiliates may, from time to time, buy or sell for other accounts, including their own accounts and for family members and friends who do not invest in the High Income Alternatives Fund, the same securities as those traded by High Income Alternatives Fund.

When it is determined that it would be appropriate for the High Income Alternatives Fund and one or more Other Ares Funds to participate in an investment opportunity, Ares will seek to execute orders for all of the participating investment accounts, including the High Income Alternatives Fund, on an equitable basis, taking into account such factors as the investment objectives of the participating investment accounts, the relative amounts of capital available for new investments, relative exposure to market trends, transaction costs, the portfolio positions of the participating investment accounts, debt covenants or other structural requirements and the manner in which the investment in question is likely to affect the amount of available capital after the investment is made. Orders may be combined for all such accounts, and if any order is not filled at the same price, they may be allocated on an average price basis. Similarly, if an order on behalf of more than one account cannot be fully executed under prevailing market conditions, investments may be allocated among the different accounts on a basis which Ares or its affiliates consider equitable. Such aggregation of orders may not always be to the benefit of the High Income Alternatives Fund with regard to the price or quantity executed. Although Ares will act in a manner that it considers fair and equitable in allocating investment opportunities among the High Income Alternatives Fund and the accounts of its other clients, situations may arise in which the account activities of Ares, its affiliates or other clients may disadvantage the High Income Alternatives Fund. Such situations may include, among others, the inability of the market fully to absorb orders for the purchase or sale of particular securities placed by the Advisor for the High Income Alternatives Fund and other accounts at prices and in quantities that would be obtainable if the same were being placed only for the High Income Alternatives Fund or during times when certain accounts are in a “ramp-up” or “wind-down” phase. The performance of different accounts managed by Ares and its affiliates may vary. Neither Ares nor its affiliates has any affirmative obligation to offer any investments to the High Income Alternatives Fund or to inform the High Income Alternatives Fund before offering any investments to Other Ares Funds.

Ares and its affiliates may purchase on behalf of its clients, including the High Income Alternatives Fund, different classes of debt and/or equity of the same borrower or issuer. These and other investments may be deemed to create a conflict of interest, particularly because Ares may take certain actions for some clients with respect to one class of debt or equity that may be adverse to other clients who hold other classes of debt or equity of the same borrower or issuer. In addition, other accounts managed

by Ares or its affiliates may seek to sell investments that are also held by the High Income Alternatives Fund at different times. For example, an account in liquidation or wind-down, or with a different strategy or withdrawal terms, may seek to sell an investment before the High Income Alternatives Fund seeks to sell such investment, which could adversely affect the market value of the investment that is still held by the High Income Alternatives Fund. In such cases, Ares will act in a manner it reasonably believes to be most equitable to all clients under the circumstances.

Ares or its affiliates may also manage separate managed accounts or dedicated investment vehicles for institutional investors that pursue strategies similar to, or that overlap with, those of the High Income Alternatives Fund. These clients may have access to detailed information about their accounts, including current portfolio holdings, which Ares does not customarily make available to investors in pooled investment vehicles. Such clients may be able to take action, including more timely action, with respect to their accounts that investors in pooled vehicles with similar or parallel strategies cannot take. Ares and its affiliates determine how certain expenses are allocated among the High Income Alternatives Fund and Other Ares Funds.

Cross Trades

Ares may cause the High Income Alternatives Fund to engage in cross trades with one or more Other Ares Funds, or its affiliates, typically for purposes of rebalancing the portfolios of the High Income Alternatives Fund and such other funds or accounts, to further the High Income Alternatives Fund’s and such other funds’ or accounts’ respective investment programs, or for other reasons consistent with the investment and operating guidelines of the High Income Alternatives Fund and such other funds or accounts. Generally, the value of any positions that are cross-traded in this manner will be determined in a manner that is consistent with the fair valuation methodologies that are used by Ares.

Other Activities

Ares and its members, officers and employees will devote so much of their time to the activities of the High Income Alternatives Fund as they deem necessary and appropriate. Ares and its affiliates are not restricted from forming additional investment funds, from entering into other investment advisory relationships or from engaging in other business activities, even though such activities may be in competition with the High Income Alternatives Fund and/or may involve substantial time and resources of Ares. These activities could be viewed as creating a conflict of interest in that the time and effort of the members of Ares and its officers and employees will not be devoted exclusively to the business of the High Income Alternatives Fund but will be allocated between the business of the High Income Alternatives Fund and the management of the monies of other advisees of members of Ares. Additionally, Ares and its affiliates may, and expect to, receive fees or other compensation from third parties in connection with these investment activities and such fees and compensation shall be for the benefit of their own account and not for the High Income Alternatives Fund.

Investments in Which Ares and/or Other Ares Funds Have a Different Principal Interest

Ares and its affiliates, including Other Ares Funds, invest in a broad range of asset classes throughout the corporate capital structure, including investments in corporate loans and debt securities, preferred equity securities, and common equity securities. Accordingly, subject to any limitations under applicable law, Ares and Other Ares Funds may invest in different parts of the capital structure of a company or other issuer in which the High Income Alternatives Fund invests. The interests of the High Income Alternatives Fund and such Other Ares Funds may not always be aligned, which may give rise to actual or potential conflicts of interest, or the appearance of such conflicts of interest. Actions taken for the High Income Alternatives Fund may be adverse to Ares or an Other Ares Fund, or vice versa.

Service Providers

Certain advisors and other service providers, or their affiliates (including accountants, administrators, lenders, bankers, brokers, attorneys, consultants, and investment or commercial banking firms) to the High Income Alternatives Fund, Ares and/or certain entities in which the High Income Alternatives Fund has an investment also provide goods or services to, or have business, personal, financial or other relationships with, Ares, its affiliates and portfolio companies. Such advisors and service providers may be investors in High Income Alternatives Fund, sources of investment opportunities or co-investors or commercial counterparties or entities in which Ares and/or Other Ares Funds have an investment, and payments by the High Income Alternatives Fund and/or such portfolio entities may indirectly benefit Ares and/or such Other Ares Funds. Additionally, certain employees of Ares may have family members or relatives employed by such advisors and service providers. These relationships may influence Ares in deciding whether to select or recommend such service providers to perform services for the High Income Alternatives Fund or a portfolio investment. The High Income Alternatives Fund, regardless of the relationship to Ares of the person performing the services, will bear the fees, costs and expenses related to such services. This may create an incentive for Ares to select an affiliated service provider or to select service providers based on the potential benefit to Ares rather than the High Income Alternatives Fund. Ares seeks to address this conflict of interest by using reasonable diligence to ascertain whether each service provider provides its service on a “best execution” basis, taking into account factors such as expertise, availability and quality of service and the competitiveness of compensation rates in comparison with other service providers satisfying Ares’ service provider selection criteria. In certain circumstances, advisors and service providers, or their affiliates, may charge different rates or have different arrangements for services provided to Ares, or its affiliates as compared to services provided to the High Income Alternatives Fund and the portfolio investments, which may result in more favorable rates or arrangements than those payable by the High Income Alternatives Fund or such portfolio investments, including because of the varying types of services provided to each. For example, the fee for a given type of work may vary depending on the complexity of the matter as well as the expertise required and demands placed on the service provider.

Investments in Other Investment Vehicles Managed or Sponsored by Ares

A portion of the assets of the High Income Alternatives Fund may be invested in other investment vehicles managed or sponsored by Ares or its affiliates, by a portfolio company in which the High Income Alternatives Fund and/or other accounts managed by Ares may have an investment, or by affiliates of such a portfolio company. Such investments may include REITs, BDCs and CEFs. The High Income Alternatives Fund will only enter into such transactions when determined by Ares to be in the best interests of the High Income Alternatives Fund. In such cases, investors will bear indirectly two levels of fees and expenses: the fees and expenses borne by High Income Alternatives Fund, and the fees and expenses borne by such other funds. The Advisor, Ares and its affiliates will be entitled to retain any fees or incentive compensation paid by any such investment vehicles and will not offset such fees or incentive compensation against the fees or incentive compensation paid by the High Income Alternatives Fund. Such investments may represent a conflict of interest to the extent that the Advisor or Ares receives such second level of fees, or to the extent they may benefit if the investment by the High Income Alternatives Fund contributes to making the investment vehicle more viable, marketable or profitable.

Portfolio Company Interests

Ares may invest on behalf of Other Ares Funds or for its own account in a portfolio company that is a competitor of a portfolio company of the High Income Alternatives Fund or that is a service provider, supplier, customer, or other counterparty with respect to a portfolio company of the High Income Alternatives Fund. In providing advice and recommendations to, or with respect to, such portfolio companies, and in dealing in their securities on behalf of Other Ares Funds or Ares, to the extent permitted by law, Ares will not have regard to the interests of the High Income Alternatives Fund and its portfolio companies. Accordingly, such advice, recommendations, and dealings may result in adverse consequences to the High Income Alternatives Fund or its portfolio companies. Conflicts of interest may also arise with respect to the allocation of Ares’s time and resources between such portfolio companies. In addition, in providing services to such portfolio companies, Ares may come into possession of information that it is prohibited from acting on (including on behalf of the High Income Alternatives Fund) or disclosing as a result of applicable confidentiality requirements or applicable law, even though such action or disclosure would be in the interests of the High Income Alternatives Fund. To the extent not restricted by confidentiality requirements or applicable law, Ares may apply experience and information gained in providing services to portfolio companies of the High Income Alternatives Fund to provide services to competing portfolio companies invested in by Ares or Other Ares Funds, which may have adverse consequences for the High Income Alternatives Fund (see also “Possession of Material Non-Public Information” below).

Possession of Material Non-Public Information

As noted above, Ares currently sponsors and advises a range of investment vehicles and accounts and expects to continue to develop its investment, advisory and related businesses. By reason of their responsibilities in connection with other activities of Ares, certain employees of Ares and its affiliates may acquire material non-public information or other confidential information. With limited exceptions, Ares does not establish information barriers between its internal investment teams. Trading by Ares on the basis of such information, or improperly disclosing such information, may be restricted pursuant to applicable law and/or internal policies and procedures adopted by Ares to promote compliance with applicable law. Additional restrictions may also be placed on the High Income Alternatives Fund or Ares by a portfolio company’s insider trading policy. Such personnel may not be free to share such information with the High Income Alternatives Fund, the High Income Alternatives Fund may not be free to act upon any such information, and the possession of information by persons associated with Ares may preclude the High Income Alternatives Fund from engaging in transactions that it might otherwise have undertaken. In addition, Other Ares Funds may hold positions in securities or be subject to contractual, legal or regulatory restraints that could prevent the Partnership from being able to initiate a transaction that it otherwise might have initiated or to sell an investment that it otherwise might have sold or, in the Advisor’s or sub-advisor’s judgment, that may make such transactions inadvisable. The trading activities of Other Ares Funds may be inconsistent with the investment activities of the High Income Alternatives Fund. Ares may also from time to time be subject to contractual “stand-still” obligations and/or confidentiality obligations that may restrict its ability to trade in certain securities on behalf of the High Income Alternatives Fund. Furthermore, Ares may have or develop business relations through its other businesses, which the Advisor or sub-advisor may consider in determining whether to undertake a transaction on behalf of the High Income Alternatives Fund, with the result that the High Income Alternatives Fund may not participate in certain transactions that it might otherwise have participated in.

Specifically, the High Income Alternatives Fund may invest in BDCs, REITs and CEFs sponsored or managed by Ares and its affiliates, which will limit the High Income Alternatives Fund ability to purchase and sell such investments due to material non-public information and other securities law restrictions.

10b5-1 Plan

Certain publicly-traded investment vehicles managed or advised by Ares and its affiliates (including ARCC and ARDC) may now or in the future be subject to “10b5-1” trading plans. Such plans generally will require Ares to buy and/or sell securities of such publicly-traded vehicles according to predefined metrics and during certain trading windows set forth in the applicable 10b5-1 plan. Accordingly, Ares may be restricted from purchasing or selling securities of such vehicles at the most opportune time and, as a result, Ares may not be able to execute the most profitable trades on behalf of the High Income Alternatives Fund. Furthermore, to the extent that the High Income Alternatives Fund invests or intends to invest in such publicly-traded investment vehicles managed or advised by Ares (including ARCC), prospective investors that are affiliated with Ares may be restricted from purchasing an interest in the High Income Alternatives Fund or redeeming their interest in the High Income Alternatives Fund other than during certain predefined trading windows.

Client Relationships

Ares has, and will in the future develop, relationships with a significant number of clients that may hold or may have held investments in Ares-sponsored or -managed investment funds or separate accounts, including the High Income Alternatives Fund, clients that may hold or may have held investments similar to the investments intended to be made by the High Income Alternatives Fund, clients that may themselves represent appropriate investment opportunities for the High Income Alternatives Fund or clients that may compete with the High Income Alternatives Fund for investment opportunities. It is difficult to predict the circumstances under which these conflicts could become material, but it is possible that such relationships could require Ares to refrain from making all or a portion of any investment or a disposition for Ares to comply with its fiduciary duties, the Advisers Act or other applicable laws.

Brokerage and Other Arrangements

Subject to any limitations under applicable law, Ares may receive benefits from brokers and counterparties selected to execute transactions on behalf of the High Income Alternatives Fund, as described above under “Brokerage Matters.” In selecting brokers or dealers to effect portfolio transactions, Ares need not solicit competitive bids and does not have an obligation to seek the lowest available commission cost. Ares may cause commissions to be paid to a broker or dealer that furnishes or pays for research or other services at a higher price than that which might be charged by another broker or dealer for effecting the same transaction. Research services obtained by the use of commissions arising from portfolio transactions may be used by Ares in its other investment activities, and, therefore, the High Income Alternatives Fund may not, in any particular instance, be the direct or indirect beneficiary of the research services provided.

Any placement agents that solicit investors on behalf of the High Income Alternatives Fund are subject to a conflict of interest because they will be compensated in connection with their solicitation activities. Any placement agents to the High Income Alternatives Fund and its affiliates may have provided, and may in the future provide, investment banking, commercial banking and other services to the issuers of the High Income Alternatives Fund’s investments and to other persons whose activities may affect the High Income Alternatives Fund’s investments. Any placement agent to the High Income Alternatives Fund may have provided, and may in the future provide, structuring, arrangement, placement and underwriting services in connection with other investment funds and activities (including cash and synthetic collateralized debt obligations) of affiliates of Ares. Future arrangements and commitments for such services may be directly or indirectly affected by any placement agent’s solicitation activities in connection with the High Income Alternatives Fund and this may subject any placement agent to a conflict of interest. Affiliates of such placement agents (if any) may also be selected by Ares to value High Income Alternatives Fund’s investments.

Ares Investor Services LLC (“AIS”), a broker dealer affiliated with Ares, is currently registered with the SEC and FINRA to conduct private placements. AIS’s private placement services include placement of Ares sponsored funds. Although the High Income Alternatives Fund will not directly pay any compensation to AIS, Ares is responsible for paying certain expenses of the operation of AIS. Such payments may be considered to be compensation to AIS. The arrangement under which Ares is responsible for paying those expenses has not been established on the basis of an arm’s length negotiation between it and AIS. While AIS’s services are primarily as described above (i.e., to Ares and its sponsored funds), it is possible that, in the future, AIS may also provide services (including underwriting, financing, capital market and advisory services) to third parties, including third parties that are competitors of Ares or one or more of its Affiliates or any portfolio companies. The expansion of AIS’s services in this manner would present additional conflicts of interest. In the event that AIS provides services to third parties, it may not take into consideration the interests of the Partnership or portfolio companies. It may also come into possession of information that AIS is prohibited from acting on (including on behalf of the High Income Alternatives Fund) or disclosing to Ares and its sponsored funds as a result of applicable confidentiality requirements or applicable law. Ares may in the future develop new businesses such as providing investment banking, advisory, and other services to corporations, financial sponsors, management, or other persons. Such services may relate to transactions that could give rise to investment opportunities that are suitable for the High Income Alternatives Fund. In such case, Ares’s client would typically require Ares to act exclusively on its behalf, thereby precluding the Partnership from participating in such investment opportunities. Ares would not be obligated to decline any such engagements to make an investment opportunity available to the High Income Alternatives Fund. In addition, Ares may come into the possession of information through these new businesses that limits the High Income Alternatives Fund’s ability to engage in potential transactions.

BROWN BROTHERS HARRIMAN & CO. (“BBH”)

Sub-Advisor to the Fund

BBH provides discretionary and non-discretionary investment management services and products to corporations, institutions and individual investors throughout the world. As a result, in the ordinary course of its businesses, BBH may engage in activities in which its interests or the interests of its clients may conflict with or be adverse to the interests of the Fund. In addition, certain of such clients (including the Fund) may utilize the services of BBH for which they will pay to BBH customary fees and expenses that will not be shared with the Fund.

BBH seeks to meet its fiduciary obligation with respect to all investment management clients, including the Fund. BBH has adopted and implemented policies and procedures that seek to manage conflicts of interest. Pursuant to such policies and procedures, BBH monitors a variety of areas, including compliance with Fund investment guidelines, review of allocation decisions and compliance with the sub-advisor’s Code of Ethics. With respect to the allocation of investment opportunities, BBH has adopted and implemented policies designed to achieve fair and equitable allocation of investment opportunities among its clients over time. The sub-advisor has structured the portfolio managers’ compensation in a manner it believes is reasonably designed to safeguard the Fund from being negatively affected as a result of any such potential conflicts.

GUGGENHEIM PARTNERS INVESTMENT MANAGEMENT (“Guggenheim”)

Sub-Advisor to the Fund

General Investment Limitations and Conflicts of Interest. The Fund is subject, directly or indirectly, to various regulatory frameworks that can limit its ability to fully pursue its investment strategies. In addition, Guggenheim is a global asset management and investment advisory organization. Along with its affiliates, Guggenheim provides a wide range of financial services to a substantial and diversified client base. Guggenheim and its affiliates advise clients in various markets and transactions and purchase, sell, hold and recommend a broad array of investments for their own accounts and the accounts of clients and of their personnel and the relationships and products they sponsor, manage and advise. Accordingly, Guggenheim and its affiliates may have direct and indirect interests in a variety of global markets and the securities of issuers in which the Fund may directly or indirectly invest. These interests may cause the Fund to be subject to regulatory limits, and in certain circumstances, these various activities may prevent the Fund from participating in an investment decision. As a result, activities and dealings of Guggenheim and its affiliates may affect the Fund in ways that may disadvantage or restrict the Fund or be deemed to benefit Guggenheim and its affiliates.

The following are descriptions of certain conflicts, financial or otherwise, that Guggenheim and its affiliates may have in transactions effected by, with or on behalf of the Fund. The descriptions below are not intended to be a complete enumeration or explanation of all of the conflicts that may arise from the business activities of Guggenheim or its affiliates. To address these conflicts, the Fund and Guggenheim and its affiliates have established various policies and procedures that are reasonably designed to detect and prevent such conflicts and prevent the Fund from being disadvantaged.

Other Activities of Guggenheim and Its Affiliates. From time to time, conflicts of interest may arise between a portfolio manager’s management of the investments of the Fund on the one hand and the management of other registered investment companies, pooled investment vehicles and other accounts (collectively, “other accounts”) on the other. The other accounts might have similar investment objectives or strategies as the Fund, track the same indices the Fund tracks or otherwise hold, purchase, or sell securities that are eligible to be held, purchased or sold by the Fund. The other accounts might also have different investment objectives or strategies than the Fund. In addition, the Fund may be limited in its ability to invest in, or hold securities of, any companies that the sub-advisors or their affiliates (or other accounts managed by the sub-advisors or their affiliates) control, or companies in which the sub-advisors or their affiliates have interests or with whom they do business. For example, affiliates of the sub-advisors may act as underwriter, lead agent or administrative agent for loans or otherwise participate in the market for loans. Because of limitations imposed by applicable law, the presence of the sub-advisors’ affiliates in the markets for loans may restrict the Fund’s ability to acquire some loans or affect the timing or price of such acquisitions.

In conformance with the Fund’s investment objectives and subject to compliance with applicable law, the sub-advisors may purchase securities for the Fund during an underwriting or other offering of securities in which a broker-dealer affiliate acts as an active or passive bookrunner, manager, co-manager or selling group member, or receives a benefit in the form of management fees, underwriting fees, selling concession or other fees or compensation (“affiliated offerings”). Participation in such offerings may directly or indirectly relieve firm commitment underwriting or other financial obligations of an affiliate, and the sub-advisors may accordingly have an incentive to cause the Funds to invest in otherwise unmarketable securities offered by an affiliate or other members of an affiliate’s underwriting syndicate. In certain circumstances, regulations prohibit the Fund from participating in those transactions, which may otherwise be profitable investments for the Fund.

From time to time, including in connection with affiliated offerings or other services through which Guggenheim or its affiliates have come into possession of material non-public information, the activities and investments of the Fund may be restricted because of regulatory requirements applicable to the Fund or Guggenheim in relation to the activities of Guggenheim or its affiliates.

Allocation of Limited Time and Attention. A portfolio manager who is responsible for managing multiple Funds and other accounts may devote unequal time and attention to the management of those Funds and other accounts. As a result, the portfolio manager may not be able to formulate as complete a strategy or identify equally attractive investment opportunities for each of those Funds or other accounts as might be the case if he or she were to devote substantially more attention to the management of a single Fund. The effects of this potential conflict may be more pronounced where Funds and other accounts overseen by a particular portfolio manager have different investment strategies.

Knowledge and Timing of Fund Trades. A potential conflict of interest may arise as a result of the portfolio manager’s day-to-day management of the Fund. Because of his or her position with the Fund, the portfolio manager knows the size, timing and possible market impact of the Fund’s trades. It is possible that the portfolio manager could use this information to the advantage of other accounts and to the possible detriment of the Fund.

Investment Opportunities. A potential conflict of interest may arise as a result of the portfolio manager’s management of a number of accounts with comparable investment guidelines. An investment opportunity may be suitable for both the Fund and other accounts managed by the portfolio manager, but may not be available in sufficient quantities for both the Fund and the other accounts to participate fully. Similarly, there may be limited opportunity to sell an investment held by the Fund and another account. Advice given to, or investment or voting decisions made for, other accounts may affect or conflict with investment decisions made for a Fund. In addition, the sub-advisor may develop and implement new trading strategies or seek to participate in new investment opportunities or trading strategies. The opportunities and strategies may not be employed across all Funds and other accounts equally, even if the opportunity or strategy is consistent with the investment guidelines of such Funds or other accounts.

As discussed above, portfolio managers may own, and a portion of their compensation may be in the form of, Fund shares. As a result, a potential conflict of interest may arise to the extent a portfolio manager owns or has an interest in shares of a specific Fund that he or she manages. These personal investments may create an incentive for a portfolio manager to favor such Fund(s) over other advisory clients, including other Funds.

The sub-advisors have adopted policies and procedures reasonably designed to allocate investment opportunities on a fair and equitable basis.

Selection of Brokers/Dealers. Portfolio managers may be able to select or influence the selection of the brokers and dealers that are used to execute securities transactions for the Fund and/or accounts that they supervise. In addition to executing trades, some brokers and dealers provide portfolio managers with brokerage and research services (as those terms are defined in Section 28(e) of the 1934 Act), which may result in the payment of higher brokerage fees than might otherwise be available. These services may benefit certain funds or accounts more than others. Although the payment of brokerage commissions is subject to the requirement that the portfolio manager determine in good faith that the commissions are reasonable in relation to the value of the brokerage and research services provided to the Fund, a portfolio manager’s decision as to the selection of brokers and dealers could yield disproportionate costs and benefits among the funds and/or accounts that the portfolio manager manages. The sub-advisors and their affiliates do not currently participate in soft dollar arrangements. To the extent that an sub-advisor participates in soft dollar arrangements, such participation would be consistent with applicable legal requirements.

Performance Fees. A portfolio manager may advise certain accounts with respect to which the advisory fee is based entirely or partially on performance. Performance fee arrangements may create a conflict of interest for the portfolio manager in that the manager may have an incentive to allocate the investment opportunities that the portfolio manager believes might be the most profitable to accounts with a heavily performance-oriented fee.

LITMAN GREGORY

Advisor to the Fund

Litman Gregory has overall responsibility for assets under management and conducts oversight and evaluation of the Funds’ investment managers and other duties. Litman Gregory generally does not make day-to-day decisions with respect to the purchase and sale of portfolio securities by the Funds. Accordingly, no material conflicts of interest are expected to arise between the Funds and other accounts managed by the portfolio managers. Litman Gregory has adopted compliance policies, including allocation policies and a code of ethics, which are intended to prevent or mitigate conflicts of interest, if any, that may arise.

NEUBERGER BERMAN INVESTMENT ADVISERS LLC (“Neuberger Berman”)

Sub-Advisor to the Fund

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 account. The management of multiple funds and accounts (including proprietary accounts) may give rise to actual or potential conflicts of interest if the funds and accounts have different or similar objectives, benchmarks, time horizons, and fees, as the Portfolio Manager must allocate his or her time and investment ideas across multiple funds and accounts. The Portfolio Manager may execute transactions for another fund or account that may adversely impact the value of securities held by a fund, and which may include transactions that are directly contrary to the positions taken by a fund. For example, a Portfolio Manager may engage in short sales of securities for another account that are the same type of securities in which a fund it manages also invests. In such a case, the Portfolio Manager could be seen as harming the performance of the fund for the benefit of the account engaging in short sales if the short sales cause the market value of the securities to fall. Additionally, if a Portfolio Manager identifies a limited investment opportunity that may be suitable for more than one fund or other account, a fund may not be able to take full advantage of that opportunity. Further, Neuberger Berman may take an investment position or action for a fund or account that may be different from, inconsistent with, or have different rights than (e.g., voting rights, dividend or repayment priorities or other features that may conflict with one another), an action or position taken for one or more other funds or accounts, including a fund, having similar or different objectives. A conflict may also be created by investing in different parts of an issuer’s capital structure (e.g., equity or debt, or different positions in the debt structure). Those positions and actions may adversely impact, or in some instances benefit, one or more affected accounts, including the funds. Potential conflicts may also arise because portfolio decisions and related actions regarding a position held for a fund or another account may not be in the best interests of a position held by another fund or account having similar or different objectives. If one account were to buy or sell portfolio securities shortly before another account bought or sold the same securities, it could affect the price paid or received by the second account. Securities selected for funds or accounts other than a fund may outperform the securities selected for the fund. Finally, a conflict of interest may arise if Neuberger Berman and a Portfolio Manager have a financial incentive to favor one account over another, such as a performance-based management fee that applies to one account but not all funds or accounts for which the Portfolio Manager is responsible. In the ordinary course of operations certain businesses within the Neuberger Berman organization (the “Firm”) may seek access to material non-public information. For instance, Neuberger Berman loan portfolio managers may utilize material non-public information in purchasing loans and from time to time, may be offered the opportunity on behalf of applicable clients to participate on a creditors committee, which participation may provide access to material non-public information. The Firm maintains procedures that address the process by which material non-public information may be acquired intentionally by the Firm. When considering whether to acquire material non-public information, the Firm will take into account the interests of all clients and will endeavor to act fairly to all clients. The intentional acquisition of material non-public information may give rise to a potential conflict of interest since the Firm may be prohibited from rendering investment advice to clients regarding the public securities of such issuer and thereby potentially limiting the universe of public securities that the Firm, including a fund, may purchase or potentially limiting the ability of the Firm, including a fund, to sell such securities. Similarly, where the Firm declines access to (or otherwise does not receive) material non-public information regarding an issuer, the portfolio managers may base investment decisions for its clients, including a fund, with respect to loan assets of such issuer solely on public information, thereby limiting the amount of information available to the portfolio managers in connection with such investment decisions.

Neuberger Berman has 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.

Compensation Structure and Methods

The following section describes the structure of, and the methods used to determine the different types of compensation (e.g., salary, bonus, deferred compensation, retirement plans and arrangements) for the Fund’s portfolio managers as of the date of this SAI.

ARES

Sub-Advisor to the Fund

Generally, compensation across the firm is determined by Ares’ Management Committee, with recommendations made by the head of each applicable business unit. Investment professionals receive a base salary and are eligible for a discretionary year-end bonus based on performance. Subject to a minimum compensation threshold, a portion of year-end bonus may be paid in the form of equity in our publicly traded parent, Ares Management LP, which vests over time and is intended as a retention mechanism for portfolio managers, investment professionals and other executives of Ares.

Additionally and where applicable, portfolio managers and sometimes analysts and other senior professionals are awarded direct carried interest and/or profit participations with respect to funds in which they are involved, and may also receive similar incentive awards relating to the funds in the firm’s other investment groups. This both aligns the compensation of key employees with investment performance and rewards the collaboration of senior professionals across business platforms.

As the result of Ares’ May 2014 initial public offering and our ongoing performance bonus awards, most of Ares’ employees are stakeholders in Ares’ parent via various equity interests. These may be subject to transfer restrictions, as well as forfeiture if an employee does not remain with Ares for a defined period of time or terminates employment prior to certain vesting dates.

Professionals receive year-end annual reviews. For analysts these will focus primarily on credit analysis and communication, including the quality and number of investment recommendations made, the efficacy and accuracy of investment monitoring, and the contributions made to industry strategy and relative value assessments prepared internally.

BBH

Sub-Advisor to the Fund

BBH portfolio managers are paid a fixed base salary and variable incentives based on performance, investment strategy performance, and the overall profitability of BBH. Base salaries are determined within a market competitive salary range, based on experience and performance, and is consistent with the salaries paid to other fixed income portfolio managers of BBH. The variable incentives are composed of two separate elements. The first element is a cash bonus paid at the end of each calendar year based on multiple performance criteria using a Balanced Scorecard methodology (the “Performance Bonus”). The second and typically smaller element is participation in a profit sharing plan that allows all employees to share in the success of BBH in meeting its profit objectives. This participation is a uniform portion of each employee’s base salary and is paid to each employee’s 401K account that vests over time. The main criteria for establishing Performance Bonuses are the investment performance of the portfolios managed and their respective leadership, collaboration, and communication skills.

GUGGENHEIM

Sub-Advisor to the Fund

Guggenheim compensates portfolio managers for their management of a fund’s portfolio. Compensation is evaluated qualitatively based on their contribution to investment performance and factors such as teamwork and client service efforts. The portfolio managers’ incentives may include: a competitive base salary, bonus determined by individual and firm wide performance, equity participation, co-investment options, and participation opportunities in various investments, including through deferred compensation programs. All employees of Guggenheim are also eligible to participate in a 401(k) plan to which a discretionary match may be made after the completion of each plan year. Guggenheim’s deferred compensation programs include equity that vests over a period of years, including equity in the form of shares of fund(s) managed by the particular portfolio manager. The value of the fund shares under the deferred compensation program is awarded annually and each award vests over a period of years (generally 4 years). A portfolio manager’s ownership of shares of a fund managed by the portfolio manager may create conflicts of interest that incentivize the portfolio manager to favor such fund over other funds or other accounts.

LITMAN GREGORY

Advisor to the Fund

Litman Gregory’s portfolio managers are compensated based on a fixed salary and a distribution of Litman Gregory’s profits commensurate with the portfolio managers’ respective ownership percentages in the parent company of the Advisor.

NEUBERGER BERMAN

Sub-Advisor to the Fund

Neuberger Berman’s compensation philosophy is one that focuses on rewarding performance and incentivizing our employees. Neuberger Berman is also focused on creating a compensation process that it believes is fair, transparent, and competitive with the market.

Compensation for Portfolio Managers consists of fixed (salary) and variable (bonus) compensation but is more heavily weighted on the variable portion of total compensation and is paid from a team compensation pool made available to the portfolio management team with which the Portfolio Manager is associated. The size of the team compensation pool is determined based on a formula that takes into consideration a number of factors including the pre-tax revenue that is generated by that particular portfolio management team, less certain adjustments. The bonus portion of the compensation is discretionary and is determined on the basis of a variety of criteria, including investment performance (including the aggregate multi-year track record), utilization of central resources (including research, sales and operations/support), business building to further the longer term sustainable success of the investment team, effective team/people management, and overall contribution to the success of Neuberger Berman. Certain Portfolio Managers may manage products other than mutual funds, such as high net worth separate accounts. For the management of these accounts, a Portfolio Manager may generally receive a percentage of pre-tax revenue determined on a monthly basis less certain deductions. The percentage of revenue a Portfolio Manager receives pursuant to this arrangement will vary based on certain revenue thresholds.

The terms of Neuberger Berman’s long-term retention incentives are as follows:

Employee-Owned Equity. Certain employees (primarily senior leadership and investment professionals) participate in Neuberger Berman’s equity ownership structure, which was designed to incentivize and retain key personnel. Neuberger Berman also offers an equity acquisition program which allows employees a more direct opportunity to invest in Neuberger Berman.

In addition, in prior years certain employees may have elected to have a portion of their compensation delivered in the form of equity, which, in certain instances, is vested upon issuance and in other instances vesting aligns with the vesting of our Contingent Compensation Plan (vesting over 3 years).

For confidentiality and privacy reasons, we cannot disclose individual equity holdings or program participation.

Contingent Compensation. Certain employees may participate in the Neuberger Berman Group Contingent Compensation Plan (the “CCP”) to serve as a means to further align the interests of our employees with the success of the firm and the interests of our clients, and to reward continued employment. Under the CCP, up to 20% of a participant’s annual total compensation in excess of $500,000 is contingent and subject to vesting. The contingent amounts are maintained in a notional account that is tied to the performance of a portfolio of Neuberger Berman investment strategies as specified by the firm on an employee-by-employee basis. By having a participant’s contingent compensation tied to Neuberger Berman investment strategies, each employee is given further incentive to operate as a prudent risk manager and to collaborate with colleagues to maximize performance across all business areas. In the case of members of investment teams, including Portfolio Managers, the CCP is currently structured so that such employees have exposure to the investment strategies of their respective teams as well as the broader Neuberger Berman portfolio. In prior years, employees may have elected to have a portion of their contingent amounts delivered in the form of NBSH equity (either vested or unvested, depending on the terms of the plain for that year). Neuberger Berman determines annually which employees participate in the program based on total compensation for the applicable year.

Restrictive Covenants. Most investment professionals, including Portfolio Managers, are subject to notice periods and restrictive covenants which include employee and client non-solicit restrictions as well as restrictions on the use of confidential information. In addition, depending on participation levels, certain senior professionals who have received equity grants have also agreed to additional notice and transition periods and, in some cases, non-compete restrictions. For confidentiality and privacy reasons, we cannot disclose individual restrictive covenant arrangements.

Portfolio Manager Securities Ownership

The table below identifies the dollar range of Fund shares beneficially owned by each portfolio manager of the High Income Alternatives Fund, as of the date of this SAI.


Portfolio Manager		Dollar Range of Securities Owned
Steven Brown		A
Adam Bloch		A
Jack Chee		A
Jeremy DeGroot		A
Derek Devens		A
Andrew Hofer		A
Neil Hohmann		A
Paul Kunz		A
Greg Mason		A
Scott Minerd		A
Jason Steuerwalt		A
Anne Walsh		A
Troy Ward		A

Key of Dollar Ranges for Table: A - None; B - $1 to $10,000; C - $10,001 to $50,000; D - $50,001 to $100,000; E - $100,001 - $500,000; F - $500,001 - $1,000,000; G - Over $1,000,000.

PROXY VOTING POLICIES AND PROCEDURES

The Board has delegated the responsibility for voting proxies relating to portfolio securities held by the Funds to the Advisor as a part of the Advisor’s general management of the Funds, subject to the Board’s continuing oversight. The policy of the Trust is also to adopt the policies and procedures used by the Advisor to vote proxies relating to portfolio securities held by its clients.

The following information is a summary of the proxy voting policies and procedures of the Advisor and the Sub-Advisors.

LITMAN GREGORY

Advisor to the Funds

It is the Advisor’s policy to vote all proxies received by the Funds in a timely manner. In general, the Advisor will vote in accordance with its pre-determined voting guidelines (the “Guidelines”). However, the Advisor reserves the right to depart from any of the Guidelines and make a voting decision on a case-by-case basis. Although many proxy proposals will be covered by the Guidelines, the Advisor recognizes that some proposals require special consideration, and the Advisor will make a decision on a case-by-case basis in these situations. Where such a case-by-case determination is required, the Advisor’s proxy voting coordinator may, but is not required to, consult with other personnel of the Advisor to determine the appropriate action on the matter.

Unless otherwise instructed by the Funds, the Advisor may, and generally will, delegate the responsibility for voting proxies relating to the Funds’ portfolio securities to one or more of the Sub-Advisors. To the extent such responsibility is delegated to a Sub-Advisor, the Sub-Advisor shall assume the fiduciary duty and reporting responsibilities of the Advisor. Unless otherwise instructed by the Funds or the Advisor, the Sub-Advisor shall apply its own proxy voting policies and procedures.

The Advisor’s duty is to vote in the best interests of the Funds’ shareholders. In situations where the Advisor determines that a proxy proposal raises a material conflict of interest between the interests of the Advisor, the Funds’ principal underwriter, or an affiliated person of the Advisor or the principal underwriter and that of one or more Funds, the conflict shall be resolved by voting in accordance with a predetermined voting policy. However, to the extent that (1) no pre-determined voting policy applies to the specific proposal or (2) there is an applicable pre-determined voting policy, but the Advisor has discretion to deviate from such policy, the Advisor shall disclose the conflict to the Board and seek the Board’s direction or consent to the proposed vote prior to voting on such proposal.

ARES

Sub-Advisor to the Fund

Ares recognizes that proxy voting is an important right of shareholders and that reasonable care and diligence must be undertaken to ensure that such rights are properly and timely exercised. Where Ares been granted discretion by a client to exercise by proxy the voting rights of securities beneficially owned by such client, Ares will exercise all voting rights delegated to it by the client. In determining how to vote, investment professionals will consult with each other, taking into account the interests of each client as well as any potential conflicts of interest. In general, Ares will vote proxies in accordance with internally established general guidelines relating to such matters as election of directors, changes in capital structure, corporate restructurings, corporate governance, anti-takeover measures and social and corporate responsibility, unless Ares’ agreement with the client requires it to vote proxies in a certain way or Ares determined otherwise due to specific and unusual facts and circumstances with respect to a particular vote.

Ares retains records pertaining to proxy voting including all proxy statements received and records of votes cast.

BBH

Sub-Advisor to the Fund

BBH has adopted proxy voting policies and procedures concerning the voting of proxies of its Fund clients (the “Proxy Policy and Procedures”) and has also retained an independent third party proxy agent (“Proxy Agent”) to recommend how to vote a Fund’s proxy. Pursuant to the Proxy Policy and Procedures, the sub-advisor reviews and analyzes the recommendations of the Proxy Agent and from time to time may depart from such recommendations based on its own analysis and discretion. The Proxy Policy and Procedures are reviewed periodically, and, accordingly, are subject to change.

The Proxy Agent maintains proxy guidelines, reviewed at least annually by the sub-advisor, that present its typical voting posture for routine and non-routine issues. Generally, the Proxy Agent recommends voting in favor of proposals that maintain or strengthen the shared interests of shareholders and management; increase shareholder value; maintain or increase shareholder influence over the issuer’s board of directors and management; and maintain or increase the rights of shareholders. Whether the Proxy Agent or BBH supports or opposes a proposal will depend on the specific circumstances described in the proxy statement and other available information.

GUGGENHEIM

Sub-Advisor to the Fund

Guggenheim has adopted Proxy Voting Policies and Procedures (in this section, “Procedures”) to guide how Guggenheim will vote proxies held in client accounts.

Generally, Guggenheim will vote proxies in accordance with certain guidelines found in the Procedures (in this section, the “Guidelines”), which may be changed or supplemented from time to time. The Guidelines cover such agenda items as the election of directors, ratification of auditors, management and director compensation, anti-takeover mechanisms, mergers and corporate restructuring, and social and corporate policy issues.

Guggenheim has delegated to an independent third party (in this section, the “Service Provider”) the responsibility to review proxy proposals and to vote proxies in accordance with the Guidelines. The Service Provider notifies Guggenheim of all proxy proposals that do not fall within the Guidelines (i.e., proposals that are either not addressed in the Guidelines or proposals for which Guggenheim has indicated that a decision will be made on a case-by-case basis), and Guggenheim then directs the Service Provider how to vote on those particular proposals.

Guggenheim may occasionally be subject to conflicts of interest in the voting of proxies. Accordingly, it has adopted procedures to identify potential conflicts and to ensure that the vote made is in the best interest of the Fund. Pursuant to such procedures, Guggenheim may resolve a conflict in a variety of ways, including voting in accordance with its established voting guidelines, referring the proposal to the client, obtaining client consent, voting in accordance with the recommendation of an independent fiduciary appointed for that purpose, or abstaining. Ultimately, if the Investment Manager cannot resolve a conflict of interest, it will seek guidance from the Board of Trustees of the relevant Fund.

Guggenheim may abstain from voting a proxy in certain circumstances, including situations where: (i) the securities being voted are no longer held by the client; (ii) the proxy and other relevant materials are not received in sufficient time to allow adequate analysis or an informed vote by the voting deadline; or (iii Guggenheim concludes that the cost of voting the proxy is likely to exceed the expected benefit to the client.

NEUBERGER BERMAN

Sub-Advisor to the Fund

Neuberger Berman’s Proxy Committee is responsible for developing, authorizing, implementing and updating the Proxy Voting Policy, overseeing the proxy voting process and engaging and overseeing any independent third-party vendors as voting delegate to review, monitor and/or vote proxies. In order to apply the Proxy Voting Policy noted above in a timely and consistent manner, Neuberger Berman utilizes Glass, Lewis & Co. (“Glass Lewis”) to vote proxies in accordance with Neuberger Berman’s voting guidelines.

For socially responsive clients, Neuberger Berman has adopted socially responsive voting guidelines. For non-socially responsive clients, Neuberger Berman’s guidelines adopt the voting recommendations of Glass Lewis. Neuberger Berman retains final authority and fiduciary responsibility for proxy voting. Neuberger Berman believes that this process is reasonably designed to address material conflicts of interest that may arise between Neuberger Berman and a client as to how proxies are voted.

In the event that an investment professional at Neuberger Berman believes that it is in the best interests of a client or clients to vote proxies in a manner inconsistent with Neuberger Berman’s proxy voting guidelines or in a manner inconsistent with Glass Lewis recommendations, the Proxy Committee will review information submitted by the investment professional to determine that there is no material conflict of interest between Neuberger Berman and the client with respect to the voting of the proxy in that manner.

If the Proxy Committee determines that the voting of a proxy as recommended by the investment professional presents a material conflict of interest between Neuberger Berman and the client or clients with respect to the voting of the proxy, the Proxy Committee shall: (i) take no further action, in which case Glass Lewis shall vote such proxy in accordance with the proxy voting guidelines or as Glass Lewis recommends; (ii) disclose such conflict to the client or clients and obtain written direction from the client as to how to vote the proxy; (iii) suggest that the client or clients engage another party to determine how to vote the proxy; or (iv) engage another independent third party to determine how to vote the proxy.

MORE INFORMATION ABOUT PROXY VOTING

The actual voting records relating to portfolio securities during the most recent 12-month period ended June 30, 2018 are available without charge, upon request, by calling toll-free, 1-800-960-0188 or by accessing the SEC’s website at www.sec.gov. In addition, a copy of the Funds’ proxy voting policies and procedures are also available without charge, upon request, by calling 1-800-960-0188.

ADMINISTRATOR

State Street Bank and Trust Company (“State Street” or the “Administrator”) serves as the Trust’s administrator pursuant to an Administration Agreement dated September 10, 2014 (the “Administration Agreement”). State Street is a wholly owned subsidiary of State Street Corporation, a publicly held bank holding company. State Street is located at One Lincoln Street, Boston, MA 02111. Pursuant to the Administration Agreement with the Trust, the Administrator has agreed to furnish statistical and research data, clerical services, and stationery and office supplies; prepare various reports for filing with the appropriate regulatory agencies; and prepare various materials required by the SEC or any state securities commission having jurisdiction over the Trust. The Administration Agreement provides that the Administrator performing services thereunder shall not be liable under the Administration Agreement except for the negligence or willful misconduct of the Administrator, its officers or employees. As compensation for these services, each Fund pays State Street an annual administration fee based upon a percentage of the average net assets of such Fund.

PORTFOLIO TRANSACTIONS AND BROKERAGE

Each Management Agreement states that, with respect to the segment of each Fund’s portfolio allocated to the applicable Sub-Advisor, the Sub-Advisor shall be responsible for broker-dealer selection and for negotiation of brokerage commission rates, provided that the Sub-Advisor shall not direct orders to an affiliated person of the Sub-Advisor without general prior authorization to use such affiliated broker or dealer by the Board. In general, a Sub-Advisor’s primary consideration in effecting a securities transaction will be execution at the most favorable cost or proceeds under the circumstances. In selecting a broker-dealer to execute each particular transaction, a Sub-Advisor may take the following into consideration: the best net price available; the reliability, integrity and financial condition of the broker-dealer; the size of and difficulty in executing the order; and the value of the expected contribution of the broker-dealer to the investment performance of each Fund on a continuing basis. The price to each Fund in any transaction may be less favorable than that available from another broker-dealer if the difference is reasonably justified by other aspects of the portfolio execution services offered.

Subject to such policies as the Advisor and the Board may determine, a Sub-Advisor shall not be deemed to have acted unlawfully or to have breached any duty created by its Management Agreement with a Fund or otherwise solely by reason of its having caused any Fund to pay a broker or dealer that provides (directly or indirectly) brokerage or research services to the Sub-Advisor a commission for effecting a portfolio transaction in excess of the amount of commission another broker or dealer would have charged for effecting that transaction, if the Sub-Advisor determines in good faith that such amount of commission was reasonable in relation to the value of the brokerage and research services provided by such broker or dealer, viewed in terms of either that particular transaction or the Sub-Advisor’s or Advisor’s overall responsibilities with respect to each Fund or other advisory clients. Each Sub-Advisor is further authorized to allocate the orders placed by it on behalf of each Fund to such brokers or dealers who also provide research or statistical material, or other services, to the Trust, the Advisor or any affiliate of either. Such allocation shall be in such amounts and proportions as the Sub-Advisor shall determine. Each Sub-Advisor shall report on such allocations regularly to the Advisor and the Trust, indicating the broker-dealers to whom such allocations have been made and the basis for such allocations.

On occasions when a Sub-Advisor deems the purchase or sale of a security to be in the best interest of a Fund as well as other clients of the Sub-Advisor, the Sub-Advisor, to the extent permitted by applicable laws and regulations, may aggregate the securities to be so purchased or sold in order to obtain the most favorable price or lower brokerage commissions and the most efficient execution. In such event, allocation of the securities so purchased or sold, as well as the expenses incurred in the transaction, will be made by the Sub-Advisor in the manner it considers to be the most equitable and consistent with its fiduciary obligations to each Fund and to such other clients.

Distribution of Fund Shares

The Funds’ principal underwriter is ALPS Distributors, Inc., 1290 Broadway, Suite 1100, Denver, Colorado 80203. The Distributor is engaged on a non-exclusive basis to assist in the distribution of shares in various jurisdictions. The Distributor is compensated for performing this service by the Advisor and is not paid by the Funds.

Distribution Plan

As noted in the prospectus, the Trust has adopted a Distribution and Shareholder Servicing Plan pursuant to Rule 12b-1 under the 1940 Act (the “Distribution Plan”) on behalf of the Investor Class of the Fund.

Under the Distribution Plan, the Fund is authorized to pay the Distributor for distribution services related to Investor Class shares (the “Distribution Fee”) at an annual rate of 0.25% of such Fund’s average daily net assets

attributable to Investor Class shares. The Distribution Plan provides that the Distributor may use all or any portion of such Distribution Fee to finance any activity that is principally intended to result in the sale of the Fund’s Investor Class shares, subject to the terms of the Distribution Plan, or to provide certain shareholder services.

The Distribution Fee is payable to the Distributor regardless of the distribution-related expenses actually incurred. Because the Distribution Fee is not directly tied to expenses, the amount of distribution fees paid by the Investor Class of the Fund during any year may be more or less than actual expenses incurred pursuant to the Distribution Plan. For this reason, this type of distribution fee arrangement is characterized by the staff of the SEC as a “compensation” plan.

The Distributor may use the Distribution Fee to pay for services covered by the Distribution Plan including, but not limited to, advertising, compensating underwriters, dealers and selling personnel engaged in the distribution of Fund shares, the printing and mailing of prospectuses, statements of additional information and reports to prospective shareholders, the printing and mailing of sales literature, and obtaining whatever information, analyses and reports with respect to marketing and promotional activities that the Fund may, from time to time, deem advisable.

Other Shareholder Servicing Expenses Paid by the Funds

The Funds make payments to financial intermediaries for certain sub-recordkeeping, sub-transfer agent or similar services provided by financial intermediaries in amounts determined by the Funds’ Board of Trustees to represent reasonable amounts for those services. These expenses paid by a Fund would remain subject to any overall expense limitation applicable to that Fund. These expenses are in addition to any supplemental amounts the Advisor pays out of its own resources and are in addition to a Fund’s payment of any amounts through the Distribution Plan.

The prospect of receiving, or the receipt of additional payments or other compensation as described above by financial intermediaries may provide financial intermediaries and/or their salespersons with an incentive to favor sales of shares of the Funds, and other mutual funds whose affiliates make similar compensation available, over sale of shares of mutual funds (or non-mutual fund investments) not making such payments. You may wish to take these payment arrangements into account when considering and evaluating any recommendations relating to the Funds’ shares.

The table below identifies the financial intermediaries who received compensation from the Funds for providing sub-recordkeeping, sub-transfer agency or similar services during the calendar year ended December 31, 2017:

Firm

Charles Schwab

Fidelity Investments

Financial Data Services, Inc.

Great-West Financial

LPL Financial

Merrill Lynch

MSCS Financial Services Operating

National Financial Services, LLC (Fidelity Brokerage)

Pershing

Raymond James

TD – Ameritrade

Vanguard

Payments by the Advisor

Set forth below is a list of the member firms of FINRA to which the Advisor, or its affiliates, made payments out of their revenues in connection with the sale and distribution of the Funds’ shares or for services to the Funds and their shareholders for the year ended December 31, 2017. Such payments are in addition to any Distribution Plan amounts paid to such FINRA member firms. Any additions, modifications, or deletions to the FINRA member firms identified in this list since December 31, 2017 are not reflected:

FINRA member firms

Raymond James

The Advisor or its affiliates may also make payments to selling and shareholder servicing agents that are not FINRA member firms and that sell shares of or provide services to the Funds and their shareholders, such as banks, insurance companies and plan administrators. These firms are not included on the list above, although they may be affiliated with companies on the above list.

PORTFOLIO TURNOVER

Although the Funds generally will not invest for short-term trading purposes, portfolio securities may be sold without regard to the length of time they have been held when, in the opinion of a Sub-Advisor, investment considerations warrant such action. Portfolio turnover rate is calculated by dividing (1) the lesser of purchases or sales of portfolio securities for the fiscal year by (2) the monthly average of the value of portfolio securities owned during the fiscal year. A 100% turnover rate would occur if all the securities in a Fund’s portfolio, with the exception of securities whose maturities at the time of acquisition were one year or less, were sold and either repurchased or replaced within one year. A high rate of portfolio turnover (100% or more) generally leads to higher transaction costs and may result in a greater number of taxable transactions as compared to the costs and taxable transactions of an investment company that holds investments for a longer period.

NET ASSET VALUE

The NAV of a Fund’s shares will fluctuate and is determined as of the close of trading on the NYSE (currently, 4:00 p.m., Eastern Time) each business day that the NYSE is open for trading. The NYSE annually announces the days on which it will not be open for trading. The most recent announcement indicates that the NYSE will not be open on the following days: New Year’s Day, Martin Luther King’s Birthday, Presidents’ Day, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving Day and Christmas Day. However, the NYSE may close on days not included in that announcement.

The NAV per share is computed by dividing the value of the securities held by a Fund plus any cash or other assets (including interest and dividends accrued but not yet received) minus all liabilities (including accrued expenses) by the total number of shares in a Fund outstanding at such time.

Generally, trading in and valuation of foreign securities is substantially completed each day at various times prior to the close of the NYSE. In addition, trading in and valuation of foreign securities may not take place on every day in which the NYSE is open for trading. In that case, the price used to determine a Fund’s NAV on the last day on which such exchange was open will be used, unless the Board determines that a different price should be used. Furthermore, trading takes place in various foreign markets on days in which the NYSE is not open for trading and on which a Fund’s NAV is not calculated. Occasionally, events affecting the values of such securities in U.S. dollars on a day on which a Fund calculates its NAV may occur between the times when such securities are valued and the close of the NYSE which will not be reflected in the computation of a Fund’s NAV unless the Board or its delegates deem that such events would materially affect the NAV, in which case an adjustment would be made.

Generally, a Fund’s investments are valued on the basis of market quotations. Securities or assets for which market quotations are not available, or for which the pricing service approved by the Board does not provide a valuation or provides a valuation that in the judgment of the relevant Sub-Advisor, with the concurrence of the Advisor, is stale or does not represent the fair value of such securities or assets, shall be valued by the Valuation Committee in consultation with the Advisor, the relevant Sub-Advisor, and the Administrator pursuant to procedures approved by the Board.

Each Fund’s securities, including ADRs, EDRs and GDRs, which are traded on securities exchanges, are generally determined on the basis of the last reported sale price on the exchange on which such securities are traded (or the NASDAQ official closing price for NASDAQ-reported securities, if such price is provided by the Funds’ accountant), as of the close of business on the day the securities are being valued or, lacking any reported sales, at the mean between the last available bid and asked price. Securities that are traded on more than one exchange are valued on the exchange determined by the Sub-Advisors to be the primary market. Securities traded in the over-the-counter market are valued at the mean between the last available bid and asked price prior to the time of valuation. Securities and assets for which market quotations are not readily available (including restricted securities, which are subject to limitations as to their sale) are valued at fair value as determined in good faith by or under the direction of the Board.

Short-term debt obligations with remaining maturities in excess of 60 days are valued at current market prices, as discussed above. Short-term securities with 60 days or less remaining to maturity are, unless conditions indicate otherwise, amortized to maturity based on their cost to a Fund if acquired within 60 days of maturity or, if already held by a Fund on the 60th day, based on the value determined on the 61st day.

Corporate debt securities, mortgage-related securities and asset-backed securities held by a Fund are valued on the basis of valuations provided by dealers in those instruments, by an independent pricing service and approved by the Board, or at fair value as determined in good faith by procedures approved by the Board. Any such pricing service, in determining value, will use information with respect to transactions in the securities being valued, quotations from dealers, market transactions in comparable securities, analyses and evaluations of various relationships between securities and yield to maturity information.

An option that is written by a Fund is generally valued at the last sale price or, in the absence of the last sale price, the last offer price. An option that is purchased by a Fund is generally valued at the last sale price or, in the absence of the last sale price, the last bid price. The value of a futures contract is the last sale or settlement price on the exchange or board of trade on which the future is traded or, if no sales are reported, at the mean between the last bid and asked price. When a settlement price cannot be used, futures contracts will be valued at their fair market value as determined by or under the direction of the Board. If an options or futures exchange closes after the time at which a Fund’s NAV is calculated, the last sale or last bid and asked prices as of that time will be used to calculate the NAV.

Any assets or liabilities initially expressed in terms of foreign currencies are translated into U.S. dollars at the official exchange rate or, alternatively, at the mean of the current bid and asked prices of such currencies against the U.S. dollar last quoted by a major bank that is a regular participant in the foreign exchange market or on the basis of a pricing service that takes into account the quotes provided by a number of such major banks. If neither of these alternatives is available or both are deemed not to provide a suitable methodology for converting a foreign currency into U.S. dollars, the Board in good faith will establish a conversion rate for such currency.

All other assets of a Fund are valued in such manner as the Board in good faith deems appropriate to reflect their fair value.

TAXATION

The following is a summary of certain material U.S. federal income tax consequences of acquiring, holding and disposing of the interests in the Funds. It is based upon the Code, the U.S. Treasury Regulations promulgated thereunder, published rulings and court decisions, all as in effect on the date hereof and all of which are subject to change or differing interpretations at any time (possibly with retroactive effect). This summary does not purport to deal with all of the U.S. federal income tax consequences applicable to a Fund or to all categories of investors, some of whom may be subject to special rules (including, without limitation, dealers in securities or currencies, financial institutions, life insurance companies, holders of Fund interests held as part of a “straddle,” “hedge” or “conversion transaction” with other investments, persons whose “functional currency” is not the U.S. dollar or persons for whom the Fund interests are not capital assets). This discussion also does not address U.S. federal tax consequences other than income taxes (such as estate and gift tax consequences). In addition, the following discussion generally applies only to “U.S. persons,” as defined for U.S. federal income tax purposes) who are beneficial owners of Fund interests. A “U.S. person” is generally defined as (i) a citizen or resident of the United States, (ii) a corporation (or an entity treated as a corporation for federal income tax purposes) or partnership (or an entity or arrangement treated as a partnership for federal income tax purposes) created or organized in or under the law of the United States or any political subdivision thereof, (iii) an estate whose income is subject to U.S. federal income tax regardless of its source or (iv) a trust if (a) it is subject to the primary supervision of a court within the United States and one or more U.S. persons have the authority to control all substantial decisions of the trust or (b) it has a valid election in effect under applicable U.S. Treasury Regulations to be treated as a U.S. person.

If a partnership (or other entity or arrangement treated as a partnership for U.S. federal income tax purposes) is an investor in the Funds, the U.S. federal income tax treatment of a partner in that partnership will generally depend on the status of the partner and the activities of the partnership.

The tax consequences of an investment in the Funds will depend not only on the nature of the Funds’ operations and the then applicable U.S. federal tax principles, but also on certain factual determinations that cannot be made at this time, and upon a particular investor’s individual circumstances. No advance rulings have been sought from the Internal Revenue Service (the “IRS”).

IN VIEW OF THE FOREGOING, EACH PROSPECTIVE INVESTOR SHOULD CONSULT ITS OWN TAX ADVISOR REGARDING ALL THE U.S. FEDERAL, STATE, LOCAL AND FOREIGN INCOME AND OTHER TAX CONSEQUENCES OF AN INVESTMENT IN THE FUNDS WITH SPECIFIC REFERENCE TO SUCH INVESTOR’S OWN PARTICULAR TAX SITUATION AND RECENT CHANGES IN APPLICABLE LAW.

Each Fund will be taxed, under the Code, as a separate entity from any other series of the Trust, and each Fund has elected to qualify for treatment as a regulated investment company (“RIC”) under Subchapter M of the Code. In each taxable year that a Fund qualifies, a Fund (but not its shareholders) will be relieved of federal income tax on that part of its investment company taxable income (consisting generally of interest and dividend income, net short term capital gain and net realized gains from currency transactions) and net capital gain that is distributed to shareholders.

In order to qualify for treatment as a RIC, a Fund must distribute annually to shareholders at least 90% of its investment company taxable income and must meet several additional requirements. Among these requirements are the following: (1) at least 90% of a Fund’s gross income each taxable year must be derived from dividends, interest, payments with respect to securities loans and gains from the sale or other disposition of securities or foreign currencies, or other income derived with respect to its business of investing in securities or currencies; (2) at the close of each quarter of a Fund’s taxable year, at least 50% of the value of its total assets must be represented by cash and cash items (including receivables), U.S. Government securities, securities of other RICs and other securities, limited in respect of any one issuer, to an amount that does not exceed 5% of the value of a Fund and that does not represent more than 10% of the outstanding voting securities of such issuer; and (3) at the close of each quarter of a Fund’s taxable year, not more than 25% of the value of its assets may be invested in (i) securities (other

than U.S. Government securities or the securities of other RICs) of any one issuer, (ii) securities (other than the securities of other RICs) of two or more issuers which the Fund controls and which are engaged in the same or similar trades or businesses or related trades or businesses, or (iii) securities of one or more of certain publicly traded partnerships, as such term is defined under the Code.

Distributions of net investment income and net realized capital gains by a Fund will be taxable to shareholders whether made in cash or reinvested in shares. In determining amounts of net realized capital gains to be distributed, any capital loss carryovers from prior years will be applied against capital gains to the extent permitted under the Code. Shareholders receiving distributions in the form of additional shares will have a cost basis for federal income tax purposes in each share so received equal to the NAV of a share of a Fund on the reinvestment date. Fund distributions also will be included in individual and corporate shareholders’ income on which the alternative minimum tax may be imposed. A Fund may make taxable distributions to shareholders even during periods in which share prices have declined. Tax consequences are not the primary consideration of a Fund in implementing its investment strategy.

Each Fund or any securities dealer effecting a redemption of a Fund’s shares by a shareholder will be required to file information reports with the IRS with respect to distributions and payments made to the shareholder. In addition, a Fund will be required to withhold federal income tax at the rate of 24% on taxable dividends, redemptions and other payments made to accounts of individual or other non-exempt shareholders who have not furnished their correct taxpayer identification numbers and made certain required certifications on the account application or with respect to which a Fund or the securities dealer has been notified by the IRS that the number furnished is incorrect or that the account is otherwise subject to backup withholding.

Each Fund intends to declare and pay dividends and other distributions, as stated in the prospectus. In order to avoid the payment of a 4% non-deductible federal excise tax based on net income, a Fund must declare on or before December 31 of each year, and pay on or before January 31 of the following year, distributions at least equal to 98% of its ordinary income for that calendar year and at least 98.2% of the excess of any capital gains over any capital losses realized in the one-year period ending October 31 of that year, together with any undistributed amounts of ordinary income and capital gains (in excess of capital losses) from the previous calendar year.

Certain U.S. shareholders, including individuals and estates and trusts, in the higher income brackets will be subject to an additional 3.8% federal tax on all or a portion of their “net investment income,” which generally will include dividends from the Funds and net gain from the disposition of shares of the Funds. U.S. shareholders are urged to consult their tax advisors regarding the implications of the additional net investment income tax resulting from an investment in the Funds.

Each Fund may receive dividend distributions from U.S. corporations. To the extent that a Fund receives such dividends and distributes them to its shareholders, and meets certain other requirements of the Code, corporate shareholders of a Fund may be entitled to the dividends received deduction, and individual shareholders may, depending on the Fund’s underlying sources of income, have “qualified dividend income,” which would be subject to tax at the shareholder’s maximum capital gains tax rate. Availability of the deduction and/or taxation at the maximum capital gains tax rate is subject to certain holding period and debt-financing limitations.

The use of hedging strategies, such as entering into futures contracts and forward contracts and purchasing options, involves complex rules that will determine the character and timing of recognition of the income received in connection therewith by a Fund. Income from foreign currencies (except certain gains therefrom that may be excluded by future regulations) and income from transactions in options, futures contracts and forward contracts derived by a Fund with respect to its business of investing in securities or foreign currencies should qualify as permissible income under Subchapter M of the Code.

For accounting purposes, premiums paid by a Fund are recorded as an asset and are subsequently adjusted to the current market value of the option. Any gain or loss realized by the Fund upon the expiration or sale of such options held by the Fund generally will be capital gain or loss.

Any security, option or other position entered into or held by a Fund that substantially diminishes the Fund’s risk of loss from any other position held by that Fund may constitute a straddle for federal income tax purposes. In general, straddles are subject to certain rules that may affect the amount, character and timing of the Fund’s gains and losses with respect to straddle positions by requiring, among other things, that the loss realized on disposition of one position of a straddle be deferred until gain is realized on disposition of the offsetting position; that the Fund’s holding period in certain straddle positions not begin until the straddle is terminated (possibly resulting in the gain being treated as short-term capital gain rather than long-term capital gain); and that losses recognized with respect to certain straddle positions, which would otherwise constitute short-term capital losses, be treated as long-term capital losses. Different elections are available to the Fund that may mitigate the effects of the straddle rules.

Certain options, futures contracts and forward contracts that are subject to Section 1256 of the Code (“Section 1256 Contracts”) and that are held by a Fund at the end of its taxable year generally will be required to be “marked to market” for federal income tax purposes, that is, deemed to have been sold at market value. Sixty percent of any net gain or loss recognized on these deemed sales and 60% of any net gain or loss realized from any actual sales of Section 1256 Contracts will be treated as long-term capital gain or loss, and the balance will be treated as short-term capital gain or loss.

Section 988 of the Code contains special tax rules applicable to certain foreign currency transactions that may affect the amount, timing and character of income, gain or loss recognized by a Fund. Under these rules, foreign exchange gain or loss realized with respect to foreign currency-denominated debt instruments, foreign currency forward contracts, foreign currency-denominated payables and receivables and foreign currency options and futures contracts (other than options and futures contracts that are governed by the mark-to-market and 60/40 rules of Section 1256 of the Code and for which no election is made) is treated as ordinary income or loss. Some part of the Fund’s gain or loss on the sale or other disposition of shares of a foreign corporation may, because of changes in foreign currency exchange rates, be treated as ordinary income or loss under Section 988 of the Code, rather than as capital gain or loss.

Redemptions and exchanges of shares of a Fund will result in gains or losses for federal income tax purposes to the extent of the difference between the proceeds and the shareholder’s adjusted tax basis for the shares. Any loss realized (to the extent it is allowed) upon the redemption or exchange of shares within six months from their date of purchase will be treated as a long-term capital loss to the extent of distributions of long-term capital gain dividends with respect to such shares during such six-month period. All or a portion of a loss realized upon the redemption of shares of the Fund may be disallowed to the extent shares of the same Fund are purchased (including shares acquired by means of reinvested dividends) within 30 days before or after such redemption.

Distributions and redemptions may be subject to state and local taxes, and the treatment thereof may differ from the federal income tax treatment. Foreign taxes may apply to non-U.S. investors.

Nonresident aliens and foreign persons are subject to different tax rules, and may be subject to withholding of up to 30% on certain payments received from a Fund. Under the Foreign Account Tax Compliance Act (“FATCA”), a 30% withholding tax on each Fund’s distributions, including capital gains distributions, and on gross proceeds from the sale or other disposition of shares of a Fund, generally applies if paid to a foreign entity unless: (i) if the foreign entity is a “foreign financial institution,” it undertakes certain due diligence, reporting, withholding and certification obligations, (ii) if the foreign entity is not a “foreign financial institution,” it identifies certain of its U.S. investors or (iii) the foreign entity is otherwise excepted under FATCA. If applicable, and subject to any applicable intergovernmental agreements, withholding under FATCA is required: (i) generally with respect to distributions from each Fund; and (ii) with respect to certain capital gains distributions and gross proceeds from a sale or disposition of Fund shares that occur on or after January 1, 2019. If withholding is required under FATCA

on a payment related to your shares, investors that otherwise would not be subject to withholding (or that otherwise would be entitled to a reduced rate of withholding) on such payment generally will be required to seek a refund or credit from the IRS to obtain the benefits of such exemption or reduction. The Funds will not pay any additional amounts in respect to amounts withheld under FATCA. You should consult your tax advisor regarding the effect of FATCA based on your individual circumstances.

The above discussion and the related discussion in each prospectus are not intended to be complete discussions of all applicable tax consequences of an investment in the Funds. Paul Hastings LLP, counsel to the Trust, has expressed no opinion in respect thereof. Shareholders are advised to consult with their own tax advisers concerning the application of foreign, federal, state and local taxes to an investment in a Fund.

DIVIDENDS AND DISTRIBUTIONS

Dividends from a Fund’s investment company taxable income (whether paid in cash or invested in additional shares) will be taxable to shareholders as ordinary income to the extent of the Fund’s earnings and profits. Tax consequences are not the primary consideration of the Funds in implementing their investment strategies. Distributions of a Fund’s net capital gain (whether paid in cash or invested in additional shares) will be taxable to shareholders as long-term capital gain, regardless of how long they have held their Fund shares. A Fund may make taxable distributions to shareholders even during periods in which the share price has declined.

Dividends declared by a Fund in October, November or December of any year and payable to shareholders of record on a date in one of such months will be deemed to have been paid by the Fund and received by the shareholders on the record date if the dividends are paid by the Fund during the following January. Accordingly, such dividends will be taxed to shareholders for the year in which the record date falls.

The Funds are required to withhold 28% of all dividends, capital gain distributions and redemption proceeds payable to any individuals and certain other non-corporate shareholders who do not provide the Fund with a correct taxpayer identification number. The Funds also are required to withhold 28% of all dividends and capital gain distributions paid to such shareholders who otherwise are subject to backup withholding.

ANTI-MONEY LAUNDERING PROGRAM

The Trust has established an Anti-Money Laundering Compliance Program (the “Program”) as required by the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (“USA PATRIOT Act”). To ensure compliance with this law, the Trust’s Program provides for the development of internal practices, procedures and controls, designation of anti-money laundering compliance officers, an ongoing training program and an independent audit function to determine the effectiveness of the Program.

Procedures to implement the Program include, but are not limited to, determining that the Distributor and the Funds’ transfer agent have established proper anti-money laundering procedures, reporting suspicious and/or fraudulent activity and conducting a complete and thorough review of all new opening account applications. The Fund will not transact business with any person or entity whose identity cannot be adequately verified under the provisions of the USA PATRIOT Act.

As a result of the Program, the Trust may be required to “freeze” the account of a shareholder if the shareholder appears to be involved in suspicious activity or if certain account information matches information on government lists of known terrorists or other suspicious persons, or the Trust may be required to transfer the account or proceeds of the account to a governmental agency.

GENERAL INFORMATION

The Trust is a Delaware statutory trust organized on August 1, 1996. The Fund is anticipated to commence operations on September 28, 2018. The Agreement and Declaration of Trust permits the Trust to issue an unlimited number of full and fractional shares of beneficial interest and to divide or combine the shares into a greater or lesser number of shares without thereby changing the proportionate beneficial interest in a Fund. Each share represents an interest in a Fund proportionately equal to the interest of each other share. Upon the Trust’s liquidation, all shareholders would share pro rata in the net assets of a Fund available for distribution to shareholders. The Board has created five series of shares, and may create additional series in the future, which have separate assets and liabilities. Income and operating expenses not specifically attributable to a particular Fund will be allocated fairly among the Funds by the Trustees, generally on the basis of the relative net assets of each Fund.

The Trust has adopted a Multiple Class Plan pursuant to Rule 18f-3 under the 1940 Act on behalf of the Funds. Currently, the Fund is authorized to issue two classes of shares: Institutional Class shares and Investor Class shares.

Rule 18f-2 under the 1940 Act provides that as to any investment company which has two or more series outstanding and as to any matter required to be submitted to shareholder vote, such matter is not deemed to have been effectively acted upon unless approved by the holders of a “majority” (as defined in the Rule) of the voting securities of each series affected by the matter. Such separate voting requirements do not apply to the election of Trustees or the ratification of the selection of accountants. Rule 18f-2 contains special provisions for cases in which an advisory contract is approved by one or more, but not all, series. A change in investment policy may go into effect as to one or more series whose holders so approve the change even though the required vote is not obtained as to the holders of other affected series.

Each Fund may hold special meetings and mail proxy materials. These meetings may be called to elect or remove Trustees, change fundamental policies, approve an investment advisory contract or for other purposes. Shareholders not attending these meetings are encouraged to vote by proxy. Each Fund will mail proxy materials in advance, including a voting card and information about the proposals to be voted on. The number of votes each shareholder is entitled to is based on the number of shares he or she owns. Shareholders are entitled to one vote for each full share held (and fractional votes for fractional shares) and may vote in the election of Trustees and on other matters submitted to meetings of shareholders. It is not contemplated that regular annual meetings of shareholders will be held.

The Equity Fund, the International Fund, the Smaller Companies Fund, the Alternative Strategies Fund and the High Income Alternatives Fund are the only operating series of shares of the Trust. The Board may, at its own discretion, create additional series of shares. The Agreement and Declaration of Trust contains an express disclaimer of shareholder liability for the Trust’s acts or obligations and provides for indemnification and reimbursement of expenses out of the Trust’s property for any shareholder held personally liable for its obligations.

The Agreement and Declaration of Trust provides that the shareholders have the right to remove a Trustee. Upon the written request of the record holders of 10% of the Trust’s shares, the Trustees will call a meeting of shareholders to vote on the removal of a Trustee. No amendment may be made to the Agreement and Declaration of Trust that would have a material adverse effect on shareholders without the approval of the holders of more than 50% of the Trust’s shares. Shareholders have no preemptive or conversion rights. Shares when issued are fully paid and non-assessable by the Trust, except as set forth above.

The Trust and Litman Gregory have obtained an exemptive order from the SEC, which permits Litman Gregory, subject to certain conditions, to hire, terminate and replace managers with the approval of the Board only and without shareholder approval. Within 60 days of the hiring of any new manager or the implementation of any proposed material change in a sub-advisory agreement with an existing manager, shareholders will be furnished information about the new manager or sub-advisory agreement that would be included in a proxy statement. The order also permits a Fund to disclose sub-advisory fees only in the aggregate in its registration statement. Pursuant to the order, shareholder approval is required before Litman Gregory enters into any sub-advisory agreement with a manager that is affiliated with the Funds or Litman Gregory.

The Trust, the Advisor, the Sub-Advisors and the Distributor have adopted codes of ethics pursuant to Rule 17j-1 under the 1940 Act. These codes of ethics permit, subject to certain conditions, personnel of the Advisor, the Sub-Advisors and the Distributor, to invest in securities that may be purchased or held by the Funds.

The Trust’s custodian, State Street Bank and Trust Company, One Lincoln Street, Boston, Massachusetts 02111 is responsible for holding the Funds’ assets and acting as the Trust’s accounting services agent. The Trust’s transfer agent, DST Asset Manager Solutions, Inc. (formerly, Boston Financial Data Services), is located at 330 West Ninth Street, Kansas City, Missouri, 64105. You may call DST Asset Manager Solutions, Inc. at 1-800-960-0188 if you have questions about your account. The Trust’s independent registered public accounting firm, Cohen & Company, Ltd., 1350 Euclid Avenue, Suite 800, Cleveland, Ohio 44115, also assists with the Funds’ tax returns. The Trust’s legal counsel is Paul Hastings LLP, 101 California Street, 48th Floor, San Francisco, California 94111.

The Funds reserve the right, if conditions exist that make cash payments undesirable, to honor any request for redemption or repurchase order by making payment in whole or in part in readily marketable securities chosen by the Fund and valued as they are for purposes of computing the Fund’s NAV (a redemption in kind). If payment is made in securities, a shareholder may incur transaction expenses in converting these securities into cash.

FINANCIAL STATEMENTS

The audited financial statements, including the Financial Highlights of the Funds, except for the High Income Alternatives Fund, for the year ended December 31, 2017, and Cohen & Company, Ltd.’s report thereon are incorporated by reference. The report of Cohen & Company, Ltd., the independent registered public accounting firm of the Funds, with respect to the audited financial statements, is incorporated herein in its entirety in reliance upon such report of Cohen & Company, Ltd. and on the authority of such firm as experts in auditing and accounting. As the High Income Alternatives Fund has recently commenced operations, there are no financial statements available at this time. Shareholders of the High Income Alternatives Fund will be informed of the Fund’s progress through periodic reports when those reports become available. Shareholders will receive a copy of the audited and unaudited financial statements at no additional charge when requesting a copy of the SAI.

APPENDIX

Description of Ratings

The following terms are generally used to describe the credit quality of debt securities:

Moody’s Investors Service, Inc.: Corporate Bond Ratings

Aaa—Bonds which are rated Aaa are judged to be of the best quality and carry the smallest degree of investment risk. Interest payments are protected by a large or by an exceptionally stable margin, and principal is secure. While the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such issues.

Aa—Bonds which are rated Aa are judged to be of high quality and are subject to very low credit risk. Together with the Aaa group they comprise what are generally known as high grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as in Aaa securities or fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long term risks appear somewhat larger than in Aaa securities.

Moody’s appends numerical modifiers “1”, “2” and “3” to each generic rating classification from Aa through Caa. Both the Aaa and Aa rating classifications. The modifier “1” indicates that the security ranks in the higher end of its generic rating category; the modifier “2” indicates a mid-range ranking; and the modifier “3” indicates that the issue ranks in the lower end of its generic rating category. Additionally a “(hyb)” indicator is appended to all ratings of hybrid securities issued by banks, insurers, finance companies, and securities firms.

A—Bonds which are rated A possess many favorable investment attributes and are to be considered as upper medium grade obligations and subject to low credit risk. Factors giving security to principal and interest are considered adequate but elements may be present which suggest a susceptibility to impairment sometime in the future.

Baa—Bonds which are rated Baa are considered as medium grade obligations, subject to moderate credit risk, i.e., they are neither highly protected nor poorly secured. Interest payments and principal security appear adequate for the present but certain protective elements may be lacking or may be characteristically unreliable over any great period of time. Such bonds lack outstanding investment characteristics and in fact have speculative characteristics as well.

Standard & Poor’s Corporation: Corporate Bond Ratings

AAA—This is the highest rating assigned by Standard & Poor’s to a debt obligation and indicates an extremely strong capacity to pay principal and interest.

AA—Bonds rated AA also qualify as high-quality debt obligations. Capacity to pay principal and interest is very strong, and in the majority of instances they differ from AAA issues only in small degree.

A—Bonds rated A have a strong capacity to pay principal and interest, although they are somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions.

BBB—Bonds rated BBB are regarded as having an adequate capacity to pay principal and interest. Whereas they normally exhibit adequate protection parameters, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity to pay principal and interest for bonds in this category than for bonds in the A category.

Commercial Paper Ratings

Moody’s commercial paper ratings are assessments of the issuer’s ability to repay punctually promissory obligations. Moody’s employs the following three designations, all judged to be investment grade, to indicate the relative repayment capacity of rated issuers: Prime 1—highest quality; Prime 2—higher quality; Prime 3—high quality.

A Standard & Poor’s commercial paper rating is a current assessment of the likelihood of timely payment. Ratings are graded into four categories, ranging from “A” for the highest quality obligations to “D” for the lowest.

Issues assigned the highest rating, A, are regarded as having the greatest capacity for timely payment. Issues in this category are delineated with the numbers “1”, “2” and “3” to indicate the relative degree of safety. The designation A-1 indicates that the degree of safety regarding timely payment is either overwhelming or very strong. A “+” designation is applied to those issues rated “A-1” which possess extremely strong safety characteristics. Capacity for timely payment on issues with the designation “A-2” is strong. However, the relative degree of safety is not as high as for issues designated A-1. Issues carrying the designation “A-3” have a satisfactory capacity for timely payment. They are, however, somewhat more vulnerable to the adverse effect of changes in circumstances than obligations carrying the higher designations.

LITMAN GREGORY FUNDS TRUST

PART C

OTHER INFORMATION

Item 28.

Exhibits


(a)		Articles of Incorporation.
	(1)	Agreement and Declaration of Trust ⁽¹⁾
		(A)	Amendment to Agreement and Declaration of Trust ⁽²⁾
		(B)	Amendment to Agreement and Declaration of Trust dated December 4, 2008 ⁽⁸⁾
		(C)	Amendment to Agreement and Declaration of Trust dated August 31, 2011 ⁽⁸⁾

(b)		By-laws ⁽¹²⁾

(c)		Instruments Defining Rights of Security Holders – See Articles III and V of Agreement and Declaration of Trust and Article II of Third Amended and Restated By-Laws

(d)		Investment Advisory Contracts
	(1)	Unified Investment Advisory Agreement between Litman Gregory Funds Trust and Litman Gregory Fund Advisors, LLC dated April 1, 2013 ⁽¹⁰⁾
		(A)	Amended Appendix A and Appendix B to the Unified Investment Advisory Agreement dated August 28, 2018 – filed herewith

	(2)	Sub-Advisory Agreements
		(A)	Equity Fund
			1.	Investment Management Agreement with Davis Selected Advisers L.P. ⁽¹³⁾
			2.	Investment Management Agreement with Fiduciary Management, Inc. ⁽¹³⁾
			3.	Investment Management Agreement with Harris Associates L.P. ⁽⁷⁾
			4.	Investment Management Agreement with Nuance Investments, LLC ⁽¹³⁾
			5.	Investment Management Agreement with Sands Capital Management, LLC ⁽¹³⁾
			6.	Investment Management Agreement with Wells Capital Management, Inc. ⁽¹³⁾
		(B)	International Fund
			1.	Investment Management Agreement with Evermore Global Advisors, LLC ⁽¹⁵⁾
			2.	Investment Management Agreement with Harris Associates L.P. ⁽¹³⁾
			3.	Investment Management Agreement with Lazard Asset Management LLC ⁽¹³⁾
			4.	Investment Management Agreement with Northern Cross, LLC ⁽¹³⁾
			5.	Investment Management Agreement with Pictet Asset Management Limited ⁽¹⁵⁾
			6.	Investment Management Agreement with Thornburg Investment Management, Inc. ⁽⁵⁾
		(C)	Smaller Companies Fund
			1.	Investment Management Agreement with Cove Street Capital, LLC ⁽¹³⁾
			2.	Investment Management Agreement with Segall Bryant & Hamill, LLC ⁽¹⁶⁾
			3.	Investment Management Agreement with Wells Capital Management, Inc. ⁽¹³⁾
		(D)	Alternative Strategies Fund
			1.	Investment Management Agreement with DCI, LLC ⁽¹⁶⁾
			2.	Investment Management Agreement with DoubleLine Capital LP ⁽¹³⁾
			3.	Investment Management Agreement with First Pacific Advisors, LLC ⁽¹³⁾
			4.	Investment Management Agreement with Loomis, Sayles & Company, L.P. ⁽¹³⁾
			5.	Investment Management Agreement with Water Island Capital LLC ⁽¹³⁾
		(E)	High Income Alternatives Fund
			1.	Investment Management Agreement with Ares Management LLC – filed herewith
			2.	Investment Management Agreement with Brown Brothers Harriman & Co. – filed herewith
			3.	Investment Management Agreement with Guggenheim Partners Investment Management, LLC – to be filed by amendment
			4.	Investment Management Agreement with Neuberger Berman Investment Advisers LLC – filed herewith


(e)		Underwriting Contracts
	(1)	Distribution Agreement with ALPS Distributors, Inc. dated April 16, 2018 ⁽¹⁶⁾
	(2)	Distribution Letter Agreement with ALPS Distributors, Inc. dated April 16, 2018 ⁽¹⁶⁾
	(3)	Amendment to the Distribution Agreement with ALPS Distributors, Inc. – to be filed by amendment

(f)		Bonus or Profit Sharing Contracts – None

(g)		Custodian Agreements
	(1)	Custody Agreement with State Street Bank and Trust Company dated January 17, 1997 ⁽¹³⁾
		(A)	Amendment to the Custody Agreement – to be filed by amendment

(h)		Other Material Contracts

	(1)	Administration Agreement with State Street Bank and Trust Company dated September 10, 2014 ⁽¹³⁾
		(A)	Amendment to the Administration Agreement – to be filed by amendment

	(2)	Powers of Attorney dated April 30, 2014 ⁽¹³⁾

	(3)	Restated Contractual Advisory Fee Waiver Agreement ⁽¹³⁾
		(A)	Amendment dated August 31, 2011 to the Restated Contractual Advisory Fee Waiver Agreement ⁽¹³⁾
		(B)	Amendment dated May 20, 2013 to the Restated Contractual Advisory Fee Waiver Agreement ⁽¹¹⁾
		(C)	Amendment dated January 1, 2017 to the Restated Contractual Advisory Fee Waiver Agreement ⁽¹⁵⁾
		(D)	Amendment dated August 28, 2018 to the Restated Contractual Advisory Fee Waiver Agreement – filed herewith

	(4)	Operating Expenses Limitation Agreement
		(A)	Operating Expenses Limitation Agreement dated August 28, 2018 for the High Income Alternatives Fund – filed herewith

(i)		Legal Opinion
	(1)	Consent of Counsel dated September 6, 2018 – filed herewith

(j)		Other Opinions
	(1)	Consent of Independent Registered Public Accounting Firm dated September 6, 2018 – filed herewith

(k)		Omitted Financial Statements – None

(l)		Initial Capital Agreements
	(1)	Subscription Agreement (initial seed capital only) ⁽³⁾

(m)		Rule 12b-1 Plan
	(1)	Amended Distribution and Shareholder Servicing Plan (12b-1 Plan) – filed herewith

(n)		Rule 18f-3 Plan
	(1)	Amended Multiple Class Plan – filed herewith

(o)		Reserved

(p)		Codes of Ethics
	(1)	Code of Ethics for Litman Gregory Funds Trust – filed herewith
	(2)	Code of Ethics for Litman Gregory Fund Advisors, LLC – filed herewith


(3)	Code of Ethics for ALPS Distributors, Inc. ⁽¹⁶⁾
(4)	Codes of Ethics for the Sub-Advisors
	(A)	Davis Selected Advisers, L.P. ⁽⁴⁾
	(B)	First Pacific Advisors, LLC ⁽¹⁴⁾
	(C)	Thornburg Investment Management, Inc. ⁽¹⁶⁾
	(D)	Wells Capital Management, Inc. ⁽¹⁵⁾
	(E)	Northern Cross, LLC ⁽¹⁶⁾
	(F)	Nuance Investments, LLC ⁽¹²⁾
	(G)	Cove Street Capital, LLC ⁽¹⁶⁾
	(H)	Harris Associates L.P. ⁽¹⁵⁾
	(I)	Sands Capital Management, LLC ⁽¹⁵⁾
	(J)	DoubleLine Capital LP ⁽¹⁶⁾
	(K)	Loomis, Sayles & Company, L.P. ⁽¹⁶⁾
	(L)	Water Island Capital, LLC ⁽¹⁵⁾
	(M)	Lazard Asset Management LLC ⁽¹⁶⁾
	(N)	Fiduciary Management, Inc. ⁽¹²⁾
	(O)	Pictet Asset Management Limited ⁽¹⁵⁾
	(P)	Evermore Global Advisors, LLC ⁽¹⁵⁾
	(Q)	DCI, LLC ⁽¹⁶⁾
	(R)	Segall Bryant & Hamill, LLC ⁽¹⁶⁾
	(S)	Ares Management LLC – filed herewith
	(T)	Brown Brothers Harriman & Co. – filed herewith
	(U)	Guggenheim Partners Investment Management, LLC – filed herewith
	(V)	Neuberger Berman Investment Advisers LLC – filed herewith

⁽¹⁾	Previously filed as an exhibit to the Registrant’s initial Registration Statement on Form N-1A, filed with the Securities and Exchange Commission (“SEC”) on August 12, 1996, and is herein incorporated by reference.

⁽²⁾	Previously filed as an exhibit to the Registrant’s Pre-Effective Amendment No. 1 to the Registration Statement on Form N-1A, filed with the SEC on November 15, 1996, and is hereby incorporated by reference.

⁽³⁾	Previously filed as an exhibit to the Registrant’s Pre-Effective Amendment No. 2 to the Registration Statement on Form N-1A, filed with the SEC on December 17, 1996, and is herein incorporated by reference.

⁽⁴⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 14 to the Registration Statement on Form N-1A, filed with the SEC on April 20, 2000, and is herein incorporated by reference.

⁽⁵⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 25 to the Registration Statement on Form N-1A, filed with the SEC on February 25, 2004, and is herein incorporated by reference.

⁽⁶⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 40 to the Registration Statement on Form N-1A, filed with the SEC on April 30, 2008, and is herein incorporated by reference.

⁽⁷⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 46 to the Registration Statement on Form N-1A, filed with the SEC on April 30, 2010, and is herein incorporated by reference.

⁽⁸⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 50 to the Registration Statement on Form N-1A, filed with the SEC on September 2, 2011, and is herein incorporated by reference.

⁽⁹⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 52 to the Registration Statement on Form N-1A, filed with the SEC on April 30, 2012, and is herein incorporated by reference.

⁽¹⁰⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 54 to the Registration Statement on Form N-1A, filed with the SEC on May 1, 2013, and is herein incorporated by reference.

⁽¹¹⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 56 to the Registration Statement on Form N-1A, filed with the SEC on February 26, 2014, and is herein incorporated by reference.

⁽¹²⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 57 to the Registration Statement on Form N-1A, filed with the SEC on April 30, 2014, and is herein incorporated by reference.

⁽¹³⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 59 to the Registration Statement on Form N-1A, filed with the SEC on April 30, 2015, and is herein incorporated by reference.

⁽¹⁴⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 61 to the Registration Statement on Form N-1A, filed with the SEC on April 29, 2016, and is herein incorporated by reference.

⁽¹⁵⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 64 to the Registration Statement on Form N-1A, filed with the SEC on April 28, 2017, and is herein incorporated by reference.

⁽¹⁶⁾	Previously filed as an exhibit to the Registrant’s Post-Effective Amendment No. 79 to the Registration Statement on Form N-1A, filed with the SEC on April 30, 2018, and is herein incorporated by reference.

Item 29.

Persons Controlled by or Under Common Control with the Fund

No person is directly or indirectly controlled by or under common control with the Registrant.

Item 30.

Indemnification

Article VI of Registrant’s By-Laws states as follows:

Section 1. AGENTS, PROCEEDINGS AND EXPENSES. For the purpose of this Article, “agent” means any person who is or was a Trustee, officer, employee or other agent of this Trust or is or was serving at the request of this Trust as a Trustee, director, officer, employee or agent of another foreign or domestic corporation, partnership, joint venture, trust or other enterprise or was a Trustee, director, officer, employee or agent of a foreign or domestic corporation which was a predecessor of another enterprise at the request of such predecessor entity; “proceeding” means any threatened, pending or completed action or proceeding, whether civil, criminal, administrative or investigative; and “expenses” includes without limitation attorney’s fees and any expenses of establishing a right to indemnification under this Article.

Section 2. ACTIONS OTHER THAN BY TRUST. This Trust shall indemnify any person who was or is a party or is threatened to be made a party to any proceeding (other than an action by or in the right of this Trust) by reason of the fact that such person is or was an agent of this Trust, against expenses, judgments, fines, settlements and other amounts actually and reasonably incurred in connection with such proceeding, if it is determined that person acted in good faith and reasonably believed:

(a) in the case of conduct in his official capacity as a Trustee of the Trust, that his conduct was in the Trust’s best interests, and

(b) in all other cases, that his conduct was at least not opposed to the Trust’s best interests, and

(c) in the case of a criminal proceeding, that he had no reasonable cause to believe the conduct of that person was unlawful.

The termination of any proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent shall not of itself create a presumption that the person did not act in good faith and in a manner which the person reasonably believed to be in the best interests of this Trust or that the person had reasonable cause to believe that the person’s conduct was unlawful.

Section 3. ACTIONS BY THE TRUST. This Trust shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action by or in the right of this Trust to procure a judgment in its favor by reason of the fact that that person is or was an agent of this Trust, against expenses actually and reasonably incurred by that person in connection with the defense or settlement of that action if that person acted in good faith, in a manner that person believed to be in the best interests of this Trust and with such care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances.

Section 4. EXCLUSION OF INDEMNIFICATION. Notwithstanding any provision to the contrary contained herein, there shall be no right to indemnification for any liability arising by reason of willful misfeasance, bad faith, gross negligence, or the reckless disregard of the duties involved in the conduct of the agent’s office with this Trust.

No indemnification shall be made under Sections 2 or 3 of this Article:

(a) In respect of any claim, issue, or matter as to which that person shall have been adjudged to be liable on the basis that personal benefit was improperly received by him, whether or not the benefit resulted from an action taken in the person’s official capacity; or

(b) In respect of any claim, issue or matter as to which that person shall have been adjudged to be liable in the performance of that person’s duty to this Trust, unless and only to the extent that the court in which that action was brought shall determine upon application that in view of all the circumstances of the case, that person was not liable by reason of the disabling conduct set forth in the preceding paragraph and is fairly and reasonably entitled to indemnity for the expenses which the court shall determine.

(c) Of amounts paid in settling or otherwise disposing of a threatened or pending action, with or without court approval, or of expenses incurred in defending a threatened or pending action which is settled or otherwise disposed of without court approval, unless the required approval set forth in Section 6 of this Article is obtained.

Section 5. SUCCESSFUL DEFENSE BY AGENT. To the extent that an agent of this Trust has been successful on the merits in defense of any proceeding referred to in Sections 2 or 3 of this Article or in defense of any claim, issue or matter therein, before the court or other body before whom the proceeding was brought, the agent shall be indemnified against expenses actually and reasonably incurred by the agent in connection therewith, provided that the Board of Trustees, including a majority who are disinterested, non-party Trustees, also determines that based upon a review of the facts, the agent was not liable by reason of the disabling conduct referred to in Section 4 of this Article.

Section 6. REQUIRED APPROVAL. Except as provided in Section 5 of this Article, any indemnification under this Article shall be made by this Trust only if authorized in the specific case on a determination that indemnification of the agent is proper in the circumstances because the agent has met the applicable standard of conduct set forth in Sections 2 or 3 of this Article and is not prohibited from indemnification because of the disabling conduct set forth in Section 4 of this Article, by:

(a) A majority vote of a quorum consisting of Trustees who are not parties to the proceeding and are not interested persons of the Trust (as defined in the Investment Company Act of 1940); or

(b) A written opinion by an independent legal counsel.

Section 7. ADVANCE OF EXPENSES. Expenses incurred in defending any proceeding may be advanced by this Trust before the final disposition of the proceeding upon a written undertaking by or on behalf of the agent, to repay the amount of the advance if it is ultimately determined that he or she is not entitled to indemnification, together with at least one of the following as a condition to the advance: (i) security for the undertaking; or (ii) the existence of insurance protecting the Trust against losses arising by reason of any lawful advances; or (iii) a determination by a majority of a

quorum of Trustees who are not parties to the proceeding and are not interested persons of the Trust, or by an independent legal counsel in a written opinion, based on a review of readily available facts that there is reason to believe that the agent ultimately will be found entitled to indemnification. Determinations and authorizations of payments under this Section must be made in the manner specified in Section 6 of this Article for determining that the indemnification is permissible.

Section 8. OTHER CONTRACTUAL RIGHTS. Nothing contained in this Article shall affect any right to indemnification to which persons other than Trustees and officers of this Trust or any subsidiary hereof may be entitled by contract or otherwise.

Section 9. LIMITATIONS. No indemnification or advance shall be made under this Article, except as provided in Sections 5 or 6 in any circumstances where it appears:

(a) that it would be inconsistent with a provision of the Agreement and Declaration of Trust of the Trust, a resolution of the shareholders, or an agreement in effect at the time of accrual of the alleged cause of action asserted in the proceeding in which the expenses were incurred or other amounts were paid which prohibits or otherwise limits indemnification; or

(b) that it would be inconsistent with any condition expressly imposed by a court in approving a settlement.

Section 10. INSURANCE. Upon and in the event of a determination by the Board of Trustees of this Trust to purchase such insurance, this Trust shall purchase and maintain insurance on behalf of any agent of this Trust against any liability asserted against or incurred by the agent in such capacity or arising out of the agent’s status as such, but only to the extent that this Trust would have the power to indemnify the agent against that liability under the provisions of this Article and the Agreement and Declaration of Trust of the Trust.

Section 11. FIDUCIARIES OF EMPLOYEE BENEFIT PLAN. This Article does not apply to any proceeding against any Trustee, investment manager or other fiduciary of an employee benefit plan in that person’s capacity as such, even though that person may also be an agent of this Trust as defined in Section 1 of this Article. Nothing contained in this Article shall limit any right to indemnification to which such a Trustee, investment manager, or other fiduciary may be entitled by contract or otherwise which shall be enforceable to the extent permitted by applicable law other than this Article.

In addition to the indemnification provisions provided for in the Registrant’s By-Laws, the Registrant has also entered into indemnification agreements (the “Indemnification Agreements”) with each of the Trustees and with its Chief Compliance Officer (collectively, the “Indemnitees”). The Indemnification Agreements set forth the procedure by which Indemnitees are to request and receive advancement of expenses and indemnification. The Indemnification Agreements provide that, in any determination for advancement of expenses or indemnification, the Indemnitees are entitled to a rebuttable presumption that they did not engage in conduct that would disqualify them from eligibility to receive advancement of expenses or for indemnification. The Indemnification Agreements also set forth the procedure by which an independent counsel may be chosen if independent counsel is to make a determination of any Indemnitee’s qualification for advancement of expenses or indemnification.

Item 31.

Business and Other Connections of the Investment Adviser

The information required by this item is contained in the Form ADVs of the following entities and is incorporated herein by reference:


Name of Investment Adviser		File No.
Litman Gregory Fund Advisors, LLC		801-52710

Name of Sub-Advisors
Ares Management LLC		801-63800
Brown Brothers Harriman & Co.		801-60256
Cove Street Capital, LLC		801-72231
Davis Selected Advisors, L.P.		801-31648
DCI, LLC		801-63857
DoubleLine Capital LP		801-70942
Evermore Global Advisors, LLC		801-70645
Fiduciary Management, Inc.		801-15164
First Pacific Advisors, LLC		801-67160
Guggenheim Partners Investment Management, LLC		801-66786
Harris Associates L.P.		801-50333
Lazard Asset Management LLC		801-61701
Loomis, Sayles & Company, L.P.		801-170
Neuberger Berman Investment Advisers LLC		801-61757
Northern Cross, LLC		801-62668
Nuance Investments, LLC		801-69682
Pictet Asset Management Limited		801-15143
Sands Capital Management, LLC		801-64820
Segall Bryant & Hamill, LLC		801-47232
Thornburg Investment Management, Inc.		801-17853
Water Island Capital, LLC		801-57341
Wells Capital Management, Inc.		801-21122

Item 32.

Principal Underwriters

(a) ALPS Distributors, Inc., the Registrant’s principal underwriter, acts as principal underwriter for the following investment companies:

1290 Funds

ALPS Series Trust

The Arbitrage Funds

AQR Funds

Barings Funds Trust

BBH Trust

Brandes Investment Trust

Broadview Funds Trust

Brown Capital Management Mutual Funds

Centre Funds

CION Ares Diversified Credit Fund

Columbia ETF Trust

Columbia ETF Trust I

Columbia ETF Trust II

Cortina Funds, Inc.

CRM Mutual Fund Trust

CSOP ETF Trust

Cullen Funds Trust

DBX ETF Trust

ETFS Trust

Flat Rock Opportunity Fund

Financial Investors Trust

Firsthand Funds

FS Credit Income Fund

FS Energy Total Return Fund

FS Series Trust

Goehring & Rozencwajg Investment Funds

Goldman Sachs ETF Trust

Griffin Institutional Access Credit Fund

Griffin Institutional Access Real Estate Fund

Hartford Funds Exchange-Traded Trust

Hartford Funds NextShares Trust

Harvest Volatility Edge Trust

Heartland Group, Inc.

Henssler Funds, Inc.

Holland Series Fund, Inc.

Index Funds

IndexIQ ETF Trust and IndexIQ Active ETF Trust

Ivy NextShares Trust

James Advantage Funds

Janus Detroit Street Trust

Lattice Strategies Trust

Litman Gregory Funds Trust

Longleaf Partners Funds Trust

M3Sixty Funds Trust

Mairs & Power Funds Trust

Meridian Fund, Inc.

Natixis ETF Trust

Northern Lights Fund Trust (on behalf of the 13D Activist Fund)

NorthStar Real Estate Capital Income Fund

NorthStar Real Estate Capital Income Fund-T

NorthStar Real Estate Capital Income Fund-ADV

NorthStar Real Estate Capital Income Fund-C

NorthStar/Townsend Institutional Real Estate Fund

Pax World Funds Series Trust I

Pax World Series Trust III

Principal Exchange-Traded Funds

Reality Shares ETF Trust

Resource Credit Income Funds

Resource Real Estate Diversified Income Fund

RiverNorth Funds

Segall Bryant & Hamill Trust (formerly Westcore Trust)

Sierra Total Return Fund

Smead Funds Trust

SPDR Dow Jones Industrial Average ETF Trust

SPDR S&P 500 ETF Trust

SPDR S&P MidCap 400 ETF Trust

Stadion Investment Trust

Stone Harbor Investment Funds

Stone Ridge Trust

Stone Ridge Trust II

Stone Ridge Trust III

Stone Ridge Trust IV

Stone Ridge Trust V

Total Income + Real Estate Fund

USCF ETF Trust

USCF Mutual Funds Trust

Wasatch Funds

WesMark Funds

Wilmington Funds

(b) To the best of Registrant’s knowledge, the directors and executive officers of ALPS Distributors, Inc. are as follows:


Name and Principal Business Address*	Positions and Offices with ALPS Distributors, Inc.	Positions and Offices with Registrant
Jeremy O. May	President, Director	None
Edmund J. Burke	Director	None
Bradley J. Swenson	Senior Vice President, Chief Operating Officer	None
Robert J. Szydlowski	Senior Vice President, Chief Technology Officer	None
Eric T. Parsons	Vice President, Controller and Assistant Treasurer	None
Joseph J. Frank**	Secretary	None
Patrick J. Pedonti**	Vice President, Treasurer and Assistant Secretary	None
Douglas W. Fleming**	Assistant Treasurer	None
Richard C. Noyes	Senior Vice President, General Counsel, Assistant Secretary	None
Steven Price	Senior Vice President, Chief Compliance Officer	None
Stephen J. Kyllo	Vice President, Deputy Chief Compliance Officer	None
Liza Orr	Vice President, Senior Counsel	None
Jed Stahl	Vice President, Senior Counsel	None
Josh Eihausen	Vice President, Associate Senior Counsel	None
James Stegall	Vice President	None
Gary Ross	Senior Vice President	None
Kevin Ireland	Senior Vice President	None
Mark Kiniry	Senior Vice President	None
Tison Cory	Vice President, Intermediary Operations	None
Hilary Quinn	Vice President	None
Jennifer Craig	Assistant Vice President	None

*	Except as otherwise noted, the principal business address for each of the above directors and executive officers is 1290 Broadway, Suite 1100, Denver, Colorado 80203.

**	The principal business address for Messrs. Pedonti, Frank and Fleming is 333 W. 11^th Street, 5^th Floor, Kansas City, Missouri 64105.

Item 33.

Location of Accounts and Records

All accounts, books and other documents required to be maintained by Section 31(a) of the Investment Company Act of 1940, as amended (the “1940 Act”), and the rules thereunder are maintained at the following locations:


Records Relating to:		Are located at:
Registrant’s Investment Adviser		Litman Gregory Fund Advisors, LLC 1676 N. California Blvd., Suite 500 Walnut Creek, CA 94596

Registrant’s Fund Administrator		State Street Bank and Trust Company One Lincoln Street Boston, MA 02116

Registrant’s Custodian/Fund Accountant		State Street Bank and Trust Company 1776 Heritage Drive Quincy, MA 02171

Registrant’s Distributor		ALPS Distributors, Inc. 1290 Broadway, Suite 1100 Denver, CO 80203

Registrant’s Transfer Agent		DST Asset Manager Solutions, Inc. (formerly, Boston Financial Data Services, Inc.) 330 West 9^th Street Kansas City, MO 64105

The documents required to be maintained by paragraphs (5), (6), (10) and (11) of Rule 31a-1(b) under the 1940 Act will be maintained by the Registrant’s respective Sub-Advisors:

Ares Management LLC

2000 Avenue of the Stars, 12th Floor

Los Angeles, CA 90067

Brown Brothers Harriman & Co.

140 Broadway

New York, NY 10005

Cove Street Capital, LLC

2101 East El Segundo, Suite 302

El Segundo, CA 90245

Davis Selected Advisers, L.P.

2949 E. Elvira Rd. Suite 101

Tucson, AZ 85756

DCI, LLC

201 Spear Street, Suite 250

San Francisco, CA 94105

DoubleLine Capital LP

333 South Grand Avenue, Suite 1800

Los Angeles, CA 90071

Evermore Global Advisors, LLC

89 Summit Avenue

Summit, NJ 07901

Fiduciary Management, Inc.

100 East Wisconsin Avenue, Suite 2200

Milwaukee, WI 53202

First Pacific Advisors, LLC

11601 Wilshire Boulevard, Suite 1200

Los Angeles, CA 90025

Guggenheim Partners Investment Management, LLC

100 Wilshire Boulevard, 5th Floor

Santa Monica, CA 90401

Harris Associates L.P.

111 S. Wacker Drive, Suite 4600

Chicago, IL 60606

Lazard Asset Management LLC

30 Rockefeller Plaza

New York, NY 10112

Loomis, Sayles & Company, L.P.

One Financial Center

Boston, MA 02111

Neuberger Berman Investment Advisers LLC

1290 Avenue of the Americas

New York, NY 10104

Northern Cross, LLC

125 Summer Street, Suite 1410

Boston, MA 02110

Nuance Investments, LLC

4900 Main Street, Suite 220

Kansas City, MO 64112

Pictet Asset Management Limited

Moor House, 120 London Wall

London EC2Y 5ET – United Kingdom

Sands Capital Management, LLC

1000 Wilson Boulevard, Suite 3000

Arlington, VA 22209

Segall Bryant & Hamill, LLC

540 West Madison Street, Suite 1900

Chicago, IL 60661

Thornburg Investment Management, Inc.

2300 North Ridgetop Road

Santa Fe, NM 87506

Water Island Capital, LLC

41 Madison Avenue, 42^nd Floor

New York, NY 10010

Wells Capital Management, Inc.

100 Heritage Reserve

Menomonee Falls, WI 53051

Item 34.

Management Services

The Registrant has disclosed all management-related service contracts in Parts A and B.

Item 35.

Undertakings

Registrant hereby undertakes to:

(1)	Furnish each person to whom a Prospectus is delivered a copy of Registrant’s latest annual report to shareholders, upon request and without charge.

(2)	If requested to do so by the holders of at least 10% of the Trust’s outstanding shares, call a meeting of shareholders for the purposes of voting upon the question of removal of a trustee and assist in communications with other shareholders.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended (the “Securities Act”), and the Investment Company Act of 1940, as amended, the Registrant certifies that it meets all of the requirements for effectiveness of this Registration Statement under Rule 485(b) under the Securities Act and has duly caused this Post-Effective Amendment No. 85 to its Registration Statement on Form N-1A to be signed below on its behalf by the undersigned, duly authorized, in the City of Walnut Creek and State of California, on the 6th day of September, 2018.


LITMAN GREGORY FUNDS TRUST

	By:	/s/ Jeremy DeGroot
		Jeremy DeGroot
		President

Pursuant to the requirements of the Securities Act, as amended, this Post-Effective Amendment No. 85 to its Registration Statement has been signed below by the following persons in the capacities and on the dates indicated.


Signature	Title	Date

/s/ Julie Allecta* Julie Allecta	Trustee	September 6, 2018

/s/ Jeremy DeGroot Jeremy DeGroot	Trustee and President (Principal Executive Officer)	September 6, 2018

/s/ Frederick A. Eigenbrod, Jr.* Frederick A. Eigenbrod, Jr.	Trustee	September 6, 2018

/s/ Harold M. Shefrin* Harold M. Shefrin	Trustee	September 6, 2018

/s/ John Coughlan John Coughlan	Treasurer (Principal Financial Officer)	September 6, 2018

* By: /s/ John Coughlan
John Coughlan, Attorney-in-Fact

INDEX TO EXHIBITS


Exhibit Number			Description

(d)	(1)	(A)	Amended Appendix A and Appendix B to the Unified Investment Advisory Agreement dated August 28, 2018

(d)	(2)	(E)(1)	Investment Management Agreement with Ares Management LLC

(d)	(2)	(E)(2)	Investment Management Agreement with Brown Brothers Harriman & Co.

(d)	(2)	(E)(4)	Investment Management Agreement with Neuberger Berman Investment Advisers LLC

(h)	(3)	(D)	Amendment dated August 28, 2018 to the Restated Contractual Advisory Fee Waiver Agreement

(h)	(4)	(A)	Operating Expenses Limitation Agreement dated August 28, 2018

(i)	(1)		Consent of Counsel dated September 6, 2018

(j)	(1)		Consent of Independent Registered Public Accounting Firm dated September 6, 2018

(m)	(1)		Amended Distribution and Shareholder Servicing Plan (12b-1 Plan)

(n)	(1)		Amended Multiple Class Plan

(p)	(1)		Code of Ethics – Litman Gregory Funds Trust

(p)	(2)		Code of Ethics – Litman Gregory Fund Advisors, LLC

(p)	(4)	(S)	Code of Ethics – Ares Management LLC

(p)	(4)	(T)	Code of Ethics – Brown Brothers Harriman & Co.

(p)	(4)	(U)	Code of Ethics – Guggenheim Partners Investment Management, LLC

(p)	(4)	(V)	Code of Ethics – Neuberger Berman Investment Advisers LLC

Exhibit (d)(1)(A)

Appendix A to Unified Investment Advisory Agreement

(August 28, 2018)

FUND SCHEDULE – LITMAN GREGORY FUNDS TRUST


Fund		Effective Date
• Litman Gregory Masters Equity Fund		April 1, 2013

• Litman Gregory Masters International Fund		April 1, 2013

• Litman Gregory Masters Smaller Companies Fund		April 1, 2013

• Litman Gregory Masters Alternative Strategies Fund		April 1, 2013

• Litman Gregory Masters High Income Alternatives Fund		August 28, 2018


LITMAN GREGORY FUNDS TRUST, on behalf of its series listed above		LITMAN GREGORY FUND ADVISORS, LLC

By:	/s/ Jeremy L. DeGroot	By:	/s/ John Coughlan
Name:	Jeremy L. DeGroot	Name:	John Coughlan
Title:	President	Title:	Chief Operating Officer

Appendix B to Unified Investment Advisory Agreement

(August 28, 2018)

FEE SCHEDULE – LITMAN GREGORY FUNDS TRUST


Fund		Fee Rate
• Litman Gregory Masters Equity Fund		1.10% of the Fund’s daily net assets up to $750 million 1.00% of the Fund’s daily net assets in excess of $750 million

• Litman Gregory Masters International Fund		1.10% of the Fund’s daily net assets up to $1 billion 1.00% of the Fund’s daily net assets in excess of $1 billion

• Litman Gregory Masters Smaller Companies Fund		1.14% of the Fund’s daily net assets up to $450 million 1.04% of the Fund’s daily net assets in excess of $450 million

• Litman Gregory Masters Alternative Strategies Fund		1.40% of the Fund’s daily net assets up to $2 billion 1.30% of the Fund’s daily net assets between $2 billion and $3 billion 1.25% of the Fund’s daily net assets between $3 billion and $4 billion 1.20% of the Fund’s daily net assets in excess of $4 billion

• Litman Gregory Masters High Income Alternatives Fund		0.95% of the Fund’s daily net assets up to $1 billion 0.925% of the Fund’s daily net assets between $1 billion and $2 billion 0.90% of the Fund’s daily net assets between $2 billion and $3 billion 0.875% of the Fund’s daily net assets between $3 billion and $4 billion 0.85% of the Fund’s daily net assets in excess of $4 billion


LITMAN GREGORY FUNDS TRUST, on behalf of its series listed above		LITMAN GREGORY FUND ADVISORS, LLC

By:	/s/ Jeremy L. DeGroot	By:	/s/ John Coughlan
Name:	Jeremy L. DeGroot	Name:	John Coughlan
Title:	President	Title:	Chief Operating Officer

Exhibit (d)(2)(E)(1)

LITMAN GREGORY MASTERS HIGH INCOME ALTERNATIVES FUND

LITMAN GREGORY FUNDS TRUST

INVESTMENT SUB-ADVISORY AGREEMENT

THIS INVESTMENT SUB-ADVISORY AGREEMENT is made as of the 29^th day of August, 2018 by and between Litman Gregory Fund Advisors LLC (the “Advisor”) and Ares Management LLC (the “Sub-Advisor”).

WITNESSETH:

WHEREAS, the Advisor has been retained as the investment adviser to the Litman Gregory Masters High Income Alternatives Fund (the “Fund”), a series of the Litman Gregory Funds Trust (the “Trust”), an open-end management investment company, registered as such under the Investment Company Act of 1940, as amended (the “Investment Company Act”), pursuant to a written agreement (the “Advisory Agreement”), a copy of which has been provided to the Sub-Advisor; and

WHEREAS, the Sub-Advisor is registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the “Investment Advisers Act”);

WHEREAS, the Fund and the Advisor desire to retain the Sub-Advisor as an investment manager to render portfolio advice and related services to the Fund pursuant to the terms and provisions of this Agreement, and the Sub-Advisor desires to furnish said advice and services; and

WHEREAS, the Trust and the Fund are third party beneficiaries of such arrangements;

NOW, THEREFORE, in consideration of the covenants and the mutual promises hereinafter set forth, the parties to this Agreement, which includes the Trust on behalf of the Fund for purposes of the indemnification provisions of Section 11 hereof, intending to be legally bound hereby, mutually agree as follows:

1. Appointment of Sub-Advisor.

(a) The Advisor hereby appoints the Sub-Advisor, and the Sub-Advisor hereby accepts such appointment, to render portfolio advice and related services with respect to the Allocated Portion of the assets of the Fund for the period and on the terms set forth in this Agreement, subject to the supervision and direction of the Advisor and the Trust’s Board of Trustees.

(b) The Sub-Advisor’s appointment shall be solely with respect to an Allocated Portion of the Fund’s assets, such Allocated Portion to be specified by the Advisor as of the date of this Agreement and subject to periodic increases or decreases at the Advisor’s sole discretion.

2. Duties of Sub-Advisor.

(a) General Duties. Subject to the supervision and approval of the Advisor and the Trust’s Board of Trustees, the Sub-Advisor will provide investment management of the Allocated Portion of the Fund’s assets. The Sub-Advisor shall invest and reinvest such Allocated Portion in accordance with (i) the investment objectives, policies and restrictions of the Fund as set forth in the Fund’s Prospectus and Statement of Additional Information, as from time to time in effect, or in any supplements thereto, and (ii) such other limitations, policies and procedures with respect to the Fund as the Advisor or the Board of Trustees of the Trust may impose from time to time, in each case as provided to or otherwise furnished in writing to the Sub-Advisor. In providing such services, the Sub-Advisor shall at all times adhere to the provisions and restrictions contained in the applicable federal securities laws, applicable state securities laws and other applicable law. The Advisor shall provide to the Sub-Advisor such information with respect to the Fund such that the Sub-Advisor will be able to maintain compliance with applicable regulations, laws, policies, and restrictions with respect to the Allocated Portion. Without limiting the generality of the foregoing, the Sub-Advisor shall: (i) manage and oversee the investment and reinvestment of the Allocated Portion of the Fund’s assets; (ii) effect the purchase and sale of portfolio securities for the Allocated Portion; (iii) vote proxies and take other actions with respect to the securities in the Sub-Advisor’s Allocated Portion; (iv) maintain copies of the books and records required to be maintained with respect to the securities in the Sub-Advisor’s Allocated Portion; (v) furnish reports, statements and other data on securities, economic conditions and other matters related to the investment of the Allocated Portion which the Advisor, the Board of Trustees, or the officers of the Trust may reasonably request; and (vi) render to the Trust’s Board of Trustees such periodic and special reports with respect to the Sub-Advisor’s Allocated Portion as the Board of Trustees may reasonably request.

The Advisor hereby designates and appoints the Sub-Adviser as its and the Fund’s limited purpose agent and attorney-in-fact, without further prior approval of the Advisor (except as expressly provided for herein or as may be required by law) to make and execute, in the name and on behalf of the Fund, all agreements, instruments and other documents and to take all such other action which the Sub-Advisor considers necessary or advisable to carry out its duties hereunder. By way of example and not by way of limitation, in connection with any purchase for the Fund or the Allocated Portion of securities or instruments that are not registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), the Sub-Advisor shall have the full power and authority, among other things, to: (i) commit to purchase such securities for the Fund on the terms and conditions under which such securities are offered; (ii) execute such account opening and other agreements, instruments and documents (including, without limitation, purchase agreements, subscription documents, ISDA and other swap and derivative documents), and make such commitments, as may be required in connection with the purchase and sale of such securities or instruments; (iii) represent that the Fund is an “accredited investor” as defined in Rule 501(a) of Regulation D under the Securities Act and a “Qualified Institutional Buyer” as defined in Rule 144A (a)(1)(i) under the Securities Act; and (iv) commit that such securities will not be offered or sold by the Fund except in

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compliance with the registration requirements of the Securities Act or an exemption therefrom. This power-of-attorney is a continuing power-of-attorney and shall remain in full force and effect until revoked by the Advisor or the Trust in writing, but any such revocation shall not affect any transaction initiated prior to receipt by the Sub-Advisor of such notice.

(b) Brokerage. With respect to the Sub-Advisor’s Allocated Portion, the Sub-Advisor will place portfolio transactions for execution either directly with the issuer or with any broker or dealer, foreign currency dealer, futures commissions merchant or other counterparty and will be responsible for negotiation of brokerage commission rates. The Sub-Advisor may direct orders to an affiliated person of the Sub-Advisor or to any other broker or dealer who has been identified by the Advisor to the Sub-Advisor as an affiliate of the Adviser, the Fund’s principal underwriter, any other investment manager of the Fund without prior authorization to use such affiliated broker or dealer by the Trust’s Board of Trustees, provided that the Sub-Advisor does so in a manner consistent with Sections 10(f) and 17(e) of the Investment Company Act, Rule 10(f)-3 and Rule 17e-1 thereunder and the Rule 10f-3 and Rule 17e-1 procedures adopted by the Trust (a copy of which shall by provided by the Advisor to the Sub-Advisor). The Advisor has provided the Sub-Advisor with a list, and will provide the Sub-Advisor with, as soon as reasonably possible, with any updates, modifications or amendments to such list, of the affiliated persons of the Advisor, the Fund and the Fund’s principal underwriter to which investment or trading restrictions apply, and will specifically identify in writing (x) all publicly traded companies in which the Allocated Portion may not be invested, together with ticker symbols for all such companies, and (y) any affiliated brokers and any restrictions that apply to the use of those brokers by the Fund.

The Sub-Advisor’s primary consideration in effecting portfolio transactions will be best execution as determined in accordance with the Sub-Advisor’s policies and procedures and in accordance with applicable law. Subject to such policies as the Advisor and the Board of Trustees of the Trust may determine, the Sub-Advisor shall not be deemed to have acted unlawfully or to have breached any duty created by this Agreement or otherwise solely by reason of its having caused the Fund to pay a broker or dealer that provides (directly or indirectly) brokerage or research services to the Sub-Advisor an amount of commission for effecting a portfolio transaction in excess of the amount of commission another broker or dealer would have charged for effecting that transaction, if the Sub-Advisor determines in good faith that such amount of commission was reasonable in relation to the value of the brokerage and research services provided by such broker or dealer, viewed in terms of either that particular transaction or the Sub-Advisor’s overall responsibilities with respect to the Allocated Portion. The Sub-Advisor is further authorized to allocate the orders placed by it on behalf of the Fund to such brokers or dealers who also provide research or statistical material, or other services, to the Trust, the Advisor, any affiliate of either, or the Sub-Advisor. Such allocation shall be in such amounts and proportions as the Sub-Advisor shall determine, and the Sub-Advisor shall report on such allocations regularly to the Advisor and the Trust, indicating the broker-dealers to whom such allocations have been made and the basis therefor.

-3-

On occasions when the Sub-Advisor deems the purchase or sale of a security to be in the best interest of the Fund as well as other clients of the Sub-Advisor, the Sub-Advisor, to the extent permitted by applicable laws and regulations, may aggregate the securities to be so purchased or sold in order to obtain the most favorable price or lower brokerage commissions and the most efficient execution. In such event, allocation of the securities so purchased or sold, as well as the expenses incurred in the transaction, will be made by the Sub-Advisor in the manner it considers to be the most equitable and consistent with its fiduciary obligations to the Fund and to such other clients.

The Advisor further authorizes the Sub-Advisor and its affiliated broker-dealers (if any) to execute agency cross transactions (the “Cross Transactions”) on behalf of the Fund and the Trust. The Sub-Advisor shall effect such Cross Transactions in compliance with Rule 206(3)-2 under the Investment Advisers Act, Rule 17a-7 under the Investment Company Act, and any other applicable provisions of the federal securities laws and shall provide the Advisor with periodic reports describing such agency cross transactions.

(c) Proxy Voting. The Advisor hereby delegates to the Sub-Advisor, the Advisor’s discretionary authority to exercise voting rights with respect to the securities and other investments in the Allocated Portion, and the Sub-Advisor is authorized and agree to act on behalf of the Fund with respect to any reorganizations, exchange offers and other voluntary corporate actions in connection with securities held in the Allocated Portion in such manner as the Sub-Advisor deems advisable, unless the Fund or the Advisor otherwise specifically directs in writing. Proxies of companies whose shares are part of the Allocated Portion shall be voted as described in the Fund’s then-current Prospectus and Statement of Additional Information, and the Sub-Advisor shall not be required to assume any responsibility for the voting of such proxies without its prior consent. The Sub-Advisor shall provide the Advisor and the Fund with information regarding the policies and procedures that the Sub-Advisor uses to determine how to vote proxies relating to the Allocated Portion. The Sub-Advisor shall provide copies of its proxy voting record with respect to the Allocated Portion to the Advisor or any authorized representative of the Advisor, or to the Fund on a quarterly basis (or more frequently, if required by law).

(d) Books and Records. In compliance with the requirements of Rule 31a-3 under the Investment Company Act, the Sub-Advisor hereby agrees that all records which it maintains for the Fund are the property of the Fund and further agrees to surrender promptly to the Fund copies of any of such records upon the Fund’s request. The Sub-Advisor further agrees to preserve for the periods prescribed by Rule 31a-2 under the Investment Company Act the records required to be maintained by Rule 31a-1 under the Investment Company Act with respect to the Fund and to preserve the records required by Rule 204-2 under the Advisers Act with respect to the Fund for the period specified in the applicable rule(s). It is understood that the performance of the Allocated Portion may be referenced by the Sub-Advisor or included within a composite track record, provided that the Fund is not specifically identified by name.

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(e) Custody. Title to all investments shall be made in the name of the Fund, provided that for convenience in buying, selling, and exchanging securities (stocks, bonds, commercial paper, etc.), title to such securities may be held in the name of the Fund’s custodian bank, or its nominee or as otherwise provided in the Fund’s custody agreement. The Advisor shall notify the Sub-Advisor of the identity of the Fund’s custodian bank and shall give the Sub-Advisor fifteen (15) days’ written notice of any changes in such custody arrangements. The Sub-Advisor shall have no responsibility with respect to the collection of income, physical acquisition or the safekeeping or custody of the Fund’s assets, including the Allocated Portion, and neither the Sub-Advisor nor any of its affiliated persons shall take possession of or handle any cash or securities, mortgages or deeds of trust, or other indicia of ownership of the Fund’s investments, or otherwise act as custodian of such investments. All cash and the indicia of ownership of all other investments shall be held by the Fund’s custodian bank. The Adviser agrees that the Fund shall instruct its custodian bank to (a) carry out all investment instructions as may be directed by the Sub-Advisor with respect thereto (which may be orally given if confirmed in writing); and (b) provide the Sub-Advisor with all operational information necessary for the Sub-Advisor to trade on behalf of the Fund.

(f) Consulting with other Investment Managers. The Sub-Advisor agrees that it will not consult with any other investment manager for the Trust or the Fund concerning any transaction by the Allocated Portion in securities or other assets, including but not limited to (i) the purchase by the Allocated Portion of a security issued by the other investment manager, or an affiliate of the other investment manager, to the Trust or the Fund except as permitted by the Investment Company Act or (ii) transactions by the Allocated Portion in any security for which the other investment manager, or its affiliate, is the principal underwriter.

3. Representations of the Sub-Advisor. The Sub-Advisor represents, warrants and covenants, as applicable, to the Advisor that:

(a) the retention of the Sub-Advisor as contemplated by this Agreement is authorized by the Sub-Advisor’s governing documents;

(b) the execution, delivery and performance of this Agreement does not violate any obligation by which the Sub-Advisor or its property is bound, whether arising by contract, operation of law or otherwise;

(c) this Agreement has been duly authorized by appropriate action and when executed and delivered by the Sub-Advisor will be a legal, valid and binding obligation of the Sub-Advisor, enforceable against the Sub-Advisor in accordance with its terms, subject, as to enforcement, to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally and to general equitable principles (regardless of whether enforcement is sought in a proceeding in equity or law);

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(d) the Sub-Advisor is duly registered as an investment adviser under the Investment Advisers Act and will continue to be so registered for as long as this Agreement remains in effect;

(e) the Sub-Advisor will promptly notify the Advisor of the occurrence of any event that would disqualify the Sub-Advisor from serving as an investment adviser of a registered investment company pursuant to Section 9(a) of the Investment Company Act; and

(f) The Sub-Advisor shall be covered by errors and omissions insurance. The company self-retention or deductible shall not exceed reasonable and customary standards, and the Sub-Advisor agrees to notify the Advisor in the event the aggregate coverage of such insurance in any annual period is reduced below $10,000,000.

4. Representations of the Advisor. The Adviser represents, warrants and covenants, as applicable, to the Sub-Advisor that:

(a) the retention of the Sub-Advisor as contemplated by this Agreement is authorized by the governing documents of the Advisor and the Advisory Agreement;

(b) the execution, delivery and performance of this Agreement do not violate any obligation by which the Advisor or its property is bound, whether arising by contract, operation of law or otherwise;

(c) this Agreement has been duly approved by the Trust’s Board of Trustees in accordance with all applicable requirements of the Investment Company Act and in accordance with relief granted by the SEC exempting the Fund from obtaining shareholder approval of this Agreement;

(d) this Agreement has been duly authorized by appropriate action of the Advisor and when executed and delivered by the Advisor will be a legal, valid and binding obligation of the Advisor, enforceable against the Advisor in accordance with its terms, subject, as to enforcement, to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally and to general equitable principles (regardless of whether enforcement is sought in a proceeding in equity or law);

(e) the Advisor is duly registered as an investment adviser under the Investment Advisers Act and will continue to be so registered for as long as this Agreement and the Advisory Agreement with the Trust with respect to the Fund remain in effect;

(f) the Trust is registered as an investment company under the Investment Company Act and will maintain such registration for so long as this Agreement and the Advisory Agreement with the Advisor with respect to the Fund remain in effect; and

(g) the Adviser will promptly notify the Sub-Advisor of the occurrence of any event that would disqualify the Advisor from serving as an investment adviser of a registered investment company pursuant to Section 9(a) of the Investment Company Act.

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5. Non-Exclusivity; Independent Contractor. The Sub-Advisor shall, for all purposes herein, be deemed to be an independent contractor, and shall, unless otherwise expressly provided and authorized to do so, have no authority to act for or represent the Trust, the Fund or the Advisor in any way, or in any way be deemed an agent for the Trust, the Fund or the Advisor. The Advisor’s employment of the Sub-Advisor is not an exclusive arrangement. The Advisor anticipates that it will employ other individuals or entities to furnish it with the services provided for herein. Likewise, it is expressly understood and agreed that the services to be rendered by the Sub-Advisor under the provisions of this Agreement are not to be deemed exclusive, and the Sub-Advisor shall be free to render similar or different services to others, and may give advice and take action with respect to any other clients which may differ from the advice given or the timing or nature of the action taken for the Fund, so long as its ability to render the services provided for in this Agreement shall not be impaired thereby.

6. Expenses.

(a) The Sub-Advisor shall, at its own expense, maintain such staff and employ or retain such personnel and consult with such other persons as it shall from time to time determine to be necessary to the performance of its obligations under this Agreement.

(b) In the event this Agreement is terminated by an assignment as contemplated by Section 14(b) hereof, and the parties agree to enter into a new agreement, the Sub-Advisor shall be responsible for (i) the costs of any special notifications to the Fund’s shareholders and any special meetings of the Trust’s Board of Trustees convened for the primary benefit of the Sub-Advisor, or (ii) its fair share of the costs of any special meetings required for the benefit of the Sub-Advisor.

(c) To the extent the Sub-Advisor incurs any costs by assuming expenses which are an obligation of the Advisor or the Fund, the Advisor or the Fund shall promptly reimburse the Sub-Advisor for such costs and expenses. To the extent the Sub-Advisor performs services for which the Fund or the Advisor is obligated to pay, the Sub-Advisor shall be entitled to prompt reimbursement in such amount as shall be negotiated between the Sub-Advisor and the Advisor but shall, under no circumstances, exceed the Sub-Advisor’s actual costs for providing such services.

7. Investment Sub-Advisory Fee.

(a) The Advisor shall pay to the Sub-Advisor, and the Sub-Advisor agrees to accept, as full compensation for all investment advisory services rendered pursuant to this Agreement, a sub-advisory fee based on the Sub-Advisor’s Allocated Portion, as such Allocated Portion may be adjusted from time to time (the “Sub-Advisory Fee”). The Sub-Advisory Fee shall be paid at the annual rate specified on Exhibit A attached hereto, based on the net assets of the Fund attributable to the Sub-Advisor’s Allocated Portion, computed on the value of such net assets on such days and at such time or times as described in the Fund’s then-current Prospectus and Statement of Additional Information.

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(b) The Sub-Advisory Fee shall be paid by the Advisor to Sub-Advisor monthly in arrears on the tenth business day of each month.

(c) The initial payment of the Sub-Advisory Fee under this Agreement shall be payable on the tenth business day of the first month following the effective date of this Agreement and shall be pro-rated as set forth below. If this Agreement is terminated prior to the end of any month, the Sub-Advisory Fee payable to the Sub-Advisor shall be pro-rated for the portion of any month in which this Agreement is in effect which is not a complete month according to the proportion which the number of calendar days in the month during which the Agreement is in effect bears to the number of calendar days in the month, and shall be payable within ten (10) days after the date of termination.

(d) The Sub-Advisory Fee payable to the Sub-Advisor under this Agreement will be reduced to the extent of any receivable owed by the Sub-Advisor to the Advisor or the Fund.

(e) The Sub-Advisor voluntarily may reduce or otherwise not require payment of any portion of the Sub-Advisory Fee owing under this Agreement or otherwise waive reimbursement of expenses due to it pursuant to this Agreement and may agree to make payments to limit the expenses which are the responsibility of the Advisor of the Fund under this Agreement. Any such reduction or payment shall be mutually agreed to in writing between the Advisor and Sub-Advisor and shall not constitute an agreement to reduce any future compensation or reimbursement due to the Sub-Advisor hereunder or to continue future payments. Any such reduction will be agreed to prior to accrual of the related expense or portion of the Sub-Advisory Fee and will be estimated daily and reconciled and paid on a monthly basis.

8. No Shorting; No Borrowing. The Sub-Advisor agrees that neither it nor any of its officers or employees shall take any short position in the shares of the Fund. This prohibition shall not prevent the purchase of such shares by any of the officers or employees of the Sub-Advisor or any trust, pension, profit-sharing or other benefit plan for such persons or affiliates thereof, at a price not less than the net asset value thereof at the time of purchase, as allowed pursuant to rules promulgated under the Investment Company Act. The Sub-Advisor agrees that neither it nor any of its officers or employees shall borrow from the Fund or pledge or use the Fund’s assets in connection with any borrowing not directly for the Fund’s benefit.

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9. Conflicts with Trust’s Governing Documents and Applicable Laws. Nothing herein contained shall be deemed to require the Trust or the Fund to take any action contrary to the Trust’s Agreement and Declaration of Trust, By-Laws, or any applicable statute or regulation, or to relieve or deprive the Board of Trustees of the Trust of its responsibility for and control of the conduct of the affairs of the Trust and the Fund. In this connection, the Sub-Advisor acknowledges that the Advisor and the Trust’s Board of Trustees retain ultimate plenary authority over the Fund, including the Allocated Portion, and may take any and all actions necessary and reasonable to protect the interests of shareholders.

10. Reports and Access. The Sub-Advisor agrees to supply such information to the Advisor and to permit such compliance inspections by the Advisor or the Fund as shall be reasonably necessary to permit the administrator to satisfy its obligations and respond to the reasonable requests of the Trustees.

11. Standard of Care, Liability and Indemnification.

(a) The Sub-Advisor shall exercise reasonable care and prudence in fulfilling its obligations under this Agreement.

(b) The Sub-Advisor shall have responsibility for the accuracy and completeness (and liability for the lack thereof) of the statements furnished by the Sub-Advisor for use by the Advisor in the Fund’s offering materials (including the Fund’s Prospectus, Statement of Additional Information, advertising and sales materials) that pertain to the Sub-Advisor and the investment of the Sub-Advisor’s Allocated Portion of the Fund. The Sub-Advisor shall have no responsibility or liability with respect to other disclosures.

(c) Except as otherwise provided in this Agreement, in the absence of willful misfeasance, bad faith, gross negligence, or reckless disregard of the obligations or duties hereunder on the part of the Sub-Advisor, the Sub-Advisor shall not be subject to liability to the Advisor, the Trust, or the Fund or to any shareholder of the Fund for any act or omission in the course of, or connected with, rendering services hereunder.

(d) In no event will the Sub-Advisor have any responsibility for any other portfolio of the Trust, for any portion of the Fund not managed by the Sub-Advisor or for the acts or omissions of any other investment manager to the Trust or the Fund. In particular, in the event the Sub-Adviser manages less than 100% of the Fund’s assets, and has managed the Allocated Portion in accordance with Section 2(a) of this Agreement, the Sub-Adviser shall have no responsibility for the Fund being in violation of any applicable law or regulation, or any investment objective, investment policy or restriction applicable to the Fund as a whole or for the Fund’s failing to qualify as a regulated investment company under the Internal Revenue Code of 1986, as amended, which result from or are based upon directions or instructions of, or information provided by, the Advisor, including, but not limited to, a failure of the Advisor to provide accurate and current information with respect to any records maintained by the Advisor or any other investment manager to the Fund, which records are not also maintained by the Sub-Advisor or, to the extent such records relate to the

Sub-Advisor’s Allocated Portion, otherwise available to the Sub-Advisor upon reasonable request.

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(e) Except as otherwise provided in this Agreement, each party to this Agreement (as an “Indemnifying Party”), including the Trust on behalf of the Fund, shall indemnify and hold harmless the other party and the shareholders, directors, officers, and employees of the other party (any such person, an “Indemnified Party”) against any loss, liability, claim, damage, or expense (including the reasonable cost of investigating and defending any alleged loss, liability, claim, damage, or expense and reasonable counsel fees incurred in connection therewith) arising out of the Indemnifying Party’s performance or non-performance of any duties under this Agreement provided, however, that nothing herein shall be deemed to protect any Indemnified Party against any liability to which such Indemnified Party would otherwise be subject by reason of willful misfeasance, bad faith, or gross negligence in the performance of duties hereunder or by reason of reckless disregard of its obligations and duties under this Agreement.

If indemnification is to be sought hereunder, then the Indemnified Party shall promptly notify the Indemnifying Party of the assertion of any claim or the commencement of any action or proceeding in respect thereof; provided, however, that the failure so to notify the Indemnifying Party shall not relieve the Indemnifying Party from any liability that it may otherwise have to the Indemnified Party provided such failure shall not affect in a material adverse manner the position of the Indemnifying Party or the Indemnified Party with respect to such claim. Following such notification, the Indemnifying Party may elect in writing to assume the defense of such action or proceeding and, upon such election, it shall not be liable for any legal costs incurred by the Indemnified Party (other than reasonable costs of investigation previously incurred) in connection therewith, unless (i) the Indemnifying Party has failed to provide counsel reasonably satisfactory to the Indemnified Party in a timely manner or (ii) counsel which has been provided by the Indemnifying Party reasonably determines that its representation of the Indemnified Party would present it with a conflict of interest.

The provisions of this paragraph 11(e) shall not apply in any action where the Indemnified Party is the party adverse, or one of the parties adverse, to the other party. The rights of indemnification herein shall not be exclusive of or affect any other rights to which any person may be entitled by contract or otherwise by law and shall survive termination of this Agreement.

(f) Notwithstanding anything herein to the contrary, no party hereto shall be liable to any other party for any indirect, incidental, consequential, special, exemplary or punitive damages of any nature whatsoever. In addition, no provision of this Agreement shall be construed to protect any Trustee or officer of the Trust, or officer of the Advisor or the Sub-Advisor, from liability in violation of Sections 17(h) and (i) of the Investment Company Act.

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12. General Legal Compliance; Code of Ethics.

(a) The Advisor and the Sub-Advisor each agree to comply with applicable laws, rules and regulations, including the Investment Advisers Act and the Investment Company Act. Upon request, and in accordance with the scope of the Sub-Advisor’s obligations and responsibilities contained in this Agreement, the Sub-Advisor will provide reasonable assistance to the Advisor in connection with the Fund’s compliance with applicable provisions of the Sarbanes-Oxley Act of 2002 and the rules and regulations thereunder, and Rule 38a-1 under the Investment Company Act.

(b) The Sub-Advisor will adhere to a code of ethics governing employee trading and trading for proprietary accounts that conforms to the requirements of the Investment Company Act and the Investment Advisers Act, a copy of which has been provided to the Board of Trustees of the Trust. The Sub-Advisor will make such reports to the Advisor and the Fund as are required by Rule 17j-1 under the Investment Company Act and agrees to provide the Advisor and the Fund with any other information required to satisfy the Fund’s code of ethics reporting. To the extent the Sub-Advisor amends its code of ethics to comply with such rules or regulations, the Sub-Advisor shall provide the Advisor with a copy of such amendments thereto.

13. Term; Use of Names.

(a) This Agreement shall become effective upon approval by the Board of Trustees of the Trust and shall remain in effect for a period of two (2) years, unless sooner terminated as hereinafter provided. This Agreement shall continue in effect thereafter for additional periods not exceeding one (1) year so long as such continuation is approved for the Fund at least annually by (i) the Board of Trustees of the Trust or by the vote of a majority of the outstanding voting securities of the Fund and (ii) the vote of a majority of the Trustees of the Trust who are not parties to this Agreement nor interested persons thereof, cast in person at a meeting called for the purpose of voting on such approval. The terms “majority of the outstanding voting securities” and “interested persons” shall have the meanings as set forth in the Investment Company Act.

(b) It is understood that the names Litman Gregory or any derivative thereof or logo associated with that name is the valuable property of the Advisor and/or its affiliates, and that the Sub-Advisor has the right to use such name (or derivative or logo) only with the approval of the Advisor and only so long as the Advisor is the investment adviser to the Fund. It is further understood that the name Ares or any derivative thereof or logo associated with those names, are the valuable property of the Sub-Advisor and its affiliates and that the Trust and/or the Fund have the right to use such names (or derivative or logo) in offering materials of the Fund with the approval of the Sub-Advisor and for so long as the Sub-Advisor is an investment manager to the Fund. The Sub-Advisor hereby consents to references to the Sub-Advisor and information about the Sub-Advisor in the Trust’s registration statement filed under the Securities Act and the Investment Company Act to the extent required by Form N-1A with respect to the Fund. Upon termination of this Agreement, the Trust and the Fund shall forthwith cease to use such names (or derivatives or logo).

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14. Termination; No Assignment.

(a) This Agreement may be terminated at any time without payment of any penalty, by: the Board of Trustees of the Trust or by vote of a majority of the outstanding voting securities of the Fund, upon sixty (60) days’ written notice to the Sub-Advisor and the Advisor. This Agreement also may be terminated at any time, without the payment of any penalty, by the Advisor or the Sub-Advisor upon sixty (60) days’ written notice to the Trust and the other party. In addition, notwithstanding anything herein to the contrary, if the Advisory Agreement terminates for any reason, this Agreement shall terminate effective upon the date the Advisory Agreement terminates. In the event of a termination, Sub-Advisor shall cooperate in the orderly transfer of the Fund’s affairs and, at the request of the Board of Trustees, transfer any and all books and records of the Fund maintained by Sub-Advisor on behalf of the Fund.

(b) This Agreement shall terminate automatically in the event of any transfer or assignment thereof, as defined in the Investment Company Act.

15. Delivery of the Sub-Adviser’s Form ADV. The Advisor acknowledges that it has received and has had an opportunity to read a copy of the Sub-Advisor’s Form ADV Part 2A (the “Brochure”) and a copy of the Form ADV Part 2B with respect to the Sub-Advisor’s personnel with the most significant responsibility for providing advisory services to the Fund (the “Brochure Supplement”). The Advisor agrees that the Brochure and Brochure Supplement, as well as other client communications, may be transmitted to the Adviser electronically.

16. Amendments; Severability. No provision of this Agreement may be changed, waived or discharged unless signed in writing by the parties hereto. Nothing in this Agreement shall be deemed a limitation or waiver of any obligation or duty that may not by law be limited or waived. If any provision of this Agreement shall be held or made invalid by a court decision, statute or rule, or shall be otherwise rendered invalid, the remainder of this Agreement shall not be affected thereby.

17. Captions. The captions in this Agreement are included for convenience of reference only and in no way define or limit any of the provisions hereof or otherwise affect their construction or effect.

18. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the [State of California]¹ without giving effect to the conflict of laws principles thereof; provided that nothing herein shall be construed to preempt, or to be inconsistent with, any federal law, regulation or rule, including the Investment Company Act and the Investment Advisers Act and any rules and regulations promulgated thereunder.

19. Nonpublic Personal Information. Notwithstanding any provision herein to the contrary, the Sub-Advisor hereto agrees on behalf of itself and its directors, trustees, shareholders, officers, and employees (1) to treat confidentially and as proprietary information of the Advisor (on behalf of itself and the Fund) and the Trust (a) all records and other information relative to the

¹	Ares to confirm.

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Fund’s prior, present, or potential shareholders (and clients of said shareholders) and (b) any Nonpublic Personal Information, as defined under Section 248.3(t) of Regulation S-P (“Regulation S-P”), promulgated under the Gramm-Leach-Bliley Act (the “G-L-B Act”), and (2) except after prior notification to and approval in writing by the Advisor or the Trust, not to use such records and information for any purpose other than the performance of its responsibilities and duties hereunder, or as otherwise permitted by Regulation S-P or the G-L-B Act, and if in compliance therewith, the privacy policies adopted by the Advisor and the Fund and communicated in writing to the Sub-Advisor. Such written approval shall not be unreasonably withheld by the Advisor or the Trust and may not be withheld where the Sub-Advisor may be exposed to civil or criminal contempt or other proceedings for failure to comply after being requested to divulge such information by duly constituted authorities.

20. Anti-Money Laundering Compliance. The Sub-Advisor acknowledges that, in compliance with the Bank Secrecy Act, as amended, the USA PATRIOT Act, and any respective implementing regulations (together, “AML Laws”), the Fund has adopted an Anti-Money Laundering Policy. The Sub-Advisor agrees to comply with the Fund’s Anti-Money Laundering Policy and the AML Laws, as the same may apply to the Sub-Advisor, now and in the future. The Sub-Advisor further agrees to provide to the Fund and/or the Advisor such reports, certifications and contractual assurances as may be reasonably requested by the Fund or the Advisor. The Advisor may disclose information respecting the Sub-Advisor to governmental and/or regulatory or self-regulatory authorities to the extent required by applicable law or regulation and may file reports with such authorities as may be required by applicable law or regulation. The Advisor will provide prompt notification of any such disclosures to the Sub-Advisor, unless otherwise prohibited by applicable law.

21. Certifications; Disclosure Controls and Procedures. The Sub-Advisor acknowledges that, in compliance with the Sarbanes-Oxley Act, and the implementing regulations promulgated thereunder, the Fund is required to make certain certifications and has adopted disclosure controls and procedures. To the extent reasonably requested by the Advisor, the Sub-Advisor agrees to use its best efforts to assist the Advisor and the Fund in complying with the Sarbanes-Oxley Act and implementing the Fund’s disclosure controls and procedures. The Sub-Advisor agrees to inform the Fund of any material development related to the Allocated Portion that the Sub-Advisor reasonably believes is relevant to the Fund’s certification obligations under the Sarbanes-Oxley Act.

22. Provision of Certain Information by the Sub-Advisor. The Sub-Advisor will promptly notify the Advisor in writing of the occurrence of any of the following events:

(a) the Sub-Advisor fails to be registered as investment adviser under the Investment Advisers Act;

(b) the Sub-Advisor is served or otherwise receives notice of any action, suit, proceeding, inquiry, or investigation, at law or in equity, before or by any court, public board, or body, involving the affairs of the Advisor or the Fund;

(c) the Sub-Advisor suffers financial impairment which, in the sole discretion of the Sub-Adviser, materially interferes with its ability to manage the Allocated Portion or otherwise fulfill its duties under this Agreement;

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(d) the Sub-Advisor, its principal officers or its controlling stockholders are the subject of a government investigation or inquiry, administrative proceeding or any other type of legal action which, under the Investment Company Act, would make it ineligible to serve as an investment adviser to a registered investment company;

(e) a change in the Sub-Advisor’s personnel materially involved in the management of the Allocated Portion; or

(f) a change in control of the Sub-Advisor.

23. Confidentiality. The parties to this Agreement shall not, directly or indirectly, permit their respective affiliates, directors, trustees, officers, members, employees, or agents to, in any form or by any means, use, disclose, or furnish to any person or entity, records or information concerning the business of any of the other parties except as necessary for the performance of duties under this Agreement or as required by law, without prior written notice to and approval of the relevant other parties, which approval shall not be unreasonably withheld by such other parties. Notwithstanding the foregoing, any party may disclose such non-public information if (a) such information is or hereafter otherwise is known by the receiving party or has been disclosed, directly or indirectly, to others or becomes ascertainable from public or published information or trade sources, (b) if such disclosure is required by applicable federal, state or other law or regulation, (c) if such disclosure is required or requested by regulatory or self-regulatory authorities or judicial process, (d) such disclosure is reasonably required by legal counsel or auditors of the party (or of the Trust, the Fund, the Trust’s Board of Trustees or affiliates of the Advisor) in connection with the performance of their professional services or (e) as may otherwise be contemplated by this Agreement.

24. Notices. Any notice herein required is to be in writing and is deemed to have been given to the Sub-Advisor or the Advisor upon receipt of the same at their respective addresses set forth below. All written notices required or permitted to be given under this Agreement will be delivered by personal service, by postage mail return receipt requested or by facsimile machine or a similar means of same delivery which provides evidence of receipt (with a confirming copy by mail as set forth herein). All notices provided to the Advisor will be sent to the attention of: Litman Gregory Fund Advisors LLC, 1676 N. California Blvd., Suite 500, Walnut Creek, CA 94596, Attention: President, Facsimile (925) 254-0335. All notices provided to the Sub-Advisor will be sent to the attention of: Ares Management LLC, 2000 Avenue of the Stars, 12th Floor, Los Angeles, CA 90067, Attention: President, Facsimile (310) 432-8654 . Each party may rely upon any notice from the other party or other communication reasonably believed by the receiving party to be genuine.

25. Counterparts. This Agreement may be executed in counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered, shall be deemed an original and all of which counterparts shall constitute but one and the same agreement.

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26. Third-Party Beneficiary. The Trust is expressly made a third-party beneficiary of this Agreement with rights as respect to the Fund to the same extent as if it had been a party hereto.

27. Entire Agreement. This Agreement contains all of the terms agreed upon or made by the parties relating to the subject matter of this Agreement, and supersedes all prior and contemporaneous agreements, negotiations, correspondence, undertakings and communications of the parties, oral or written, respecting such subject matter.

[Remainder of Page Intentionally Blank.]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized officers, all on the day and year first above written.


Litman Gregory Fund Advisors LLC		Ares Management LLC

By:	/s/ John M. Coughlan	By:	/s/ Daniel J. Hall
Name:	John M. Coughlan	Name:	Daniel J. Hall
Title:	Chief Operating Officer	Title:	Authorized Signatory

As a Third Party Beneficiary,

Litman Gregory Funds Trust
on behalf of
Litman Gregory Masters High Income Alternatives Fund

By:	/s/ Jeremy DeGroot
Name:	Jeremy DeGroot
Title:	President

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Exhibit (d)(2)(E)(2)

LITMAN GREGORY MASTERS ALTERNATIVE STRATEGIES FUND

LITMAN GREGORY FUNDS TRUST

INVESTMENT SUB-ADVISORY AGREEMENT

THIS INVESTMENT SUB-ADVISORY AGREEMENT (the “Agreement”) is made as of the 29 day of August 2018 by and between LITMAN/GREGORY FUND ADVISORS, LLC (the “Advisor”) and Brown Brothers Harriman & Co. through its separately identifiable department known as the “BBH Mutual Fund Advisory Department” that is registered with the U.S. Securities and Exchange Commission (the “SEC”) as an investment adviser as the term is defined under the Investment Advisers Act of 1940, as amended (“Investment Advisers Act”) (the “Sub-Advisor”).

WITNESSETH:

WHEREAS, the Advisor has been retained as the investment adviser to the Litman Gregory Masters Alternative Strategies Fund (the “Fund”), a series of the Litman Gregory Funds Trust (the “Trust”), an open-end management investment company, registered as such under the Investment Company Act of 1940, as amended (the “Investment Company Act”); and

WHEREAS, the Advisor has been authorized by the Trust to retain one or more investment advisers (each an “investment manager”) to serve as portfolio managers for a specified portion of the Fund’s assets (the “Allocated Portion”) and the Advisor has or will receive a “manager of manager’s” exemptive order from the U.S. Securities and Exchange Commission (“SEC”) for the appointment of the Sub-Adviser; and

WHEREAS, the Sub-Advisor is registered as an investment adviser under the Investment Advisers Act and is engaged in the business of supplying investment advisory services as an independent contractor; and

WHEREAS, the Fund and the Advisor desire to retain the Sub-Advisor as an investment manager to render portfolio advice and services to the Fund pursuant to the terms and provisions of this Agreement, and the Sub-Advisor desires to furnish said advice and services; and

WHEREAS, the Trust and the Fund are third party beneficiaries of such arrangements to the extent required under applicable law;

NOW, THEREFORE, in consideration of the covenants and the mutual promises hereinafter set forth, the parties to this Agreement, which shall include the Trust on behalf of the Fund for purposes of the indemnification provisions of section 11 hereof, intending to be legally bound hereby, mutually agree as follows:

1. Appointment of Sub-Advisor.

(a) The Advisor hereby appoints the Sub-Advisor, and the Sub-Advisor hereby accepts such appointment, to render investment advice and related services with respect to the Allocated Portion of the assets of the Fund for the period and on the terms set forth in this Agreement, subject to the supervision and direction of the Advisor and the Trust’s Board of Trustees.

(b) The Sub-Advisor’s appointment shall be solely with respect to an Allocated Portion of the Fund’s assets, such Allocated Portion to be specified by the Advisor and subject to periodic increases or decreases at the Advisor’s sole discretion.

(c) Nature of Fund. The Sub-Advisor and the Advisor both acknowledge that the Fund is a mutual fund that operates as a series of an open-end series investment company under the plenary authority of the Trust’s Board of Trustees. In managing the Allocated Portion, the Sub-Advisor shall do so subject always to the plenary authority of the Board of Trustees.

2. Duties of Sub-Advisor.

(a) General Duties. The Sub-Advisor shall act as one of several investment managers to the Fund and shall invest the Sub-Advisor’s Allocated Portion of the assets of the Fund in accordance with the investment objectives, policies and restrictions of the Fund as set forth in the Fund’s and the Trust’s governing documents, including, without limitation, the Trust’s Agreement and Declaration of Trust and By-Laws; the applicable sections of the Fund’s prospectus, statement of additional information and undertakings; the Sub-Advisor’s adopted written policies and procedures as required by Rule 206(4)-7 under the Investment Advisers Act and Rule 38a-1 under the Investment Company Act of 1940 that relate to the services provided by Sub-Adviser to the Allocated Portion (“Compliance Policies”), to the extent that the Compliance Policies are not materially inconsistent with any such policies of the Fund and such other limitations, policies and procedures as the Advisor or the Trustees of the Trust may provide from time to time in writing to the Sub-Advisor (collectively, the “Fund Documentation”). Advisor has furnished or will furnish to Sub-Advisor as soon as available copies (and any amendments thereto) to the Fund Documentation. Sub-Advisor shall only be responsible for compliance with any amendment to Fund Documentation upon receipt of the amendment and the Sub-Advisor has been afforded a reasonable period of time to comply with any such amendment. In providing such services, the Sub-Advisor shall at all times adhere to the provisions and restrictions contained in the federal securities laws, applicable state securities laws, and other applicable law. Advisor shall provide to the Sub-Advisor such information with respect to the Fund such that the Sub-Advisor will be able to maintain compliance with applicable regulations, laws, policies, and restrictions with respect to the Sub-Advisor’s Allocated Portion. The Sub-Advisor shall not be responsible for any aspects of the Fund’s investments other than with respect to the investments relating to the Sub-Advisor’s Allocated Portion unless expressly set forth herein.

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Portion that will remain uninvested, if any; (iv) manage and oversee the investments of the Sub-Advisor’s Allocated Portion, subject to the ultimate supervision and direction of the Trust’s Board of Trustees; (v) vote proxies, file required ownership reports, and take other actions with respect to the securities in the Sub-Advisor’s Allocated Portion; (vi) maintain the books and records required to be maintained with respect to the securities in the Sub-Advisor’s Allocated Portion; (vii) furnish reports, statements and other data on securities, economic conditions and other matters related to the investment of the Fund’ assets which the Advisor, the Trustees, or the officers of the Trust may reasonably request; and (viii) render to the Trust’s Board of Trustees such periodic and special reports with respect to the Sub-Advisor’s Allocated Portion as the Board may reasonably request.

(b) Brokerage. With respect to the Sub-Advisor’s Allocated Portion, the Sub-Advisor shall be responsible for broker-dealer selection and for negotiation of brokerage commission rates. The Sub-Advisor may direct orders to an affiliated person of the Sub-Advisor or to any other broker-dealer who has been identified by the Advisor to the Sub-Advisor as an affiliate of any other investment manager without prior authorization to use such affiliated broker or dealer by the Trust’s Board of Trustees, provided that the Sub-Advisor does so in a manner consistent with Sections 17(a) and 17(e) of the Investment Company Act, Rule 17e-1 thereunder and the Rule 17e-1 procedures adopted by the Trust (a copy of which shall by provided by the Advisor). The Sub-Advisor’s primary consideration in effecting a securities transaction will be best execution. In selecting a broker-dealer to execute each particular transaction, the Sub-Advisor may take the following into consideration: the best net price available; the reliability, integrity and financial condition of the broker-dealer; the size of and difficulty in executing the order; and the value of the expected contribution of the broker-dealer to the investment performance of the Fund on a continuing basis. The price to the Fund in any transaction may be less favorable than that available from another broker-dealer if the difference is reasonably justified by other aspects of the portfolio execution services offered.

Subject to such policies as the Advisor and the Board of Trustees of the Trust may determine, the Sub-Advisor shall not be deemed to have acted unlawfully or to have breached any duty created by this Agreement or otherwise solely by reason of its having caused the Fund to pay a broker or dealer that provides (directly or indirectly) brokerage or research services to the Sub-Advisor an amount of commission for effecting a portfolio transaction in excess of the amount of commission another broker or dealer would have charged for effecting that transaction, if the Sub-Advisor determines in good faith that such amount of commission was reasonable in relation to the value of the brokerage and research services provided by such broker or dealer, viewed in terms of either that particular transaction or the Sub-Advisor’s or the Advisor’s overall responsibilities with respect to the Fund. The Sub-Advisor is further authorized to allocate the orders placed by it on behalf of the Fund to such brokers or dealers who also provide research or statistical material, or other services, to the Trust, the Advisor, any affiliate of either, or the Sub-Advisor. Such allocation shall be in such amounts and proportions as the Sub-Advisor shall determine, and the Sub-Advisor shall report on such allocations regularly to the Advisor and the Trust, indicating the broker-dealers to whom such allocations have been made and the basis therefor.

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(c) Proxy Voting. The Advisor hereby delegates to the Sub-Advisor, the Advisor’s discretionary authority to exercise voting rights with respect to the securities and other investments in the Allocated Portion. The Sub-Advisor’s proxy voting policies shall comply with any rules or regulations promulgated by the SEC. The Sub-Advisor shall maintain and preserve a record, in an easily-accessible place for a period of not less than three (3) years (or longer, if required by law), of the Sub-Advisor’s voting procedures, of the Sub-Advisor’s actual votes, and such other information required for the Fund to comply with any rules or regulations promulgated by the SEC. The Sub-Advisor shall supply updates of this record to the Advisor or any authorized representative of the Advisor, or to the Fund on a quarterly basis (or more frequently, if required by law). The Sub-Advisor shall provide the Advisor and the Fund with information regarding the policies and procedures that the Sub-Advisor uses to determine how to vote proxies relating to the Allocated Portion. The Fund may request that the Sub-Advisor vote proxies for the Allocated Portion in accordance with the Fund’s proxy voting policies.

(e) Custody. Title to all investments shall be made in the name of the Fund, provided that for convenience in buying, selling, and exchanging securities (stocks, bonds, commercial paper, etc.), title to such securities may be held in the name of the Fund’s custodian bank, or its nominee or as otherwise provided in the Fund’s custody agreement. The Fund shall notify the Sub-Advisor of the identity of its custodian bank and shall give the Sub-Advisor fifteen (15) days’ written notice of any changes in such custody arrangements. Neither the Sub-Advisor, nor any parent, subsidiary or related firm, shall take possession of or handle any cash or securities, mortgages or deeds of trust, or other indicia of ownership of the Fund’s investments, or otherwise act as custodian of such investments. All cash and the indicia of ownership of all other investments shall be held by the Fund’s custodian bank. The Fund shall instruct its custodian bank to (a) carry out all investment instructions as may be directed by the Sub-Advisor with respect thereto (which may be orally given if confirmed in writing); and (b) provide the Sub-Advisor with all operational information necessary for the Sub-Advisor to trade on behalf of the Fund.

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(f) (1) Consulting with Certain Affiliated Sub-Advisors. With respect to any transaction the Fund enters into with an affiliated sub-advisor (or an affiliated person of such sub-advisor) in reliance on Rule 10f-3, Rule 17a-10 or Rule 12d3-1 under the Investment Company Act, the Sub-Advisor agrees that it will not consult with the affiliated sub-advisor concerning such transaction, except to the extent necessary to comply with the percentage limits of paragraphs (a) and (b) of Rule 12d3-1.

(2) Transactions Among Sub-Advisors of the Fund. In any case in which there are two or more sub-advisors responsible for providing investment advice to the Fund, the Sub-Advisor may enter into a transaction on behalf of the Fund with another sub-advisor of the Fund (or an affiliated person of such sub-advisor) in reliance on Rule 10f-3, Rule 17a-10 or Rule 12d3-1 under the Investment Company Act, only if (i) the Sub-Advisor, under the terms of this Agreement, is responsible for providing investment advice with respect to its Allocated Portion, and (ii) the other sub-advisor is responsible for providing investment advice with respect to a separate portion of the portfolio of the Fund.

3. Representations and Warranties.

(a) Sub-Advisor. Sub-Advisor represents and warrants to the Advisor that:

(i)

Sub-Advisor shall use its best judgment and efforts in rendering the advice and services to the Fund as contemplated by this Agreement.

(ii)

Sub-Advisor shall maintain all licenses and registrations necessary to perform its duties hereunder in good order.

(iii)

Sub-Advisor shall conduct its operations at all times in conformance with the Investment Advisers Act, the Investment Company Act and any other applicable state and/or self-regulatory organization regulations.

(iv)

Sub-Advisor shall be covered by errors and omissions insurance. The company self-retention or deductible shall not exceed reasonable and customary standards, and Sub-Advisor agrees to notify Advisor in the event the aggregate coverage of such insurance in any annual period is reduced below $10,000,000.

(v)

The Sub-Advisor represents and warrants to the Advisor and the Fund that (i) the retention of the Sub-Advisor as contemplated by this Agreement is authorized by the Sub-Advisor’s governing documents; (ii) the execution, delivery and performance of this

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Agreement does not violate any obligation by which the Sub-Advisor or its property is bound, whether arising by contract, operation of law or otherwise; and (iii) this Agreement has been duly authorized by appropriate action of the Sub-Advisor and when executed and delivered by the Sub-Advisor will be the legal, valid and binding obligation of the Sub-Advisor, enforceable against the Sub-Advisor in accordance with its terms hereof, subject, as to enforcement, to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally and to general equitable principles (regardless of whether enforcement is sought in a proceeding in equity or law).

(b) Advisor. Advisor represents and warrants to the Sub-Advisor that:

(i)

the retention of the Sub-Adviser by the Advisor as contemplated by this Agreement is authorized by the Fund Documentation, any necessary approval of the Fund’s and Trust’s Board of Trustees, and the Fund’s shareholders, as applicable, the Advisor’s “manager of manager’s” exemptive order from the SEC for the appointment of the Sub-Adviser and applicable law;

(ii)

the execution, delivery and performance of this Agreement do not violate any obligation by which Advisor is bound, whether arising by contract, operation of law or otherwise; and

(iii)

this Agreement has been duly authorized by appropriate action of Advisor and when executed and delivered by Advisor will be a legal, valid and binding obligation of Advisor, enforceable against Advisor in accordance with its terms.

4. Independent Contractor. The Sub-Advisor shall, for all purposes herein, be deemed to be an independent contractor, and shall, unless otherwise expressly provided and authorized to do so, have no authority to act for or represent the Trust, the Fund, or the Advisor in any way, or in any way be deemed an agent for the Trust, the Fund, or the Advisor. It is expressly understood and agreed that the services to be rendered by the Sub-Advisor to the Fund under the provisions of this Agreement are not to be deemed exclusive, and the Sub-Advisor shall be free to render similar or different services to other Clients (as defined herein). Further, Advisor acknowledges that Sub-Advisor may have investment responsibilities, or render investment advice to, or perform other investment advisory services, for individuals or entities, including client accounts and other investment companies registered pursuant to or exempt from the Investment Company Act (“Clients”), which may invest in the same type of securities as the Fund. Advisor agrees that Sub-Adviser may give advice or exercise investment responsibility and take such other action with respect to such Clients which may differ from advice given or the timing or nature of action taken with respect to the Sub-Advisor’s Allocated Portion so long as Sub-Advisor’s ability to render the services provided for in this Agreement shall not be impaired thereby.

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6. Expenses.

(a) The Sub-Advisor shall be responsible for (i) providing the personnel, office space, and equipment reasonably necessary to fulfill its obligations under this Agreement.

(b) In the event this Agreement is terminated by an assignment in the nature of a change of control as contemplated by Section 14(b) hereof, and the parties agree to enter into a new agreement, the Sub-Advisor shall be responsible for (i) the costs of any special notifications to the Fund’s shareholders and any special meetings of the Trust’s Board of Trustees convened for the primary benefit of the Sub-Advisor, or (ii) its fair share of the costs of any special meetings required for the benefit of the Sub-Advisor as well as for other purposes.

(d) To the extent the Sub-Advisor incurs any costs by assuming expenses which are an obligation of the Advisor or the Fund, the Advisor or the Fund shall promptly reimburse the Sub-Advisor for such costs and expenses. To the extent the Sub-Advisor performs services for which the Fund or the Advisor is obligated to pay, the Sub-Advisor shall be entitled to prompt reimbursement in such amount as shall be negotiated between the Sub-Advisor and the Advisor but shall, under no circumstances, exceed the Sub-Advisor’s actual costs for providing such services.

7. Investment Sub-Advisory Fee.

(a) The Advisor shall pay to the Sub-Advisor, and the Sub-Advisor agrees to accept, as full compensation for all investment advisory services furnished or provided to the Fund pursuant to this Agreement, an annual sub-advisory fee based on the Sub-Advisor’s Allocated Portion, as such Allocated Portion may be adjusted from time to time, as set forth in Exhibit A – Fee Agreement (the “Sub-advisory Fee”), attached hereto and made a part herein. Such fee shall be paid at the annual rate as stated in Exhibit A - Fee Agreement based on the net assets of the Fund attributable to the Sub-Advisor’s Allocated Portion, computed on the value of such net assets as of the close of business each day.

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(b) The Sub-advisory Fee shall be paid by the Advisor to Sub-Advisor monthly in arrears on the tenth business day of each month.

(c) The initial fee under this Agreement shall be payable on the tenth business day of the first month following the effective date of this Agreement and shall be prorated as set forth below. If this Agreement is terminated prior to the end of any month, the fee to the Sub-Advisor shall be prorated for the portion of any month in which this Agreement is in effect which is not a complete month according to the proportion which the number of calendar days in the month during which the Agreement is in effect bears to the number of calendar days in the month, and shall be payable within ten (10) days after the date of termination.

(d) The fee payable to the Sub-Advisor under this Agreement will be reduced to the extent of any receivable owed by the Sub-Advisor to the Advisor or the Fund.

(e) The Sub-Advisor voluntarily may reduce any portion of the compensation or reimbursement of expenses due to it pursuant to this Agreement and may agree to make payments to limit the expenses which are the responsibility of the Advisor of the Fund under this Agreement. Any such reduction or payment shall be applicable only to such specific reduction or payment and shall not constitute an agreement to reduce any future compensation or reimbursement due to the Sub-Advisor hereunder or to continue future payments. Any such reduction will be agreed to prior to accrual of the related expense or fee and will be estimated daily and reconciled and paid on a monthly basis.

(f) The Sub-Advisor may agree not to require payment of any portion of the compensation or reimbursement of expenses otherwise due to it pursuant to this Agreement. Any such agreement shall be applicable only with respect to the specific items covered thereby and shall not constitute an agreement not to require payment of any future compensation or reimbursement due to the Sub-Advisor hereunder.

8. No Shorting; No Borrowing. The Sub-Advisor agrees that neither it nor any of its officers or employees shall take any short position in the shares of the Fund. This prohibition shall not prevent the purchase of such shares by any of the officers or employees of the Sub-Advisor or any trust, pension, profit-sharing or other benefit plan for such persons or affiliates thereof, at a price not less than the net asset value thereof at the time of purchase, as allowed pursuant to rules promulgated under the Investment Company Act. The Sub-Advisor agrees that neither it nor any of its officers or employees shall borrow from the Fund or pledge or use the Funds assets in connection with any borrowing not directly for the Fund’s benefit.

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10. Reports and Access. The Sub-Advisor agrees to supply such information to the Advisor and to permit such compliance inspections during normal business hours (and at the expense of the Advisor) by the Advisor or the Fund as shall be reasonably necessary to permit the administrator to satisfy its obligations and respond to the reasonable requests of the Trustees.

11. Standard of Care, Liability and Indemnification.

(a) The Sub-Advisor shall exercise reasonable care in fulfilling its obligations under this Agreement.

(b) The Sub-Advisor shall have responsibility for the accuracy and completeness (and liability for the lack thereof) of the statements furnished by the Sub-Advisor for use by the Advisor in the Fund’s offering materials (including the prospectus, the statement of additional information, advertising and sales materials) that pertain to the Sub-Advisor and the investment of the Sub-Advisor’s Allocated Portion of the Fund. The Sub-Advisor shall have no responsibility or liability with respect to other disclosures.

(c) The Sub-Advisor shall be liable to the Fund for any loss (including brokerage charges) incurred by the Fund as a result of any investment made by the Sub-Advisor in violation of Section 2 hereof provided that such loss is judicially determined by a court of competent jurisdiction or through a mutually agreed binding arbitration in New York subject to the rules of the American Arbitration Association (AAA) or JAMS to be a direct result of Sub-Advisor’s willful misfeasance, bad faith or gross negligence in the performance of the obligations or duties hereunder.

(d) Except as otherwise provided in this Agreement, in the absence of willful misfeasance, bad faith, gross negligence, or reckless disregard in the performance of the obligations or duties hereunder on the part of the Sub-Advisor, the Sub-Advisor shall not be subject to liability to the Advisor, the Trust, or the Fund or to any shareholder of the Fund for any act or omission in the course of, or connected with, rendering services hereunder or for any losses that may be sustained in the purchase, holding or sale of any security by the Fund or related to any error of judgment or mistake of law by the Sub-Advisor.

(e) Except as otherwise provided in this Agreement, including without limitation paragraphs (c) and (d) above, each party to this Agreement (as an “Indemnifying Party”), including the Trust on behalf of the Fund, shall indemnify and hold harmless the other party and the shareholders, directors, officers, partners and employees of the other party (any such person, an “Indemnified Party”) against any loss, liability, claim, damage, or expense (including the reasonable cost of investigating and defending any alleged loss, liability, claim, damage, or expense and reasonable counsel fees incurred in connection therewith) directly incurred (“Losses”) by an Indemnified Party to the extent that such Losses are judicially determined by a court of final appeals to be directly arising out of the Indemnifying Party’s (i)

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material breach of this Agreement or (ii) willful misfeasance, bad faith, gross negligence or reckless disregard in the performance or non-performance of any duties under this Agreement provided, however, that nothing herein shall be deemed to protect any Indemnified Party against any liability to which such Indemnified Party would otherwise be subject by reason of willful misfeasance, bad faith, or gross negligence in the performance of its obligations or duties under this Agreement.

The provisions of this paragraph 11(e) shall not apply in any action where the Indemnified Party is the party adverse, or one of the parties adverse, to the other party.

(f) Notwithstanding anything to the contrary in the Agreement, in no event shall either party to this Agreement (including any of their directors, officers, agents, partners or employees) be liable for any indirect, special, incidental, punitive or consequential damages, even if advised of the possibility thereof.

(g) No provision of this Agreement shall be construed to protect any Trustee or officer of the Trust, or officer of the Advisor or the Sub-Advisor, from liability in violation of Sections 17(h) and (i) of the Investment Company Act.

12. Non-Exclusivity; Trading for Sub-Advisor’s Own Account; Code of Ethics. The Advisor’s employment of the Sub-Advisor is not an exclusive arrangement. The Advisor anticipates that it will employ other individuals or entities to furnish it with the services provided for herein. Likewise, the Sub-Advisor may act as investment adviser for any other person, and shall not in any way be limited or restricted from buying, selling, or trading any securities for its or their own accounts or the accounts of others for whom it or they may be acting, provided, however, that the Sub-Advisor expressly represents that it will undertake no activities which will adversely affect the performance of its obligations to the Fund under this Agreement; and provided further that the Sub-Advisor will adhere to a code of ethics governing employee trading

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and trading for proprietary accounts that conforms to the requirements of the Investment Company Act and the Investment Advisers Act, a copy of which has been provided to the Board of Trustees of the Trust.

The Sub-Advisor will make such reports to the Advisor and the Fund as are required by Rule 17j-1 and Rule 38a-1 under the Investment Company Act. The Sub-Advisor agrees to provide the Advisor and the Fund with any information required to satisfy the compliance program, code of ethics reporting or disclosure requirements of the Sarbanes-Oxley Act and any rules or regulations promulgated by the SEC. To the extent the Sub-Advisor adopts or has adopted a separate code of ethics or amends or has amended its code of ethics to comply with such rules or regulations, the Sub-Advisor shall provide the Advisor with a copy of such code of ethics and any amendments thereto.

13.

Term.

(a) This Agreement shall become effective upon approval by the Board of Trustees of the Trust and shall remain in effect for a period of two (2) years, unless sooner terminated as hereinafter provided. This Agreement shall continue in effect thereafter for additional periods not exceeding one (1) year so long as such continuation is approved for the Fund at least annually by (i) the Board of Trustees of the Trust or by the vote of a majority of the outstanding voting securities of the Fund and (ii) the vote of a majority of the Trustees of the Trust who are not parties to this Agreement nor interested persons thereof, cast in person at a meeting called for the purpose of voting on such approval, and (iii) the Advisor. The terms “majority of the outstanding voting securities” and “interested persons” shall have the meanings as set forth in the Investment Company Act.

(b) During the term of this Agreement, the Fund and its distributor may use the Sub-Advisor’s trade name or any name derived from the Sub-Advisor’s trade name only in a manner consistent with the nature of this Agreement for so long as this Agreement or any extension, renewal, or amendment hereof remains in effect, and agrees to furnish Sub-Advisor all prospectuses, proxy statements and reports to shareholders prepared for distribution to shareholders of the Fund or the public, which refer to Sub-Adviser in any way. Upon termination of this Agreement, the Fund shall cease to use such a name or any other name connected with Sub-Advisor. Other than as set forth herein, neither the Advisor, the Trust nor the Fund shall have any other rights relating to the use of the name of the Sub-Advisor, its affiliates or any derivation thereof.

14. Termination; No Assignment.

(a) This Agreement may be terminated at any time without payment of any penalty, by: the Board of Trustees of the Trust or by vote of a majority of the outstanding voting securities of the Fund, upon sixty (60) days’ written notice to the Sub-Advisor and the Advisor. This Agreement also may be terminated at any time, without the payment of any penalty, by the Advisor or the Sub-Advisor upon sixty (60) days’ written notice to the Trust and the other party. In the event of a termination, Sub-Advisor shall cooperate in the orderly transfer of the Fund’s affairs and, at the request of the Board of Trustees, transfer any and all books and records of the Fund maintained by Sub-Advisor on behalf of the Fund.

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(b) This Agreement shall terminate automatically in the event of any transfer or assignment thereof, as defined in the Investment Company Act.

15. Severability. If any provision of this Agreement shall be held or made invalid by a court decision, statute or rule, or shall be otherwise rendered invalid, the remainder of this Agreement shall not be affected thereby.

16. Captions. The captions in this Agreement are included for convenience of reference only and in no way define or limit any of the provisions hereof or otherwise affect their construction or effect.

17. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York without giving effect to the conflict of laws principles thereof; provided that nothing herein shall be construed to preempt, or to be inconsistent with, any federal law, regulation or rule, including the Investment Company Act and the Investment Advisers Act and any rules and regulations promulgated thereunder. If any suit is instituted by any of the parties to enforce any of the terms or conditions of this Agreement, each of the parties hereby submits to the exclusive jurisdiction of and venue in the federal courts of the United States of America, County of New York, State of New York, to the extent permitted by federal law, and otherwise, each of the parties hereby submits to the exclusive jurisdiction of and venue in the state courts of the State of New York located in the city and county of New York. Each party hereto hereby irrevocably waives all right of trial by jury in any action, proceeding or counterclaim, arising out of or in connection with this agreement or any matter arising hereunder.

18. Notices. All notices or other communications given under this Agreement shall be made by guaranteed overnight delivery, facsimile or e-mail (confirmed by telephone); notice is effective when received. Notice shall be given to the parties at the following addresses:


Advisor:		Litman/Gregory Fund Advisors, LLC
		1676 N. California Blvd., Suite 500
		Walnut Creek, CA 94596

Sub-Adviser:		Brown Brothers Harriman & Co., through its separately identifiable department, BBH Mutual Fund Advisory Department
		140 Broadway
		New York, NY 10005
		Attn: Daniel Greifenkamp

With a copy to:		Brown Brothers Harriman & Co. 140 Broadway
		New York, NY 10005 Attn: General Counsel

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Fund:		Litman Gregory Funds Trust
		1676 N. California Blvd., Suite 500
		Walnut Creek, CA 94596
		Attn:

19. Nonpublic Personal Information. Notwithstanding any provision herein to the contrary, the Sub-Advisor hereto agrees on behalf of itself and its directors, partners, officers, and employees (1) to treat confidentially and as proprietary information of the Advisor (on behalf of itself and the Fund) and the Trust (a) all records and other information relative to the Fund’s prior, present, or potential shareholders (and clients of said shareholders) and (b) any Nonpublic Personal Information, as defined under Section 248.3(t) of Regulation S-P (“Regulation S-P”), promulgated under the Gramm-Leach-Bliley Act (the “G-L-B Act”), and (2) except to the extent authorized by applicable law, court order or request by a governmental authority, unless prior notification to and approval in writing by the Advisor or the Trust, not to use such records and information for any purpose other than the performance of its responsibilities and duties hereunder, or as otherwise permitted by Regulation S-P or the G-L-B Act, and if in compliance therewith, the privacy policies adopted by the Advisor and the Fund and communicated in writing to the Sub-Advisor. Such written approval shall not be unreasonably withheld by the Advisor or the Trust and may not be withheld where the Sub-Advisor may be exposed to civil or criminal contempt or other proceedings for failure to comply after being requested to divulge such information by duly constituted authorities.

20. Anti-Money Laundering Compliance. The Sub-Advisor represents that it has implemented its own anti-money laundering program that is reasonably designed to comply with the Bank Secrecy Act, as amended, the USA PATRIOT Act, and any respective implementing regulations (together, “AML Laws”). The Sub-Advisor further agrees to provide to the Fund and/or the Advisor -with certifications or assurances, as may be reasonably requested by the Fund or the Advisor, pertaining to the Sub-Advisor’s compliance with AML Laws. The Advisor may disclose information respecting the Sub-Advisor to governmental and/or regulatory or self-regulatory authorities to the extent required by applicable law or regulation, provided that the Fund or Advisor shall seek the Sub-Advisor’s written notice and approval prior to any such disclosure, where permitted by law.

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22. Provision of Certain Information by the Sub-Advisor. The Sub-Advisor will promptly notify the Advisor in writing of the occurrence of any of the following events:

(a) the Sub-Advisor fails to be registered as investment adviser under the Advisers Act or under the laws of any jurisdiction in which the Sub-Advisor is required to be registered as investment adviser in order to perform its obligations under this Agreement;

(b) to the extent permitted by applicable law, the Sub-Advisor is served or otherwise receives notice of any action, suit, proceeding, inquiry, or investigation, at law or in equity, before or by any court, public board, or body, involving the affairs of the Advisor or the Fund;

(c) the Sub-Advisor suffers financial impairment which materially interferes with its ability to manage the Allocated Portion or otherwise fulfill its duties under this Agreement;

(e) a change in the Sub-Advisor’s personnel materially involved in the day-to-day management of the Allocated Portion; or

(f) a change in control or management of the Sub-Advisor, provided that retirement and additions of individual new partners of BBH shall not be deemed to be a change in control or management of Sub-Advisor.

23. Counterparts. This Agreement may be executed in counterparts and by the different parties hereto on separate counterparts, each of which when so executed and delivered, shall be deemed an original and all of which counterparts shall constitute but one and the same agreement.

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized officers, all on the day and year first above written.


LITMAN/GREGORY FUND ADVISORS, LLC		BROWN BROTHERS HARRIMAN & CO. through its separately identifiable department known as BBH Mutual Fund Advisory Department

By:	/s/ John M. Coughlan	By:	/s/ Daniel J. Greifenkamp
Name:	John M. Coughlan	Name:	Daniel J. Greifenkamp
Title:	Chief Operating Officer	Title:	Vice President

As a Third Party Beneficiary,

LITMAN GREGORY FUNDS TRUST
on behalf of
LITMAN GREGORY ALTERNATIVE STRATEGIES FUND

By:	/s/ John M. Coughlan
Name:	John M. Coughlan
Title:	Treasurer

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Exhibit (d)(2)(E)(4)

LITMAN GREGORY MASTERS HIGH INCOME ALTERNATIVES FUND

LITMAN GREGORY FUNDS TRUST

INVESTMENT SUB-ADVISORY AGREEMENT

THIS INVESTMENT SUB-ADVISORY AGREEMENT is made as of the 29^th day of August, 2018 by and between Litman Gregory Fund Advisors LLC (the “Advisor”) and Neuberger Berman Investment Advisers, LLC (the “Sub-Advisor”).

WITNESSETH:

WHEREAS, the Sub-Advisor is registered as an investment adviser under the Investment Advisers Act of 1940, as amended (the “Investment Advisers Act”), and is engaged in the business of supplying investment advisory services as an independent contractor; and

WHEREAS, the Trust and the Fund are third party beneficiaries of such arrangements;

1. Appointment of Sub-Advisor.

2. Duties of Sub-Advisor.

Without limiting the generality of the foregoing, the Sub-Advisor shall: (i) furnish the Fund with advice and recommendations with respect to the investment of the Sub-Advisor’s Allocated Portion of the Fund’s assets; (ii) effect the purchase and sale of portfolio securities for the Sub-Advisor’s Allocated Portion; (iii) determine that portion of the Sub-Advisor’s Allocated Portion that will remain uninvested, if any; (iv) manage and oversee the investments of the Sub-Advisor’s Allocated Portion, subject to the ultimate supervision and direction of the Trust’s Board of Trustees; (v) vote proxies in the manner outlined below, file required ownership reports, and take other actions with respect to the securities in the Sub-Advisor’s Allocated Portion; (vi) maintain the books and records required to be maintained with respect to the securities in the Sub-Advisor’s Allocated Portion; (vii) furnish reports, statements and other data on securities, economic conditions and other matters related to the investment of the Fund’ assets which the Advisor, the Trustees, or the officers of the Trust may reasonably request; and (viii) render to the Trust’s Board of Trustees such periodic and special reports with respect to the Sub-Advisor’s Allocated Portion as the Board may reasonably request.

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manner consistent with Sections 17(a) and 17(e) of the Investment Company Act, Rule 17e-1 thereunder and the Rule 17e-1 procedures adopted by the Trust (a copy of which shall by provided by the Advisor). The Advisor agrees that it will provide the Sub-Advisor with a written list of relevant affiliates and will, from time to time, update such list as necessary. The Sub-Advisor’s primary consideration in effecting a securities transaction will be best execution. In selecting a broker-dealer to execute each particular transaction, the Sub-Advisor may take the following into consideration: the best net price available; the reliability, integrity and financial condition of the broker-dealer; the size of and difficulty in executing the order; and the value of the expected contribution of the broker-dealer to the investment performance of the Fund on a continuing basis. The price to the Fund in any transaction may be less favorable than that available from another broker-dealer if the difference is reasonably justified by other aspects of the portfolio execution services offered.

The Sub-Advisor is authorized on behalf of the Fund to enter into and execute any documents required to effect transactions with respect to the Fund, provided that such transactions are in accord with the Registration Statement and with all written guidelines, policies and procedures adopted by the Trust or the Advisor that are provided in writing to the Sub-Advisor. The Advisor hereby (i) represents that the Fund is an “accredited investor” as defined in Rule 501 (a) of Regulation D under the Securities Act of 1933, as amended (the

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“Securities Act”) and a “Qualified Institutional Buyer” as defined in Rule 144A (a)(1)(i) under the Securities Act, and, in connection therewith, and the Advisor agrees to (A) furnish the Sub-Advisor with such financial information as it may request to confirm its status, and (B) promptly notify the Sub-Advisor if the Fund is no longer an “accredited investor” and/or a “Qualified Institutional Buyer”; and (ii) commits that such securities will not be offered or sold by the Fund except in compliance with the registration requirements of the Securities Act or an exemption therefrom. The Advisor shall provide (or cause to be provided) to the Sub-Advisor any additional information that the Sub-Advisor may reasonably request to assist it in managing the Fund. The Sub-Advisor may give a copy of this Agreement to any broker-dealer or other party to a transaction for the Fund as evidence of the Sub-Advisor’s authority to act for the Fund.

(c) Proxy Voting; Class Actions and Litigations. The Advisor hereby delegates to the Sub-Advisor, the Advisor’s discretionary authority to exercise voting rights with respect to the securities and other investments in the Allocated Portion. The Sub-Advisor’s proxy voting policies shall comply with any rules or regulations promulgated by the SEC. The Sub-Advisor shall maintain and preserve a record, in an easily-accessible place for a period of not less than three (3) years (or longer, if required by law), of the Sub-Advisor’s voting procedures, of the Sub-Advisor’s actual votes, and such other information required for the Fund to comply with any rules or regulations promulgated by the SEC. The Sub-Advisor shall supply updates of this record to the Advisor or any authorized representative of the Advisor, or to the Fund on a quarterly basis (or more frequently, if required by law). The Sub-Advisor shall provide the Advisor and the Fund with information regarding the policies and procedures that the Sub-Advisor uses to determine how to vote proxies relating to the Allocated Portion. The Fund may request that the Sub-Advisor vote proxies for the Allocated Portion in accordance with the Fund’s proxy voting policies, and any such request shall be communicated to the Sub-Advisor in writing. The Advisor shall instruct the Fund’s custodian to forward or cause to be forwarded to the Sub-Advisor (or its designated agent) all relevant proxy solicitation materials. The Sub-Advisor may, at its discretion, elect to use one or more third parties, including proxy voting services, in fulfilling its obligations hereunder.

The parties acknowledge that the Sub-Advisor shall not have any obligation to initiate or otherwise act on behalf of the Fund with respect to class-action proceedings; however, notwithstanding the foregoing, upon reasonable request of the Advisor the Sub-Advisor will provide relevant information and/or documentation relating to such class-action proceedings.

The Sub-Advisor agrees that upon the request of the Advisor or the Fund, it shall provide reasonable assistance to the Advisor or the Fund in the exercise of the rights incident to the investments held by the Fund in the context of a litigation, bankruptcy or other reorganization but will not have any obligation to act on behalf of the Fund.

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Sub-Advisor to comply with applicable law and regulation, audits, and its internal policies and procedures. The Sub-Advisor further agrees to preserve for the periods prescribed by Rule 31a-2 under the Investment Company Act the records required to be maintained by Rule 31a-1 under the Investment Company Act with respect to the Fund and to preserve the records required by Rule 204-2 under the Advisers Act with respect to the Fund for the period specified in the Rule.

(e) Custody. Title to all investments shall be made in the name of the Fund, provided that for convenience in buying, selling, and exchanging securities (stocks, bonds, commercial paper, etc.), title to such securities may be held in the name of the Fund’s custodian bank, or its nominee or as otherwise provided in the Fund’s custody agreement. The Fund shall notify the Sub-Advisor of the identity of its custodian bank and shall give the Sub-Advisor fifteen (15) days’ written notice of any changes in such custody arrangements. Neither the Sub-Advisor, nor any parent, subsidiary or related firm, shall take possession of or handle any cash or securities, mortgages or deeds of trust, or other indicia of ownership of the Fund’s investments, or otherwise act as custodian of such investments. All cash and the indicia of ownership of all other investments shall be held by the Fund’s custodian bank. The Fund shall instruct its custodian bank to (a) carry out all investment instructions as may be directed by the Sub-Advisor with respect thereto (which may be orally given if confirmed in writing); and (b) provide the Sub-Advisor with all operational information necessary for the Sub-Advisor to trade on behalf of the Fund.

3. Representations of Sub-Advisor.

(a) Sub-Advisor shall use its best judgment and efforts in rendering the advice and services to the Fund as contemplated by this Agreement.

(b) Sub-Advisor shall maintain all licenses and registrations necessary to perform its duties hereunder in good order.

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(c) Sub-Advisor shall conduct its operations at all times in conformance with the Investment Advisers Act, the Investment Company Act and any other applicable state and/or self-regulatory organization regulations.

(d) Sub-Advisor shall be covered by errors and omissions insurance. The company self-retention or deductible shall not exceed reasonable and customary standards, and Sub-Advisor agrees to notify Advisor in the event the aggregate coverage of such insurance in any annual period is reduced below $10,000,000.

(e) The Sub-Advisor represents and warrants to the Advisor and the Fund that (i) the retention of the Sub-Advisor as contemplated by this Agreement is authorized by the Sub-Advisor’s governing documents; (ii) the execution, delivery and performance of this Agreement does not violate any obligation by which the Sub-Advisor or its property is bound, whether arising by contract, operation of law or otherwise; and (iii) this Agreement has been duly authorized by appropriate action of the Sub-Advisor and when executed and delivered by the Sub-Advisor will be the legal, valid and binding obligation of the Sub-Advisor, enforceable against the Sub-Advisor in accordance with its terms hereof, subject, as to enforcement, to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally and to general equitable principles (regardless of whether enforcement is sought in a proceeding in equity or law).

5. Sub-Advisor’s Personnel. The Sub-Advisor shall, at its own expense, maintain such staff and employ or retain such personnel and consult with such other persons as it shall from time to time determine to be necessary to the performance of its obligations under this Agreement. Without limiting the generality of the foregoing, the staff and personnel of the Sub-Advisor shall be deemed to include persons employed or retained by the Sub-Advisor to furnish, as applicable, statistical information, research, and other factual information, advice regarding economic factors and trends, and such other information, advice, and assistance as the Sub-Advisor, the Advisor or the Trust’s Board of Trustees may desire and reasonably request. The Sub-Advisor is permitted to use persons employed by an “affiliated person” (as defined in the Investment Company Act) of the Sub-Advisor, each of whom shall be treated as an “associated person” of the Sub-Advisor (as defined in the Investment Advisers Act to provide, or assist in providing, discretionary investment advisory services under this Agreement to the extent not prohibited by, or inconsistent with, applicable law, including the requirements of the 1940 Act, the rules thereunder, and relevant positions of the SEC and its staff. In addition, Sub-Advisor is permitted to use affiliates and employees of such affiliates, to provide non-discretionary

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investment advisory services. The Sub-Advisor will be responsible under this Agreement for any action taken by such person on behalf of the Fund to the same extent as if the Sub-Advisor had taken such action directly.

6. Expenses.

(a) The Sub-Advisor shall be responsible for providing the personnel, office space, and equipment reasonably necessary to fulfill its obligations under this Agreement. All other expenses to be incurred in the operation of the Fund will be borne by the Trust.

7. Investment Sub-Advisory Fee.

(a) The Advisor shall pay to the Sub-Advisor, and the Sub-Advisor agrees to accept, as full compensation for all investment advisory services furnished or provided to the Fund pursuant to this Agreement, an annual sub-advisory fee based on the Sub-Advisor’s Allocated Portion, as such Allocated Portion may be adjusted from time to time. Such fee shall be paid at the annual rate specified on Exhibit A attached hereto on the net assets of the Fund attributable to the Sub-Advisor’s Allocated Portion, computed on the value of such net assets as of the close of business each day.

(b) The sub-advisory fee shall be paid by the Advisor to Sub-Advisor monthly in arrears on the tenth business day of each month.

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which is not a complete month according to the proportion which the number of calendar days in the month during which the Agreement is in effect bears to the number of calendar days in the month, and shall be payable within ten (10) days after the date of termination.

(d) The fee payable to the Sub-Advisor under this Agreement will be reduced to the extent of any receivable owed by the Sub-Advisor to the Advisor or the Fund.

8. No Borrowing. The Sub-Advisor agrees that neither it nor any of its officers or employees shall borrow from the Fund or pledge or use the Funds assets in connection with any borrowing not directly for the Fund’s benefit.

11. Standard of Care, Liability and Indemnification.

(a) The Sub-Advisor shall exercise reasonable care and prudence in fulfilling its obligations under this Agreement.

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(b) The Sub-Advisor shall have responsibility for the accuracy and completeness (and liability for the lack thereof) of the statements furnished by the Sub-Advisor for use by the Advisor in the Fund’s offering materials (including the prospectus, the statement of additional information, advertising and sales materials) that pertain to the Sub-Advisor and the investment of the Sub-Advisor’s Allocated Portion of the Fund. The Sub-Advisor shall have no responsibility or liability with respect to other disclosures.

(c) The Sub-Advisor shall be liable to the Fund for any loss (including brokerage charges) incurred by the Fund as a result of any investment made by the Sub-Advisor in violation of Section 2 hereof.

(d) Except as otherwise provided in this Agreement, in the absence of willful misfeasance, bad faith, gross negligence, or reckless disregard of the obligations or duties hereunder on the part of the Sub-Advisor, the Sub-Advisor shall not be subject to liability to the Advisor, the Trust, or the Fund or to any shareholder of the Fund for any act or omission in the course of, or connected with, rendering services hereunder or for any losses that may be sustained in the purchase, holding or sale of any security by the Fund.

(e) Except as otherwise provided in this Agreement, including without limitation paragraphs (c) and (d) above, each, party to this Agreement (as an “Indemnifying Party”), including the Trust on behalf of the Fund, shall indemnify and hold harmless the other party and the directors, officers, and employees of the other party (any such person, an “Indemnified Party”) against any loss, liability, claim, damage, or expense (including the reasonable cost of investigating and defending any alleged loss, liability, claim, damage, or expense and reasonable counsel fees incurred in connection therewith) arising out of the Indemnifying Party’s performance or non-performance of any duties under this Agreement provided, however, that nothing herein shall be deemed to protect any Indemnified Party against any liability to which such Indemnified Party would otherwise be subject by reason of willful misfeasance, bad faith, or gross negligence in the performance of duties hereunder or by reason of reckless disregard of obligations and duties under this Agreement.

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The provisions of this paragraph 11(e) shall not apply in any action where the Indemnified Party is the party adverse, or one of the parties adverse, to the other party.

(f) No provision of this Agreement shall be construed to protect any Trustee or officer of the Trust, or officer of the Advisor or the Sub-Advisor, from liability in violation of Sections 17(h) and (i) of the Investment Company Act.

The Sub-Advisor will make such reports to the Advisor and the Fund as are required by Rule 17j-1 and as reasonably requested by the Advisor to assist the Advisor with its compliance obligations under Rule 38a-1 under the Investment Company Act. The Sub-Advisor agrees to provide the Advisor and the Fund with any information required to satisfy the compliance program, code of ethics reporting or disclosure requirements of the Sarbanes-Oxley Act and any rules or regulations promulgated by the SEC. To the extent the Sub-Advisor adopts or has adopted a separate code of ethics or amends or has materially amended its code of ethics to comply with such rules or regulations, the Sub-Advisor shall provide the Advisor with a copy of such code of ethics and any amendments thereto.

13. Term.

(a) This Agreement shall become effective upon approval by the Board of Trustees of the Trust and shall remain in effect for a period of two (2) years, unless sooner terminated as hereinafter provided. This Agreement shall continue in effect thereafter for additional periods not exceeding one (1) year so long as such continuation is approved for the Fund at least annually by (i) the Board of Trustees of the Trust or by the vote of a majority of the outstanding voting securities of the Fund and (ii) the vote of a majority of the Trustees of the Trust who are not parties to this Agreement nor interested persons thereof, cast in person at a meeting called for the purpose of voting on such approval, and (iii) the Advisor. The terms “majority of the outstanding voting securities” and “interested persons” shall have the meanings as set forth in the Investment Company Act.

(b) The Fund and its distributor may use the Sub-Advisor’s trade name or any name derived from the Sub-Advisor’s trade name and approved by the Sub-Advisor only in a

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manner consistent with the nature of this Agreement for so long as this Agreement or any extension, renewal, or amendment hereof remains in effect. Within sixty (60) days from such time as this Agreement shall no longer be in effect, the Fund shall cease to use such a name or any other name connected with Sub-Advisor.

14. Termination; No Assignment.

(a) This Agreement may be terminated at any time without payment of any penalty, by: the Board of Trustees of the Trust or by vote of a majority of the outstanding voting securities of the Fund, upon sixty (60) days’ written notice to the Sub-Advisor and the Advisor. This Agreement also may be terminated at any time, without the payment of any penalty, by the Advisor or the Sub-Advisor upon sixty (60) days’ written notice to the Trust and the other party. In the event of a termination, Sub-Advisor shall cooperate in the orderly transfer of the Fund’s affairs and, at the request of the Board of Trustees, transfer any and all books and records of the Fund maintained by Sub-Advisor on behalf of the Fund.

(b) This Agreement shall terminate automatically in the event of any transfer or assignment thereof, as defined in the Investment Company Act.

17. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of California without giving effect to the conflict of laws principles thereof; provided that nothing herein shall be construed to preempt, or to be inconsistent with, any federal law, regulation or rule, including the Investment Company Act and the Investment Advisers Act and any rules and regulations promulgated thereunder.

18. Nonpublic Personal Information. Notwithstanding any provision herein to the contrary, the Sub-Advisor hereto agrees on behalf of itself and its directors, trustees, shareholders, officers, and employees (1) to treat confidentially and as proprietary information of the Advisor (on behalf of itself and the Fund) and the Trust (a) all records and other information relative to the Fund’s prior, present, or potential shareholders (and clients of said shareholders) and (b) any Nonpublic Personal Information, as defined under Section 248.3(t) of Regulation S-P (“Regulation S-P”), promulgated under the Gramm-Leach-Bliley Act (the “G-L-B Act”), and (2) except after prior notification to and approval in writing by the Advisor or the Trust, not to use such records and information for any purpose other than the performance of its responsibilities and duties hereunder, or as otherwise permitted by Regulation S-P or the G-L-B Act, and if in compliance therewith, the privacy policies adopted by the Advisor and the Fund and communicated in writing to the Sub-Advisor. Such written approval shall not be unreasonably

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withheld by the Advisor or the Trust and may not be withheld where the Sub-Advisor may be exposed to civil or criminal contempt or other proceedings for failure to comply after being requested to divulge such information by duly constituted authorities.

19. Anti-Money Laundering Compliance. The Sub-Advisor acknowledges that, in compliance with the Bank Secrecy Act, as amended, the USA PATRIOT Act, and any respective implementing regulations (together, “AML Laws”), the Fund has adopted an Anti-Money Laundering Policy. The Sub-Advisor agrees to comply with Federal Anti-Money Laundering Laws, as the same may apply to the Sub-Advisor, now and in the future. The Sub-Advisor further agrees to provide to the Fund and/or the Advisor such reports, certifications and contractual assurances as may be requested by the Fund or the Advisor to comply with AML Laws. The Advisor may disclose information respecting the Sub-Advisor to governmental and/or regulatory or self-regulatory authorities to the extent required by applicable law or regulation and may file reports with such authorities as may be required by applicable law or regulation.

20. Certifications; Disclosure Controls and Procedures. The Sub-Advisor acknowledges that, in compliance with the Sarbanes-Oxley Act, and the implementing regulations promulgated thereunder, the Fund is required to make certain certifications and has adopted disclosure controls and procedures. To the extent reasonably requested by the Advisor, the Sub-Advisor agrees to use its best efforts to assist the Advisor and the Fund in complying with the Sarbanes-Oxley Act and implementing the Fund’s disclosure controls and procedures. The Sub-Advisor agrees to inform the Fund of any material development related to the Allocated Portion that the Sub-Advisor reasonably believes is materially relevant to the Fund’s certification obligations under the Sarbanes-Oxley Act.

21. Provision of Certain Information by the Sub-Advisor. The Sub-Advisor will promptly notify the Advisor in writing of the occurrence of any of the following events:

(c) the Sub-Advisor suffers financial impairment which materially interferes with its ability to manage the Allocated Portion or otherwise fulfill its duties under this Agreement;

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(e) a change in the Sub-Advisor’s personnel materially involved in the management of the Allocated Portion; or

(f) a change in control or management of the Sub-Advisor.

22. Confidentiality. The parties to this Agreement shall not, directly or indirectly, permit their respective affiliates, directors, trustees, officers, members, employees, or agents to, in any form or by any means, use, disclose, or furnish to any person or entity, records or information concerning the business of any of the other parties except as necessary for the performance of duties under this Agreement or as required by law, without prior written notice to and approval of the relevant other parties, which approval shall not be unreasonably withheld by such other parties. Notwithstanding the foregoing, the Sub-Advisor may disclose information (i) to affiliates and legal counsel of the Sub-Advisor; (ii) to the Fund’s Custodian and Administrator with respect to the Trust and the Fund; (iii) to brokers and dealers and other entities that are counterparties with respect to transactions effected by the Sub-Advisor for the Fund; and (iv) to third party service providers subject to confidentiality agreements or similar obligations of confidentiality. Confidential information of a party to this Contract that (a) was or becomes generally available to the public, other than as a result disclosure by the other party; (b) was or becomes available to the other party on a non-confidential basis from a source other than the party, which source is not known to be bound by any obligations of confidentiality; or (c) is independently developed by the other party without reference to or reliance on information or advice furnished pursuant to this Contract, will not be considered confidential for purposes of this Contract. Further, the Sub-Advisor has entered into an agreement with State Street Bank and Trust Company (“State Street”) to provide certain operational and administrative services (including without limitation, backoffice) and compliance monitoring services to the Sub-Advisor with respect to its registered investment company clients whose portfolios may include certain types of instruments, including derivatives. In order to utilize this service, the Sub-Advisor will provide holdings, transaction data and other information to State Street on a daily basis.

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized officers, all on the day and year first above written.


Litman Gregory Fund Advisors LLC		Neuberger Berman Investment Advisers LLC

By:	/s/ John M. Coughlan	By:	/s/ Brian Kerrane
Name:	John M. Coughlan	Name:	Brian Kerrane
Title:	Chief Operating Officer	Title:	Managing Director


As a Third Party Beneficiary,

Litman Gregory Funds Trust on behalf of Litman Gregory Masters High Income Alternatives Fund

By:		/s/ Jeremy DeGroot
Name:		Jeremy DeGroot
Title:		President

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Exhibit (h)(3)(D)

LITMAN GREGORY FUNDS TRUST

Third Amendment to Restated Contractual Advisory Fee Waiver Agreement

THIS THIRD AMENDMENT TO RESTATED CONTRACTUAL ADVISORY FEE WAIVER AGREEMENT (this “Amendment”), effective as of August 28, 2018, is entered into by and between LITMAN GREGORY FUNDS TRUST (the “Trust”), a Delaware statutory trust, and LITMAN GREGORY FUND ADVISORS, LLC, a California limited liability company (the “Advisor,” together with the Trust, the “Parties”).

RECITALS

WHEREAS, the Trust has retained the Advisor to provide investment management advice and services to each series of the Trust (each, a “Fund,” and collectively, the “Funds”) pursuant to the Unified Investment Advisory Agreement, dated as of April 1, 2013, as amended, by and between the Trust and the Advisor (the “Investment Advisory Agreement”);

WHEREAS, the Parties have entered into the Restated Contractual Advisory Fee Waiver Agreement, dated as of January 1, 2006, as amended (the “Agreement”), pursuant to which the Adviser waives a portion of the advisory fees it is entitled to receive under the Investment Advisory Agreement with respect to certain Funds; and

WHEREAS, the Parties wish to amend the fee waiver rates with respect to the Litman Gregory Masters Equity Fund, Litman Gregory Masters Smaller Companies Fund, Litman Gregory Masters International Fund, Litman Gregory Masters Alternative Strategies Fund and Litman Gregory Masters High Income Alternatives Fund as set forth in Appendix A of the Agreement;

NOW, THEREFORE, in consideration of the mutual agreements herein set forth, and for other good and valuable consideration, the adequacy and sufficiency of which are hereby acknowledged, the Parties agree as follows:

Appendix A to the Agreement is hereby suspended and replaced in its entirety with Appendix A attached to this Amendment.

Except as expressly amended by this Third Amendment, the Agreement shall remain unchanged and in full force and effect.

IN WITNESS WHEREOF, the Parties have caused this Third Amendment to be duly executed by their duly authorized officers on one or more counterparts, all on the date and year first above written.


LITMAN GREGORY FUNDS TRUST on behalf of its series listed on Appendix A		LITMAN GREGORY FUND ADVISORS, LLC

By:	/s/ John M. Coughlan	By:	/s/ John M. Coughlan
Name:	John M. Coughlan	Name:	John M. Coughlan
Title:	Chief Operating Officer	Title:	Chief Operating Officer

Appendix A

FUND AND WAIVER SCHEDULE – LITMAN GREGORY FUNDS TRUST

(updated August 28, 2018)


Fund		Fee Waiver Rate
• Litman Gregory Masters Equity Fund		Such percentage rate of the daily net assets of the Fund so that after payment of all sub-advisory fees, the net advisory fee retained by the Advisor is 0.40% of the daily net assets of the Fund

• Litman Gregory Masters International Fund		Such percentage rate of the daily net assets of the Fund so that after payment of all sub-advisory fees, the net advisory fee retained by the Advisor is 0.40% of the daily net assets of the Fund on the first $1 billion of daily net assets and 0.30% of Fund assets in excess of $1 billion.

• Litman Gregory Masters Smaller Companies Fund		Such percentage rate of the daily net assets of the Fund so that after payment of all sub-advisory fees, the net advisory fee retained by the Advisor is 0.26% of the daily net assets of the Fund

• Litman Gregory Masters Alternative Strategies Fund		Such percentage rate of the daily net assets of the Fund so that after payment of all sub-advisory fees, the net advisory fee retained by the Advisor is 0.50% of the first $2 billion of daily net assets, 0.40% of the next $1 billion of daily net assets, 0.35% of the next $1 billion of daily net assets and 0.30% of Fund assets in excess of $4 billion.

• Litman Gregory Masters High Income Alternatives Fund		Such percentage rate of the daily net assets of the Fund so that after payment of all sub-advisory fees, the net advisory fee retained by the Advisor is 0.40% on the first $1 billion of daily net assets, 0.375% on the next $1 billion of daily net assets, 0.35% on the next $1 billion of daily net assets, 0.325% on the next $1 billion of daily net assets and 0.30% of Fund assets in excess of $4 billion.


LITMAN GREGORY FUNDS TRUST on behalf of its series listed above		LITMAN GREGORY FUND ADVISORS, LLC

By:	/s/ John M. Coughlan	By:	/s/ John M. Coughlan
Name:	John M. Coughlan	Name:	John M. Coughlan
Title:	Chief Operating Officer	Title:	Chief Operating Officer

Exhibit (h)(4)(A)

LITMAN GREGORY FUNDS TRUST

Operating Expenses Limitation Agreement

This Operating Expenses Limitation Agreement (this “Agreement”) is effective as of August 28, 2018, by and between Litman Gregory Funds Trust (the “Trust”), a Delaware statutory trust, on behalf of the Litman Gregory Masters High Income Alternatives Fund, a series of the Trust (the “Fund”), and the investment advisor to the Fund, Litman Gregory Fund Advisors, LLC, a California limited liability company (the “Advisor”).

WITNESSETH:

WHEREAS, the Advisor renders advice and services to the Fund pursuant to the terms and provisions of a Unified Investment Advisory Agreement between the Trust and the Advisor dated April 1, 2013, as such agreement may be amended from time to time (the “Investment Advisory Agreement”);

WHEREAS, the Fund is responsible for, and has assumed the obligation for, payment of certain expenses pursuant to the Investment Advisory Agreement; and

WHEREAS, the Advisor desires to limit the Fund’s Operating Expenses (as that term is defined in Paragraph 2 of this Agreement) pursuant to the terms and provisions of this Agreement, and the Trust (on behalf of the Fund) desires to allow the Advisor to implement such limit;

NOW, THEREFORE, in consideration of the covenants and the mutual promises hereinafter set forth, the parties, intending to be legally bound hereby, mutually agree as follows:

1. Limit on Operating Expenses. The Advisor hereby agrees to limit the Fund’s Operating Expenses to an annual rate, expressed as a percentage of such Fund’s average annual net assets, as shown on Schedule A of this Agreement (the “Expense Cap”). In the event that the current Operating Expenses of the Fund, as accrued daily, exceeds its Expense Cap, the Advisor will pay to the Fund, on a monthly basis, the excess expense within 30 days of being notified that an excess payment is due.

2. Definition. For purposes of this Agreement, the term “Operating Expenses” with

respect to the Fund is defined to include all expenses necessary or appropriate for the operation of the Fund, including the Advisor’s investment advisory or management fee under Paragraph 7 of the Investment Advisory Agreement and other expenses described in Paragraph 6 of the Investment Advisory Agreement, but does not include any taxes, interest, brokerage commissions, expenses incurred in connection with any merger or reorganization, borrowing costs (including commitment fees), dividend expenses, acquired fund fees and expenses or any extraordinary expenses such as but not limited to litigation.

3. Reimbursement of Fees and Expenses. The Advisor, under Paragraph 7(e) of the Investment Advisory Agreement, retains its right to receive reimbursement of reductions of its investment management fee and of Operating Expenses paid by it that it is not responsible for under Paragraph 6 of the Investment Advisory Agreement.

4. Recoupment Balance. Any fee reduced by the Advisor, or Operating Expenses paid by it (collectively, “subsidies”), pursuant to this Agreement may be reimbursed by the Fund to the Advisor no later than the end of the third fiscal year following the year to which the subsidy relates (subsidies available for reimbursement to the Advisor under this Paragraph are collectively referred to as the “Recoupment Balance”), and any such reimbursement must be approved by the Board of Trustees of the Trust (the “Board”). For example, subsidies relating to the period January 1, 2019 through December 31, 2019 would no longer be eligible for reimbursement after January 1, 2023. The Advisor generally seeks reimbursement on a rolling three-year basis whereby the oldest subsidies are recouped first. The Advisor may not request or receive reimbursement of the Recoupment Balance before payment of the Fund’s Operating Expenses for the current year and cannot cause the Fund to exceed the Expense Cap or any other agreed upon expense limitation for that year in making such reimbursement. The Advisor agrees not to request or seek reimbursement of subsidies that are no longer eligible for reimbursement.

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5. Term. This Agreement shall become effective on the date specified herein and shall remain in effect until April 30, 2020 unless sooner terminated as provided in Paragraph 6 of this Agreement. This Agreement shall continue in effect thereafter for additional periods not exceeding one (1) year so long as such continuation is approved for the Fund at least annually by the Board (and separately by a majority of the Trustees who are not “interested persons” of the Trust as such term is defined in the Investment Company Act of 1940, as amended (the “Investment Company Act”)).

6. Termination. This Agreement may be terminated at any time by the Board, on behalf of the Fund, upon sixty (60) days’ written notice to the Advisor without payment of any penalty. The Advisor may decline to renew this Agreement by written notice to the Trust at least thirty (30) days before its renewal date. This Agreement will automatically terminate if the Investment Advisory Agreement is terminated with respect to the Fund, with such termination effective upon the effective date of the Investment Advisory Agreement’s termination with respect to the Fund.

7. Assignment. This Agreement and all rights and obligations hereunder may not be assigned without the written consent of the other party.

8. Severability. If any provision of this Agreement shall be held or made invalid by a court decision, statute or rule, or shall be otherwise rendered invalid, the remainder of this Agreement shall not be affected thereby.

9. Captions. The captions in this Agreement are included for convenience of reference only and in no way define or limit any of the provisions hereof or otherwise affect their construction of effect.

10. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of California without giving effect to the conflict of laws principles thereof; provided that nothing herein shall be construed to preempt, or to be inconsistent with, any federal law, regulation or rule, including the Investment Company Act and the Investment Advisers Act of 1940, as amended, and any rules and regulations promulgated thereunder.

Page 3 of 5

11. Notice of Limited Liability. The Advisor agrees that the Trust’s obligations under this Agreement shall be limited to the Fund and to its assets, and that the Advisor shall not seek satisfaction of any such obligation from the shareholders of the Fund nor from any Trustee, officer, employee or agent of the Trust or the Fund.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their duly authorized officers on one or more counterparts, all on the date and year first above written.


LITMAN GREGORY FUNDS TRUST, on behalf of the Litman Gregory Masters High Income Alternatives Fund		LITMAN GREGORY FUND ADVISORS, LLC

By:	/s/ John Coughlan	By:	/s/ John Coughlan
Name:	John Coughlan	Name:	John Coughlan
Title:	Treasurer	Title:	Chief Operating Officer
Date:	8/28/2018	Date:	8/28/2018

Page 4 of 5

Schedule A


Series of Litman Gregory Funds Trust	Operating Expense Limit
Litman Gregory Masters High Income Alternatives Fund
Institutional Class		0.98% of average daily net assets
Investor Class		1.23% of average daily net assets

Page 5 of 5

Exhibit (i)(1)

Paul Hastings LLP

101 California Street, 48th Floor

San Francisco, California 94111

1(415) 856-7007

[email protected]

September 6, 2018

VIA EDGAR

Litman Gregory Funds Trust

1676 N. California Blvd., Suite 500

Walnut Creek, California 94596

Re:	Litman Gregory Funds Trust - File Nos. 333-10015 and 811-07763

Ladies and Gentlemen:

We hereby consent to the inclusion of our law firm’s name as counsel to the Litman Gregory Funds Trust (the “Registrant”), as shown in Post-Effective Amendment No. 85 to the Registrant’s Registration Statement on Form N-1A.

Very truly yours,

/s/ David A. Hearth

David A. Hearth

for PAUL HASTINGS LLP

Exhibit (j)(1)

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the references to our firm in this Registration Statement on Form N-1A of Litman Gregory Funds Trust, comprising of the Litman Gregory Masters High Income Alternatives Fund, under the headings “General Information” and “Financial Statements” in the Statement of Additional Information.

/s/ Cohen & Company, Ltd.

Cohen & Company, Ltd.

Cleveland, Ohio

September 6, 2018

Exhibit (m)(1)

LITMAN GREGORY FUNDS TRUST

DISTRIBUTION AND SHAREHOLDER SERVICING PLAN

(12b-1 Plan)

The following Distribution Plan (the “Plan”) has been adopted pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended (the “Act”), by Litman Gregory Funds Trust f/k/a The Masters’ Select Funds Trust (the “Trust”), a Delaware statutory trust, on behalf of the Funds listed on Appendix B (the “Funds”), each a series of the Trust. The Plan has been approved by a majority of the Trust’s Board of Trustees, including a majority of the Trustees who are not “interested persons” of the Trust, as such term is defined in Section 2(a)(19) of the Act, and who have no direct or indirect financial interest in the operation of the Plan or in any Rule 12b-1 Agreement (as defined below) (the “Independent Trustees”), cast in person at a meeting called for the purpose of voting on such Plan.

In approving the Plan, the Board of Trustees determined that adoption of the Plan would be prudent and in the best interests of each Fund and its shareholders. Such approval by the Board of Trustees included a determination, in the exercise of its reasonable business judgment and in light of its fiduciary duties, that there is a reasonable likelihood that the Plan will benefit each Fund and the shareholders of each class of shares covered by the Plan (the “Covered Shares”).

The provisions of the Plan are as follows:

1.	PAYMENTS BY THE FUND TO PROMOTE THE SALE OF FUND SHARES

The Trust, on behalf of each Fund, will pay ALPS Distributors, Inc. (the “Distributor”), as principal distributor of the Fund’s shares, a distribution and shareholder servicing fee as shown on Appendix B in connection with the promotion and distribution of Fund shares and the provision of personal services to shareholders, including, but not necessarily limited to, advertising, compensation to underwriters, dealers and selling personnel, the printing and mailing of prospectuses to other than current Fund shareholders, and the printing and mailing of sales literature. The Distributor may pay all or a portion of these fees to any registered securities dealer, financial institution or any other person (the “Recipient”) who renders assistance in distributing or promoting the sale of shares, or who provides certain shareholder services, pursuant to a written agreement (the “Rule 12b-1 Agreement”), a form of which is attached hereto as Appendix A with respect to the Fund. To the extent not so paid by the Distributor such amounts may be retained by the Distributor. Payment of these fees shall be made monthly promptly following the close of the month.

2.	RULE 12B-1 AGREEMENTS

(a) No Rule 12b-1 Agreement shall be entered into with respect to a Fund and no payments shall be made pursuant to any Rule 12b-1 Agreement, unless such Rule 12b-1 Agreement is in writing and the form of which has first been delivered to and approved by a vote of a majority of the Trust’s Board of Trustees, and of the Independent Trustees, cast in person at

a meeting called for the purpose of voting on such Rule 12b-1 Agreement. The form of Rule 12b-1 Agreement relating to the Fund attached hereto as Appendix A has been approved by the Trust’s Board of Trustees as specified above.

(b) Any Rule 12b-1 Agreement shall describe the services to be performed by the Recipient and shall specify the amount of, or the method for determining, the compensation to the Recipient.

(c) No Rule 12b-1 Agreement may be entered into unless it provides (i) that it may be terminated with respect to each Fund at any time, without the payment of any penalty, by vote of a majority of the shareholders of each Fund’s Covered Shares, or by vote of a majority of the Independent Trustees, on not more than 60 days’ written notice to the other party to the Rule 12b-1 Agreement, and (ii) that it shall automatically terminate in the event of its assignment (as defined in the Act and related rules and Securities and Exchange Commission interpretations thereof).

(d) Any Rule 12b-1 Agreement shall continue in effect for a period of more than one year from the date of its execution only if such continuance is specifically approved at least annually by a vote of a majority of the Board of Trustees, and of the Independent Trustees, cast in person at a meeting called for the purpose of voting on such Rule 12b-1 Agreement.

3.	QUARTERLY REPORTS

The Distributor shall provide to the Board of Trustees, and the Trustees shall review at least quarterly, a written report of all amounts expended pursuant to the Plan. This report shall include the identity of the Recipient of each payment and the purpose for which the amounts were expended and such other information as the Board of Trustees may reasonably request.

4.	EFFECTIVE DATE AND DURATION OF THE PLAN

The Plan shall become effective immediately upon approval by the vote of a majority of the Board of Trustees, and of the Independent Trustees, cast in person at a meeting called for the purpose of voting on the approval of the Plan. The Plan shall continue in effect with respect to the Fund for a period of one year from its effective date unless terminated pursuant to its terms. Thereafter, the Plan shall continue with respect to the Fund from year to year, provided that such continuance is approved at least annually by a vote of a majority of the Board of Trustees, and of the Independent Trustees, cast in person at a meeting called for the purpose of voting on such continuance. The Plan, or any Rule 12b-1 agreement, may be terminated with respect to the Fund at any time, without penalty, on not more than sixty (60) days’ written notice by a majority vote of the shareholders of each Fund’s Covered Shares, or by vote of a majority of the Independent Trustees.

5.	SELECTION OF INDEPENDENT TRUSTEES

During the period in which the Plan is effective, the selection and nomination of those Trustees who are Independent Trustees of the Trust shall be committed to the discretion of the Independent Trustees.

6.	AMENDMENTS

All material amendments of the Plan shall be in writing and shall be approved by a vote of a majority of the Board of Trustees, and of the Independent Trustees, cast in person at a meeting called for the purpose of voting on such amendment. In addition, the Plan may not be amended to increase materially the amount to be expended by each Fund hereunder without the approval by a majority vote of the shareholders of each Fund’s Covered Shares.

7.	RECORDKEEPING

The Trust shall preserve copies of the Plan, any Rule 12b-1 Agreement and all reports made pursuant to Section 3 for a period of not less than six years from the date of this Plan, any such Rule 12b-1 Agreement or such reports, as the case may be, the first two years in an easily accessible place.

Adopted: February 25, 2009

Amended:

August 31, 2011

September 4, 2014

August 28, 2018

APPENDIX A TO

DISTRIBUTION AND SHAREHOLDER SERVICING PLAN

LITMAN GREGORY FUNDS TRUST

Rule 12b-1 Related Agreement

ALPS DISTRIBUTORS, INC.

1290 Broadway, Suite 1100

Denver, CO 80203

Re: Litman Gregory Funds Trust

Ladies and Gentlemen:

This letter will confirm our understanding and agreement with respect to payments to be made to you pursuant to a Distribution and Shareholder Servicing Plan (the “Plan”) adopted by Litman Gregory Funds Trust (the “Trust”), on behalf of the Funds listed on Schedule A (the “Funds”), a series of the Trust, pursuant to Rule 12b-1 under the Investment Company Act of 1940, as amended (the “Act”). The Plan and this related agreement (the “Rule 12b-1 Agreement”) have been approved by a majority of the Board of Trustees of the Trust, including a majority of the Board of Trustees who are not “interested persons” of the Trust, as defined in the Act, and who have no direct or indirect financial interest in the operation of the Plan or in this or any other Rule 12b-1 Agreement (the “Independent Trustees”), cast in person at a meeting called for the purpose of voting thereon. Such approval included a determination by the Board of Trustees that, in the exercise of its reasonable business judgment and in light of its fiduciary duties, there is a reasonable likelihood that the Plan will benefit the holders of the shares of each Fund covered by the Plan (the “Covered Shares”).

1. To the extent you provide distribution and marketing services in the promotion of the Fund’s Covered Shares and/or services to the holders of Covered Shares, including furnishing services and assistance to your customers who invest in and own Covered Shares, including, but not limited to, answering routine inquiries regarding the Fund and assisting in changing account designations and addresses, we shall pay you a fee as described on Schedule A. We reserve the right to increase, decrease or discontinue the fee at any time in our sole discretion upon written notice to you.

You agree that all activities conducted under this Rule 12b-1 Related Agreement will be conducted in accordance with the Plan, as well as all applicable state and federal laws, including the Act, the Securities Exchange Act of 1934, the Securities Act of 1933, the U.S. Patriot Act of 2001 and any applicable rules of the National Association of Securities Dealers, Inc.

2. You shall furnish us with such information as shall reasonably be requested either by the Trustees of the Fund or by us with respect to the services provided and the fees paid to you pursuant to this Rule 12b-1 Agreement.

3. We shall furnish to the Board of Trustees, for its review, on a quarterly basis, a written report of the amounts expended under the Plan by us and the purposes for which such expenditures were made.

4. This Rule 12b-1 Agreement may be terminated by the vote of (a) a majority of the holders of Covered Shares, or (b) a majority of the Independent Trustees, on 60 days’ written notice, without payment of any penalty. In addition, this Rule 12b-1 Agreement will be terminated by any act which terminates the Plan or the Distribution Agreement between the Trust and us and shall terminate immediately in the event of its assignment. This Rule 12b-1 Agreement may be amended by us upon written notice to you, and you shall be deemed to have consented to such amendment upon effecting any purchases of Covered Shares for your own account or on behalf of any of your customer’s accounts following your receipt of such notice.

5. This Rule 12b-1 Agreement shall become effective on the date accepted by you and shall continue in full force and effect so long as the continuance of the Plan and this Rule 12b-1 Agreement are approved at least annually by a vote of the Board of Trustees of the Trust and of the Independent Trustees, cast in person at a meeting called for the purpose of voting thereon. All communications to us should be sent to the above address. Any notice to you shall be duly given if mailed or faxed to you at the address specified by you below.


ALPS Distributors, Inc.

By:
		(Name and Title)

Accepted:


(Dealer or Service Provider Name)


(Street Address)


(City)(State)(ZIP)


(Telephone No.)


(Facsimile No.)

By:
(Name and Title)

Schedule A

to the

Rule 12b-1 Related Agreement

For all services rendered pursuant to the Rule 12b-1 Agreement, we shall pay you a fee calculated as follows:

Fee of 0.25% of the average daily net assets of each Fund covered by the Plan (computed on an annual basis) which are owned of record by your firm as nominee for your customers or which are owned by those customers of your firm whose records, as maintained by the Trust or its agent, designate your firm as the customer’s dealer or service provider of record.

We shall make the determination of the net asset value, which determination shall be made in the manner specified in the Fund’s current prospectus, and pay to you, on the basis of such determination, the fee specified above, to the extent permitted under the Plan.

APPENDIX B TO

DISTRIBUTION AND SHAREHOLDER SERVICING PLAN

LITMAN GREGORY FUNDS TRUST


FUNDS	CLASSES	12b-1 Fee (as a % of Avg. Net Assets
Litman Gregory Masters Equity Fund	Institutional Class Shares Investor Class Shares*		NONE 0.25	%

Litman Gregory Masters International Fund	Institutional Class Shares Investor Class Shares*		NONE 0.25	%

Litman Gregory Masters Smaller Companies Fund	Institutional Class Shares		NONE

Litman Gregory Masters Alternative Strategies Fund	Institutional Class Shares Investor Class Shares*		NONE 0.25	%

Litman Gregory Masters High Income Alternatives Fund	Institutional Class Shares Investor Class Shares*		NONE 0.25	%

*	Covered Shares.

Exhibit (n)(1)

LITMAN GREGORY FUNDS TRUST

MULTIPLE CLASS PLAN

This Multiple Class Plan (this “Plan”) is adopted pursuant to Securities and Exchange Commission Rule 18f–3 promulgated under the Investment Company Act of 1940, as amended (the “1940 Act”).

This Plan shall govern the terms and conditions under which Litman Gregory Funds Trust f/k/a The Masters’ Select Funds Trust (the “Trust”) may issue separate classes of shares representing interests in the Funds listed in Appendix B, all series of the Trust (each a “Fund” and together the “Funds”). To the extent that a subject matter herein is covered by the Trust’s Agreement and Declaration of Trust or Bylaws, the Agreement and Declaration of Trust and Bylaws will control in the event of any inconsistencies with the descriptions herein.

SECTION 1. Rights and Obligations.

Except as set forth herein, all classes of shares issued by a Fund shall have identical voting, dividend, liquidation and other rights, preferences, powers, restrictions, limitations, qualifications, designations, and terms and conditions. The only differences among the various classes of shares shall relate solely to the following: (a) each class may be subject to different class expenses as discussed under Section 3 of this Plan; (b) each class may bear a different identifying designation; (c) each class shall have exclusive voting rights with respect to matters solely affecting such class; (d) each class may have different exchange privileges; and (e) each class may be offered to different types of investors.

SECTION 2. Classes of Shares and Designation Thereof.

Each Fund may offer any or all of the following classes of shares:

(a)

Institutional Class Shares. “Institutional Class Shares” will be offered with no sales charges, transaction fees, shareholder service fees or distribution (Rule 12b-1) fees. Institutional Class Shares do not automatically convert into shares of any other class.

(b)

Investor Class Shares. “Investor Class Shares” will be offered with no sales charges, shareholder service fees, or transaction fees. Investor Class Shares will be subject to distribution (12b-1) fees at an annual rate of up to 0.25% of average daily net assets attributable to the Investor Class Shares. Investor Class Shares do not automatically convert into shares of any other class.

SECTION 3. Allocation of Expenses.

(a)

Class Expenses. Each class of shares may be subject to different class expenses consisting of: (1) shareholder service fees, if applicable to a particular class; (2) transfer agency and other recordkeeping costs to the extent allocated to a

particular class; (3) Securities and Exchange Commission (“SEC”) and blue sky registration fees incurred separately by a particular class; (4) litigation or other legal expenses relating solely to a particular class; (5) printing and postage expenses related to the preparation and distribution of class-specific materials such as shareholder reports, prospectuses and proxies to shareholders of a particular class; (6) expenses of administrative personnel and services as required to support the shareholders of a particular class; (7) audit or accounting fees or expenses relating solely to a particular class; (8) Trustee fees and expenses incurred as a result of issues relating solely to a particular class; (9) distribution (Rule 12b-1) fees, if applicable to a particular class; and (10) any other expenses subsequently identified that should be properly allocated to a particular class, which shall be approved by the Board of Trustees (collectively, the “Class Expenses”).

(b)

Other Expenses. Except for the Class Expenses discussed above (which will be allocated to the appropriate class), all expenses incurred by each Fund will be allocated in accordance with Rule 18f-3 (c).

(c)

Waivers and Reimbursements of Expenses. Litman/Gregory Fund Advisors, LLP (the “Adviser”) and any other provider of services to the Funds may waive or reimburse the expenses of a particular class or classes, provided, however, that such waiver shall not result in cross–subsidization among classes.

SECTION 4. Allocation of Income.

The Funds will allocate income and realized and unrealized capital gains and losses in accordance with Rule 18f-3 (c).

SECTION 5. Exchange Privileges.

A class of shares of a Fund may be exchanged only for the same class of shares of another Fund. All exchanges will be subject to such conditions as may be imposed from time to time as disclosed in Appendix A.

SECTION 7. Effective Date.

This Plan shall not take effect with respect to a Fund until (a) a majority of the Trustees of the Trust, including a majority of the Trustees who are not “interested persons” of the Trust (as defined in the 1940 Act), find that the Plan, as proposed and including the expense allocations, is in the best interests of each Institutional Class individually and the Trust as a whole, and (b) an amendment to the Trust’s registration statement under the 1940 Act and the Securities Act of 1933, as amended, with respect to multiple classes of the Fund has become effective.

SECTION 8. Amendments.

This Plan may not be amended to materially change the provisions of this Plan unless such amendment is approved in the manner specified in item (a) of Section 7 above.

Adopted: February 25, 2009

Amended:

August 31, 2011

August 28, 2018

APPENDIX A TO

MULTIPLE CLASS PLAN

LITMAN GREGORY FUNDS TRUST

EXCHANGE PRIVILEGES

SECTION 1. TERMS AND CONDITIONS OF EXCHANGES.

Shareholders of the Funds may participate in exchanges as described below. An exchange is permitted only in the following circumstances:

(a)

the exchange must be between the same class of shares (e.g., Institutional Class Shares of one Fund cannot be exchanged for Investor Class Shares of another Fund, nor can Institutional Class Shares of one Fund be exchanged for Investor Class Shares of that same Fund);

(b)

the dollar amount of the exchange must be at least equal to the minimum investment applicable to the shares of the Fund acquired through such exchange;

(c)

the shares of the Fund acquired through exchange must be qualified for sale in the state in which the shareholder resides;

(d)

the exchange must be made between accounts having identical registrations and addresses;

(e)

the full amount of the purchase price for the shares being exchanged must have already been received by the Trust;

(f)

the account from which shares have been exchanged must be coded as having a certified taxpayer identification number on file or, in the alternative, an appropriate IRS Form W–8 (certificate of foreign status) or Form W–9 (certifying exempt status) must have been received by the Trust;

(g)

newly acquired shares (through either an initial or subsequent investment) must be held in an account for at least ten days, and all other shares are held in an account for at least one day, prior to the exchange; and

(h)

certificates (if any) representing shares must be returned before shares can be exchanged.

Because excessive exchanges can harm a Fund’s performance, the Trust does not accommodate frequent purchases and redemptions of Fund shares and reserves the right to restrict, reject or cancel, without any prior notice, any purchase or exchange order, including

A-1

transactions representing excessive trading (accounts under common ownership or control and accounts with the same taxpayer identification number will be counted together). The Adviser and the Trust’s transfer agent currently monitor for various patterns in trading activity in client accounts, including omnibus accounts, such as a purchase and sale of approximately the same amount of shares of a Fund (a “round trip”) more than twice in any twelve month period. These parameters are subject to change. The Trust reserves the right to refuse exchanges by any person or group if, in the Adviser’s judgment, a Fund would be unable effectively to invest the money in accordance with its investment objective and policies, or would otherwise be potentially adversely affected. A shareholder’s exchanges may be restricted or refused if a Fund receives, or the Adviser anticipates, simultaneous orders affecting significant portions of that Fund’s assets and, in particular, a pattern of exchanges coinciding with a “market timing” strategy. Although the Trust attempts to provide prior notice to affected shareholders when it is reasonable to do so, it may impose these restrictions at any time. The Trust reserves the right to terminate or modify the exchange privileges of Fund shareholders in the future.

THE EXCHANGE PRIVILEGE IS NOT AN OPTION OR RIGHT TO PURCHASE SHARES BUT IS PERMITTED UNDER THE RESPECTIVE POLICIES OF THE PARTICIPATING FUNDS, AND MAY BE MODIFIED OR DISCONTINUED BY THE TRUST OR BY THE ADVISER OR DISTRIBUTOR OF THE FUNDS AT ANY TIME, AND TO THE EXTENT PERMITTED BY APPLICABLE LAW, WITHOUT NOTICE.

Shares to be exchanged will be redeemed at their net asset value as determined at the close of business on the day that an exchange request in proper form is received, as described in the applicable prospectus. Exchange requests received after the required time will result in the redemption of shares at their net asset value as determined at the close of business on the next business day.

In the event of unusual market conditions, the Trust reserves the right to reject any exchange request if, in the judgment of the Adviser, the number of requests or the total value of the shares that are the subject of the exchange are likely to place a material burden on a Fund. For example, the number of exchanges by investment managers making market–timing exchanges may be limited.

SECTION 2. FEES.

There is no fee for exchanges between the Funds.

SEE THE APPLICABLE PROSPECTUS FOR MORE INFORMATION ABOUT SHARE EXCHANGES.

A-2

APPENDIX B TO

MULTIPLE CLASS PLAN

LITMAN GREGORY FUNDS TRUST


FUNDS		CLASSES
Litman Gregory Masters Equity Fund		Institutional Class Shares Investor Class Shares

Litman Gregory Masters International Fund		Institutional Class Shares Investor Class Shares

Litman Gregory Masters Smaller Companies Fund		Institutional Class Shares

Litman Gregory Masters Alternative Strategies Fund		Institutional Class Shares Investor Class Shares

Litman Gregory Masters High Income Alternatives Fund		Institutional Class Shares Investor Class Shares

B-1

Exhibit (p)(1)

Appendix 1-A

LITMAN GREGORY FUNDS TRUST

CODE OF ETHICS

(as amended July 23, 2018)

I.	Legal Requirement

Rule 17j-1 under the Investment Company Act of 1940, as amended (the “1940 Act”), requires Litman Gregory Funds Trust (the “Trust”) and its series (each a “Fund” and collectively, the “Funds”) to have a written code of ethics which addresses trading practices by “fund access persons.” Fund access persons are defined to include (1) officers and employees of the Trust, (2) officers, directors and investment personnel of the Trust’s investment advisers, (3) certain personnel of any broker-dealer firm that acts as the distributor for a Fund, and (4) each member of the Trust’s Board of Trustees. This code of ethics (the “Code”) is intended to promote ethical conduct and to provide guidelines and specific reporting requirements to help ensure the Trust’s compliance with applicable securities laws and regulations.

This Code governs the activities of the Trust’s fund access persons. It is important that you understand your reporting obligations under this Code.

This Code does not cover all areas of potential liability. Fund access persons are expected to be sensitive to and aware of situations that raise a potential conflict of interest or that may constitute a trading violation. If you have any questions regarding this Code or a compliance issue, please contact the Trust’s Chief Compliance Officer.

II.

General Prohibitions

It shall be unlawful and a violation of this Code for any fund access person, in connection with the purchase or sale, directly or indirectly, of a security held or to be acquired by the Trust:

(a)

To employ any device, scheme or artifice to defraud the Trust;

(b)

To make to the Trust any untrue statement of a material fact or omit to state to the Trust a material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading;

(c)

To engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon the Trust; or

(d)

To engage in any manipulative practice with respect to the Trust.

(e)

To disclose to any unauthorized individual or entity outside of the Trust or remove from the Trust’s offices proprietary information.

III.

Fund Access Person Reporting Provisions

All fund access persons (defined below) covered by this Code, except the Trust’s Independent Trustees, are required to file reports at least quarterly of their personal securities transactions (excluding excepted securities) and, if they wish to trade in the same securities as any Fund, must comply with the specific procedures in effect for such transactions.

The Trust uses various investment advisers, including sub-advisers, to advise the Funds. These adviser entities are required to adopt specific trading procedures appropriate to their organization consistent with Rule 17j-1 under the 1940 Act. Fund access persons of those entities are specifically excluded from the coverage of this Code. However, those entities are required to provide the Trust with their respective codes of ethics and any material amendments thereto.

The fund access persons of the Trust’s administrator, State Street Bank & Trust Company, and the Trust’s principal underwriter, ALPS, are required to comply with the reporting and other requirements of their organizations’ respective code of ethics and are excluded from the coverage of this Code.

The reports of fund access persons will be reviewed and compared against the activities of the Funds and if a pattern emerges that indicates abusive trading or noncompliance with applicable procedures, the matter will be referred to the Board of Trustees; the Board of Trustees will make appropriate inquiries and decides what action, if any, is then necessary.

Independent Trustees who do not have day-to-day contact with the Funds and who do not have specific knowledge of the Funds’ intended investments are not required to file any reports at all, and there is no restriction on their personal securities trading activities. However, if an Independent Trustee should learn that one of the Funds is about to take a particular position, and he or she wishes to make a similar or related trade, the Trustee should obtain prior approval of the trade.

Persons covered by this Code are advised to seek advice before engaging in any transactions involving securities under consideration for purchase or sale by a Fund of the Trust or if a transaction directly or indirectly involves themselves and the Trust other than the purchase or redemption of shares of a Fund or the performance of their normal business duties.

IV.

Implementation

The Trust’s Chief Compliance Officer (currently John Coughlan) is responsible for maintaining an updated list of fund access persons. The Chief Compliance Officer may designate an alternate who is authorized to administer this Code when he is unavailable.

The Chief Compliance Officer shall circulate a copy of this Code to each fund access person, together with an acknowledgment of receipt, which shall be signed and returned to the Chief Compliance Officer.

The Chief Compliance Officer is charged with responsibility for insuring that the reporting requirements of this Code are adhered to by all fund access persons. The Chief Compliance Officer shall be responsible for ensuring that the review requirements of this Code are performed in a prompt manner.

Definitions

(a) “Fund access person” means: (i) any trustee, officer or advisory person (as defined below) of a Fund or the Trust; (ii) any director, officer, general partner or advisory person (as described below) of an investment adviser to a Fund; and (iii) any director, officer or general partner of a broker-dealer acting as distributor or principal underwriter of a Fund who, in the ordinary course of his or her business, makes, participates in or obtains information regarding the purchases and sales of securities for such Fund or whose ordinary business functions and duties relate to the making of recommendations to such Fund regarding the purchase and sale of securities.

Exceptions: (i) any investment adviser unaffiliated with Litman Gregory Fund Advisors, LLC (“LGFA”) and/or the Trust (except by reason of being a sub-advisor) and all employees of such unaffiliated adviser, provided that such sub-advisor represents to LGFA that it has and enforces a code of ethics that meets the requirements of Rule 17j-1 under the 1940 Act, and (ii) any employee of the Trust’s administrator or principal ;underwriter, including such employees who may act as officers of the Trust.

(b) “Advisory person” means with respect to (A) the Trust, (B) an investment adviser to a Fund or (C) any company in a control relationship to the Trust or the investment adviser, (i) any employee who, in connection with his or her regular functions or duties, makes, participates in, or obtains information regarding, the purchase or sale of a security by a Fund, or whose functions relate to the making of any recommendations with respect to such purchases or sales; and (ii) any natural person in a control relationship to the Trust or an investment adviser who obtains information concerning recommendations made to a Fund with regard to the purchase or sale of a security.

Exceptions: (i) any investment adviser unaffiliated with LGFA and/or the Trust (except by reason of being a sub-advisor) and all employees of such unaffiliated advisor, provided that such sub-advisor represents to LGFA that it has and enforces a code of ethics that meets the requirements of Rule 17j-1 under the 1940 Act, and (ii) any employee of an administration company providing administration services to the Trust or the Fund including such employees who may act as officers of the Trust.

(c) A security is “being considered for purchase or sale” when a recommendation to purchase or sell a security has been made and communicated, and, with respect to a person making a recommendation, when such person seriously considers making such a recommendation.

(d) “Beneficial ownership” shall be interpreted in the same manner as it would be in determining whether a person is subject to the provisions of Section 16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations thereunder, with the exception that the determination of direct or indirect beneficial ownership shall apply to all securities which a fund access person has or acquires.

(e) “Control” means the power to exercise a controlling influence over the management or policies of a company, unless such power is solely the result of an official position, as further defined in Section 2(a)(9) of the 1940 Act.

(f) “Excepted securities” include shares of registered open-end investment companies (other than shares of the Litman Gregory Masters Funds), securities issued by the government of the United States (including government agencies), banker acceptances, bank certificates of deposit, commercial paper, high quality short-term debt instruments and other money market instruments.

(g) An “Initial Public Offering” means an offering of securities registered under the Securities Act of 1933, as amended (the “Securities Act”), the issuer of which, immediately before the registration, was not subject to the reporting requirements of Sections 13 or 15(d) of the Exchange Act.

(h) “Investment Personnel” means with respect to (A) the Trust, (B) an investment adviser to a Fund or (C) any company in a control relationship to the Trust or the investment adviser:

(i) Any employee, who, in connection with his or her regular functions or duties, makes or participates in making recommendations regarding the purchase or sale of securities by a Fund.

(ii) Any natural person who controls the Trust or investment adviser to a Fund and who obtains information concerning recommendations made to that Fund regarding the purchase or sale of securities by that Fund.

(i) “Limited Offering” means an offering that is exempt from registration under the Securities Act pursuant to Section 4(2) or Section 4(6) or pursuant to Rule 504, Rule 505, or Rule 506 under the Securities Act.

(j) “Purchase or sale of a security” includes the writing of an option to purchase or sell a security.

(k) “Reportable Securities” are those securities for which quarterly transactions reports must be filed. Reportable Securities are all securities included in the definition of “Security” in the Advisers Act and the 1940 Act (with the exceptions below) and include any (a) equity or debt instrument traded on an exchange (including foreign securities exchanges), through NASDAQ or through the “pink sheets,” over-the-counter or any public market, (b) options to purchase or sell such equity or debt instrument, (c) warrants and rights with respect to such securities, (d) municipal bonds, (e) index stock or bond group options that include such equity or debt instrument, (f) futures contracts on stock or bond groups that include such equity or debt instrument, (g) any option on such futures contracts, (h) limited offerings or private offerings and (i) shares of mutual funds managed by the Company (i.e., the Litman Gregory Masters Funds); provided that Reportable Securities shall not include securities issued by the Government of the United States, banker acceptances, bank certificates of deposit, commercial paper, high quality short-term debt instruments and shares of open-end mutual funds (other than the Litman Gregory Masters Funds). For the avoidance of doubt, exchange-traded funds and closed-end registered investment companies are reportable securities.

(l) “Security” shall have the meaning set forth in Section 2(a)(36) of the 1940 Act, except that it shall not include excepted securities (as defined below).

VI.

Prohibited Trading Practices

No fund access person shall purchase or sell directly or indirectly, any security in which he or she has, or by reason of such transactions acquires, any direct or indirect beneficial ownership in the security:

(a) if such security to his or her actual knowledge at the time of such purchase or sale:

(i) is being considered for purchase or sale by a Fund;

(ii) is in the process of being purchased or sold by a Fund (except that an fund access person may participate in a bunched transaction with the Fund if the price terms are the same); or

(b) if such action by such fund access person would defraud a Fund, operate as a fraud or deceit upon a Fund, or constitute a manipulative practice with respect to such Fund. In each case, the relevant Fund shall be limited to the Fund(s) to which such fund access person has a direct relationship.

To ensure that security purchases and sales by fund access persons do not constitute a fraudulent, deceptive or manipulative practice with respect to the various Funds, each investment adviser and principal underwriter to a Fund shall adopt a policy preventing fund access persons from trading ahead of the Fund or otherwise trading in securities being considered for purchase or sale by a Fund for an appropriate period of time.

Fund access persons (other than the Independent Trustees) covered by this Code shall pre-clear all Reportable Securities with the Chief Compliance Officer. The purchase and sale of shares in the Litman Gregory Masters Funds are exempt from the pre-clearance requirement of this paragraph VI, however such exemption does not absolve fund access Persons from reporting trades in the Litman Gregory Masters Funds pursuant to paragraph IX herein.

VII.

Exempted Transactions/Securities

The prohibitions of Section VI and the reporting requirements of Section IX of this Code shall not apply to:

(a)

Purchases or sales effected in any account over which the fund access person has no direct or indirect influence or control.

(b)

Purchases or sales which are non-volitional on the part of either the fund access person or the Trust (e.g., receipt of de minimis gifts, a sale in connection with a court order).

(c)

Purchases which are part of an automatic dividend reinvestment plan.

(d)

Purchases and sales of securities which are not included in the definition of “Security” in Section V above or are “excepted securities” as defined in Section V.

(e)

Trading in mutual funds, including the Litman Gregory Masters Funds.

VIII.

Pre-approval of Investments in IPOs and Limited Offerings

Fund access persons must obtain approval from the Chief Compliance Officer before directly or indirectly acquiring beneficial ownership in any securities issued in an Initial Public Offering or in a Limited Offering through the compliance and employee trade monitoring system’s web page accessible to all Employees

IX.

Reporting

Independent Trustees and individuals who already report their investment transactions under the rules applicable to registered investment advisers may be excepted from the reporting requirement (see Section X below). Subject to the exceptions set forth below, every fund access person shall report to the Chief Compliance Officer or compliance delegate the information described below with respect to transactions in any security in which such fund access person has, or by reason of such transaction acquires, any direct or indirect beneficial ownership in the security. Every report shall be made not later than thirty (30) days after the end of each calendar quarter and shall contain the following information:

(1)

The date of the transaction, the title and the number of shares, and the principal amount of each security involved;

(2)

The nature of the transaction (i.e., purchase, sale, or any other type of acquisition or disposition);

(3)

The price at which the transaction was effected; and

(4)

The name of the broker, dealer, or bank with or through whom the transaction was effected.

For periods in which no reportable transactions were effected, the report shall contain a representation that no transactions subject to the reporting requirements were effected during the relevant time period.

Any such report may contain a statement that the report shall not be construed as an admission by the person making such report that he has any direct or indirect beneficial ownership in the security to which the report relates.

The report must be completed via the compliance and employee trade monitoring system, which will have the account statement and transactions downloaded to the system. If the Personal Account is an approved exception to the Designated Brokerage Policy, copies of the account

statements must be submitted to Compliance via file attachments in the compliance and employee trade monitoring system within 30 calendar days following the end of each calendar year regardless of whether any trading activity took place in that account during the quarter. In addition, the report must include a certification that all trades in Reportable Securities in the Employee’s Personal Accounts during the reporting period are covered by such account statements.

Exceptions to Reporting Requirements

An Independent Trustee, i.e., a Trustee of the Trust who is not an “interested person” (as defined in Section 2(a)(19) of the 1940 Act) of the Trust, is not required to file a report on a transaction in a security provided such Trustee neither knew nor, in the ordinary course of fulfilling his or her official duties as a trustee of the Trust, should have known that, during the 15-day period immediately preceding or after the date of the transaction by the Trustee, such security is or was purchased or sold by the Trust or is or was being considered for purchase by an investment adviser of the Trust.

Where an Independent Trustee is exempt from the reporting requirements of this Code pursuant to this Section X, such Trustee may nevertheless voluntarily file a report representing that he or she did not engage in any securities transactions which, to his or her knowledge, involved securities that were being purchased or sold or considered for purchase by any Fund during the 15-day period preceding or after the date(s) of any transaction(s) by such Trustee. The failure to file such a report, however, shall not be considered a violation of this Code.

Fund access persons also need not make a report with respect to exempted transactions/ securities as described in Section VII of this Code.

Access persons need not make a report where the report would duplicate information recorded pursuant to the applicable rules under the Investment Advisers Act of 1940, as amended.

XI.

Review

The Chief Compliance Officer shall compare all reports of personal securities transactions with completed and contemplated portfolio transactions of each Fund to determine whether a possible violation of the Code may have occurred. The Chief Compliance Officer may delegate this function to one or more persons employed by an investment adviser or principal underwriter with respect to the reports filed by fund access persons in such organization, and shall receive and be entitled to rely on a summary report from such compliance delegate.

Before making any determination that a violation has been committed by any person, the Chief Compliance Officer shall give such person an opportunity to supply additional explanatory material. If a securities transaction of the Chief Compliance Officer is under consideration, an alternate shall act in all respects in the manner prescribed herein for the Chief Compliance Officer.

If the Chief Compliance Officer determines that a violation of the Code has or may have occurred, he shall, following consultation with the Trust’s legal counsel, submit his or her written determination, together with the transaction report, if any, and any additional explanatory

material provided by the individual, to the President of the Trust or, if the President shall be the Chief Compliance Officer, the Treasurer, who shall make an independent determination of whether a violation has occurred.

The Chief Compliance Officer shall be responsible for maintaining a current list of all fund access persons (including all Trustees) and for identifying all reporting fund access persons on such list, and shall take steps to ensure that all reporting fund access persons have submitted reports in a timely manner. The Chief Compliance Officer may delegate the compilation of this information to appropriate persons employed by an investment adviser or principal underwriter and shall be entitled to rely on the information received from such delegates. Failure to submit timely reports will be communicated to the Board of Trustees.

XII.

Confidential Information

Confidential Information Defined

Fund access persons may receive material, nonpublic information (i.e., “inside information”), or other sensitive or confidential information from or about the Trust’s shareholders or its management. Such confidential information may include, among other things:

•

Names and addresses of shareholders.

•

Financial or other information about the shareholder, such as the number of shares held by a shareholder.

•

The names of the securities being purchased or sold, or being considered for purchase or sale, for a Fund.

•

Any Trust information privately given to a fund access person that, if publicly known, would be likely to (i) affect the price of any security in a Fund’s portfolio or the shares of a Fund or (ii) embarrass or harm the Trust.

Given the breadth of the above, all information that a fund access person obtains through the Trust should be considered confidential information unless it is specifically known to be available to the public.

Policy Statement Regarding Use and Treatment of Confidential Information.

All confidential information, whatever the source, may be used only in the discharge of the fund access person’s duties with the Trust. Confidential information may not be used for any personal purpose, including the purchase or sale of securities for a personal account. No fund access person may use any confidential information in any manner that adversely affects the Trust. All confidential information is to be treated as the secret, proprietary and confidential data of the Trust.

Procedures Regarding Use and Treatment of Confidential Information.

The Trust encourages each of its fund access persons to be aware of, and sensitive to, such fund access person’s treatment of confidential information. The Trust has also adopted a Privacy Policy which also sets forth policies and procedures regarding maintaining the privacy of the nonpublic personal information of its shareholders. Each fund access person must take the following precautions:

•

Fund access persons must not discuss confidential information unless necessary as part of his or her duties and responsibilities with the Trust.

•

Particular care should be exercised if confidential information must be discussed in public places, such as restaurants, elevators, taxicabs, trains or airplanes, where such information may be overheard.

•

Under no circumstances may confidential information be shared with any person, including any spouse or other family member, who is not a fund access person of the Trust.

•

Fund access persons must return all confidential information upon their separation from the Trust.

XIII.

Proprietary Information

Proprietary Information Defined.

Proprietary information shall mean any Company information which is in written, graphic, machine-readable or other tangible form. Proprietary Information also includes non-tangible oral or visual information. Given the breadth of this definition, all information that an Employee obtains through the Company should be considered proprietary information unless it is specifically known to be available to the public.

See the Litman Gregory Employee Handbook, Non-Disclosure section for a complete definition of proprietary information.

Policy Statement Regarding Use and Treatment of Proprietary Information.

The Employee recognizes that the confidentiality of proprietary information is a matter of great concern to the Company. The Employee agrees that he or she will not disclose to any individual or entity outside the Company any proprietary information of the Company, except to individuals who have a specific “need to know” due to their contractual or other business relationship to the Company, and that he or she will not use such proprietary information other than for the benefit of the Company.

Procedures Regarding Use and Treatment of Proprietary Information.

The Company encourages each of its Employees to be aware of, and sensitive to, such Employee’s treatment of proprietary information. The Employee understands and agrees that all files, records, papers, memoranda, letters, handbooks and manuals, facsimile or other

communications which he or she obtains that were written, authorized, signed, received or transmitted during his or her employment are and remain the property of the Company and, as such, are not to be removed from the Company’s offices except for the purpose of business activity on behalf of the Company. Upon termination of employment, Employee will promptly deliver to the Company any such materials that may then be in his or her possession.

Employees who improperly use or disclose trade secrets or confidential or proprietary information will be subject to disciplinary action, up to and including termination of employment and legal action, even if they do not actually benefit from the disclosed information.

XIV.

Restrictions on Gifts and Entertainment.

General Policy Statement.

A conflict of interest occurs when the personal interests of employees interfere or could potentially interfere with their responsibilities to the Company and its clients. The overriding principle is that employees should not accept inappropriate gifts, favors, entertainment, special accommodations, or other things of material value that could influence their decision-making or make them feel beholden to a person or firm. Similarly, employees should not offer gifts, favors, entertainment or other things of value that could be viewed as overly generous or aimed at influencing decision-making or making a client feel beholden to the firm or the supervised person.

De Minimis Gifts and Entertainment.

From time to time employees may receive or accept gifts from third parties. Employees may accept de minimis gifts but shall not give nor accept any gift received that has a total value in excess of $200.00 from any broker/dealer, money manager, or others who transact business with the Company, unless approved by the Chief Compliance Officer. Any such gifts or benefits should be reported to the Chief Compliance Officer on the compliance and employee trade monitoring system accessible to all Employees. Gifts of cash may never be accepted or disbursed by an employee. In addition, employees may attend business meals, sporting events and other entertainment events at the expense of a giver, as long as the expense is reasonable and both the giver(s) and the employee(s) are present.

XV.

FCPA Considerations

The Foreign Corrupt Practices Act (“FCPA”) prohibits, under threat of imprisonment, any officer, agent or Employee of the Company from directly or indirectly paying or giving, offering or promising to pay, giving or authorizing or approving such offer or payment, of any funds, gifts, services or anything else of any value, no matter how small or seemingly insignificant (i) to any foreign official or other person specified below (each, a “Foreign Covered Person”), for the purpose of obtaining business, favorable treatment or other commercial benefits, whether by (a) influencing any act or decision of the Foreign Covered Person in his official capacity, (b) inducing the Foreign Covered Person to do or not do any act in violation of his lawful duty; or (c) inducing the Foreign Covered Person to use his influence to that end with a foreign government or instrumentality; or (ii) with any other agent, intermediary (including, for example, a Foreign Covered Person’s friend, relative, business or law firm) or other person while knowing

that all or a portion thereof will directly or indirectly be forwarded to a Foreign Covered Person for such purpose. (Note: Not actually “knowing”, willfully avoiding or disregarding all facts, hints or clues is not a defense.)

Foreign Covered Person.

A “Foreign Covered Person” for this purpose is any foreign official including, without limitation, any officer or employee of any foreign government or any governmental department, agency or instrumentality (e.g., a central bank) or any government-owned or controlled enterprise (e.g., sovereign wealth fund) or any person acting in an official capacity for or on behalf of any such government, department, agency, instrumentality or enterprise). It also includes any foreign political party, party official or candidate for political office. Foreign for this purpose means outside of the United States.

Exemptions

There are certain exemptions to the broad prohibitions set forth above. However, these exemptions are very precise and must be discussed with the CCO before they can be invoked. No Employee is to discuss or consider any proscribed activity outlined above without the prior approval of the CCO.

Pre-Clearance

No Employee may engage in any activity that would violate the FCPA without the prior approval of the CCO. If an activity would render an analysis of the FCPA to determine whether it would violate the FCPA, such activity must be presented to the CCO to conduct an analysis and for final approval.

XVI.

Sanctions

If a material violation of this Code occurs or a preliminary determination is made that a violation may have occurred, a report of the alleged violation shall be made to a senior officer of the Trust and, if appropriate, the Board of Trustees. The Trust’s senior officer or the Board of Trustees may impose such sanctions as it deems appropriate, including:

•

The applicable Employee meeting with the Chief Compliance Officer and/or the Managing Partner in charge of the Employee’s business unit to review this Code and discuss the nature and extent of the violation;

•

The violation will be recorded in the Company’s compliance books and records;

•

The applicable Employee may be required to attend and provide evidence of satisfactory completion of compliance training courses;

•

The applicable Employee may be required to immediately sell any security purchased in violation of Section IX above;

•

The applicable Employee may be subject to a fine and/or disgorgement of any profits earned on the purchase or sale of any security in violation of Section IX above, or the personal absorption of any loss on the sale of such security;

•

The applicable Employee may be suspended without pay for a period of time to be determined by the committee; and/or

•

The offending employee’s employment at the Company may be terminated

XVII.

Whistleblower Policy

General Policy

The Company requires Directors, Officers and Employees to observe high standards of business and personal ethics in the conduct of their duties and responsibilities. All Employees and representatives of the Company must practice honesty and integrity and comply with all applicable laws and regulations.

Reporting Responsibility

This Whistleblower Policy is intended to encourage and enable Employees and others to raise serious concerns internally so that the Company can address and correct inappropriate conduct and actions. It is the responsibility of all Directors, Officers and Employees to report concerns about violations of the Company’s code of ethics or suspected violations of law or regulations that govern the Company’s operations.

No Retaliation

It is contrary to the values of the Company for anyone to retaliate against any Director, Officer, or Employee who in good faith reports an ethics violation, or a suspected violation of law, such as a compliant of discrimination, or suspected fraud, or suspected violation of any regulation governing the operations of the Company. An Employee who retaliates against someone who has reported a violation in good faith is subject to discipline up to and including termination of employment.

Reporting Procedure

The Company has an open door policy and suggests that Employees share their questions, concerns, suggestions or complaints with their supervisor. If you are not comfortable speaking with your supervisor, or you are not satisfied with your supervisor’s response, you are encouraged to speak with the Chief Compliance Officer. Supervisors and managers are required to report complaints or concerns about suspected ethical and legal violations in writing to the Company’s Chief Compliance Officer or his/her designee, who has the responsibility to investigate all reported complaints. Employees with concerns or complaints may also submit their concerns in writing using the compliance and employee trade monitoring system accessible to all Employees.

The Company’s Chief Compliance Officer is responsible for ensuring that all complaints about unethical or illegal conduct are investigated and resolved. The Compliance Officer will advise the Chief Executive Officer.

Acting in Good Faith

Anyone filing a written complaint concerning a violation or suspected violation must be acting in good faith and have reasonable grounds for believing the information disclosed indicates a violation. Any allegations that prove not to be substantiated and which prove to have been made maliciously or knowingly to be false will be viewed as a serious disciplinary offense.

Confidentiality

Violations or suspected violations may be submitted on a confidential basis by the complainant. Reports of violations or suspected violations will be kept confidential to the extent possible, consistent with the need to conduct an adequate investigation.

Handling of Reported Violations

The Company’s Chief Compliance Officer or his/her designee will notify the person who submitted a complaint and acknowledge receipt of the reported violation or suspected violation. All reports will be promptly investigated and appropriate corrective action will be taken if warranted by the investigation.

Exhibit A

LITMAN GREGORY FUNDS TRUST

SUPPLEMENTAL ANTIFRAUD CODE OF ETHICS FOR

PRINCIPAL OFFICERS AND SENIOR FINANCIAL OFFICERS

(as amended December 15, 2016)

The Board of Trustees (the “Board”) of Litman Gregory Funds Trust (the “Trust”) has adopted this Supplemental Antifraud Code of Ethics (the “Code”) for the Trust’s Principal Officers and Senior Financial Officers (the “Officers”) to guide and remind the Officers of their responsibilities to the Trust, other Officers, shareholders of the series of the Trust (the “Funds”), and governmental authorities. Officers are expected to act in accordance with the guidance and standards set forth in this Code.

For the purposes of this Code, the Trust’s Principal Officers and Senior Financial Officers shall include: the Principal Executive Officer; the Principal Financial Officer; the Principal Accounting Officer; the Controller; and any persons performing similar functions on behalf of the Trust, regardless of whether such persons are employed by the Trust or a third party.

This Code is intended to serve as the code of ethics described in Section 406 of The Sarbanes-Oxley Act of 2002 and Form N-CSR. To the extent that an Officer is subject to the Trust’s code of ethics adopted pursuant to Rule 17j-1 of the Investment Company Act of 1940, as amended (the “Rule 17j-1 Code”), this Code is intended to supplement and be interpreted in the context of the Rule 17j-1 Code. This Code also should be interpreted in the context of all applicable laws, regulations, the Trust’s Agreement and Declaration of Trust and Bylaws, as amended, and all other governance and disclosure policies and documents adopted by the Board. All Officers must become familiar and fully comply with this Code. Because this Code cannot and does not cover every applicable law or provide answers to all questions that might arise, all Officers are expected to use common sense about what is right and wrong, including a sense of when it is proper to seek guidance from others on the appropriate course of conduct.

The purpose of this Code is to set standards for the Officers that are reasonably designed to deter wrongdoing and are necessary to promote:

•

honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

•

full, fair, accurate, timely, and understandable disclosure in reports and documents that the Trust files with, or submits to, the Securities and Exchange Commission (the “SEC”) and in any other public communications by the Trust;

•

compliance with applicable governmental laws, rules and regulations;

•

the prompt internal reporting of violations of the Code to the appropriate persons as set forth in the Code; and

•

accountability for adherence to the Code.

1.	Honest and Ethical Conduct

Honesty, Diligence and Professional Responsibility

Officers are expected to observe both the form and the spirit of the ethical principles contained in this Code. Officers must perform their duties and responsibilities for the Trust:

•

with honesty, diligence, and a commitment to professional and ethical responsibility;

•

carefully, thoroughly and in a timely manner; and

•

in conformity with applicable professional and technical standards.

Officers who are certified public accountants are expected carry out their duties and responsibilities in a manner consistent with the principles governing the accounting profession, including any guidelines or principles issued by the Public Company Accounting Oversight Board or the American Institute of Certified Public Accountants from time to time.

Objectivity / Avoidance of Undisclosed Conflicts of Interest

Officers are expected to maintain objectivity and avoid undisclosed conflicts of interest. In the performance of their duties and responsibilities for the Trust, Officers must not subordinate their judgment to personal gain and advantage, or be unduly influenced by their own interests or by the interests of others. Officers must avoid participation in any activity or relationship that constitutes a conflict of interest unless that conflict has been completely disclosed to affected parties. Further, Officers should avoid participation in any activity or relationship that could create the appearance of a conflict of interest.

A conflict of interest would generally arise if an Officer directly or indirectly participated in any investment, interest, association, activity or relationship that may impair or appear to impair the Officer’s objectivity.

Any Officer who may be involved in a situation or activity that might be a conflict of interest or give the appearance of a conflict of interest should consider reporting such situation or activity using the reporting procedures set forth in Section 4 of this Code

The Audit Committee of the Board of Trustees of the Trust (the “Audit Committee”) will not be responsible for monitoring or enforcing this conflict of interest policy, but rather each Officer is responsible for self-compliance with this conflict of interest policy.

Preparation of Financial Statements

Officers must not knowingly make any misrepresentations regarding a Fund’s financial statements or any facts in the preparation of a Fund’s financial statements, and must comply with

all applicable laws, standards, principles, guidelines, rules and regulations in the preparation of the Fund’s financial statements. This section is intended to prohibit:

•

making, or permitting or directing another to make, materially false or misleading entries in a Fund’s financial statements or records;

•

failing to correct a Fund’s financial statements or records that are materially false or misleading when he or she has the authority to record an entry; and

•

signing, or permitting or directing another to sign, a document containing materially false or misleading financial information.

Officers must be scrupulous in their application of generally accepted accounting principles. No Officer may (i) express an opinion or state affirmatively that the financial statements or other financial data of the Trust are presented in conformity with generally accepted accounting principles, or (ii) state that he or she is not aware of any material modifications that should be made to such statements or data in order for them to be in conformity with generally accepted accounting principles, if such statements or data contain any departure from generally accepted accounting principles then in effect in the United States.

Officers must follow the laws, standards, principles, guidelines, rules and regulations established by all applicable governmental bodies, commissions or other regulatory agencies in the preparation of financial statements, records and related information. If an Officer prepares financial statements, records or related information for purposes of reporting to such bodies, commissions or regulatory agencies, the Officer must follow the requirements of such organizations in addition to generally accepted accounting principles.

If an Officer and his or her supervisor have a disagreement or dispute relating to the preparation of financial statements or the recording of transactions, the Officer should take the following steps to ensure that the situation does not constitute an impermissible subordination of judgment:

•

The Officer should consider whether (i) the entry or the failure to record a transaction in the records, or (ii) the financial statement presentation or the nature or omission of disclosure in the financial statements, as proposed by the supervisor, represents the use of an acceptable alternative and does not materially misrepresent the facts or result in an omission of a material fact. If, after appropriate research or consultation, the Officer concludes that the matter has authoritative support and/or does not result in a material misrepresentation, the Officer need do nothing further.

•

If the Officer concludes that the financial statements or records could be materially misstated as a result of the supervisor’s determination, the Officer should follow the reporting procedures set forth in Section 4 of this Code.

Obligations to the Independent Auditor of a Fund

In dealing with a Fund’s independent auditor, Officers must be candid and not knowingly misrepresent facts or knowingly fail to disclose material facts, and must respond to specific inquiries and requests by the Fund’s independent auditor.

Officers must not take any action, or direct any person to take any action, to fraudulently influence, coerce, manipulate or mislead a Fund’s independent auditor in the performance of an audit of the Fund’s financial statements for the purpose of rendering such financial statements materially misleading.

2.	Full, Fair, Accurate, Timely and Understandable Disclosure

It is the Trust’s policy to provide full, fair, accurate, timely, and understandable disclosure in reports and documents that the Trust files with, or submits to, the SEC and in any other public communications by the Trust. The Trust has designed and implemented Disclosure Controls and Procedures to carry out this policy.

Officers are expected to use their best efforts to promote, facilitate, and prepare full, fair, accurate, timely, and understandable disclosure in all reports and documents that the Trust files with, or submits to, the SEC and in any other public communications by the Trust.

Officers must review the Trust’s Disclosure Controls and Procedures to ensure they are aware of and carry out their duties and responsibilities in accordance with the Disclosure Controls and Procedures and the public reporting obligations of the Trust. Officers are responsible for monitoring the integrity and effectiveness of the Trust’s Disclosure Controls and Procedures.

3.	Compliance with Applicable Laws, Rules and Regulations

Officers are expected to know, respect and comply with all laws, rules and regulations applicable to the conduct of the Trust’s business. If an Officer is in doubt about the legality or propriety of an action, business practice or policy, the Officer should seek advice from the Officer’s supervisor or the Trust’s legal counsel.

In the performance of their work, Officers must not knowingly be a party to any illegal activity or engage in acts that are discreditable to the Trust. Officers are expected to promote the Trust’s compliance with applicable laws, rules and regulations. To promote such compliance, Officers may establish and maintain mechanisms to educate employees carrying out the finance and compliance functions of the Trust about any applicable laws, rules or regulations that affect the operation of the finance and compliance functions and the Trust generally.

4.	Reporting of Illegal or Unethical Behavior

Officers should promptly report any conduct or actions by an Officer that do not comply with the law or with this Code. Officers and the Trust shall adhere to the following reporting procedures:

•

Any Officer who questions whether a situation, activity or practice is acceptable must immediately report such practice to the Principal Executive Officer of the Trust (or to an Officer who is the functional equivalent of this position) or to the Trust’s legal counsel. The person receiving the report shall consider the matter and respond to the Officer within a reasonable amount of time.

•

If the Officer is not satisfied with the response of the Principal Executive Officer or counsel, the Officer must report the matter to the Chairman of the Audit Committee.

If the Chairman is unavailable, the Officer may report the matter to any other member of the Audit Committee. The person receiving the report shall consider the matter, refer it to the full Audit Committee if he or she deems appropriate, and respond to the Officer within a reasonable amount of time.

•

If, after receiving a response, the Officer concludes that appropriate action was not taken, he or she should consider any responsibility that may exist to communicate to third parties, such as regulatory authorities or the Fund’s independent auditor. In this matter, the Officer may wish to consult with his or her own legal counsel.

•

The Audit Committee and the Trust will not be responsible for monitoring or enforcing this reporting of violations policy, but rather each Officer is responsible for self-compliance with this reporting of violations policy.

•

To the extent possible and as allowed by law, reports will be treated as confidential.

•

If the Audit Committee determines that an Officer violated this Code, failed to report a known or suspected violation of this Code, or provided intentionally false or malicious information in connection with an alleged violation of this Code, the Trust may take disciplinary action against any such Officer to the extent the Audit Committee deems appropriate. No Officer will be disciplined for reporting a concern in good faith.

•

The Trust and the Audit Committee may report violations of the law to the appropriate authorities.

5.	Accountability and Applicability

All Officers will be held accountable for adherence to this Code. On an annual basis, within 30 days of the beginning of each calendar year, each Officer shall certify in writing his or her receipt, familiarity and commitment to compliance with this Code, by signing the Acknowledgment Form (Exhibit C to this Code).

This Code is applicable to all Officers, regardless of whether such persons are employed by the Trust or a third party. If an Officer is aware of a person who may be considered an Officer as defined by this Code (“Potential Officer”), the Officer should inform legal counsel to the Trust of such Potential Officer so that a determination can be made regarding whether such Potential Officer has completed or should complete an Acknowledgment Form. However, the absence of such a determination will not be deemed to relieve any person of his or her duties under this Code.

6.	Disclosure of this Code

This Code shall be disclosed by at least one of the following methods in the manner prescribed by the SEC, unless otherwise required by law:

•

by filing a copy of the Code with the SEC;

•

by posting the text of the Code on the Trust’s website; or

•

by providing, without charge, a copy of the Code to any person upon request.

7.	Waivers

Any waiver of this Code, including an implicit waiver, that has been granted to an Officer, may be made only by the Board or a committee of the Board to which such responsibility has been delegated, and must be disclosed by the Trust in the manner prescribed by law and as set forth above in Section 6 (Disclosure of this Code).

8.	Amendments

This Code may be amended by the affirmative vote of a majority of the Board. Any amendment of this Code, must be disclosed by the Trust in the manner prescribed by law and as set forth above in Section 6 (Disclosure of this Code), unless such amendment is deemed to be technical, administrative, or otherwise non-substantive. Any amendments to this Code will be provided to the Officers.

Exhibit (p)(2)

Appendix 1-B

LITMAN GREGORY FUND ADVISORS, LLC

LITMAN GREGORY ASSET MANAGEMENT, LLC

CODE OF ETHICS

(as amended July 23, 2018)

Litman Gregory Fund Advisors, LLC (“LGFA”) and its affiliate, Litman Gregory Asset Management, LLC (“LGAM”, and with LGFA, the “Company”), have adopted the policies and procedures set forth in this Code of Ethics (the “Code”).

This Code governs the activities of all of the Company’s Employees (as defined in Section VI.A.1. below). It is important that you understand your reporting obligations under this Code.

If you have any questions regarding this Code, please contact the Chief Compliance Officer of LGAM or LGFA, as applicable.

I.	PURPOSE OF THIS CODE

This Code is intended to promote ethical conduct and to provide guidelines and specific reporting requirements to help ensure the compliance of the Company and its Employees with applicable securities laws and regulations, including the Securities Act of 1933, the Securities Exchange Act of 1934, as amended, the Investment Company Act of 1940, as amended (the “1940 Act”), the Investment Advisers Act of 1940, as amended (the “Advisers Act”), and all other applicable Federal securities laws (as defined in Rule 38a-1 of the 1940 Act). In particular, Rule 204A-1 under the Advisers Act and Rule 17j-1 under the 1940 Act, require the Company to establish, maintain and enforce a written code of ethics that, at a minimum, sets the standard of business conduct that the Company requires of its Employees, requires Employees to comply with applicable federal securities laws, and sets forth provisions regarding personal securities transactions by Employees.

II.

KEY PRINCIPLES

This Code is based on the following key principles:

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Each Employee’s duty at all times to place the interests of clients first;

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The requirement that all personal securities transactions be conducted in such a manner as to be consistent with this Code and to avoid any actual or potential conflict of interest or any abuse of an Employee’s position of trust and responsibility;

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The principle that Employees should not take inappropriate advantage of their positions;

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The fiduciary obligation of Employees to protect the confidentiality of clients’ proprietary, sensitive or other confidential information communicated to the Company or its Employees;

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The principle that Employees will not disclose to any unauthorized individual or entity outside of the Company or remove from the Company’s offices proprietary information.

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The principle that the Company and each Employee must maintain the highest ethical standards and refrain from engaging in activities that may create actual or apparent conflicts of interest between the interests of the Company or its Employees and the interests of the Company’s clients.

III.

FRAUD

Fraudulent activities by Employees are prohibited. Specifically, any Employee, in connection with the purchase or sale, directly or indirectly, by such Employee of a security held or to be acquired by a Company client, may not:

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Employ any device, scheme or artifice to defraud the Company’s clients;

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Make any untrue statement of a material fact to the Company’s clients or omit to state a material fact necessary in order to make the statements made to the Company’s clients, in light of the circumstances under which they are made, not misleading;

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Engage in any act, practice or course of business that operates or would operate as a fraud or deceit on the Company’s clients; or

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Engage in any manipulative practice with respect to the Company’s clients or securities in general.

IV.

INSIDER TRADING

The Company and its Employees are prohibited by law from purchasing or selling any publicly- traded stock, bond, option or other security while in possession of material, nonpublic information (i.e., insider trading).

Insider Trading Defined.

It is against the law to engage in insider trading. The term “insider trading” is generally used to refer to (i) a person’s use of material, nonpublic information in connection with transactions in securities, and (ii) certain communications of material, nonpublic information.

The laws concerning insider trading generally prohibit:

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The purchase or sale of securities by an insider, while in possession of material, nonpublic information;

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The purchase or sale of securities by a non-insider, while in possession of material, nonpublic information where the information was disclosed to the non-insider in violation of an insider’s duty to keep the information confidential or was misappropriated; or

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The communication of material, nonpublic information in violation of a confidentiality obligation where the information leads to a purchase or sale of securities.

1. Who is an Insider? The concept of “insider” is broad. It includes the officers, directors, employees and majority shareholders of a company and may also include, among others, a company’s attorneys, accountants, consultants, investment bankers, commercial bankers and the employees of such organizations. Analysts are usually not considered insiders of the companies that they follow, although if an analyst is given confidential information by a company’s representative in a manner in which the analyst knows or should know to be a breach of that representative’s duties to the company, the analyst may become a temporary insider.

2. What is Material Information? Trading on inside information is not a basis for liability unless the information is “material.” “Material” information is construed broadly and is generally defined as information that a reasonable investor would likely consider important in making his or her investment decision or information that is reasonably certain to have a substantial effect on the price of a company’s securities. Information that should be considered material includes, but is not limited to: dividend changes, earnings estimates, changes in previously released earnings estimates, significant merger or acquisition proposals or agreements, major litigation, liquidity problems and extraordinary management developments. Material information does not have to relate to a company’s business; it can be significant (but as yet not widely known) market information. For example, a reporter for The Wall Street Journal was found criminally liable for disclosing to others the dates on which reports on various companies would appear in The Wall Street Journal and whether or not those reports would be favorable.

3. What is Nonpublic Information? Information is nonpublic unless it has been effectively communicated to the marketplace. For information to be considered public, one must be able to point to some fact to show that the information has been generally disseminated to the public. For example, information found in a report filed with the SEC or appearing in Dow Jones, Reuters Economic Services, The Wall Street Journal or another publication of general circulation is considered public. Market rumors are not considered public information.

4. What is “Trading While in Possession of” Material Nonpublic Information? Generally, a purchase or sale of a security is made “while in possession of” material nonpublic information about that security or issuer if the person making the purchase or sale was aware of the material nonpublic information when the person made the purchase of sale.

5. Not Certain if You Have “Inside” Information? If you have any doubts about whether you are in possession of material nonpublic information, consult with the applicable Chief Compliance Officer.

Penalties for Insider Trading.

Penalties for trading on or communicating material, nonpublic information are severe, both for the individuals involved in the unlawful conduct and for their employers, and may include administrative penalties, civil injunctions, disgorgement of profits, jail sentences, and significant fines for the person who committed the violation or for the employer or other controlling person of the person who committed the violation. A person can be subject to some or all of these penalties even if he or she does not personally benefit from the violation.

In addition, any violation of the procedures set forth in this Code can be expected to result in serious sanctions by the Company, including dismissal. See section VIII. D. below for more information on sanctions for violations of this Code.

Policy Statement Regarding Insider Trading.

The Company expects that each of its Employees will obey the law and not trade while in possession of material, nonpublic information. In addition, the Company discourages its Employees from seeking or knowingly obtaining material nonpublic information.

Procedures to Prevent Insider Trading.

Because the Company does not have an investment banking division or affiliate and generally prohibits its Employees from serving as an officer or director of a company having publicly traded securities, the Company does not anticipate that its Employees will routinely be in receipt of material, nonpublic information. However, such persons may from time to time receive such information. If any such person receives any information which may constitute such material, nonpublic information, such Employee (i) should not buy or sell any securities (including options or other securities convertible into or exchangeable for such securities) for a personal account or a client account, (ii) should not communicate such information to any other person (other than the Chief Compliance Officer), and (iii) should discuss promptly such information with the Chief Compliance Officer. Under no circumstances should such information be shared with any persons not employed by the Company, including family members or friends. Each Employee contacting an issuer or analyst should (i) identify himself as associated with the Company, (ii) identify the Company as an investment management firm, and, (iii) after the conversation, make a memorandum memorializing the conversation with the issuer or analyst (including the beginning of the conversation where the Employee identified himself or herself as associated with the Company). Once such material, nonpublic information becomes public, the Employee may trade in securities in accordance with this Code.

V.	OTHER CONFIDENTIAL INFORMATION

Confidential Information Defined.

Even if the Company and its Employees do not routinely receive material, nonpublic information (i.e., “inside information”), the Company or its Employees may receive such information or other sensitive or confidential information from or about the Company’s clients, and the Company’s Employees will receive confidential or sensitive information about the Company’s affairs. Such confidential information may include, among other things:

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Names and addresses of clients (e.g., “client lists”).

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Financial or other information about the client, such as the client’s financial condition or the specific securities held in a specific client’s portfolio.

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The names of the securities being purchased or sold, or being considered for purchase or sale, for any client’s account.

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Any client or Company information privately given to an Employee that, if publicly known, would be likely to (i) affect the price of any security in the portfolio of any client of the Company or (ii) embarrass or harm the client or the Company.

Given the breadth of the above, all information that an Employee obtains through the Company should be considered confidential information unless it is specifically known to be available to the public.

Policy Statement Regarding Use and Treatment of Confidential Information.

All confidential information, whatever the source, may be used only in the discharge of the Employee’s duties with the Company. Confidential information may not be used for any personal purpose, including the purchase or sale of securities for a personal account. No Employee may use any confidential information in any manner that adversely affects the Company or its clients. All confidential information is to be treated as the secret, proprietary and confidential data of the Company.

Procedures Regarding Use and Treatment of Confidential Information.

The Company encourages each of its Employees to be aware of, and sensitive to, such Employee’s treatment of confidential information. The Company has also adopted a Privacy Policy which also sets forth policies and procedures regarding maintaining the privacy of its consumers and customers’ personal financial information. Each Employee must take the following precautions:

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Employees must not discuss confidential information unless necessary as part of his or her duties and responsibilities with the Company.

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Precautions must be taken to avoid storing confidential information in plain view in public areas of the Company’s facilities, including reception areas, conference rooms and kitchens, and Employees must remove confidential information from areas where third parties may inadvertently see it. Confidential information should, whenever reasonably feasible, be stored in locked or otherwise physically secure locations.

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Under no circumstances may confidential information be shared with any person, including any spouse or other family member, who is not a manager, member, officer, director, or employee of the Company.

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Employees must return all confidential information upon their separation from the Company.

VI.

PROPRIETARY INFORMATION

Proprietary Information Defined.

Confidential and Proprietary information includes, but is not limited to, the following examples:

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Any knowledge or information with respect to Litman Gregory’s business activities, methods, or financial condition

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Professional contacts

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Customer, client, subscriber, employee and vendor lists

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Customer, client or subscriber preferences

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Litman Gregory-developed proprietary processes and procedures

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Litman Gregory-developed software, software code, and Litman Gregory-developed proprietary software applications using third-party software platforms

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Labor relations strategies

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Marketing strategies

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Market research

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Pending projects and proposals

Policy Statement Regarding Use and Treatment of Proprietary Information.

The Employee recognizes that the confidentiality of proprietary information is a matter of great concern to the Company. All employees may be required to sign a non-disclosure agreement as a condition of employment. Whether or not such a separate non-disclosure agreement is signed, the Employee agrees that he or she will not disclose to any individual or entity outside the Company any proprietary information of the Company, except to individuals who have a specific “need to know” due to their contractual or other business relationship to the Company, and that he or she will not use such proprietary information other than for the benefit of the Company. Employees are prohibited from using proprietary information to solicit Litman Gregory clients for any purpose other than Litman Gregory business.

Procedures Regarding Use and Treatment of Proprietary Information.

The Company encourages each Employee to be aware of, and sensitive to, such Employee’s treatment of proprietary information. The Employee understands and agrees that all files, records, papers, memoranda, letters, handbooks and manuals, facsimile or other communications which he or she obtains that were written, authorized, signed, received or transmitted during his or her employment are and remain the property of the Company and, as such, are not to be removed from the Company’s offices except for the purpose of business activity on behalf of the Company. Upon termination of employment, Employee will promptly deliver to the Company any such materials that may then be in his or her possession.

VII.

TRADING FOR PERSONAL SECURITIES ACCOUNTS

The Company and its Employees owe a fiduciary obligation to the Company’s clients. The Company and such persons, therefore, must avoid actual and apparent conflicts of interest with the Company’s clients. In any situation where the potential for conflict exists, the client’s interest must take precedence over personal interests. If there is any doubt, resolve the matter in the client’s favor and confer with the Chief Compliance Officer.

If both an Employee and a client of the Company are engaging in transactions involving a Reportable Security (as defined below), an actual or apparent conflict of interest could arise. In those cases, transactions for client accounts must take precedence over transactions for Personal Accounts (all, as defined below) and personal transactions that create an actual or apparent conflict must be avoided.

Employees must not implement any securities transactions for a client without having disclosed any material beneficial ownership, business or personal relationship, or other material interest in the issuer or its affiliates to the Chief Compliance Officer. If the Chief Compliance Officer deems the disclosed interest to present a material conflict, the Employee may not participate in any decision-making process regarding the securities of that issuer.

Key Definitions.

1. Employee. The term “Employee” as used in this Code includes all managers, members, officers, directors and employees of the Company as well as spouses, domestic partners and dependents. “Employee” also includes long-term temporaries and on-site consultants.

2. Access Persons. “Access Person” means any Employee who, in connection with his or her regular functions or duties, makes, participates in, or obtains information regarding, the purchase or sale of Reportable Securities or whose function relates to the making of any recommendations with respect to such purchases or sales. Currently, all Employees are treated as Access Persons.

3. Fund Access Persons. “Fund Access Person” means any Access Person who, in connection with his or her regular functions or duties, makes, participates in, or obtains information regarding, the purchase or sale of Reportable Securities held by any of the series (i.e., funds) of the Litman Gregory Funds Trust, or whose function relates to the making of any recommendations with respect to such purchases or sales, or who regularly receives material non-public information regarding the Litman Gregory Funds Trust. The Chief Compliance Officer of LGFA maintains the list of Fund Access Persons.

4. Personal Account. The “Personal Account” of an Employee shall include each and every account (other than an account for the benefit of any of the Company’s clients) for which such Employee influences or controls investment decisions. Personal Account includes self-directed retirement and employee benefit accounts. An account for the benefit of any of the following will be presumed to be a “Personal Account” unless the Company and the Employee otherwise agree in writing:

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An Employee.

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The spouse or domestic partner of an Employee.

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Any child under the age of 22 of an Employee, whether or not residing with the Employee.

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Any other immediate family member of an Employee residing in the same household with the Employee. An immediate family member includes a child, stepchild, grandchild, parent, stepparent, grandparent, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in law and also includes adoptive relationships.

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Any other account in which an Employee has a beneficial interest (for example, an account for a trust, estate, partnership or closely held corporation in which the Employee has a beneficial interest).

Exception. If an Employee certifies in writing to the Chief Compliance Officer that (i) the certifying Employee does not influence the investment decisions for any specified account of such spouse, domestic partner, child or dependent person, and (ii) the person or persons making the investment decisions for such account do not make such decisions, in whole or in part, based upon information that the certifying Employee has provided, the Chief Compliance Officer may, in his or her discretion, determine that such an account is not an Employee’s “personal account.”

Other Exceptions. Special policies apply when trading in an Employee’s Personal Account is handled by someone other than the Employee. In situations where a third party exercises complete investment discretion in managing an Employee’s Personal Account, pre-clearance for reportable securities is not required. If the Employee has any role in the managing of the account, however, this exception does not apply. In any event, securities held or traded for these accounts must be included in the Employee’s quarterly and annual reports described in Section E, below.

In order to fit within the exception regarding accounts for which the Employee has no investment discretion, the following is required: (a) a written verification by the Employee, and (b) a written verification by a third party involved in the management of the account. In all cases, whether to grant the exception is in the discretion of the Chief Compliance Officer.

5. Reportable Securities. “Reportable Securities” are those securities for which quarterly transaction reports must be filed. Reportable Securities are all securities included in the definition of “Security” in the Advisers Act and the 1940 Act (with the exceptions below) and include any (a) equity or debt instrument traded on an exchange (including foreign securities exchanges), through NASDAQ or through the “pink sheets,” over-the-counter or on any public market, (b) options to purchase or sell such equity or debt instrument, (c) warrants and rights with respect to such securities, (d) municipal bonds, (e) index stock or bond group options that include such equity or debt instrument, (f) futures contracts on stock or bond groups that include such equity or debt instrument, (g) any option on such futures contracts, (h) limited offerings or private offerings, and (i) shares of mutual funds managed by the Company (i.e., the Litman Gregory Masters Funds); provided that Reportable Securities shall not include securities issued by the Government of the United States, banker acceptances, bank certificates of deposit, commercial paper, high quality short-term debt instruments and shares of open-end mutual funds (other than the Litman Gregory Masters Funds). For the avoidance of doubt, exchange-traded funds and closed-end registered investment companies are reportable securities.

Policy Statement Regarding Trading for Personal Accounts.

The Company recognizes that the personal investment transactions of its Employees demand the application of a strict code of ethics. Consequently, the Company requires that all personal investment transactions be carried out in a manner that will not endanger the interest of any client or create any apparent or actual conflict of interest between the Company or its Employees, on the one hand, and the client, on the other hand. Therefore, the Company has adopted the procedures set forth below.

Designated Brokerage Policy

The Company requires its Employees to hold their Personal Accounts at Charles Schwab, Fidelity Investments or TD Ameritrade. Employee acknowledges that these designated brokers will provide daily electronic data feeds, which include Personal Account transactions and holdings, into the compliance and employee trade monitoring system. Employees are required to transfer their Personal Accounts to one of the designated brokers listed within 45 days of employment. Note: employees are responsible for notifying Compliance via the compliance and employee trade monitoring system whenever opening and/or terminating Personal accounts.

Exception. Exception to this policy will be considered for certain account types. In order to request an account type exception a written request by the Employee to the Chief Compliance Officer is required. In all cases, whether to grant the exception is in the discretion of the Chief Compliance Officer.

Procedures Regarding Trading for Personal Accounts.

1. Trading Procedures. The following procedures must be followed by Employees before buying or selling securities for a Personal Account, provided that such procedures shall not be required with respect to trading in mutual funds.

Any Employee wishing to buy or sell any Reportable Security, for any Personal Account must first obtain approval for such purchase or sale from the Chief Compliance Officer or his or her delegate. A form of such pre-clearance request is accessible through the compliance and employee trade monitoring system accessible to all Employees.

Confirm that Employee Is Not in Receipt of Inside Information.

Each Employee wishing to buy or sell a security for a Personal Account should first confirm that he or she is not in receipt of any inside information that would materially affect the price of that security.

Confirm that the Trade is Not an Opportunity That Should Be Offered to Company Clients.

Employees are not to make a trade if the Employee has reason to believe that the trade should first be offered to the Company’s clients, such as the situation where a client may be eligible for a “limited availability” investment opportunity offered to an Employee. If you have any doubt, confer with the Chief Compliance Officer.

Obtain Pre-Clearance for IPOs or Private Placement Securities.

Access Persons wishing to buy any security in an initial public offering (“IPO”) must first obtain approval for such transaction from the Chief Compliance Officer through the compliance and employee trade monitoring system accessible to all Employees. Access Persons wishing to buy/sell a limited offering (private placement) for any Personal Account must first obtain approval for such transaction from the Chief Compliance Officer or his or her delegate through the compliance and employee trade monitoring system accessible to all Employees.

Obtain Pre-Clearance for Reportable Securities¹ Traded Market on Close

All Employees are required to seek pre-clearance prior to effecting a transaction. The employee must do the following through the compliance and employee trade monitoring system:

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Indicate on the pre-clearance request form, that the transaction is a “market-on-close” (“MOC”) execution. A market-on-close order is a non-limit market order that is executed as close to the end of the market day as possible (12:30-1:00pm Pacific). Approval will be given for all MOC trade requests. Approval for the requested transaction shall only be valid for transactions conducted on the day on which the approval is granted unless specifically noted by the Approver.

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Employees seeking to submit orders MOC in accordance with this paragraph are advised that a series or cluster of orders in thin end-of-day trading can result in poor execution.

Obtain Pre-Clearance for Reportable Securities² Traded Intra-Day

Employees wishing to buy or sell a security for a Personal Account, but do not wish to wait to execute a market-on-close transaction may do so, will require pre-clearance approval from the Chief Compliance Officer or his or her delegate. Such pre-clearance shall only be valid for the purchase or sale of any Reportable Security on the day on which the pre-clearance is granted, with the exception of limit order trades, in which case the approval will remain valid for the time period specified on the pre- clearance request form.

Upon receiving a request for pre-clearance, the Chief Compliance Officer or his or her delegate will review the securities then held in client accounts using the most recent holdings data available to the Company. The review will include a check of Market Capitalization status. Approval of transactions in Reportable Securities issued by a company with a market capitalization of at least $10 billion (USD) on the date of a proposed transaction shall be in the discretion of the Chief Compliance Officer. The Chief Compliance Officer may also consult directly with Investment Advisors about their trading plans and programs regarding the security the Access Person desires to buy or sell. After such review the Chief Compliance Officer will either approve the request or restrict the Access Person from trading in the security for such period the Chief Compliance Officer deems appropriate to eliminate any actual or apparent conflict of interest or inappropriate use of confidential client information.

¹	For the avoidance of doubt, shares of any of the Litman Gregory Masters Funds are excluded from the definition of Reportable Securities for the purpose of satisfying this requirement.

2. Exceptions and Waivers. In appropriate circumstances (e.g., financial need, extreme market conditions, unexpected corporate developments, discovery of inadvertent violation), the Chief Compliance Officer may grant an exception or waiver to permit specifically requested trading. A memorandum describing the scope of circumstances of any such waiver/exception shall be created and maintained in the Employee’s files and part of the Company’s books and records.

3. Prohibition on Short-Term Trading of Litman Gregory Masters Funds. Shares of any mutual funds advised by the Company (i.e., the Litman Gregory Masters Funds) must be held for a minimum of 60 calendar days after the date of purchase. However, the Chief Compliance Officer of LGFA may waive these requirements in his or her discretion in the event of an extraordinary circumstance.

Reports and Affirmations of Personal Transactions and Securities Ownership.

1. Submission of Reports and Affirmations. In order for the Company to monitor compliance with its insider trading and conflict of interest policies and procedures, each Employee shall submit the reports and affirmations listed below using the compliance and employee trade monitoring system. Each Employee must submit and acknowledge the report certifying the completeness and accuracy of the information included therein and certifying certain other matters. The reports contain important acknowledgments.

An “Initial Holdings Report” for all securities in each of his or her Personal Accounts. The report shall be submitted to the Chief Compliance Officer within 10 calendar days following the first day of employment with the Company, current as of a date no more than 45 days prior to the date of his or her employment using the compliance and employee trade monitoring system. If the tenth day is not a work day, then the report must be submitted earlier.

A “Quarterly Transactions Affirmation” for all trades in Reportable Securities in each of his or her Personal Accounts. The report shall be submitted to the Chief Compliance Officer within 30 calendar days following the end of each calendar quarter regardless of whether any trading activity took place in that account during the quarter using the compliance and employee trade monitoring system. If the thirtieth day is not a work day, then the report must be submitted earlier.

If the Personal Account is an approved exception to the Designated Brokerage Policy, copies of the account statements and trade confirmations must be submitted to Compliance via file attachments in the compliance and employee trade monitoring system within 30 calendar days following the end of each calendar quarter regardless of whether any trading activity took place in that account during the quarter. In addition, the report must include a certification that all trades in Reportable Securities in the Employee’s Personal Accounts during the calendar quarter are covered by such account statements.

An “Annual Holdings Report” for all securities in each of his or her Personal Accounts. The report shall be submitted to the Chief Compliance Officer within 30 calendar days following the end of the calendar year, with information current as of a date no more than 45 days prior to the date the Annual Holdings Report is submitted using the compliance and employee trade monitoring system. If the thirtieth day is not a work day, then the report must be submitted earlier.

If the Personal Account is an approved exception to the Designated Brokerage Policy, copies of the account statements must be submitted to Compliance via file attachments in the compliance and employee trade monitoring system within 30 calendar days following the end of each calendar year regardless of whether any trading activity took place in that account during the quarter. In addition, the report must include a certification that all trades in Reportable Securities in the Employee’s Personal Accounts during the reporting period are covered by such account statements.

2. Review and Retention of Reports. The Chief Compliance Officer or his or her designee shall promptly review each Initial Holdings Report, Quarterly Personal Transaction Report and Annual Holdings Report Quarterly, to determine whether any violations of the Company’s policies or of the applicable securities laws took place. The Company shall retain the Reports required by this Code as part of the books and records required by the Advisers Act and the rules promulgated thereunder.

VIII.

OTHER BUSINESS CONDUCT

Restrictions on Public Company Directorships.

Access Persons are prohibited from serving on the boards of directors of publicly traded companies if, in the written determination of the Chief Compliance Officer, such service is inconsistent with the interests of any client, including the Trust. If the Chief Compliance Officer has approved such service by an Access Person, that Access Person shall be isolated through informational barrier procedures from persons making investment decisions with respect to such issuer.

Restrictions on Gifts and Entertainment.

General Policy Statement.

A conflict of interest occurs when the personal interests of Employees interfere or could potentially interfere with their responsibilities to the Company and its clients. The overriding principle is that Employees should not accept inappropriate gifts, favors, entertainment, special accommodations, or other things of material value that could influence their decision-making or make them feel beholden to a person or firm. Similarly, Employees should not offer gifts, favors, entertainment or other things of value that could be viewed as overly generous or aimed at influencing decision-making or making a client feel beholden to the firm or the supervised person.

De minimis gifts and entertainment.

From time to time Employees may receive or accept gifts from third parties. Employees may accept de minimis gifts but shall not give nor accept any gift received that has a total value in excess of $200.00 from any broker/dealer, money manager, or others who transact business with the Company, unless approved by the Chief Compliance Officer. Any such gifts or benefits should be reported to the Chief Compliance Officer using the compliance and employee trade monitoring system accessible to all Employees. Gifts of cash may never be accepted or disbursed by an Employee. In addition, Employees may attend business meals, sporting events and other entertainment events at the expense of a giver, as long as the expense is reasonable and both the giver(s) and the Employee(s) are present.

Charitable Gifting.

Employees may receive requests for charitable gifts from or directly related to a client or business relationship. The amount of the charitable gift should never be based upon the level of actual or anticipated business provided by the client or business relationship soliciting a gift. Types of charitable gift recipients include, but are not limited to, all types of charitable organizations, fund raising campaigns, endowments, foundations, etc. The client or business relationship may or may not have direct ties to the recipient of the gift. However, the person requesting a charitable gift should not derive any economic or tangible personal benefit from the gift. This policy applies to charitable gifts made by the Company and those made by Employees of the Company to a client or business relationship. Charitable gifts by the Company or an Employee to the same recipient are limited to not more than $1,000 per gift, and not exceeding two gifts per calendar year, (i.e. not exceeding a total of $2,000 per year). Any Employee seeking to make a gift in excess of these guidelines is required to first seek pre-clearance from the Chief Compliance Officer or his or her delegate. Any such charitable gift should be reported to the Chief Compliance Officer.

This policy is not intended to regulate charitable gifting by an Employee that is unrelated to the Company’s business or client relationships. This policy is not intended to apply to expenses that are determined to be primarily marketing related that may also benefit a charity (such as placement of an ad in a charity brochure that is distributed to a large audience). This policy does not apply to an Employee’s personal political contributions. See Section XVII Pay-to-Play of the Compliance Manual for more details regarding political contributions. This policy does not include personal gifts that may have a charitable beneficiary component if such gifts aren’t excessive and so frequent as to cause the appearance of a conflict of interest. Personal gifts of this nature are typically received based on pre-existing personal relationships in recognition of some life event, such as a birthday, anniversary, etc. These types of personal gifts are not given by the Company.

FCPA Considerations

a. Foreign Covered Person. A “Foreign Covered Person” for this purpose is any foreign official including, without limitation, any officer or employee of any foreign government or any governmental department, agency or instrumentality (e.g., a central bank) or any government-owned or controlled enterprise (e.g., sovereign wealth fund) or any person acting in an official capacity for or on behalf of any such government, department, agency, instrumentality or enterprise). It also includes any foreign political party, party official or candidate for political office. Foreign for this purpose means outside of the United States.

b. Exemptions. There are certain exemptions to the broad prohibitions set forth above. However, these exemptions are very precise and must be discussed with the CCO before they can be invoked. No Employee is to discuss or consider any proscribed activity outlined above without the prior approval of the CCO.

c. Pre-Clearance. No Employee may engage in any activity that would violate the FCPA without the prior approval of the CCO. If an activity would render an analysis of the FCPA to determine whether it would violate the FCPA, such activity must be presented to the CCO to conduct an analysis and for final approval.

IX.

WHISTLEBLOWER POLICY

General Policy

The Company requires Directors, Officers and Employees to observe high standards of business and personal ethics in the conduct of their duties and responsibilities. All Employees and representatives of the Company, must practice honesty and integrity and comply with all applicable laws and regulations.

Reporting Responsibility

This Whistleblower Policy is intended to encourage and enable Employees and others to raise serious concerns internally so that the Company can address and correct inappropriate conduct and actions. It is the responsibility of all Directors, Officers, and Employees to report concerns about violations of the Company’s code of ethics or suspected violations of law or regulations that govern the Company’s operations.

No Retaliation

It is contrary to the values of the Company for anyone to retaliate against any Director, Officer, or Employee who in good faith reports an ethics violation, or a suspected violation of law, such as a complaint of discrimination, or suspected fraud, or suspected violation of any regulation governing the operations of the Company. An Employee who retaliates against someone who has reported a violation in good faith is subject to discipline up to and including termination of employment.

Reporting Procedure

Acting in Good Faith

Confidentiality

Handling of Reported Violations

X.	MISCELLANEOUS

Importance of Adherence to Code.

It is very important that all Employees adhere strictly to this Code of Ethics. Any violations of such policies and procedures may result in serious sanctions, including dismissal from the Company. Trading violations may also result in disgorgement of profits. See section VIII. D. for more information on sanctions for violations of this Code.

LGFA Reporting

On at least an annual basis, the LGFA Chief Compliance Officer shall prepare a written report describing any issues arising under the Code, including information about any material Code violations by Access Persons and any sanctions imposed due to such violations, and submit the information for review by the board of trustees of the Litman Gregory Funds Trust. On an annual basis, LGFA shall certify to the Board of Trustees of the Litman Gregory Funds Trust that it has adopted procedures reasonably necessary to prevent its Access Persons from violating the Code of Ethics.

Annual Circulation/Certification of Receipt of Code and Amendments.

This Code shall be circulated at least annually to all Employees, and at least annually, each Employee shall be asked to certify in writing pursuant to the form attached hereto that he or she has received and followed the Code. Each Employee will also be asked to certify to the receipt of any amendments to the Code circulated during the year.

Sanctions

Violations of this Code will result in sanctions, to be determined by a committee composed of the Chief Compliance Officers and two Managing Partners of the Company. Sanctions will be determined based on the frequency and the severity of the violation, and may include:

•

The violation will be recorded in the Company’s compliance books and records;

•

The applicable Employee may be required to attend and provide evidence of satisfactory completion of compliance training courses;

•

The applicable Employee may be required to immediately sell any security purchased in violation of Section VI above;

•

The applicable Employee may be subject to a fine and/or disgorgement of any profits earned on the purchase or sale of any security in violation of Section VI above, or the personal absorption of any loss on the sale of such security;

•

The applicable Employee may be suspended without pay for a period of time to be determined by the committee; and/or

•

The offending employee’s employment at the Company may be terminated.

Exhibit (p)(4)(S)

Ares Management LLC

Code of Ethics

This Code of Ethics is designed not only to fulfill technical compliance with applicable regulatory Code of Ethics Rules, but also to eliminate conflicts of interest (actual or apparent) between the personal trading activities of Covered Persons and their Covered Family Members and the interests of Ares and its Clients, including Investors and prospective Investors in our Funds. The reporting and preclearance requirements covered in this Code of Ethics Policy also apply to the accounts and activities of your Covered Family Members. “Covered Family Member” includes any member of your immediate family who is living in your household, such as a spouse, registered domestic partner, child, stepchild, grandchild, parent, stepparent, grandparent, sibling, or person with whom you have an adoptive or “in-law” relationship.

General Standards

All employees are generally designated Covered Persons effective their first date of employment. Non-employee officers, consultants and other temporary workers are evaluated with regard to designation as Covered Persons at the discretion of the CCO. As a Covered Person, you must certify in writing that you have read, understand, and will comply with this Code of Ethics Policy upon such designation and must, at least annually thereafter, acknowledge being subject to the Code of Ethics (as amended) and attest to continued compliance. You owe our clients a fiduciary duty, which prohibits you from:

•

engaging, directly or indirectly, in any business investment in a manner detrimental to any Client

•

taking any actions or making any decisions that are inconsistent with loyalty, honesty, and good faith toward Ares and its Clients, or that violate federal securities laws or any other applicable law, rule, or regulation

•

using confidential information gained through your connection to Ares in a manner detrimental to any Client

Before, or at the same time as, you and your Covered Family Members recommend or authorize the purchase, sale, or any other action, in relation to a Covered Security by or for a Client, you must disclose to the CCO:

•

you or your Covered Family Member’s Beneficial Interest in the Covered Security

•

any interest you or your Covered Family Member have, or intend to acquire, in any third-party account in which the Covered Security is held

•

any Beneficial Interest in any other security that may benefit you or your Covered Family Member from the proposed purchase, sale or other action

•

any interest in, or business relationship with, the issuer of the Covered Security by you or a Covered Family Member

You must keep your and any Covered Family Member’s personal securities transactions consistent with this Code of Ethics and ensure that you or any Covered Family Member do not abuse your position of trust and responsibility with Ares.

Limits and Prohibitions on Securities Trades

Investing in IPOs

You and your Covered Family Members are prohibited from taking a long or short position in an IPO of any US public company registered under the 1934 Act. You may, however, request approval from the CCO to invest personally in an IPO of an Ares-Related Security through the pre-clearance process described below.

30-Day Minimum Holding Period

You and your Covered Family Members are prohibited from selling a Covered Security within 30 days of purchasing that Security, or “buying to cover” a Covered Security within 30 days of selling short such Covered Security, unless the transaction is a type that does not require pre-clearance or the CCO has waived the minimum holding period requirement.

Blackout Period

You and your Covered Family Members are generally prohibited from transacting in any Covered Security of an issuer within 5 trading days after any trade has been placed or cancelled on behalf of any Client account involving a security of that issuer or if there is a pending order in a security of that issuer. Thus, you and your Covered Family Members would not be permitted to transact until the sixth business day after a Client transaction or cancellation thereof. This restriction is subject to the following exceptions.

•

There is no blackout period applied to Securities for which pre-clearance is not required.

•

The blackout period may be shortened to 2 trading days after any trade has been placed or cancelled on behalf of any Client account for transactions in certain large issuers that meet a certain market capitalization requirement as determined from time to time by the CCO.

Ares-Related Securities

All transactions in Ares-Related Securities must always receive pre-clearance approval (as described below) and are subject to the applicable Insider Trading Policy (or similar Policy) of each entity.

Pre-Clearing Securities Transactions

Pre-Clearance Procedures

Before undertaking any transactions in a Covered Security, you must submit a pre-clearance request and obtain written or electronic approval. Pre-clearance requests should be submitted through the Compliance Portal or as otherwise directed by Compliance.

Pre-clearance approval for a transaction is generally valid for 2 trading days, meaning it expires at the end of the second trading day after the day it was approved. If your personal transaction request is approved Monday, the approval expires at the close of business on Wednesday. The only exceptions are private offerings (for which approvals are valid for 120 days) and any other exceptions specified by the CCO.

If you place “limit,” “stop-loss,” “good-until-cancelled,” or “standing buy/sell” orders are cautioned that transactions receiving preclearance approval must be executed before the preclearance approval expires. At the end of the preclearance approval period, any unexecuted order must be canceled, and a new preclearance request must be submitted and approved if you wish to transact in the security.

If pre-clearance approval expires before your desired transaction is made, you must re-submit and receive written pre-clearance approval. Only the CCO may approve exceptions to this Policy, and must do so on a case-by-case basis.

The CCO may deny or revoke approval for any proposed transaction at any time for any reason. The CCO has full discretion over the approval process, and in certain circumstances (often related to protecting Ares and preserving confidential information, such as the nature or its trading or restricted issues), the reason for denial of pre-clearance

request or revocation of approval may not be disclosed to you. Generally, the CCO may deny a pre-clearance request or revoke approval for your requested personal securities transaction if it has the potential to do any of the following:

•

appear as improper conduct

•

conflict with a transaction for a Client

•

violate a confidentiality agreement or informational wall/barrier(s)

•

involve an issuer on our Restricted List

•

compromise Ares’ high ethical standards

Pre-Clearance Exceptions

Pre-clearance is not required for any of the following transactions:

•

purchases or sales of Covered Securities over which you have no direct or indirect influence or control (such as transactions in a Managed Account by an unaffiliated and strictly autonomous investment manager) Note that financial advisers of Managed accounts must obtain pre-clearance approval from the CCO for any purchase or sale of Ares-Related Securities.

•

purchases or sales under an automatic investment plan, automatic rebalancing plan, dividend reinvestment plan, or other program with a predetermined schedule and allocation, provided either that the program is generally available to shareholders or investors in the issuer or that the initial investment in a Covered Security through the plan is approved in advance by Compliance

•

acquisitions of Securities through stock dividends, dividend reinvestments, stock splits, reverse stock splits, mergers, consolidations, spin-offs, and other similar corporate reorganizations or distributions generally applicable to all holders of the same class of Securities

•

other non-volitional events, such as exercise or assignment of an option contract at expiration (as opposed to the exercise or closing of an option contract prior to expiration, which requires pre-clearance)

•

automatic acquisition or disposition of an employer’s Securities through the employer’s 401(k) plan, employee stock purchase plan, or other similar program

•

purchases resulting from an exercise of rights issued pro rata to all holders of a class of Securities, to the extent these rights were acquired from the issuer, and the sales of such rights

•

the exercise of a conversion or redemption right, or similar transactions with the issuer of a Security under the terms of the Security

•

purchases or sales of shares in exchange-traded funds (“ETFs”), exchange traded notes (“ETNs”), options in them, or structured products for which the underlying performance is based on a particular market index or a portfolio of assets (“Index ETFs”), and in publicly traded closed-end funds (“CEFs”), except for any CEF that is a business development company (“BDC”) or any fund or trust advised by, sub-advised by, or otherwise affiliated with Ares. In addition, this preclearance exception does not apply to trading desk personnel and Investment Committee members in the Credit and the Income Strategy business groups. Note such members or those deemed as such by Compliance must pre-clear any purchase or sale of ETFs, ETNs and CEFs and options in them.

•

purchases or sales of municipal securities or auction rate preferred Securities (ARPS)

•

purchases or sales of currencies or commodities

•

purchases or sales of sovereign debt Securities

•

additional contributions to a private offering whose initial investment received pre-clearance approval or was reported as an initial holding (note: this exception does not apply to successive private funds managed by the same adviser) and where your ownership in such investment remains under 5% of the issuers securities or otherwise does not constitute a controlling interest in the issuer. Note that any change to your existing investment (regardless of your ownership percentage) from that of a passive nature to one of an active nature, which may include, acquiring a control position as a result of additional funding or through services as a director, manager, partner, employee or otherwise, must be pre-cleared and reported immediately.

•

purchases or sales of options and futures on currencies, indexes, ETFs, ETNs, commodities, options on futures, or on a Security that does not require pre-clearance. This preclearance exception for the purchase or sale of options in ETFs, ETNs and CEFs does not apply to trading desk personnel and Investment Committee members in the Credit and the Income Strategy business groups.

•

charitable donations or other gifts of Securities to anyone other than those at the request of a Business Partner, any government official or their intermediaries

•

sales conducted in a brokerage account specifically designated for charitable giving (i.e. where proceeds from sales of securities transferred to the account are donated to various charitable organizations)

Reporting and Review

Your Reporting Obligations

You must submit the following certifications and reports through Compliance Portal or as otherwise directed by Compliance, as required by the Code of Ethics Rules:

a. Initial Certifications. No later than 10 calendar days after becoming a Covered Person, you must complete an Initial Covered Account Certification, an Initial Covered Securities Certification and an Initial Disclosure Form. The Covered Accounts and Covered Securities-related information reported in these certifications must be dated within 45 days prior to your employment start date. If you fail to submit these certifications by the stated deadline, you will be prohibited from engaging in any personal securities transactions that require pre-clearance until the certifications are submitted. You may be subject to other sanctions as well.

b. Quarterly Certifications. Within 30 days of the end of each calendar quarter, unless on a leave of absence of other exception granted by the CCO, you are required to submit and complete a Quarterly Covered Securities Transaction Certification and a Quarterly Covered Account Certification. These certifications must include all reportable Securities transactions made by you or your Covered Family Members that were effected during the quarter and any active reportable accounts. Compliance may require additional certifications.

c. Annual Holdings Report. Within 30 days of each calendar year end, you must complete an Annual Covered Securities Certification for all Covered Securities held by you or your Covered Family Members in a Covered Account, except for those held in Managed accounts, as of each December 31.

Account Reporting

a. New Accounts. You must promptly report any newly established Covered Accounts for which you and your Covered Family Members have Beneficial Interest, including those that are managed by an independent third-party. If a broker requires authorization from you to provide Ares with duplicate account information, you must provide this authorization promptly upon request by Compliance. You are prohibited from making any transactions that require pre-clearance approval in that account unless the account has been reported in the Compliance Portal. You must report any new accounts not already reported before completing the Quarterly Covered Account Certification.

U.S.-based employees must maintain their Covered Securities holdings with an approved electronic broker. New employees must transfer any Covered Securities holdings not held with an approved electronic broker to an account with an approved electronic broker within 90 days from their start date.

b. Duplicate Account Information and Electronic Monitoring. You must provide Compliance with copies of trade confirmations and account statements for your Covered Accounts that hold Covered Securities. These may be forwarded directly to Compliance by the financial institutions where the accounts are maintained. If the financial institution does not or cannot directly provide transaction activity and holdings information on a regular basis, you are responsible for promptly providing such trade confirmations and statements to Compliance.

Exceptions from Reporting Requirements

You do not need to report Covered Securities holdings or transactions made in Managed Accounts. A Managed Account is an account managed by an unaffiliated and strictly autonomous investment manager or third-party and over which you or your Covered Family Member have no direct or indirect influence or control.

To qualify for these reporting exceptions, you must provide Compliance with a copy of the agreement used in establishing the Managed Account. This agreement must indicate that you cannot directly or indirectly influence the trading or timing of transactions in the account(s).

At the discretion of Compliance, you may be required to complete periodic certifications to represent that you do not have the ability to influence or control trading and that you will not attempt to do so. You may also be required to inform your investment manager of restricted securities and provide copies of statements when requested.

Review of Reports and Information; Sanctions

The CCO, or another person under the CCO’s direction and supervision, will oversee the review of all employee reports of Covered Accounts, Covered Securities and transactions for any potential Code of Ethics Policy violations. If an actual or potential violation is detected, the employee will first be offered an opportunity to supply additional explanatory information or material. If Compliance determines that a violation of the Code has occurred, the Company may impose appropriate sanction(s), such as the issuance of a warning or violation memorandum, mandatory training, a ban on personal trading, disgorgement of profits, a suspension (with or without pay), or termination of employment.

Confidentiality

All reports, duplicate account statements, and other information submitted as required by this Code of Ethics will be treated as confidential and intended solely for internal use unless Ares is required to disclose it to a regulatory or governmental agency.

Disclaimer of Beneficial Interest

For any personal securities holdings information you are required to report in relation to any Covered Family Members’ securities holdings, you may at any time deliver to the CCO a statement that your submission of any such personal securities information does not constitute an acknowledgment that you have any direct or indirect Beneficial Interest in any securities about which information has been provided.

Adopted: September 6, 2016

Exhibit (p)(4)(T)

Policies: Code of Ethics and Professional Conduct

General

Policy Change Request

Policy


Policy Name:		Code of Ethics and Professional Conduct

Executive Summary:		The Code of Ethics and Professional Conduct (the “Code”) set standards for appropriate workplace conduct and summarizes certain compliance, human resources and other Firm policies. It does not cover every issue that may arise, but it sets out basic principles to guide Partners and employees of BBH (“BBH Personnel”). All BBH Personnel must conduct themselves accordingly and avoid even the appearance of unethical or improper behavior.

Policy Statement:		I. Introduction

		“It is essential for us in all our dealings not only to be fair, But never to have the appearance of
		unfairness ” Alexander Brown to William Brown, 1819

The foundation of Brown Brothers Harriman & Co. (together with its affiliates and subsidiaries, “BBH” or the “Firm”) is the reputation that it has built over the last two centuries and the trust that our clients and communities have in the Firm and its employees. This foundation has been built upon our values and standards. Acting with integrity, accountability and respect is key to maintaining BBH’s reputation and ultimately its success. While we care about the results we achieve, we care just as much about how we achieve them.

The Code of Ethics and Professional Conduct (the “Code”) is our guide to appropriate workplace conduct and regulatory requirements to which BBH is subject. Together with our BBH policies such as our Compliance Manual and Employee Handbooks, we have set standards to ensure that we do the right thing. This Code summarizes certain compliance, human resources and other Firm policies. It does not cover every issue that may arise, but it sets out basic principles to guide Partners and employees of BBH (“BBH Personnel”). All BBH Personnel must conduct themselves accordingly and avoid even the appearance of unethical or improper behavior. BBH Personnel are responsible for understanding the principles of the Code, upholding the highest ethical and professional standards and adhering to the Code to ensure they abide by all applicable regulatory requirements.

The Code does not supplant the rules and regulations of governmental and regulatory bodies. If a law conflicts with this Code, you must comply with the law. If you have any questions about an apparent conflict or the Code in general, you should speak with your manager or contact BBH’s Compliance Department. BBH Personnel are responsible for understanding the legal and policy requirements that apply to their jobs and reporting any suspected violations of law, this Code or Firm policy. Violations of the Code will result in disciplinary action, up to and including termination and, where appropriate, referral to relevant regulatory organizations.

a. Scope

The Code applies to all BBH Personnel. In addition to the Code, BBH Personnel who are part of the BBH Mutual Fund Advisory Department (also known as the Separately Identifiable Department or “SID”[1]) and those supporting the registered BBH proprietary mutual funds are also subject to the BBH Trust Code of Ethics, adopted by the BBH Trust pursuant to Rule 17j-1(c)(1) of the Investment Act of 1940, as amended (the “1940 Act”). BBH Personnel located outside of the United States may be subject to requirements or guidance in addition to those set forth in the Code, as set forth in the Code of Ethics of the BBH offices outside of the U.S.

This Code should be read in conjunction with BBH policies related to workplace conduct. The Code addresses a broad spectrum of business activities and practices and sets out basic principles that are intended to guide BBH Personnel in their day-to-day conduct.

b. Guideline Overview

BBH Personnel must conduct themselves in accordance with this Code and avoid even the appearance of improper, unethical, or unprofessional behavior. BBH Personnel are responsible for helping to ensure prompt and consistent action against violations of this Code. Below are practical guidelines to help you assess whether a violation of the Code may have occurred and escalate issues when they arise:

Make sure you have all relevant facts. In order to reach the right solutions, it helps to be as fully informed as possible.

Ask yourself: “What specifically am I being asked to do? Does it seem unethical or improper?” Focus on the specific question that you face, and the alternatives available to you. Use your judgment and common sense. If something seems unethical or improper, seek guidance before acting.

Clarify your responsibility and role. In many situations, the responsibility for action is shared. Are your colleagues informed? It may help to get others involved and discuss the situation.

Discuss the issue with your manager. This is the basic rule of thumb for most situations. In many cases, your manager may be more knowledgeable about the relevant facts, history or potential conflicts, and will appreciate being brought into the decision-making process. Remember that it is your manager’s responsibility to help solve problems.

Seek help from BBH resources. In the rare case where it may not be appropriate to discuss an issue with your manager or where you do not feel comfortable approaching your manager with your question, you can discuss it with your Human Resources manager, or a member of BBH’s Compliance Department. See Section II below for further detail.

You may report ethical violations anonymously. You also may anonymously report an ethical violation. BBH will take seriously and investigate all allegations of conduct that appear to violate the Code through MySafeWorkplace/Convercent or through BBH management, although anonymous reportings may be more difficult to investigate than those filed by individuals who reveal their identities.

BBH prohibits retaliation. BBH prohibits and will not tolerate any retaliation or threatened retaliatory action against BBH Personnel for making a good faith report of an apparent or possible violation of the Code or any other BBH policy. Similarly, BBH Personnel who discourage or prevent another person either from making such a report, or from seeking the help or assistance the person needs to report the matter to the individuals designated below, are subject to disciplinary action. No adverse employment action (including for example, termination, counseling, or other discipline) may be taken solely for reporting such matters.

Always ask first, act later. If you are unsure of what to do in any situation, seek guidance before you act.

II. Reporting Violations of the Code

The business of BBH must always be in compliance with the spirit, as well as the letter, of applicable laws and regulations.

Knowledge of events by BBH Personnel related to questionable, inappropriate or fraudulent business conduct, accounting practices or regulatory, internal accounting, or auditing matters should be immediately reported. Such matters will be handled in a confidential and protected manner, to the extent possible, and will not be shared except to the extent necessary to conduct a complete and fair investigation or to take appropriate corrective action. Failure to report such matters constitutes a violation of this Code and/or other applicable BBH policy.

Matters related to any questionable or improper business practices or fraud must be immediately reported. As set forth in the Anti-Fraud Policy, BBH Personnel must report such matters to any of the following:

Their manager:

The Compliance Department;

The General Auditor; or

Through BBH’s independent reporting system,

MySafeWorkplace/Convercent (described below).

It is the responsibility of the individual to whom a matter has been reported to also promptly report the potential Code violation to the Firm’s Chief Compliance Officer (“CCO”) (if the CCO has already not been contacted). Matters related to questionable or improper workplace conduct, including as set forth in the Professional Conduct section of this Code, also should be immediately reported. In addition to the resources listed above, BBH Personnel may report matters related to improper workplace conduct to their Human Resource Business Partner or Employee Relations.

All matters will be handled confidentially, to the extent possible. To facilitate reviews of matters, it is preferable for BBH Personnel to identify themselves when making the claim. However, matters may also be submitted on an anonymous basis to either BBH management (see above) or to MySafeWorkplace/Convercent. MySafeWorkplace/Convercent is an independent reporting system and hotline which reinforces the value BBH places on employee communication. Matters can be submitted anonymously and confidentially either via the web at MySafeWorkplace/Convercent or by calling a toll-free number 800-461-9330 (US) or +800-1777-9999 (Europe/Asia).

Reported matters will be promptly reviewed and investigated and, where necessary, appropriate action will be taken upon completion of the review. Incidences will be monitored as appropriate by BBH’s Governance, Risk and Compliance Oversight Committee, the Audit Committee, Human Resources or, in the cases of a reported fraud incident, the Anti-Fraud Committee. A report on trends and/or material matters will be presented to the appropriate committee, where warranted.

III. Cooperating with an Investigation

BBH Personnel are required to cooperate with any investigation into alleged violations of our Code of Ethics and Professional Conduct, laws, regulations, policies or procedures, and are expected to be truthful and forthcoming during any investigation. This includes situtations where BBH Personnel are an involved party, a witness, or are asked to provide information as part of an investigation. Any attempt to withhold information, sabotage or otherwise interfere with an investigation may be subject to disciplinary action up to and including dismissal.

Investigations are confidential company matters. To protect the integrity of the investigation, you are not allowed to discuss any aspect of an investigation, even the fact that an investigation is being conducted, with other employees or the public.

At the same time, this requirement for confidentiality does not prohibit you from reporting legal violations to any governmental or regulatory body or official(s) or self-regulatory organization and you may do so either during or after your employment without notice to the Company. Furthermore, no BBH policy is meant to prohibit you from doing so, or from participating in any benefits involved in such reporting. The only restriction in this regard is that you are not authorized to disclose information covered by the Company’s attorney-client privilege.

Additionally, upon receipt of any Regulatory Contact, including, but not limited to receipt of a subpoena, summons or a formal request for information. BBH Personnel must promptly notify the Compliance Department, OGC, or Enterprise Risk Management. The recipient should provide all written materials received from the Regulator, as outlined in the Regulatory Contact Policy.

IV. Compliance with Laws and Regulations

BBH’s business is subject to extensive regulation both within and outside the U.S. For instance, BBH is a private bank licensed by the New York State Department of Financial Services (“NYSDFS”) as well as other bank regulators.

In addition, BBH has registered with the Securities and Exchange Commission (“SEC”) under the Investment Advisers Act of 1940, as amended (the “Advisers Act”) a SID called the BBH Mutual Fund Advisory Department. As a registered investment adviser, the business activities of the SID are primarily governed by the rules and regulations of the Advisers Act. Rule 204a-1 promulgated under the Advisers Act requires registered investment advisers to adopt codes of ethics in conformity with the requirements set forth herein and within associated policies.

To assist BBH in complying with all laws and regulations applicable to its business activities, BBH has provided guidance to BBH Personnel in the form of policies, procedures and manuals, including the BBH Compliance Manual which is accessible on the BBH Compliance Portal. BBH Personnel are expected to cooperate with any regulatory requests, inquiries or examinations to help ensure BBH meets its obligations. Please refer to the Regulatory Contact Policy for additional information.

V. Statement of Principles

BBH Personnel are required to comply with all laws and regulations applicable to BBH’s business activities and are subject to the following Statement of Principles intended to provide guidance for handling a broad spectrum of matters. BBH Personnel shall:

Place the interest of clients first

Conduct all of their personal securities transactions in a manner consistent with this Code and associated policies

Avoid inappropriate conflicts of interest or any abuse of a position of trust and responsibility

Refrain from taking inappropriate advantage of their BBH position

Ensure that client information is kept confidential, including the identity of clients’ security holdings and financial circumstances

Ensure that they maintain independence in the investment decision-making process and Act professionally while on BBH premises or conducting BBH business.

Any questions regarding the application of this Statement of Principles to particular matters should be directed to the Compliance Department.

VI. Private and Confidential Information

As described in the Privacy and Confidentiality Policy, BBH Personnel may become aware of confidential information not generally available to the public concerning the business of BBH, clients of BBH, or individuals in BBH (“Confidential Information”). The Privacy and Confidentiality Policy also helps to ensure the safekeeping of information relating to an identified or identifiable individual, client or BBH Personnel, referred to as “Personally Identifiable.”

BBH Personnel are required to safeguard Confidential and Personally Identifiable Information and ensure that such information is not used improperly or in a manner inconsistent with the specific purpose for which it was created or obtained. For instance, BBH Personnel may use information regarding clients only for purposes of meeting BBH’s obligations to its clients. BBH Personnel may work with, review, examine, inspect, have access to, or obtain such information only for the purpose of fulfilling their responsibilities to clients and BBH, and should hold such information in strict confidence.

Confidential Information or Personally Identifiable Information obtained as a result of an affiliation with BBH is not to be used for the purpose of furthering any private interest or as a means of obtaining any personal gain. BBH Personnel may not disclose Confidential Information or Personal Information to any third party without proper prior authorization. BBH Personnel must comply with this obligation during and after the termination of their BBH employment.

BBH Personnel should note that Personally Identifiable Information receives extra protection under many laws across the various locations in which BBH operates. As such, BBH Personnel may not retain Personally Identifiable Information in locations (e.g., shared drives, personal files) other than their department’s offifial storage medium for such data.

The SID and Investment Management Line of Business

The SID and Investment Management Line of Business have invested a great deal to develop investment management strategies, methods and resources. In many cases, these assets give BBH a competitive advantage and, as a result, BBH prohibits the dissemination of BBH ideas, strategies, methods and contacts to outsiders. BBH Personnel must not disclose to outsiders BBH’s buy and sell decisions or securities under consideration for future investment prior to BBH effecting such decisions or considerations, or the portfolio holdings of clients of BBH (other than to third parties who require such information to conduct BBH business or to service clients of BBH; e.g., brokers, consultants, outside legal counsel, accountants or custodians or pursuant to BBH’s internal policies) without the authorization of their supervising partner. In granting such authorization, the supervising partner will determine whether disclosure to the third party is necessary and whether the third party has agreed to comply with BBH’s confidentiality policies and procedures.

VII. Inside Information/Material Non-Public Information

BBH Personnel may have access to material, non-public information (“MNPI”), also known as Inside Information, about our clients and other companies that conduct business with us, MNPI is information that is not known by the public, but if it were, would likely affect the market price of the securities issued by a company or be considered important to a reasonable investor in deciding to buy or sell those securities. The determination of whether non-public information is MNPI is fact dependent and, in certain circumstances, may be complex. The best practice is to consider all non-public information about publicly traded securities, activities or financial condistion of a company and its employees as MNPI and consult with the Compliance Department prior to sharing any such information.

You must never, under any circumstances, trade, encourage others to trade, or recommend securities or related financial instruments while in the possession of MNPI related to those securities or instruments. BBH has established the Information Barrier and Insider Information Policy and associated procedures, which are designed to prevent the misuse of MNPI and to avoid conflicts of interest.

VIII. Protection and Proper Use of BBH Assets

BBH Personnel should strive to protect BBH’s assets and ensure their efficient use. Theft, carelessness, and waste have a direct impact on the Firm’s profitability. BBH Personnel should report suspected incidents of theft to their supervisor for investigation and must report suspected fraud as set forth above. BBH technology, equipment or other resources may not be used for non-BBH business, though reasonable and incidental personal use may be permitted. When BBH Personnel leave BBH, all BBH property must be returned.

BBH Personnel have an obligation to protect BBH’s assets, including proprietary information. Proprietary information is a type of Confidential Information and it should be treated as such. For example, proprietary information includes intellectual property, such as trade secrets, patents, trademarks and copyrights, as well as business, marketing and service plans, engineering and manufacturing ideas, designs, databases, records, salary information and any unpublished financial data and reports. The unauthorized use or distribution of proprietary information violates BBH policy, and could also be illegal and result in civil or criminal penalties under applicable laws.

IX. Use of Social Media

a. Business Use

BBH Personnel are prohibited from using Social Media for Business Communications without prior approval and training. BBH Personnel seeking to use LinkedIn for Business Communications must obtain appropriate approvals and complete the required training and certifications prior to joining the LinkedIn Business User program. Select BBH Personnel may also be allowed to use Twitter for Business Communications, which requires additional approval and training. For further information, please see the Social Media Compliance Policy.

b. Personal Use

As outlined in the Social Media Human Resources Policy, BBH Personnel should only express their personal opinions and never represent themselves as a spokesperson for the Firm. Employees may not engage in any Firm-related business activity on social media, unless approved to do so in accordance with the Social Media Compliance Policy. If an Employee makes a refrence to the Firm in a personal social media account or posting, the Employee must make it clear that their views do not represent those of the Firm, its employees or anyone working with or on behalf of the Firm.

X. Conflicts of Interest

BBH has a fiduciary relationship with certain clients and, as such, has a duty to act in the best interests of those clients and to make full and fair disclosure of potential conflicts of interest to them. Inappropriate conflicts of interest should be avoided and identified conflicts should be appropriately managed.

Specifically, conflicts of interest may arise when BBH Personnel, or members of their family, receive improper personal benefits as a result of their position in BBH. Potential conflicts of interest may also arise when BBH Personnel work in some manner for a competitor, client or vendor, receive compensation or benefits from them or hold investments in them or their affiliates. Thus, BBH Personnel are not permitted to work for a competitor as a consultant or serve as a board member, whether profit or non-profit, unless approved in writing by BBH. Please refer to the Outside Business Activities and Directorships Policy for further guidance.

Conflicts of interest should be identified and appropriately addressed prior to accepting any new clients or executing transactions. A potential conflict may exist whenever BBH’s interests are not aligned with a client’s interests. Any BBH Personnel who become aware of a conflict or potential conflict should bring it to the attention of a manager or the Compliance Department. Each LOB is required to record all such material conflicts of interest and the corresponding mitigating controls on an inventory that is reviewed and approved annually by the applicable oversight committee.

Securities Transactions and Conflicts of Interest

BBH Personnel should exercise particular care in making purchases and sales of securities to avoid a conflict of interest with clients. The following requirements also apply to family members in certain circumstances. It is the individual responsibility of BBH Personnel to refrain from market activity if a conflict with the interest of a client might result. This includes, among other things, trading in anticipation of or immediately after a change in the estimate of the intrinsic value of a security by a BBH research area.

Conflicts considerations are most important among BBH Personnel who participate in making recommendations or have any pre-publication knowledge of a research report or knowledge of planned investments. BBH Personnel should refrain from any action in contemplation of a BBH research report, such as effecting a transaction for their own account, or for accounts in which they have an interest or discretion, or passing on advance information concerning the research report to clients or other persons outside BBH.

Front-running BBH research recommendations and trading on inside information are not the only concerns when BBH Personnel contemplate personal securities transactions. Any strategy that may infringe on a client’s interest, whether done at BBH or at another financial institution, or use of information about client securities positions or any other relevant non-public information received as a result of employment or relationship with BBH to make investment decisions, is a violation of this Code and may also constitute an illegal practice.

Further, it is unlawful for any affiliated person of a “Fund,” [2], or any affiliated person of BBH, in connection with the purchase or sale, directly or indirectly, by the person of a “Covered Security” [3] “Held or to be Acquired by a Fund:” [4] (i) to employ any device, scheme or artifice to defraud a Fund; (ii) to make any untrue statement of material fact to a Fund or omit to state a material fact necessary in order to make the statements made to a Fund, in light of the circumstances under which they are made, not misleading; (iii) to engage in any act, practice or course of business that operates or would operate as a fraud or deceit on a Fund; or (iv) to engage in any manipulative practice with respect to a Fund.

In order to facilitate monitoring for personal trading conflicts, all personal securities accounts maintained by BBH personnel and their immediate family members must be reported to Compliance via MCO. U.S. personnel who maintain investment discretion in a personal securities account are required to maintain the accounts at designated brokerage firms, who are required to provide account statements to BBH on at least a quarterly basis (no later than thirty (30) days after quarter-end). All BBH Personnel are also required to pre-approve their private securities transactions and Initial Public Offerings.

Please refer to the Personal Trading Policy , the Private Securities Transaction Policy, and the Conflicts of Interest Policy for further guidance.

Reporting Requirements of Access Persons [5]

Access Persons are responsible for adhering to certain requirements described in the Personal Trading Policy which include, among other things, initial and annual Access Person Certifications (including holdings reports) and pre-approval of personal securities transactions (including those of their covered family members).

XI. Supplier Relationships

BBH works to create mutually beneficial supplier relationships that contribute to the Firm’s value by delivering products and services in a manner consistent with BBH’s values. We set high standards of performance for BBH products and services, and we expect the same from our suppliers. To make the best use of BBH’s resources and supplier relationships. BBH Personnel must:

•

Select goods and services on the basis of price, quality, availabilty, terms, and service.

•

Obtain proper approvals, including from the Supplier Management Committee, before engaging a supplier to deliver goods and/or services, in accorfance with the BBH Supplier Risk Management Policy BBH’s Purchasing Best Practices and all other BBH policies governing outsourcing and the management of supplier relationships, and follow these requirements throughout all phases of the supplier management lifecycle.

•

Enter into contracts for the provision of goods and/or services only as approved in accordance with the Firm’s Supplier Risk Management Policy

•

Maintain arm’s-length market terms and comply with applicable law when BBH transacts with other BBH businesses or clients

•

Follow all applicable laws including those related to transactions involving affiliates.

XII. Competing Business Ventures

BBH Personnel are prohibited from taking for themselves personal opportunities that are discovered through the use of corporate property, information or their position with BBH without the consent of their manager and the Compliance Department. BBH Personnel may not use corporate property, information, or their position with BBH for improper personal gain, and BBH Personnel may not compete with BBH directly or indirectly. BBH Personnel owe a duty to BBH to advance the Firm’s legitimate interests when the opportunity to do so arises.

BBH seeks to outperform our competition fairly and honestly. Misappropriating proprietary information, possessing trade secret information that was obtained without the owner’s consent, or inducing such disclosures by past or present employees of other companies is prohibited. BBH Personnel must not engage in the abuse of privileged information, the unlawful misrepresentation of material facts, or any other intentional unfair-dealing practice.

XIII. Gifts, Entertainment and Personal Remuneration

Giving and receiving Gifts and Entertainment is normal and customary in the financial industry. However, certain laws, rules and regulations prohibit the use of Gifts and Entertainment to inappropriately influence a recipient’s business judgement or create a feeling of indebtedness.

Our clients, suppliers and vendors are vital to BBH’s success. That’s why it’s imperative that these relationships remain objective, fair, transparent and free from conflicts. While business gifts and entertainment can be important to building goodwill, they can also affect the relationship if one’s ability to exercise sound business judgement becomes compromised. To prevent misunderstandings, BBH maintains a Gifts, Entertainment and Other Non-Cash Compensation Policy regarding reporting and approval requirements, as well as restrictions on giving and receiving certain types of gifts, entertainment and personal remuneration. BBH Personnel are required to adhere to this policy.

XIV. Interactions with Government Personnel, Political Activities and Lobbying Requirements

Various anti-corruption statutes, including the U.S. Foreign Corrupt Practices Act and the UK Bribery Act, among others, prohibit making improper payments to others in order to obtain or retain business. Such prohibitions apply to BBH Personnel as well as agents and consultants acting on behalf of BBH, and cover payments to government officials as well as non-government officials such as clients or prospects. See the Anti-Corruption Policy and the Gifts, Entertainment and Other Non-Cash Compensation Policy for more information.

In addition, many U.S. jurisdictions have “pay-to-play” laws limiting contributions made by government contractors to political candidates and parties. BBH Personnel who wish to make political contributions to, or host events for or on behalf of, U.S. state or local candidates or parties must seek pre-approval pursuant to BBH’s Political Contributions Policy .

Certain states and municipalities have enacted laws that require individuals and companies soliciting business, directly or indirectly through a consultant or other intermediary, from state and local pension funds to register as a lobbyist. Certain states and municipalities (e.g., New York City and the State of California) have enacted rules requiring solicitors to register as lobbyists. Other states may adopt similar requirements in the future and some also have laws on servicing government-related businesses. For this reason, the Firm requires pre-clearance of products and services to certain pension funds by employees and consultants representing BBH as detailed in the Lobbying Policy .

XV. Charitable Contributions

While BBH Personnel are encouraged to become involved with charitable organizations, your participation may not interfere with your job at BBH. Remember that soliciting customers, vendors and other employees for contributions or other participation is generally prohibited or restricted, and many of our locations have specific policies governing these activities. You must comply with each of the requirements of the Charitable Contributions policy in connection with your business-related charitable giving.

XVI. Anti-Money Laundering

Money laundering is the criminal practice of disgusting illegally obtained funds so that they appear to be proceeds from legal activity. Facilitation of money laundering by financial istitutions or their employees is also considered money laundering. Where an employee is willfully blind to “red flags” indicative of suspicious activity, fails to inquire in the face of information suggesting illegal activity, or knew or should have known that the activity at issue is suspicious, criminal liability may be imposed on the firm and the employee.

Our Global Anti-Money Laundering Policy and related procedures are designed to comply with all applicable laws and regulations related to money laundering, terrorist financing and economic sanctions. You’re expected to comply fully with all anti-money laundering laws and only conduct business with reputable clients involved in legitimate business activities that use funds derived from lawful purposes. In addition to out global policies, individual lines of business have detailed policies and procedures that address unique requirements and circumstances. You’re expected to know those procedures and follow them. Ask your manager for guidance. Knowing Your Customer means following established customer idemtification protocols for your business line, validating that the individual or entity, and the source of their funds, is legitimate, and completing a profile in our KYC View system

Failing to detect suspicious transactions or doing business with any person or entity involved in criminaal or terrorist activities puts the company and you at serious risk. Accordingly, the company will not tolerate any circumstance where an individual or business unit circumvents anti-money laundering polocies or procedures or fails to report suspicious activity. If you suspect or detect any suspicious activity, you must contact AML Compliance, or a senior manager, immediately.

XVII. Sanctions

The purpose of U.S. Sanctions is to prevent economic and other support of certain targets, such as foreign governments, regimes and other transnational organizations, as a means of implementing U.S. foreign policy and protecting national security interests. These sanctions are affected through blocked assets controls, trade embargoes, travel bans, and other commercial and financial restrictions.

In the U.S., sanctions programs are administered by the Secretary of the Treasury in consultation with the Secretary of State. Within the Treasury Department, OFAC is responsible for the administration and enforcement of sanctions. In addition, U.S. bank regulatory agencies include sanctions program assessments in their regulatory examinations and may cooperate or coordinate with OFAC’s investigations, to ensure regulatory compliacne by financial institutions and their regulated affiliates.

All BBH Personnel are responsible for understanding and complying with the Bloba Sanctions Policy.

BBH Personnell must remain vigilant to sanctions-related risks at all times and escalate any potential sanctions violations to the Sanctions team within AML Compliance.

XVIII. Manipulative and Deceptive Devices

BBH Personnel must not, in connection with any business activity or transaction:

Use or employ, or attempt to use or employ, any device, scheme or artifice to defraud;

Make, or attempt to make, any untrue or misleading statement of material fact or omit to state a material fact necessary in order to make the statements made not untrue or misleading;

Engage, or attempt to engage, in any act, practice or course of business which operates or would operate as a fraud or deceit upon others; or Manipulate or attempt to manipulate the price of any security or financial instrument.

XIX. Document Integrity, Recordkeeping and Document Destruction

BBH requires true and accurate recording and reporting of information in order to conduct its business and to make responsible business decisions. In addition, since BBH is engaged in a variety of financial services activities, it is subject to extensive regulations regarding the manner in which it maintains and retains its books and records.

BBH strives to maintain the highest standards in preparing accounting and financial information. The integrity of our books and records is essential for regulatory, legal, business and client confidence purposes. All BBH Personnel responsible for preparing or maintaining any books, records and accounts for BBH are required to record all entries based upon proper supporting documentation so that the records of BBH conform to applicable legal and regulatory requirements, as well as BBH’s system of internal controls.

Business records and communications often become public, and BBH Personnel should avoid exaggeration, derogatory remarks, guesswork, or inappropriate characterizations of people and companies. This principle applies equally to electronic communications, internal memos, and formal or informal communications. Records should be retained or destroyed strictly in accordance with BBH’s Records Management Policy. In order to be able to meet our data destruction obligations, it is critical that BBH Personnel maintain data only in those locations identified on their records retention schedules, and not in personal drives or files. Finally, in the event of litigation or governmental investigations, please consult the Compliance Department or the Office of the General Counsel regarding any specific recordkeeping requirements or obligations.

XX. Professional Conduct

Through the years, BBH has earned an enviable reputation in the financial community as a company and employer. BBH’s reputation depends, to a large extent, on the confidence that its clients, employees and other stakeholders have in the Firm. As BBH Personnel, your conduct reflects not only on you personally but also on the Firm. BBH Personnel who work together collaboratively impact each other’s performance, productivity and personal satisfaction in their jobs. Consequently, BBH expects you to act in a responsible and professional manner whenever you are on Firm property, conducting Firm business or representing the Firm at business or social functions. Any behavior, whether on-premises or off-premises, that negatively impacts the work environment or tarnishes the reputation of BBH will not be tolerated. Such inappropriate behavior includes, but is not limited to: harassing or illegal acts; rude, insubordinate, threatening, offensive or vulgar language and behavior; violence or threats of violence; or other behavior inconsistent with the professional and ethical standards of BBH. Employees who violate BBH’s professional conduct policies and standards will be subject to disciplinary action, up to and including termination, in accordance with applicable laws.

a. General Standards

1. Discrimination, Harassment and Bullying

BBH strives to create and maintain a workplace where BBH Personnel are treated with dignity and respect. The combined and consistent effort, standards and values of those employed throughout BBH contribute significantly to a positive workplace environment which in turn allows the business to grow and employees to develop. To this end, BBH is committed to providing a workplace (i) in which all employees have an equal opportunity to all of the terms and conditions of employment based on job-related qualifications and performance; and (ii) that is free of bullying or harassment, in compliance with the laws in each work locale.

As part of this commitment, BBH effectively addresses any complaints of discriminatory, harassing or bullying conduct and fosters policies and practices that promote diversity and employment equality.

Under BBH policy, the following terms have the meanings set forth below:

Bullying

The term “bullying” means repeated inappropriate behavior, direct or indirect, whether verbal, written, physical or otherwise, conducted by one or more persons against another or others, at the place of work, outside of the office against a work colleague or in the course of employment, which could reasonably be regarded as undermining the individual’s right to dignity at work or ability to perform his/her job. While an isolated incident of the behavior described in this definition may be an affront to dignity at work, it generally is not considered to be bullying.

Discrimination and Harassment

The term “harassment” or “discrimination” means verbal, written or physical conduct that denigrates or shows hostility or dislike toward an individual because of a characteristic protected by the law in the work locale and that: (i) has the purpose or effect of creating an intimidating, hostile or offensive work environment; (ii) has the purpose or effect of unreasonably interfering with an individual’s work performance; or (iii) otherwise adversely affects an individual’s employment opportunities, such as hiring, compensation and benefits, promotion, training and transfer. Discriminatory or harassing conduct includes, but is not limited to: epithets, slurs or negative stereotyping; threatening, intimidating or hostile acts; denigrating jokes; and written or graphic material that denigrates or shows hostility or dislike toward an individual or group that is placed on walls, in electronic communications or elsewhere on BBH premises or circulated in the workplace, on Firm time or using Firm equipment.

BBH will not tolerate bullying, discrimination or harassment (as defined in the Code and your local Employee Handbook) by Partners, managers, co-workers or non-employees in the workplace (including off-premise, work-related events). It is the responsibility of all BBH Personnel to prevent bullying, discrimination and harassment where possible and to report any instances to which they are party or witness. Managers have a particular responsibility to take action to stop any incident of bullying, discrimination or harassment that they witness, and to report the incident, as well as any incident that is brought to their attention. Managers are required to act if they suspect any form of bullying, discrimination or harassment, even if no complaint has been made.

For more information on BBH’s policies prohibiting bullying, discrimination and harassment in the workplace, consult your local Employee Handbook or Rules.

1. Workplace Civility

When BBH Personnel work together to achieve a common, mutually beneficial goal, it sometimes is the case that impatience may arise and result in BBH Personnel saying things that they might not otherwise say. It is at these times when it is important to exercise discretion and be mindful of maintaining respectful and civil work relationships. BBH Personnel should remember that being civil gives us the means to disagree without being disagreeable and that just because someone disagrees, does not mean that they are being unprofessional, uncivil or acting inappropriately. To ensure that BBH has a work environment where BBH Personnel can express their different opinion in a mutually collaborative environment, the Firm expects BBH Personnel to adhere to the below

standards of acceptable and unacceptable workplace behaviors.

Acceptable and Healthy Workplace Behaviors

Acceptable and healthy workplace behaviors include, but are not limited to:

•

Using respectful, supportive and encouraging language in all interactions, no matter the subject or format (e.g., in person or through electronic communication) of the conversation;

•

Being aware of the noise level and subject matter of your conversations in open air environments (including your work stations), and when it comes to your work area keeping it clean and refraining from posting things that could offend others or contradict what most people consider good taste or appropriate;

•

Questioning a peer’s position on an issue politely and with an open mind, rather than asserting your position is the right one;

•

Giving peers direct, non-personal feedback, as opposed to criticism;

•

Expressing appreciation when a peer does something correctly and in a timely manner;

•

Approaching conflict with maturity and true desire for resolution, rather than as a fight or opportunity to belittle a co-worker; and

•

Maintaining a positive attitude when you are having a bad day.

Inappropriate Workplace Behaviors

Inappropriate workplace behaviors are defined as negative or aggressive acts aimed at one or more individuals that cause or could cause them to feel hurt, embarrassed, disrespected, anxious or depressed. Such behaviors will not be tolerated by the Firm. Examples include, but are not limited to:

•

Acting in violation of the Firm’s Professional Conduct, Anti-Harassment, Anti-Discrimination, Anti-Bullying, Anti-Retaliation, Systems Acceptable Use, HR Electronic Communications Policy and/or other applicable Firm policies;

•

Excessive yelling, repeated emotional outbursts, berating others or using a harsh tone of voice;

•

Criticizing, talking down to others or using degrading remarks or a condescending tone in front of someone else;

•

Treating someone less favorably than others;

•

Gossiping or spreading rumors;

•

Undermining another’s ability to complete his/her work accurately or timely;

•

Making threats; and

•

Any malicious behavior a reasonable person would find unprofessional, disturbing and harmful to their psychological health.

1. Workplace Violence

BBH strives to maintain a safe and secure workplace that is conducive to good job performance and is free from all types of workplace violence. BBH will not tolerate on BBH time or property, or at BBH sponsored events: violence; threats; threatening; abusive or malicious behavior; intimidation; or any form of workplace violence from any source. Examples of prohibited behavior include, but are not limited to, physical violence, verbal threats and threatening or intimidating voice mails and emails. Unless local law expressly permits possession of a weapon in a locked personal vehicle on company property, you may not possess or use any weapon or any component of a weapon (i.e., ammunition) on BBH property.

You must report any instance of workplace violence (including possession of weapons on BBH property) to BBH Security, your manager or Human Resources immediately. In cases of imminent danger, you should contact local emergency law enforcement officials first, and then contact BBH Security.

Domestic violence also can adversely affect workplace safety. If you are the victim of such violence, you should notify local law enforcement and BBH Security of any person who may affect your safety or the safety of your fellow employees. You can also contact the Employee Assistance Program for further assistance.

1. Drug and Alcohol Abuse

Use of illegal drugs, alcohol abuse and misuse of legal drugs creates serious health, safety and other risks in the workplace. The possession, sale or use of drugs that are unlawful under the laws of the country, state and/or city in which you are employed or being under the influence of such drugs, on BBH time or property, or at BBH sponsored events, is prohibited. Similarly, you may not possess, serve, use or be under the influence of, alcohol or marijuana while on BBH property or while conducting BBH business. The only exceptions are for BBH functions where alcohol may be served with the prior approval of a Partner or Department Head, as applicable. Although alcohol may be served at such events, consumption is completely voluntary, should always be in moderation, and never in a manner that would embarrass or harm BBH.

a. Manager’s Responsibility

Managers have a particular responsibility to ensure that healthy and appropriate behaviors are being exhibited at all times by, among other things:

•

Setting a good example by treating all with courtesy and respect;

•

Monitoring the workplace for signs of inappropriate behavior and taking action to resolve the behavior before it escalates by speaking to applicable employees directly and/or raising issues to Human Resources, where applicable; and

•

Promoting awareness of this and other related policies and the applicable complaint procedures.

a. Employee’s Responsibility

Employees play a significant role in ensuring a work environment that does not tolerate discriminatory, harassing, bullying, inappropriate or negative behavior. As employees often are in a better position than management to know what is happening with peers and co-workers, employees should report any unacceptable behavior they see in the workplace.

a. Complaint Procedure

If you believe you are being subjected to conduct in violation of this Policy, a good first step is to speak directly with the other employee to try to resolve the issue. If you are uncomfortable doing so or have done so yet the behavior continues, you should report such concerns using the procedures set forth in Section II of this Code.

XIV. Administration of the Code and Annual Acknowledgement

BBH Personnel are required annually to acknowledge receipt of the Code and certify that they agree to abide by the terms of this Code.

End Notes

1. “SID”: The Brown Brothers Harriman Mutual Fund Advisory Department, known as the SID, is a “Separately Identifiable Department” of BBH. This Code applies to SID personnel. In addition, SID personnel are covered by the BBH Trust Code of Ethics.

2. “Fund” means an investment company registered under the Investment Company Act of 1940, as amended, including but not limited to the registered BBH proprietary mutual funds.

3. “Covered Security,” as described in the Trading Policies, includes all securities with the following exceptions: securities issued or guaranteed by the U.S. Government or by an entity controlled or supervised by the U.S. Government, bankers’ acceptances, bank certificates of deposit, commercial paper and such other money market instruments, and shares of registered open-end investment companies (including non-U.S. unit trusts) other than a fund managed by the SID. Further, transactions effected pursuant to an automatic investment plan are not included. The definition also includes securities held by a trust in which BBH Personnel are a settler, trustee or beneficiary, securities held by a partnership in which BBH Personnel are a general partner and securities in which any contract, arrangement, understanding or relationship gives BBH Personnel direct or indirect economic interest. Covered Securities include both unit-investment trust exchange traded funds (“ETFs”) and open-end ETFs.

4. “Covered Security Held or to be Acquired by a Fund” means any Covered Security which, within the most recent 15 days: (a) is or has been held by a Fund; or (b) is being or has been considered by a Fund or BBH for purchase by a Fund.

5. “Access Persons” means any BBH Personnel who are exposed regularly, as a party of their functions, to information about the BBH proprietary mutual funds’ securities transactions or holdings. Examples include having access to trading systems, portfolio accounting systems or research databases. Additionally, Access Persons include BBH Personnel who make any recommendation, participate in the determination of which recommendation will be made, or who, in connection with their duties, regularly obtain information concerning recommendations on Covered Securities being made by the investment adviser to a Fund or SID client. Support personnel within BBH may be deemed Access Persons if their functions or duties give them access to such non-public information.


Policy Access	View Access History	Attachments:
History:

Related Policies and Procedures


Related Policies and Procedures

Related		Related

Policies:		Procedures:

Exhibit (p)(4)(U)

LOGO

Sponsor

Guggenheim Partners Investment Management, LLC

Chief Compliance Officer

Owner

GPIM Director of Policies & Procedures

Contact

[email protected]

Effective Date

March 30, 2018

Innovative Solutions. Enduring Values.^®

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Table of Contents


1.	Objectives of the Code of Ethics		3

2.	Who is Subject to the Code?		3

3.	Who Administers the Code?		4

	3.1.	Chief Compliance Officer	4

	3.2.	Code of Ethics Compliance Platform	5

4.	Fiduciary Duty to Clients		6

	4.1.	Managing Conflicts	6

	4.2.	Confidentiality and Safeguarding Information	6

	4.3.	Prohibition on Front Running	6

	4.4.	Compliance with the Code of Ethics	7

5.	Reporting of Personal Trading		7

	5.1.	Which Investment Accounts Do Access Persons Need to Report?	7

	5.2.	Required Initial Holdings Reports and Certifications	8

	5.3.	Required Quarterly Transaction Reports	9

	5.4.	Annual Holdings Reports and Certifications	11

	5.5.	New Investment Accounts	11

6.	Pre-clearance for Personal Trading		11

	6.1.	Trades Requiring Pre-Clearance	12

	6.2.	Trades Not Requiring Pre-Clearance	12

	6.3.	Prohibited Transactions	13

7.	Trading Restrictions		14

	7.1.	For All Trading	14

	7.2.	Excessive Trading in Reportable Accounts	14

	7.3.	Holding Periods	15

8.	Annual Review		15

9.	Retention of Records		15

10.	Sanctions		15

11.	Interpretations and Exceptions		16

12.	Supplement 1 – Transactions in Closed End Funds (“CEFs”) Advised or Sub-Advised by the Advisor		17

13.	Supplement 2 – Transactions in Exchange Traded Funds (“ETFs”) Advised or Sub-Advised by the Advisor and Securities Traded by Such Funds		19

14.	Supplement 3 – Transactions in Unit Investment Trusts (“UITs”) for Which the Advisor Assists with the Selection of Securities Traded by Such Trusts		20

LOGO

1.	Objectives of the Code of Ethics

Guggenheim Partners Investment Management, LLC (“GPIM” or the “Advisor”), its subsidiaries and affiliated investment advisers are committed to conducting our investment advisory business with the highest legal and ethical standards. We aim to uphold our reputation of integrity and professionalism in the furtherance of the interests of our clients and in a manner that is consistent with all applicable laws, rules and regulations. This reputation is a vital business asset and has generated the trust and confidence of GPIM’s clients.

Accordingly, the Advisor has adopted this Code of Ethics (the “Code”) to effectuate the purposes and objectives of Rule 204A-1 of the Investment Advisers Act of 1940, as amended (the “Advisers Act”) and in accordance with industry best practices. All persons associated with the Advisor are responsible for knowing and understanding the policies and guidelines contained in the Code. Our conduct should reflect GPIM’s values, demonstrate ethical leadership, and promote a work environment that upholds our reputation for integrity, ethical conduct and trust. The Code sets forth the general principles and standards of conduct expected from you. It cannot and is not intended to cover every scenario or circumstances under which you may face business and personal conflicts. Technical compliance is not enough and you are expected to comply with the spirit of the Code.

Compliance monitors, surveils and escalates to the business when appropriate. The GPIM Chief Compliance Officer (“CCO”) and GPIM Compliance Department should be contacted for advice and recommendations as to compliance with regulatory requirements, this Code and together with the GPIM Compliance Manual (“Manual”), the Compliance Program. However, the business has primary authority and control over the investment activities and operation of GPIM and for managing employees. Access Persons should contact Guggenheim Partners’ Central Compliance Department (“Central Compliance”) with any questions on employee trading and activities.

If you have any questions, please speak to a member of the GPIM Compliance Department.

2.	Who is Subject to the Code?

As a condition of employment, all individual employees, officers, principals, partners and directors of GPIM (generally referred to as “Employees”) are required to comply with the Code. In addition, the following categories of persons are considered to be Access Persons and are required to comply with the Code together with Employees. “Access Person”¹ includes any:

Employee, Director, officer, manager, principal and partner of the Advisor (or other persons occupying a similar status or performing similar functions), or other person who provides advice on behalf of the Advisor or is subject to the Advisor’s supervision and control;

¹	This includes any arrangement where the Access Person serves as an agent, executor, trustee or in another capacity.


Confidential		3

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Any person who:

Has access to nonpublic information regarding any of the Advisor’s client’s purchase or sale of securities, or nonpublic information regarding the portfolio holdings of any client account the Advisor or their affiliates manage, or any fund which is advised or sub-advised by the Advisor (or certain affiliates, where applicable);

ii.

Makes recommendations or investment decisions on behalf of the Advisor;

iii.

Has the power to exercise a controlling influence over the management and policies of the Advisor, or over investment decisions, who obtains information concerning recommendations made to a client account with regard to the purchase or sale of a security;

iv.

The CCO shall determine on a case-by-case basis whether a temporary employee (e.g., consultant or intern) should be considered an Access Person. Such determination shall be made based upon an application of the criteria provided above, whether an appropriate confidentiality agreement is in place, and such other information as may be necessary to ensure that proprietary information is protected. As such, temporary employees may only be subject to certain sections of the Code, such as certifying to it, or may be exempt from certain reporting requirements such as not having to hold their reportable accounts at the permitted broker-dealers; or

Any person deemed to be an Access Person by the CCO.

3.	Who Administers the Code?

3.1.

Chief Compliance Officer

3.1.1.

Responsibilities

The Advisor’s Compliance Department (the “GPIM Compliance Department”) is responsible for administering the Code of Ethics under the auspices and responsibility of the CCO and the Advisor’s senior management. The CCO will delegate appropriate responsibilities to designated members of the GPIM Compliance Department. Central Compliance administers certain sections of the Code of Ethics pertaining to Employee activities.

3.1.2.

Reporting of Violations

If an Access Person becomes aware of a violation of this Code, the Access Person has an obligation to report the matter promptly to the CCO. Nothing in this policy prohibits an Access Person from contacting a securities regulator.

3.1.3.

Review of Violations

The GPIM Compliance Department will review all violations of the Code and oversee any appropriate investigation and subsequent response. As the designee of senior management, the CCO shall have the right to make final and binding interpretations of the Code and may grant, using his/her discretion, exceptions to certain of the Code’s requirements and restrictions.


Confidential		4

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•

No Employee, who in good faith reports a violation of this Code, shall suffer harassment, retaliation or with respect to a report concerning a violation by another Employee, adverse employment consequences.

•

An Employee who retaliates against someone who has reported a violation in good faith may be subject to disciplinary action. Alternatively, the Advisor will treat any malicious or knowingly false report of a violation to be a serious offense and may discipline the Employee making such a report.

3.1.4.

Review of CCO Compliance with Code

A member of senior management of the Advisor or any other person designated (e.g., a member of the Legal Department or the Global Head of Compliance or his designee), who may or may not be an Employee of the Advisor, is responsible for reviewing the CCO’s personal trading reports and Code certifications required under the Code. If the CCO is in violation of the Code, senior management will impose the appropriate sanction(s).

3.1.5.

Employee Cooperation

Employees are encouraged to share questions, concerns, suggestions or complaints with the GPIM Compliance Department. Reports of violations or suspected violations will be kept confidential to the extent possible, but consistent with the need to conduct an adequate investigation.

3.2.

Code of Ethics Compliance Platform

3.2.1.

Use of Compliance Platform

The Advisor utilizes an electronic Compliance Platform, to manage the Code’s reporting and certification obligations. Access Persons are required to use the Compliance Platform, to the extent practical.

•

Code reporting requirements are to be completed through the Compliance Platform (including certifications, personal securities transactions covered by the Code, disciplinary disclosures, outside business affiliations, private transactions, board memberships, and gifts and entertainment) or through an alternate manner approved by the GPIM Compliance Department.

•

At the time of designation as an Access Person, Central Compliance will provide all Access Persons with login information and instructions for using the Compliance Platform.

3.2.2.

Electronic Reporting

Quarterly personal securities transaction reporting and annual holdings reporting will be completed electronically, to the extent practical. In order for duplicate brokerage statements to be sent directly to the Compliance Platform or for electronic feeds to be established, Access Persons may need to provide appropriate authorization to their brokers.


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3.2.3.

Exceptions to Electronic Reporting

On a case by case basis and at the discretion of Central Compliance, paper reports and certifications may be accepted in lieu of electronic reporting on the Compliance Platform.

4.	Fiduciary Duty to Clients

4.1.

Managing Conflicts

Access Persons owe a fiduciary duty to clients and have an obligation to act in their clients’ best interests. Access Persons must scrupulously avoid serving personal or conflicted interests ahead of the interests of clients. Conflicts and potential conflicts can arise in a variety of situations. All Access Persons must also seek to identify and appropriately address potential conflicts between and among client accounts as well. One client’s interests may not be favored over the interests of another. The Manual, available via OneGuggenheim, includes the Private Transactions Conflicts of Interests Review Policy that provides additional guidance and procedures for addressing potential conflicts within a business transaction context.

4.2.

Confidentiality and Safeguarding Information

Unless permitted in writing prior to disclosure, information regarding clients or their accounts may not be shared with persons outside of the Advisor, such as vendors, family members, or market participants. In particular, information regarding the trading intentions of clients or the Advisor on behalf of its clients may not be shared. Access Persons may have information regarding clients, their investment strategies, strategic plans, assets, holdings, transactions, personnel matters and other information. This information must remain confidential and may not be shared outside the Advisor.

4.3.

Prohibition on Front Running

Front-running, or engaging in conduct that may be construed as front-running, is strictly prohibited under this Code. Such conduct generally involves an Access Person purchasing or selling a Covered Security for his/her own account(s) on the basis of trading plans or actual trading positions of the Advisor’s client account(s) over which the Access Person has investment control when the Access Person knows that such order is likely to materially change a price received by a client or move a market to the benefit of the Access Person and detriment of the client. Proprietary, Access Persons’, and discretionary accounts will be monitored for front-running.


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4.4.

Compliance with the Code of Ethics

On a quarterly basis, Access Persons are required to acknowledge that they have reviewed, understand and agree to comply with the Code. A current copy of this Code is available via OneGuggenheim.

5.	Reporting of Personal Trading

It is the sole responsibility of the Access Person to ensure that all reporting requirements are completed by the timeframes set forth by this Code. This may mean that the Access Person may have to enter information manually, provide statements or follow up with his/her broker-dealer or bank.

5.1.

Which Investment Accounts Do Access Persons Need to Report?

Generally, any account which is in the name of the Access Person and members of his/her Immediate Family², which can, even if the account does not currently, hold Covered Securities (as defined in Section 5.3.1) will need to be reported.

5.1.1.

Report any of the following Investment Accounts:

The Access Person has Beneficial Ownership³ over an Investment Account.

Any Investment Account with a broker-dealer or bank over which the Access Person has investment decision-making authority (including accounts that the Access Person is named on, such as being a guardian, executor or trustee, as well as accounts that Access Person is not named on such as an account owned by another person but for which the Access Person has been granted trading authority).

Any Investment Account with a broker-dealer or bank established by partnership, corporation, or other entity in which the Access Person has a direct or indirect interest through any formal or informal understanding or agreement.

Any college savings account in which the Access Person has investment discretion and which holds securities issued under Section 529 of the Internal Revenue Code and in which the Access Person has a direct or indirect interest.

Any other account that the CCO deems appropriate in light of the Access Person’s interest or involvement.

Immediate Family includes, but is not limited to, a spouse, child, grandchild, stepchild, parent, grandparent, sibling, mother or father-in-law, son or daughter-in-law, or brother or sister-in-law, living in the same household, or otherwise dependent on the Access Person. Access Persons may rebut this presumption if they are able to provide the Advisor with satisfactory assurances that they have no material interest in the account and exercise no control over investment decisions made regarding the account. Access Persons should consult with Central Compliance for guidance regarding this process.

A person has Beneficial Ownership if he or she, directly or indirectly through any contract, arrangement, understanding, relationship or otherwise, has or shares a direct or indirect pecuniary (financial) interest in a (i) security or (ii) accounts which can hold securities, including but not limited to: individual, joint, partnership, custodial, trust, IRA, UGMA and KEOGH accounts. The determination of Beneficial Ownership is the responsibility of each Access Person: it is a fact-based decision.


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Any account in which the Access Person’s Immediate Family is the owner. Access Persons are presumed to have investment decision-making authority for, and therefore should report, any Investment Account of a member of their Immediate Family if they live in the same household.

Any 401(k) accounts from a previous employer which can, or offer the ability to, hold Covered Securities.

5.1.2.

Independently managed third-party account reporting:

Access Persons must disclose managed/third-party discretionary accounts, i.e., where the person has “no direct or indirect influence or control”.

Access Persons are required to obtain a signed copy of the Managed Account Letter (provided by Central Compliance) from their third-party investment advisor confirming that the advisor has authority to effect transactions on behalf of the account without obtaining prior consent of the Access Person and that the Access Person does not direct trades in the account.

Access Persons should immediately notify Central Compliance in writing if there are any changes in control over the account or if there are any changes to the relationship between the trustee or third-party investment advisor and the Access Person (i.e., independent professional or friend or relative, unaffiliated versus affiliated firm). Please note that an immediate family member with discretion over a covered account is not considered a third-party advisor.

Trades in managed/third-party discretionary accounts are not subject to the pre-clearance requirements and trading restrictions of the Code.

Account holdings/transactions in such accounts do not need to be reported if the Access Person has no influence or control over the account.

5.2.

Required Initial Holdings Reports and Certifications

Information that is required when you initially become subject to the Advisor’s Code:

Access Persons must report all of their Investment Accounts. (See Section 5.1.1 for more information.)

The report must include copies of statements which include the name of the broker/dealer or bank, title on the account, security names, and the number of shares and principal amount of all holdings.

If the Access Person’s brokerage firm provides automatic feeds to the Compliance Platform, the Advisor will obtain account information electronically, after the Access Person has completed the appropriate authorizations as required by the brokerage firm.


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All required account information must be reported within 10 calendar days from the date of hire, or the date on which the Access Person becomes an Employee of the Advisor and so designated as an Access Person, and the information must be current as of a date no more than 45 calendar days prior to the date the person becomes an Access Person.

Access Persons must complete a form certifying receipt and acknowledgement of this Code.

All Access Persons and any new accounts of current Access Persons must maintain their personal brokerage accounts with brokerage firms designated and approved by Central Compliance.⁴ The CCO or his designee may provide exceptions to this policy on a limited basis, however the Access Person will be responsible for ensuring that the account statements and trade confirmations are received by Central Compliance in a timely manner.

Existing accounts by new Access Persons which are not held at the permitted broker-dealers must be transferred within 60 calendar days from the date the Access Person is so designated; the failure to transfer within this time will be considered a violation of this Code. Any request to extend the 60 days transfer deadline must be accompanied by a written explanation by the current broker-dealer as to the reason for delay. Central Compliance may grant specific exceptions in writing.

5.3.

Required Quarterly Transaction Reports

5.3.1.

Information required on a quarterly basis:

Access Persons must report all their quarterly transactions in Covered Securities in which they have a direct or indirect beneficial interest, within at least 30 calendar days after quarter end.

“Covered Securities,” as defined by the Acts, are any financial instrument related to a security, including:

•

Stock

•

Note

•

Treasury stock

•

Security future

•

Bond

•

Debenture

•

Evidence of indebtedness

⁴	The list of designated Broker Dealers is available on OneGuggenheim at: http://oneguggenheim/Compliance/Pages/Designated-Broker-Dealers.aspx?type=GPIM?Source=http://oneguggenheim/compliance/Pages/default.aspx


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•

Investment contract

•

Voting trust certificate

•

Certificate of deposit for a security

•

Option on any security or on any group or index of securities (e.g., put, call or straddle)

•

Exchange traded fund (ETF)

•

Limited partnership

•

Certificate of interest or participation in any profit-sharing agreement

•

Collateral-RIC certificate

•

Fractional undivided interest in oil, gas or other mineral right

•

Pre-organizational certificate or subscription

•

Transferable shares

•

Foreign unit trust (i.e., UCIT) and foreign mutual fund

•

Private Investments (as defined in Section 6.1 below). Please note that a Private Investment and Loan Pre-Clearance Form (available through OneGuggenheim) must be completed prior to any new investment.

•

Unit investment trusts (UIT)

•

Closed-end mutual funds

•

Any 529 college savings plans

•

Open-end mutual funds managed, advised or sub-advised by the Advisor or an affiliate, as applicable

•

Any other instrument that is considered a “security” under the applicable securities laws

The term “Covered Securities” does not include obligations of the U.S. government, futures on obligations of the U.S. government, bank loans, bankers acceptances, bank certificates of deposit, commercial paper and high quality short term debt instruments such as repurchase agreements, shares issued by unit investment trusts that are invested exclusively in one or more open-end funds, none of which are reportable funds, or open-end mutual funds which the Advisor or its affiliates, as applicable, do not manage, advise or sub-advise (Access Persons should be aware that investments in Guggenheim Funds through its 401(k) or Employee Investment Program are reportable as Covered Securities).

From time to time, the Compliance Platform may not receive all duplicate statements from brokers or may not receive them on a timely basis. In those cases, Access Persons will be notified by Central Compliance and must provide copies of the statements to Central Compliance who will forward the information to the Compliance Platform.


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5.4.

Annual Holdings Reports and Certifications

5.4.1.

Information required on an annual basis:

•

Access Persons must provide a list of all Covered Securities in which they or their Immediate Family have a direct or indirect interest, including those not held in an account at a broker-dealer or bank. The list must include the title, number of shares and principal amount of each Covered Security. Access Persons must report the account number, account name and financial institution for each Investment Account with a broker-dealer or bank for which they are required to report.

•

Access Persons must report all accounts and holdings within 30 calendar days after year end via the Compliance Platform, or as otherwise permitted by Central Compliance, and the information must be current as of a date no more than 45 calendar days prior to the date the report is submitted.

•

Access Persons must also certify annually that they have complied with the requirements and have disclosed all holdings required to be disclosed pursuant to the requirements of this Code. In addition, Access Persons will respond to personal disciplinary history questions.

5.5.

New Investment Accounts

Upon opening a reportable account or obtaining an interest in an account that requires reporting, the account must be reported within 5 calendar days of funding the Investment Account. The account must be reported to Central Compliance via the Compliance Platform or as otherwise permitted by Central Compliance, along with the title of the account, the name of the financial institution for the account, the date the account was established (or the date on which interest or authority that requires the account to be reported was gained) and the date reported.

6.	Pre-clearance for Personal Trading

All Access Persons must pre-clear any trades in their Investment Accounts (except as provided below) through the Compliance Platform prior to execution. Prior to participating in any Private Investments (as defined below), all Access Persons must pre-clear (i.e., receive approval) for proposed transactions through Central Compliance. This is necessary in order to verify that there is no conflict between the desired trade and the Advisor’s current activities or the interests of the Advisor and its clients.

Approvals to trade in an Investment Account are generally only good on the day they are sought. If an Access Person receives approval to trade a security and does not execute the trade on the day the approval is received, the trade will need to be pre-cleared again if the Access Person still wants to execute the trade.


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If an Access Person is in possession of material non-public information about any security, the Access Person must not trade it, in accordance with GPIM’s Insider Trading Policy (see the Manual for more information), despite pre-clearing the trade and receiving approval.

6.1.

Trades Requiring Pre-Clearance

Covered Securities: Unless excluded below, Access Persons must pre-clear trades in Covered Securities through the Compliance Platform, which checks the trade against the Advisor’s Restricted List and any other applicable rules and guidelines. (See Section 5.3.1 above for the full list of Covered Securities.)

Initial Public Offerings: Trades in IPO’s must be pre-cleared. Access Persons must request pre-approval by submitting the Private Investment and Loan Pre-Clearance Form to Central Compliance. The form is available on OneGuggenheim. Note: Any Employee who is also registered with a broker-dealer is prohibited from participating in an IPO.

Private Investments: Private Investments include, but are not limited to investments in: hedge funds, private equity funds, venture capital funds, other private fund vehicles and privately-held companies. New Access Persons must disclose any existing Private Investments within 10 days of becoming an Access Person. The Central Compliance Employee Activities Group sends an email to all new Access Persons with the Private Investments Disclosure Form, which they must complete. Existing Access Persons are required to seek prior written approval to invest in any new Private Investments and must complete the Private Investment and Loan Pre-Clearance Form (available through OneGuggenheim), providing information about the investment that will assist Central Compliance with the review of the request. The Guggenheim Capital Conflicts Review Committee (“CRC”) may also review private investment requests for approval, as necessary. Approval by the CRC is required in the event that it is determined that a proposed or existing private investment involves one or more potential significant conflicts of interest.

6.2.

Trades Not Requiring Pre-Clearance

Government Securities/Certain Other Debt Instruments: Trades in any direct obligations of the U.S. Government, bankers’ acceptances, bank certificates of deposit, commercial paper and high quality short-term debt instruments including repurchase agreements are not required to be pre-cleared.

Money Market Funds: Trades in any investment company or fund that is a money market fund are not required to be pre-cleared.

Open-End Registered Funds: Trades in open-end mutual funds that are not advised or sub-advised by the Advisor or affiliates are not required to be pre-cleared.

No Knowledge: Securities transactions where no knowledge of the transaction exists before it is completed are not required to be pre-cleared. For example, a transaction


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effected by a trustee of a blind trust or discretionary trades involving an investment partnership, when the Access Person is neither consulted nor advised of the trade before it is executed, are not required to be pre-cleared. If an option is exercised, the underlying transaction need not be pre-cleared though the option itself must be pre-cleared.

Certain Corporate Actions: Any acquisition of securities through stock dividends, dividend reinvestments, stock splits, reverse stock splits, mergers, consolidations, spin-offs, exercise of rights or other similar corporate reorganizations or distributions generally applicable to all holders of the same class of securities is not required to be pre-cleared.

529 College Savings Plans Not Advised or Sub-Advised by the Advisor: Any transaction in units of a college savings plan established under Section 529 of the Internal Revenue Code, unless the underlying investment includes Open-End Registered Funds advised or sub-advised by the Advisor, are not required to be pre-cleared.

Miscellaneous: Any transaction in any other securities as Central Compliance may designate.

6.3.

Prohibited Transactions

Investment Clubs: Participation in Investment Clubs is prohibited. Generally, an Investment Club is a group of people who pool their money to make investments. Usually, Investment Clubs are organized as partnerships and after members study different investments, the group decides to buy or sell based on a majority vote of the members. If you have any questions regarding whether an arrangement is an Investment Club, please contact Central Compliance.

Commodity Interests: Trading in Commodity Interests and related Futures are generally prohibited, except for the following types of futures: (i) Futures referencing broad-based securities indices (for example; S&P 500; NASDAQ 1000; and Russell 2000); (ii) Futures referencing major currencies (for example: Euro; Yen; Australian Dollar; and British Pound); (iii) Futures referencing the following physical commodities: Gold; Silver; Oil; and Natural Gas; and (iv) Futures referencing US Government debt obligations (for example: 30 year Treasury bond; 10/5 year Treasury Notes; and long-term Treasury Bonds).

Access Persons should consult with Central Compliance with regard to whether a particular instrument is a commodity interest. Senior management, together with the CCO, may grant exceptions to this prohibition on a case-by-case basis and approval will be conditioned on compliance with certain requirements.


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7.	Trading Restrictions

7.1.

For All Trading

In addition to reporting and pre-clearance obligations, the Code also includes restrictions regarding the manner in which Covered Securities may be traded and held in any reportable Investment Accounts. (See Section 5.1.1 for more information.)

Regardless of whether a transaction is specifically prohibited in this Code, no person subject to this Code may engage in any personal securities transactions that (i) impact their ability to carry out their assigned duties or (ii) increase the possibility of an actual or apparent conflict of interest. Access Persons are prohibited from the following under any circumstances:

7.1.1.

Market Manipulation

Securities transactions may not be executed with the intent to raise, lower, or maintain the price of any security or to falsely create the appearance of trading activity.

7.1.2.

Trading on Inside Information

Transactions (e.g., purchases or sales) of any security cannot be made if in possession of material non-public information about the security or the issuer of the security. (Please also refer to the Manual for the Insider Trading Policy.)

7.1.3.

Front-running

No Access Person may trade ahead of a client transaction. (See Section 4.3 for more information.)

7.2.

Excessive Trading in Reportable Accounts

Access Persons may not engage in excessive trading in their reportable Investment Accounts. Access Persons shall not make more than 60 Covered Securities trades in any reporting quarter. Transactions that do not require pre-clearance are not included in the total, and buy or sell transactions respectively, executed in the same security on the same day, are considered to be one transaction (i.e., an approved transaction executed in lots throughout the day is considered one transaction).

Option Strategies

Option strategies such as option spreads that are executed on the same security on the same day, are considered to be one economic transaction. The multiple transactions that make up the option spread will not be counted as individual transactions towards the excessive trading limit.


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7.3.

Holding Periods

7.3.1.

Registered Funds

Holding periods apply for certain funds advised or sub-advised by the Advisor. A list of applicable funds subject to additional personal trading policies is included as Supplements 1, 2 and 3.

•

After purchase in an account of a closed-end mutual fund advised or sub-advised by the Advisor, Access Persons must hold that security in that account for at least 60 calendar days from the date of purchase.

•

Note that this limitation also applies to any purchase or sale in an Access Person’s individual retirement account, 401(k), deferred compensation plan, or any similar retirement plan or Investment Account for their or their Immediate Family.

8.	Annual Review

The GPIM Compliance Department will review the adequacy of the policies and procedures contained in this Code and the effectiveness of its implementation on an annual basis. This review will consider any changes in the business activity of the Advisor and any changes to the Advisers Act or applicable regulations that might suggest a need to revise the policies and procedures contained herein. In addition, the GPIM Compliance Department will consider the need for interim reviews in response to significant compliance events, changes in business arrangements or regulatory developments.

9.	Retention of Records

This Code, as updated from time to time, acknowledgements of receipt of a copy of the Code by each Access Person, a list of all persons required to make reports hereunder from time to time, a copy of each report made by an Access Person and a record of any violation hereof and any action taken as a result of such violation, shall be maintained by the Advisor as required under the Advisers Act for a period of not less than 5 years.

Central Compliance will use best efforts to assure that all requests for pre-clearance, all personal securities transaction reports and all reports of securities holdings are treated as “Personal and Confidential.” However, such documents will be available for inspection by appropriate regulatory agencies, and by other parties within the Advisor and its affiliates as are necessary to evaluate compliance with, or sanctions under, this Code.

10.

Sanctions

This Code is designed to facilitate compliance with applicable laws and to reinforce the Advisor’s reputation for integrity in the conduct of their businesses. For violations of this Code, sanctions may be imposed as deemed appropriate by the GPIM Compliance Department with Central Compliance and as applicable in coordination with senior management. Escalation will depend on the severity and frequency of the infraction considering the facts and circumstances such as potential or actual harm or reputational risk to clients, prospects or the Advisor. A pattern of violations that individually do not violate the law, but which taken together demonstrate a pattern of lack of respect for the Code, may result in disciplinary action, including termination of employment.


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Specifically, the Access Person shall be subject to remedial actions which may include, but are not limited to, any one or more of the following: (1) verbal warning and/or letter of instruction; (2) written memo or letter of caution (including requirement for additional training) or other measures; (3) enhanced supervision or management plan; (4) decrease in compensation, performance measure or other penalty; (5) termination of employment; or (6) referral to civil or governmental authorities for possible civil or criminal prosecution. If the Access Person is normally eligible for a discretionary bonus, violations of the Code may also reduce or eliminate the discretionary portion of his/her bonus.

11.

Interpretations and Exceptions

The GPIM Compliance Department shall have the right to make final and binding interpretations of the Code and may grant, at its discretion, exceptions to certain of the prohibited transactions as described in this Code. Any memorandum created regarding the granting of any such exceptions will be retained. Each Access Person must obtain written approval from the GPIM Compliance Department before taking any action regarding such an exception.


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12.	Supplement 1 – Transactions in Closed End Funds (“CEFs”) Advised or Sub-Advised by the Advisor

With respect to transactions in CEFs advised or sub-advised by the Advisor, the following requirements are in addition to, or supplement, the requirements of the Advisor’s Code of Ethics (“Code”). Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Code.

12.1.

Pre-Approval

Access Persons are required to obtain prior approval through the Compliance Platform before undertaking any transaction (e.g., purchase or sale) in CEFs advised or sub-advised by the Advisor. Pre-approval is in addition to, not a substitute, for other restrictions discussed below.

12.2.

Blackouts – Dividend

Access Persons are prohibited from trading in CEFs advised or sub-advised by the Advisor seven (7) days before and seven (7) days after the initial dividend of such CEF is declared. Access Persons are also prohibited from trading in CEFs advised or sub-advised by the Advisor seven (7) days before the dividend of such CEF is declared. Dividends that are automatically reinvested are not subject to the pre-approval requirement.

12.3.

Blackouts – Fund Securities

Access Persons with knowledge about or access to information about CEF equity transactions (“Equity Access Persons”) may not engage in personal transactions in equity securities to be traded in CEFs advised or sub-advised by the Advisor seven (7) days before and seven (7) days after such transaction.

12.4.

Holding Period

Access Persons are required to hold any purchase of CEFs advised or sub-advised by the Advisor for sixty (60) calendar days. Additional holding period requirements exist for persons deemed to be insiders of a closed-end fund for the purposes of Section 16 of the Securities Exchange Act of 1934. Such persons should contact Central Compliance prior to effecting trading in the closed end fund(s) for which they are an insider.

12.5.

Requests for Exceptions from Blackouts

Requests for exceptions from the blackout restriction should be submitted in writing to Central Compliance. Central Compliance shall respond to all such requests in writing. Central Compliance will maintain records of all exception requests and records of all responses.


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12.6.

Review of Trading

Central Compliance will review trading activity of Access Persons and in other client accounts, at least quarterly, to ensure compliance with the above procedures. A record of such reviews will be maintained by Central Compliance.

12.7.

Reporting of Transactions

Access Persons must email the CEFs Advisor at: [email protected], but in no event more than 24 hours, after any transaction in CEFs advised or sub-advised by the Advisor. Such reporting is required to make mandatory regulatory filings within the required time period.


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13.

Supplement 2 – Transactions in Exchange Traded Funds (“ETFs”) Advised or Sub-Advised by the Advisor and Securities Traded by Such Funds

With respect to transactions in an ETF advised or sub-advised by the Advisor and equity securities traded by such Funds, the Advisor’s Access Persons are required to comply with the following requirements which are in addition to, or supplement, the requirements of the Advisor’s Code of Ethics (“Code”). Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Code.

13.1.

Pre-Approval

Access Persons are required to obtain prior approval through the Compliance Platform before undertaking any transaction (e.g., purchase or sale) in an ETF advised or sub-advised by the Advisor and the securities held by such ETFs. Pre-approval is in addition to, not a substitute for, other guidelines discussed below.

13.2.

Blackouts – Fund Securities

With respect to the Advisor role as the advisor or sub-advisor to an ETF, no Access Person with knowledge about or access to information about ETF equity transactions (“Equity Access Persons”) shall engage in a securities transaction in an equity security recommended for inclusion or exclusion for the ETF from the time a final recommendation concerning such security is communicated, either to the Advisor’s investment decision-maker or to the ETF’s Advisor, until the security is purchased or sold by the ETF.

13.3.

Investment of Dividends

Dividends that are automatically reinvested are not subject to the pre-approval requirement.

13.4.

Requests for Exceptions from Blackouts

13.5.

Review of Trading


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14.

Supplement 3 – Transactions in Unit Investment Trusts (“UITs”) for Which the Advisor Assists with the Selection of Securities Traded by Such Trusts

With respect to transactions in a UIT for which the Advisor assists with the selection of securities traded by such Trusts, and with respect to securities selected for inclusion for any such UIT, the Advisor’s Access Persons are required to comply with the following requirements which are in addition to, or supplement, the requirements of the Advisor’s Code of Ethics (“Code”). Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Code.

14.1.

Blackouts

With respect to the Advisor’s role in security selection for UITs, no Access Person with knowledge about or access to information about UIT equity transactions (“Equity Access Persons”) shall engage in a securities transaction in an equity security recommended for inclusion or exclusion for the UIT from the time a final recommendation concerning such security is communicated to the UIT Sponsor until the time such security is deposited into the UIT.

14.2.

Requests for Exceptions from Blackouts

14.3.

Review of Trading


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Exhibit (p)(4)(V)

The contents of this Code of Ethics document are proprietary and confidential. This document is furnished to the recipient on condition that the recipient will not disclose or reveal its contents to any other person and will limit its use solely in connection with its due diligence inquiries of Neuberger Berman for the purpose of evaluating a potential or existing business relationship. If the recipient is required by compulsory process to furnish this document to another person, the recipient will notify Neuberger Berman promptly after receiving such a request.

NEUBERGER BERMAN

CODE OF ETHICS

January 2018

CODE OF ETHICS

This Code of Ethics (the “Code”) is adopted by the North-American based registered investment advisers (the “NB Advisers”)¹ of Neuberger Berman Group LLC (the “Firm”) pursuant to Rule 204A-1 under the Investment Advisers Act of 1940 (the “Advisers Act”), the Neuberger Berman Group of Funds (the “NB Funds”) and any NB Adviser that serves as investment adviser or sub-adviser to the NB Funds or other non-NB Funds (collectively, the “Funds”) pursuant to Rule 17j-1 under the Investment Company Act of 1940 (the “Company Act”).

Any questions relating to this document should be brought to the attention of your designated Chief Compliance Officer or the firm’s Head of Compliance, Brad E. Cetron. A list of Chief Compliance Officers and other Compliance contacts within the Firm is attached here as Exhibit A.

By accepting employment with the Firm, you have agreed to be bound by this Code of Ethics. On an annual basis you will be required to certify in writing your understanding of, and adherence to, this Code and your intention to comply with its requirements (including any amendments).

¹	Neuberger Berman Investment Advisers LLC, NB Alternatives Advisers LLC, Neuberger Berman Breton Hill ULC and Neuberger Berman BD LLC. This Code also applies to Neuberger Berman Trust Company N.A. and Neuberger Berman Trust Company of Delaware N.A.

Table of Contents


Statement of General Principles			5
A. General Prohibitions			6
B. Definitions			6
C. Code Policies			12
1. Covered Accounts			12
2. Initial Public Offerings			12
3. Insider Trading			12
4. Transactions in Restricted List Securities			12
5. Private Placements			12
6. Dissemination of Client Information			13
7. Gifts			13
8. Related Issuer			13
9. Trading Opposite Clients			13
10. Service on a Board of Directors			14
11. Limitations on Short and Long Positions			14
12. Transactions in Shares of Funds			15
13. Sanctions			15
14. Violations			15
D. Reporting Requirements			15
1. Reports by Access Persons			15
2. Reports by Disinterested Directors/Trustees			17
3. Exceptions to Reporting Requirements			17
4. Notification of Reporting Obligations			17
E. Code Procedures			17
1. Maintenance of Covered Accounts			17
2. Pre-Clearance of Securities Transactions			18
a. Access Persons			18
b. Advisory Persons			18
c. NB CEF Insiders			19
d. Exceptions from Pre-Clearance Requirement			19
3. Blackout Period			19
a. Same Day – Advisory Persons of a Fund			19
b. Research Personnel			19
4. Price Restitution			19
a. Same Day Price Restitution			19
b. Five(5)/One(1) Day Price Restitution – Advisory Persons			20
c. Price Restitution Execution			20
d. Exceptions to Price Restitution			20
5. Holding Periods			21
a. Thirty (30) Day Holding Period			21
b. Sixty (60) Day Holding Period			21


c. Exceptions to the Holding Periods			21
6. Code Procedures Monitoring			22
F. NB Funds’ Ethics and Compliance Committee			22
G. Annual Report to the NB Funds’ Board			22
H. Administration			23
I. Recordkeeping			23
Exhibit A: Compliance Contacts			25
Exhibit B: Applicability of Code Procedures to Temporary Access Persons			26

Statement of General Principles

The Code is designed to ensure, among other things, that employees put Client interests first and conduct their activities in a manner consistent with applicable Federal Securities Laws. The following principles shall govern the personal investment activities of all individuals subject to this Code:

•

Employees must at all times place the interests of Clients ahead of their personal interests - Client trades have priority over personal securities trades.

•

Personal securities transactions must be conducted in accordance with this Code and in such a manner as to avoid any actual, perceived or potential conflict of interest or abuse of an employee’s position of trust and responsibility.

•

Employees should not take advantage of their position to benefit themselves at the expense of any Client.

•

In personal securities investing, employees should follow a philosophy of investment rather than trading.

•

Employees must comply with applicable Federal Securities Laws.

A. General Prohibitions

No person associated with the NB Advisers or the Firm, in connection with the purchase or sale, directly or indirectly, of a security held or to be acquired by a Client, shall:

•

Employ any device, scheme or artifice to defraud any Client;

•

Make any untrue statement of a material fact to any Client or omit to state to such Client a material fact necessary in order to make the statements made, in light of the circumstances under which they are made, not misleading;

•

Engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any Client;

•

Engage in any manipulative practice with respect to any Client;

•

Engage in any transaction in a security while in possession of material nonpublic information regarding the security or the issuer of the security; or

•

Engage in any transaction intended to raise, lower, or maintain the price of any security or to create a false appearance of active trading.

B. Definitions

The following words have the following meanings in this Code:

Access Person

a.	Any employee, officer, director of any NB Adviser or NB Fund (or any company controlled by the NB Advisers) and their Immediate Family Members; and

Any director, officer or general partner of a principal underwriter who, in the ordinary course of business, makes, participates in or obtains information regarding the purchase or sale of Covered Securities by any NB Fund for which the principal underwriter acts, or whose functions or duties in the ordinary course of business relate to the making of any recommendation to the NB Fund regarding the purchase or sale of Covered Securities.

c.	Any temporary employee, consultant, contractor, intern or other person who will be on the Firm’s premises for a period of ninety (90) days or more. See Exhibit B for applicability of Code Procedures to Temporary Access Persons.

Advisory Person

An Access Person of the NB Advisers who, in connection with his or her regular functions or duties, makes, or participates in making, recommendations regarding the purchase or sale of Covered Securities by a Related Client. The determination as to whether an individual is an Advisory Person shall be made by the Legal and Compliance Department, taking into consideration the following roles and responsibilities: Portfolio Manager, Traders, Analysts (credit/research) and any member on any of their respective teams, including Administrative Assistants.

Beneficial Interest

An employee has a Beneficial Interest in an account if they may profit or share in the profit from transactions. In general, a person is regarded as having direct or indirect Beneficial Interest in securities held in his or her name, as well as:

•

in the name of an Immediate Family Member;

•

in his or her name as trustee for himself or herself or for his or her Immediate Family Member;

•

in a trust in which he or she has a Beneficial Interest or is the settlor with a power to revoke;

•

by another person and he or she has a contract or an understanding with such person that the securities held in that person’s name are for his or her benefit;

•

in the form of acquisition rights of such security through the exercise of warrants, options, rights, or conversion rights;

•

by a partnership of which he or she is a member;

•

by a corporation which he or she uses as a personal trading medium;

•

by a holding company which he or she controls; or

•

any other relationship in which a person would have beneficial ownership under Rule 16a-1(a)(2) of the Securities Exchange Act of 1934 and the rules and regulations thereunder, except that the determination of direct or indirect Beneficial Interest shall apply to all securities which an Access Person has or acquires.

Any employee who wishes to disclaim a Beneficial Interest in any securities must submit a written request to the Legal and Compliance Department explaining the reasons therefore. Any disclaimers granted by the Legal and Compliance Department must be made in writing. Without limiting the foregoing, if a disclaimer is granted to any employee with respect to an account of an Immediate Family Member, the provisions of this Code applicable to such employee shall not apply to the Immediate Family Member for which such disclaimer was granted. However, if the Immediate Family Member whose account was disclaimed is also an employee of an NB Adviser, the sections of this Code applicable to employees would still be applicable to the employee’s Immediate Family Member.

Blind Trust

A trust in which an Access Person has Beneficial Interest or is the settlor with a power to revoke, with respect to which the Legal and Compliance Department has determined that such Access Person has no direct or indirect influence or control over the selection or disposition of securities and no knowledge of transactions therein, provided, however, that direct or indirect influence or control of such trust is held by a person or entity not associated with the Firm and not a relative of such Access Person.

Client

An investment advisory account, including, but not limited to, the Funds, other commingled investment vehicles and separate accounts for which any of the NB Advisers provides investment advice, management or exercises discretion.

“Control” means the power to exercise a controlling influence over the management or policies of a company, unless such power is solely the result of an official position with such company. Generally, any person who owns beneficially, either directly or through one or more controlled companies, more than 25 percent of the voting securities of a company shall be presumed to control such company (Section 2(a)(9) of the Company Act).

Covered Account

An account held in the name of an Access Person where the Access Person has, or is deemed to have, a Beneficial Interest, including investments held outside of an account over which an Access Person has physical control, such as a stock certificate.

Covered Security

Any note, stock, treasury stock, security future, bond, debenture, evidence of indebtedness, certificate of interest or participation in any profit-sharing agreement, collateral-trust certificate, preorganization certificate or subscription, transferable share, investment contract, voting-trust certificate, certificate of deposit for a security, fractional undivided interest in oil, gas, or other mineral rights, any put, call, straddle, option, or privilege on any security (including a certificate of deposit) or on any group or index of securities (including any interest therein or based on the value thereof), or any put, call, straddle, option, or privilege entered into on a national securities exchange relating to foreign currency, or, in general, any interest or instrument commonly known as a “security”, or any certificate of interest or participation in, temporary or interim certificate for, receipt for, guarantee of, or warrant or right to subscribe to or purchase, any of the foregoing;

b.	Shares of any Fund; and

c.	Exchange Traded Funds and closed-end funds registered under the Company Act.

The term Covered Security does not include:

a.	Direct obligations of the Government of the United States, its territories or States or Related Securities thereof, (including short term debt securities that are government securities within the meaning of the law);

b.	Bankers’ acceptances, bank certificates of deposit, commercial paper and high quality short- term debt instruments including repurchase agreements; and

Shares issued by registered open-end investment companies for which any NB Adviser does not act as investment adviser, sub-adviser or distributor provided such shares are held directly with the fund company in a mutual fund account and not in a third party brokerage account unless the Access Person has obtained prior written approval from the Legal and Compliance Department to maintain such account.

De minimis Restitution

Price restitutions that result in less than $1000 collectively or where the gain to be received by each underlying Client account is less than $100.

Disinterested Director/Trustee

A person who serves as director/trustee of an NB Fund and is not otherwise affiliated with an NB Fund.

Domestic Partnership

An interpersonal relationship between two individuals who live together and share a common domestic life (“Domestic Partners”).²

Ethics and Compliance Committee

The Ethics and Compliance Committee of the NB Funds.

Exchange Traded Fund

Unit investment trusts or open-ended investment companies registered under the Company Act that trade on a national stock exchange.

Exempt Transactions

Transactions that may be exempt from certain provisions of the Code such as, pre-clearance, minimum holding periods, or blackout periods. Exempt Transactions are not exempt from the general provisions of the Code including reporting requirements. The following have been defined as Exempt Transactions:

a.	Transactions in Managed Accounts.

b.	Transactions made automatically in accordance with a predetermined schedule and allocation, such as part of a dividend reinvestment plan (“DRIP”).

c.	An involuntary purchase effected upon the exercise of rights issued by an issuer pro rata to all holders of a class of its securities, to the extent such rights were acquired from such issuer, and sales of rights so acquired.

d.	The acquisition or disposition of securities through stock dividends, stock splits, reverse stock splits, mergers, margin calls, consolidations, spin-offs, or other similar corporate reorganizations or distributions generally applicable to all holders of the same class of securities.

e.	Securities transactions effected in Blind Trusts.

A transaction by an NB Fund Disinterested Director/Trustee unless at the time of such transaction, the Disinterested Fund Director/Trustee, knew or should have known that, during the fifteen calendar day period immediately preceding or, after the date of the transaction by the Disinterested Director/Trustee, such security was purchased or sold by the NB Fund or was being considered for purchase or sale for Clients of the NB Adviser.

g.	Transactions in the following broad-based security indices: S&P 500, NASDAQ, 7-10 Year Treasury Bond Index, 20+ Year Treasury Bond Index, Russell 2000 and Dow Jones Industrial Average.

h.	Other transactions designated in writing by the Legal and Compliance Department.

Federal Securities Laws

The Securities Act of 1933 (“Securities Act”), the Securities Exchange Act of 1934 (“Exchange Act”), the Company Act, the Advisers Act, the Sarbanes-Oxley Act of 2002 (as applicable), Title V of the Gramm- Leach-Bliley Act, any rules adopted by the Securities and Exchange Commission

²	The above definition is being used solely for purposes of this Code of Ethics and should not be construed as the applicable definition for other purposes (e.g., employee benefits).

(“SEC”) under any of these statutes, the Bank Secrecy Act as it applies to registered investment companies and investment advisers, and any rules adopted thereunder by the SEC or the Department of the Treasury.

Fund

Any investment company, and series thereof, registered under the Company Act for which any NB Adviser is the investment manager, investment adviser, sub-adviser, administrator or distributor.

iCompliance

The Firm’s proprietary employee compliance dashboard managed by the Legal and Compliance Department. iCompliance facilitates the reporting and monitoring of a number of key compliance requirements including: the Firm’s annual personal securities holding affirmation; tracking of employee outside investments, outside activities, political contributions and employee licenses and registrations; and a pre-trade approval process for employee trading activity that occurs at third party broker-dealers.

Immediate Family Member

a.	An Access Person’s child, stepchild, grandchild, parent, stepparent, grandparent, spouse, Domestic Partner, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, sister-in- law, including adoptive relationships; and

b.	Any other relative or person who shares the same household as the Access Person and to whom the employee provides material financial support and is deemed to be an Immediate Family Member by the Legal and Compliance Department.

Legal and Compliance Department

The Neuberger Berman Legal and Compliance Department.

Limited Access Person

An Access Person’s Immediate Family Member who would otherwise be an Access Person but who is determined by the Legal and Compliance Department to be a Limited Access Person considering factors including, but not limited to, whether the Immediate Family Member shares the same household as the Access Person and is financially dependent on the Access Person.

Limited Access Person Account

An account in the name of a Limited Access Person held at the Firm. A Limited Access Person Account may be treated as a Managed Account at the discretion of the Legal and Compliance Department.

Managed Account

A Covered Account where full control and investment discretion has been delegated pursuant to an investment advisory agreement that includes the payment of a management fee to: 1) an unrelated third party investment manager, or 2) a Neuberger Berman portfolio management team of which the employee is not a member. A Limited Access Person Account may be treated as a Managed Account at the discretion of the Legal and Compliance Department.

NB Advisers

The Firm’s North-American .-based investment advisers: Neuberger Berman Investment Advisers LLC, Neuberger Berman Breton Hill ULC, Neuberger Berman BD LLC, NB Alternatives Advisers LLC, Neuberger Berman Trust Company N.A., Neuberger Berman Trust Company of Delaware N.A.

NB Closed-End Fund (“CEF”) Insider

An Access Person who is a director, officer or principal stockholder (holder of more than 10% of a class of reportable securities) of any company that has a class of equity securities registered pursuant to Section 12 of the Exchange Act and is subject to beneficial ownership reporting obligations under Section 16. Obligations apply to all insiders of the closed-end funds (“NB CEF”) as well as to NBIA and certain of its affiliated persons.

NB Funds

The NB Group of Funds.

Private Placement

An offering that is exempt from registration under the Securities Act pursuant to Section 4(2) or Section 4(6) or pursuant to Rules 504, 505 or 506 under the Securities Act.

Related Client

A Client account, including a proprietary account consisting of seed capital during the incubation period, for which an Advisory Person or the portfolio management team of which the Advisory Person is a member, has or is deemed to have, investment decision-making authority or is responsible for maintaining and/or reviewing information pertaining to the account.

Related Issuer

An issuer with respect to which an Advisory Person or their Immediate Family Member: (i) has a material business relationship with such issuer or any promoter, underwriter, officer, director, or employee of such issuer; or (ii) is an Immediate Family Member of any officer, director or senior management employee of such issuer.

Related Security

A Related Security is one whose value is based on or derived from the value of another security, including convertible securities and derivative securities such as options, futures and warrants.

Security Held or to be Acquired by a Client

Any Covered Security (or Related Security) that within the most recent fifteen (15) days:

•

is or has been held by a Client, or

•

is being or has been considered by a NB Adviser for purchase by such Client.

Trading Desk

The Neuberger Berman Trading Desk.

C. Code Policies

1.	Covered Accounts

Access Persons who are not Advisory Persons are generally permitted to maintain their Covered Accounts at Neuberger Berman, or with prior approval from the Legal and Compliance Department, at Fidelity Investments (“Fidelity”). Advisory Persons are generally required to maintain their Covered Accounts at Neuberger Berman.³

2.	Initial Public Offerings

Access Persons are generally prohibited from acquiring direct or indirect beneficial ownership of any equity security in an initial public offering.

3.	Insider Trading

The Firm has adopted an Information Barrier Policy and related MNPI Procedures (together, the “Insider Trading Policy and Procedures”). All Access Persons are required to be familiar with the Insider Trading Policy and Procedures and shall certify, on an annual basis, that they have read, understood and complied with the requirements of this Code and the Insider Trading Policy and Procedures.

4.	Transactions in Restricted List Securities

Access Persons may obtain material non-public information (“MNPI”) or establish special or “insider” relationships with one or more issuers of securities (e.g., the employee may become an officer or director of an issuer, a member of a creditor committee that engages in material negotiations with an issuer, and so forth). In such cases, the Access Person should keep in mind that they are subject to the Firm’s Information Barrier Policy and the MNPI Procedures.

5.	Private Placements

Access Persons may not acquire direct or indirect Beneficial Interest in any Private Placement without prior written approval from the Legal and Compliance Department and such other persons as may be required. Private Placements include, but are not limited to, any interest in a hedge fund, private equity vehicle or other similar private or limited offering investment.

Approval of a Private Placement shall take into account, among other factors, whether: i) the investment opportunity should be reserved for a Client, and ii) the opportunity is being offered to the individual by virtue of his or her position with the Firm, the NB Adviser or his or her relationship with or to the Client or the issuer of the Private Placement. Additional capital investments (other than capital calls related to the initially approved investment) in a previously approved Private Placement require a new approval.

³	See Section E(1) for information related to Maintenance of Employee Covered Accounts.

Advisory Persons who hold a previously approved Private Placement and are subsequently involved, or play a part in the consideration of the same Private Placement as an investment for a Related Client, must inform the Legal and Compliance Department of their personal investment (or their Immediate Family Member’s investment). The decision to invest in the Private Placement for a Related Client will be determined by the Legal and Compliance Department and other relevant parties as deemed necessary for the review process.

Access Persons’ private placement redemptions are subject to review and approval by the Legal and Compliance Department.

6.	Dissemination of Client Information

Access Persons are prohibited from revealing material information relating to current or anticipated investment intentions, portfolio transactions or activities of Client/Funds except to persons whose responsibilities require knowledge of such information.

Gifts

Access Persons are prohibited from giving or receiving any gift or other item of value to or from any one person or entity that does business with the Firm without prior approval from the Legal and Compliance Department. Generally, promotional items valued at $25 or less do not require prior approval although certain recipients may be subject to stricter gift limits under state rules or rules applicable to ERISA fiduciaries. The Firm has adopted gift and entertainment policies to which all employees are subject. See the NB Code of Conduct and the Political Activity Policy for additional information.

8.	Related Issuer

Advisory Persons are required to disclose to the Legal and Compliance Department when they play a part in any consideration of an investment by a Client in a Related Issuer. The decision to purchase securities of the Related Issuer for a Client will be determined by the Legal and Compliance Department and other relevant parties as deemed necessary for the review process.

9.	Trading Opposite Clients

No Advisory Person or Advisory Person of a Fund may execute transactions in a Covered Security held in a Covered Account that would be on the opposite side of any trade in a Related Client account that was executed within 5 business days prior to the trade in the Covered Account (“Opposite Side Trade”). For example, if an Advisory Person executes a purchase of shares of Company XYZ on Monday, February 1st for a Related Client account(s), that Advisory Person and their team will be prohibited from executing a sale of shares of Company XYZ for their Covered Accounts between the time when the Related Client order was submitted on Monday, February 1st through the close of trading on Monday, February 8th.

Notwithstanding the foregoing, an Advisory Person or Advisory Person of a Fund (or their team member) may execute an Opposite Side Trade for the following reasons:

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to capture a gain or loss for tax purposes;

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the Advisory Person or Advisory Person of a Fund sold the security for the Related Client account in order to raise cash;

•

securities transactions effected in Blind Trusts;

•

securities transactions that are non-volitional on the part of the Advisory Person or Advisory Person of a Fund. Non-volitional transactions include shares obtained or redeemed through a corporate action (e.g. stock dividend) or the exercise of rights issued by an issuer pro rata to all holders of a class of securities; or

•

other such exceptions as may be granted by the Legal and Compliance Department.

10.	Service on a Board of Directors

Access Persons are prohibited from serving on the board of directors of any public or private company without prior written approved from the Legal and Compliance Department.⁴

11.	Limitations on Short and Long Positions

Advisory Persons are not permitted to: a) sell short any security (or Related Security) that they hold or intend to hold for a Related Client; or b) buy a long position in a security (or Related Security) if they have or intend to create a short position in the same security for a Related Client. Notwithstanding the foregoing, certain types of transactions may be permitted with prior approval from the Legal and Compliance Department and the CIO (or designee), such as

A purchase to cover an existing short position, except that if an Advisory Person intends to create a long position for a Related Client in the same security, all Related Client transactions must be completed before the Advisory Person can cover their short position.

ii.

A short sale against a broad-based index. Approved broad-based indices include the S&P 500, NASDAQ, 7-10 Year Treasury Bond Index, 20+ Year Treasury Bond Index, Russell 2000 and Dow Jones Industrial Average. Any other index must be approved by the Legal and Compliance Department before engaging in any short sales against such index.

iii.

A short sale to hedge an existing security position provided the hedging activity is proportionate to the account.

iv.

Any approvals granted under this section will not relieve the Advisory Person from being subject to Price Restitution.

⁴	Request must be made through iCompliance by completing the Outside Affiliation request form.

12.	Transactions in Shares of Funds

All trading in shares of a Fund is subject to the terms of the prospectus and the Statement of Additional Information of the Fund.

No Access Person may engage in excessive trading or market timing in any shares of any Fund.

13.

Sanctions

The Firm shall have the authority to impose sanctions for violations of this Code. Such sanctions may include a letter of censure, suspension or termination of the employment of the violator, forfeiture of profits, forfeiture of personal trading privileges, forfeiture of gifts, or any other penalty deemed to be appropriate.

14.	Violations

Access Persons must report apparent or suspected violations in addition to actual or known violations of the Code to the Legal and Compliance Department. Access Persons are encouraged to seek advice from the Legal and Compliance Department with respect to any action or transaction which may violate this Code and to refrain from any action or transaction which might lead to the appearance of a violation. The types of reporting that are required under this Code include:

•

Non-compliance with applicable laws, rules, and regulations;

•

Fraud or illegal acts involving any aspect of the Firm’s business;

•

Material misstatements in regulatory filings, internal books and records, client records or reports;

•

Activity that is harmful to clients, including fund investors; and

•

Deviations from required controls and procedures that safeguard clients and the Firm.

D. Reporting Requirements⁵

Reports by Access Persons

Initial Disclosure

All Access Persons must disclose their Covered Accounts within 10 calendar days of becoming an Access Person. The initial holdings disclosure must include all Covered Accounts in which the Access Person has a direct or indirect Beneficial Interest. Access Persons may satisfy this requirement by providing copies of their account statements for all Covered Accounts to the Legal and Compliance Department (as applicable).

ii.

The information provided must be current as of a date no more than 45 days prior to the date the person became an Access Person.

iii.

Access Persons will be provided with a copy of the Code of Ethics and be required to acknowledge receipt of the Code.

⁵	All Code reporting disclosures are done through iCompliance.

Quarterly Disclosure

Within 30 days of the end of each calendar quarter, Access Persons must disclose securities transactions in any Covered Security in which such Access Person has, or by reason of such transaction acquires, any direct or indirect Beneficial Interest that occurred during the previous quarter. For each transaction executed during the quarter, the following information must be provided:

•

the date of the transaction;

•

type of transaction (buy, sell, short, cover, etc.);

•

name of security, exchange ticker, symbol or CUSIP number;

•

the number of shares, price and principal amount; and

•

the interest rate and maturity date (as applicable).

ii.

The above requirement may be satisfied if information is being received by Neuberger Berman as stated in Section D(3)(b).

Annual Disclosure

On an annual basis, Access Persons must affirm that all Covered Accounts have been reported and are reflected in iCompliance.

ii.

Access Persons are required to certify that they have read, understand, and complied with the Code of Ethics and the Insider Trading Policy and Procedures, and have disclosed or reported all personal securities transactions, holdings and accounts required to be disclosed or reported pursuant to the requirements of the Code.

iii.

The information provided must be current as of a date no more than 45 days of the date the report is submitted.

iv.

With respect to any Blind Trust in which an Access Person has a Beneficial Interest, such Access Person must certify that they do not exert any direct or indirect influence or control over the trustee by: a) suggesting or directing any particular transactions in the account, or b) consulting with the trustee regarding the allocation of investments in the account.

With respect to any Managed Account managed by a third-party, Access Persons must certify that they do not exert any direct or indirect influence or control over the third-party manager by: a) suggesting or directing any particular transactions in the account, or b) consulting with the third-party manager regarding the allocation of investments in the account.

Reports by Disinterested Directors/Trustees

A director/trustee of a NB Fund who is not an “interested person” of the NB Fund within the meaning of section 2(a)(19) of the Company Act, and who would be required to make a report solely by reason of being a NB Fund director/trustee, need not make:

An initial holdings disclosure and annual holdings disclosure under Section D(1)(a) and (c) above; and

ii.

A quarterly transactions disclosure under Section D(1)(b) above, unless the director/trustee knew or, in the ordinary course of fulfilling their official duties as a NB Fund director/trustee, should have known that during the 15-day period immediately before or after the director/trustee’s transaction in a Covered Security, the NB Fund purchased or sold the Covered Security, or the NB Fund or its investment adviser considered purchasing or selling the Covered Security.

Exceptions to Reporting Requirements

With regards to Section D(1)(b), Access Persons need not disclose holdings if such disclosure would duplicate information contained in trade confirmations or account statements (including electronic feeds of such information) received by Neuberger Berman. For purposes of the foregoing, the Legal and Compliance Department maintains (i) electronic records of all securities transactions effected through Neuberger Berman and Fidelity, and (ii) copies of any duplicate confirmations that have been provided to the Legal and Compliance Department under this Code of Ethics with respect to securities transactions that, pursuant to exceptions granted by the Legal and Compliance Department, have not been effected through Neuberger Berman.

Notification of Reporting Obligations

The Legal and Compliance Department shall identify all Access Persons who are required to make reports under the Code and inform them of their reporting obligations.

E. Code Procedures

Maintenance of Covered Accounts

General Rules

Access Persons who are not Advisory Persons may maintain their Covered Accounts at Neuberger Berman or Fidelity. Prior written approval from the Legal and Compliance Department is required for Fidelity accounts.

ii.

Advisory Persons are required to maintain their Covered Accounts at Neuberger Berman.

iii.

Limited Access Persons are not required to keep their securities accounts at Neuberger Berman or Fidelity.

Exceptions to Maintenance of Covered Accounts at Neuberger Berman or Fidelity:

Managed Accounts. Any Access Person granted approval to maintain an external Managed Account is required to direct their broker, adviser or trustee to provide duplicate copies of all trade confirmations, as well as copies of account statements to the Legal and Compliance Department.

ii.

DRIPs established directly with the issuer that have been approved by the Legal and Compliance Department and for which duplicate copies of confirmations and periodic statements are provided.

iii.

Other accounts as may be permitted by the Legal and Compliance Department.

Pre-Clearance of Securities Transactions

Access Persons

Access Persons are required to obtain prior approval for transactions in Covered Accounts not maintained at Neuberger Berman by submitting a pre-clearance request in iCompliance that is compared with the Firm’s Restricted List.

ii.

Access Persons are required to obtain prior approval from the Trading Desk before executing any transactions in Covered Accounts held at Neuberger Berman. Before granting approval, the Trading Desk, subject to oversight by the Legal and Compliance Department, will determine whether:

•

the employee is an Advisory Person of a Fund that is a Related Client with a pending “buy” or “sell” order in the same (or Related Security;

•

the security is on the Firm’s Restricted List(s); or

•

the transaction is de minimis

iii.

The Legal and Compliance Department reviews transactions for required trade pre-clearance and all transactions are subject to the Price Restitution review, subject to certain exceptions (see section E(4)).

Advisory Persons

Advisory Persons who are members of the Firm’s Equity Research Department are subject to additional pre-approval requirements for their personal trading. Members of the Research Department should refer to the Equity Research Department’s Procedures for specific details.

NB CEF Insiders

Access Persons who are NB CEF Insiders must obtain prior approval from mutual fund compliance before placing any transactions in the NB CEFs.

Exceptions from Pre-clearance Requirement

Exempt Transactions

ii.

Other securities designated in writing by the Legal and Compliance Department

Blackout Period

Same Day – Advisory Persons of a Fund

An Advisory Person of a Fund may not buy or sell a Covered Security (or a Related Security) on a day during which any Related Client executes either a “buy” or “sell” order in the same security (“Same Day Blackout Period”).

ii.

Purchases that occur within the Same Day Blackout Period will be required to be “broken.” Any losses will be incurred by the Covered Account and any gains (including gains disgorged from a sale within the Same Day Blackout Period) may be donated to a charitable organization designated by the Firm.

iii.

Certain Limited Access Person Accounts may be subject to the Same Day Blackout Period.

Research Personnel

Advisory Persons who are members of the Firm’s Equity Research Department may be subject to a blackout period for their personal trading. Members of the Research Department should refer to the Equity Research Department’s Procedures for specific details.

Price Restitution

Same Day Price Restitution

Access Persons

•

If an Access Person purchases or sells a Covered Security in a Covered Account and a Client purchases or sells the same security during the same day, the Access Person may not receive a more favorable price than that received by the Client.

ii.

Limited Access Persons

•

If an Advisory Person related to a Limited Access Person purchases or sells a Covered Security in the Limited Access Person Account and such Advisory Person purchases or sells the same security during the same day for a Related Client, the Limited Access Person Account may not receive a more favorable price than that received by the Related Client.

iii.

For the avoidance of doubt, a “purchase” includes a long buy, as well as a cover short, and a “sell” includes a long sell, as well as a short sale.

Five(5)/One(1) Day Price Restitution – Advisory Persons

If an Advisory Person purchases or sells a Covered Security within five (5) business days prior, or one (1) business day subsequent to a Related Client (“5/1 Price Restitution”), the Advisory Person may not receive a more favorable price than that received by the Related Client.

ii.

Certain Limited Access Person Accounts may be subject to the 5/1 Price Restitution.

iii.

For the avoidance of doubt, a “purchase” includes a long buy, as well as a cover short, and a “sell” includes a long sell, as well as a short sale.

Price Restitution Execution

Price restitution will generally be executed when there is a total gain of at least $1000 from the difference in price received by the Access Person vs. the Related Client(s), and a gain of at least $100 to each underlying Client Account.

ii.

With respect to the Funds, the Legal and Compliance Department reserves the right to review the individual restitutions below $1000 and may require payment of these amounts if facts and circumstances warrant.

iii.

Where restitution is required, preference shall be to provide the economic benefit to Clients where operationally, contractually or legally permitted. Where otherwise not feasible or permitted, restitution may be made by transfer, wire or check and shall be remitted to the Firm for donation to a charitable organization designated by the Firm.

Exceptions to Price Restitution

Exempt Transactions.

ii.

De minimis Restitution.

iii.

Transactions in non-Covered Securities.

iv.

Transactions arising through hedged options trading.

Transactions in the Firm’s retirement contribution program.

vi.

Certain transactions related to the initial investment of a Related Client account or investments made as a result of additional funds contributed to an existing Related Client account communicated to the Legal and Compliance Department.

vii.

Other exceptions designated in writing by the Legal and Compliance Department.

Holding Periods

Thirty (30) Day Holding Period

All securities positions, including both long and short positions, established in any Covered Account must be held for at least 30 calendar days (beginning on the day of the transaction) measured on a Last In-First Out (“LIFO”) basis.

Sixty (60) Day Holding Period

ii.

Access Persons are required to hold shares of any Fund for at least 60 days, measured on a LIFO basis. After the holding period has lapsed, Fund shares may be redeemed or exchanged; however, the redemption or exchange of such shares will result in a new 60-day holding period.

Exceptions to the Holding Periods

Transactions in Managed Accounts

ii.

U.S. Treasury obligations

iii.

Bona fide hedging transactions, identified as such to the Legal and Compliance Department prior to execution, on the following broad-based indices: S&P 500, NASDAQ, 7-10 Year Treasury Bond Index, 20+ Year Treasury Bond Index, Russell 2000 and Dow Jones Industrial Average.

iv.

Positions where at time of order entry, there is an expected loss of at least 10%. This exclusion does not apply to losses in options on equities.

Notwithstanding the foregoing, on a limited basis and with the prior approval of the Legal and Compliance Department and CIO (or designee), shares that have been held for at least one year may be sold even if additional shares of the same security were purchased in the last 30 calendar days.

vi.

The 60-day holding period shall not apply to:

•

Taxable and tax-exempt money market funds;

•

Variable annuity contracts for which a Fund does not serve as the underlying investment vehicle; and

•

Shares of an investment company that are purchased through an automatic investment program or payroll deduction.

vii.

The above exclusions shall not apply if, in the opinion of the Legal and Compliance Department, a pattern of excessive trading exists.

Any requests for exceptions to the above holding periods must be submitted to the Legal and Compliance Department.

Code Procedures Monitoring

The Legal and Compliance Department will conduct post-trade monitoring of employee trades to ascertain that such trading conforms to the procedures above, and where required, that employees have obtained the necessary pre-trade approvals as may be applicable.

F. NB Funds’ Ethics and Compliance Committee

The Ethics and Compliance Committee shall be composed of at least two members who shall be Disinterested Director/Trustees selected by the Board of Directors/Trustees of the Company/Trust (the “Board”).

The Ethics and Compliance Committee shall consult regularly with the Legal and Compliance Department and/or the NB Funds Chief Compliance Officer and either the Committee or the Board shall meet no less frequently than annually with the Legal and Compliance Department and/or the NB Funds Chief Compliance Officer regarding the implementation of this Code. The Legal and Compliance Department shall provide the Ethics and Compliance Committee with such reports as are required herein or as are requested by the Ethics and Compliance Committee.

A quarterly report shall be provided to the Board certifying that except as specifically disclosed to the Ethics and Compliance Committee, the Legal and Compliance Department knows of no violations of the Code of Ethics and the NB Funds Chief Compliance Officer shall attend all regular meetings of the Board to report on the implementation of this Code.

G. Annual Report to the NB Funds’ Board

No less frequently than annually and concurrently with reports to the Board, the NB Funds Chief Compliance Officer shall furnish to the Funds, and the Board must consider a written report that:

•

describes any issues arising under this Code or procedures concerning personal investing since the last such report, including, but not limited to, information about material violations of the Code or procedures and sanctions imposed in response to the material violations;

•

certifies that NBIA, the Firm or any NB Adviser, as applicable, have adopted procedures reasonably necessary to prevent Access Persons from violating the Code; and

•

identifies any recommended changes in existing restrictions or procedures based upon the fund’s experience under the Code, evolving industry practices, or developments in applicable laws or regulations.

H. Administration

All Access Persons must be presented with a copy of this Code of Ethics upon commencement of employment and any amendments thereafter.

All Access Persons are required to read this Code of Ethics and to acknowledge in writing that they have read, understood and agreed to abide by this Code of Ethics, upon commencement of employment and on an annual basis thereafter. In addition, Access Persons are required to read and understand any amendments thereto.

All Access Persons are required to provide a list of their Covered Accounts.

Access Persons who violate the rules of this Code of Ethics are subject to sanctions, which may include censure, suspension or termination of employment.

Nothing contained in this Code of Ethics shall be interpreted as relieving any Covered Account from acting in accordance with the provisions of any applicable law, rule or regulation or any other statement of policy or procedure governing the conduct of Access Persons.

If any Access Person has any question with regard to the applicability of the provisions of this Code of Ethics generally or with regard to any securities transaction, he or she should consult with Legal and Compliance.

The Legal and Compliance Department may grant exceptions to the requirements of this Code based upon individual facts and circumstances. Exceptions granted will be documented and retained in accordance with record-keeping requirements. Exceptions will not serve as precedent for additional exceptions, even under similar circumstances.

I. Recordkeeping

The Firm shall maintain the following records:

A copy of this Code of Ethics and any Code of Ethics that has been in effect within the previous five years.

Any record of any violation of this Code of Ethics and any action taken as a result of the violation. These records shall be maintained in an easily accessible place for at least five years after the end of the fiscal year in which the violation occurs.

A copy of each report made by an Access Person as required by this Code of Ethics, including any information provided in lieu of the monthly reports. These records shall be maintained for at least five years after the end of the fiscal year in which the report is made or the information provided, the first two years in an easily accessible place.

A record of all persons, currently or within the past five years, who are or were required to make reports under this Code of Ethics, or who are or were responsible for reviewing these reports. These records shall be maintained in an easily accessible place.

A copy of each decision to approve an acquisition by an Access Person of any Private Placement. These records must be maintained for at least five years after the end of the fiscal year in which the approval is granted.

Previous Revisions:

May 2011

January 2013

January 2016

EXHIBIT A

Compliance Contacts


NB Adviser	Compliance Contact	Contact Information
NB Alternatives Advisers LLC	Yonah Feder, CCO	(212) 476-8532

Neuberger Berman Investment Advisers LLC - Fixed Income	Brian Lord, CCO MaryAnn McCann	(312) 325-7707 (312) 627-4338

Neuberger Berman Investment Advisers LLC - Equity Neuberger Berman BD LLC	Brad Cetron, CCO Henry Rosenberg Joshua Blackman Jason Hauptman Stacy Miller Alyssa Benson Christina Korzeniowski Christopher Altieri Steven Szaro	(646) 497-4654 (646) 497-4668 (646) 497-4791 (646) 497-4681 (646) 497-4663 (212) 476-8120 (646) 497-4603 (646) 497-4677 (646) 497-4098

Neuberger Berman Investment Advisers LLC - Mutual Funds	Chamaine Williams, CCO Chris Connor Kevin Pemberton Noel Daugherty Kelly Ullman	(646) 497-4934 (212) 476-5430 (646) 497-4770 (646) 497-4653 (646) 497-4938

Neuberger Berman Investment Advisers LLC - Alternatives	Yonah Feder, CCO	(212) 476-8532

Neuberger Berman Trust Company N.A. Neuberger Berman Trust Company of Delaware N.A	Benedykt Szwalbenest, CCO	(212) 476-9869

EXHIBIT B

Applicability of Code Procedures to Temporary Access Persons

This section describes the requirements under the Code procedures applicable to Temporary Access Persons who will be on the Firm’s premises for ninety (90) days or more and will have access to certain types of firm information. The Legal and Compliance Department reserves the right to treat persons who will be on the Firm’s premises for less than ninety (90) days as Temporary Access Persons if it deems so appropriate. Absent specific mention in this section, Temporary Access Persons are subject to all other provisions of the Code.

D.1. Reporting Requirements – Temporary Access Persons

Initial Disclosure

All Temporary Access Persons must disclose their Covered Accounts within 10 calendar days of becoming a Temporary Access Person. The initial holdings disclosure must include all Covered Accounts in which the Temporary Access Person has a direct or indirect Beneficial Interest. Temporary Access Persons may satisfy this requirement by providing copies of their account statements for all Covered Accounts to the Legal and Compliance Department (as applicable).

The information provided must be current as of a date no more than 45 days prior to the date the person became an Access Person.

Temporary Access Persons will be provided with a copy of the Code of Ethics and be required to acknowledge receipt of the Code.

Ongoing Disclosure

Temporary Access Persons must provide the Legal and Compliance Department with duplicate statements of all Covered Accounts disclosed, on a monthly basis (or quarterly, as may be applicable) for their duration at the Firm.

Annual Disclosure

Temporary Access Persons who are with the Firm at the time the annual affirmation takes place, must affirm that all their Covered Accounts have been reported and are reflected in iCompliance.

Temporary Access Persons are required to certify that they have read, understand, and complied with the Code of Ethics and the Insider Trading Policy and Procedures, and have disclosed or reported all personal securities transactions, holdings and accounts required to be disclosed or reported pursuant to the requirements of the Code.

The information provided must be current as of a date no more than 45 days of the date the report is submitted.

With respect to any Managed Account, Temporary Access Persons must certify that they do not place, recommend, approve or direct transactions in such account.

E.1. Maintenance of Covered Accounts

Temporary Access Persons are not required to hold their Covered Accounts at Neuberger Berman, but must either 1) direct their broker, adviser or trustee, as applicable, to provide duplicate copies of all trade confirmations, as well as copies of account statements to the Legal and Compliance Department for their duration at the Firm, or 2) provide copies of their trade confirmations and account statements to the Legal and Compliance Department.

E.2. Pre-Clearance of Securities Transactions

Temporary Access Persons are required to obtain prior approval for transactions in Covered Accounts by submitting a pre-clearance request in iCompliance.

E.3. Same-Day Blackout Period

A Temporary Access Person of a Fund may not buy or sell a Covered Security (or Related Security) on a day during which any Related Client executes either a “buy” or “sell” order in the same security (“Same Day Blackout Period”).

E.4. Price Restitution

Same Day Price Restitution

If a Temporary Access Person purchases or sells a Covered Security in a Covered Account and a Client purchases or sells the same security during the same day, the Temporary Access Person may not receive a more favorable price than that received by the Client.

Five(5)/One(1) Day Price Restitution

If a Temporary Access Person purchases or sells a Covered Security within five (5) business days prior, or one (1) business day subsequent to a Related Client (“5/1 Price Restitution”), the Temporary Advisory Person may not receive a more favorable price than that received by the Related Client.

E.5. Holding Periods

Thirty (30) Day Holding Period

Sixty (60) Day Holding Period

Temporary Access Persons are required to hold shares of any Fund for at least 60 days, measured on a LIFO basis. After the holding period has lapsed, Fund shares may be redeemed or exchanged; however, the redemption or exchange of such shares will result in a new 60-day holding period.

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REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

Pre-Effective Amendment No.

Post-Effective Amendment No. 85