This policy sets out how Cenkos Securities plc (“Cenkos” or “we”) identify and manage conflicts of interest in connection with the publication of investment research. This policy applies to all investment research published by us for distribution externally, whether this is contained within formal research, sales notes or other similar material. For the avoidance of doubt, this does not include personal recommendations or specific advice provided to clients.

While we aim to provide investment research that is “independent”, our research is not “impartial” as judged by reference to the requirements set out by the Financial Services Authority (the “FSA”). Therefore, our research should not be treated as an impartial assessment of the subject matter. Notwithstanding this, we endeavour to ensure that our research is fair and represents the views of Cenkos and not those of anyone else, including any entity which is the subject matter of any investment research.

This policy supplements our general obligation to act with integrity and fairness in our dealings with clients and counterparties. It is issued to demonstrate how we deal with conflicts of interests in producing our investment research.

This policy cannot be applied to all the circumstances which Cenkos may encounter; where we diverge from this policy, the relevant material should disclose that fact and the reason for the divergence. Provided that Cenkos seeks to manage any such conflicts of interest within means permitted by the regulatory regime, Cenkos shall have no liability whatsoever for any divergence from this policy. In addition, this policy does not create any third party rights or duties that would not already exist if the policy had not been made available nor does it form part of a contract between us and any other person.

Identification of Conflicts

Conflicts of interests can arise in a number of ways in an entity which provides investment banking, corporate broking and market-making services to its clients. These conflicts can arise when we owe duties and obligations to more than one client (e.g. our corporate finance clients and contacts, broking clients, other clients and counterparties) as well as when we or our employees have relevant interests.

We have developed a number of arrangements to help us identify the existence of conflicts of interest within our business and to manage those interests effectively. Training is provided to all our personnel. Compliance with our policies and procedures is overseen directly by our Chief Executive and Compliance Officer.

Investment Research Function and Responsibilities

Cenkos has three principal departments: corporate broking, corporate finance and market-making/agency broking. There is no separate investment research function; our investment research is prepared by personnel within our corporate broking division.

The content of investment research is entirely the responsibility of persons within corporate broking; there is no “house view”. The Compliance Officer may conduct a high level review, checking the contents for compliance with the regulatory regime, defamatory material or otherwise. On occasion, the corporate finance department or the issuer may be given the investment research prior to distribution and may be permitted to comment on the factual accuracy of the content, but neither are permitted to amend the substance of the opinion or recommendation of the investment research.

The decision as to whether to cover a particular security or issuer, and the timing of publication of our investment research, is entirely the responsibility of the corporate broking department. Our investment research is published on an ad hoc basis and we do not publish investment research in respect of a security or an issuer on a consistent basis. Just because we have published investment research on a particular issuer or security does not mean that we will publish further material research on that issuer or security in the future. We do not enter into agreements with companies where we commit to publish investment research.

In general, our investment research is prepared at the request of our clients, to illustrate a particular trading idea or strategy or to support an offering of securities. The investment research is distributed to identified recipients and is not made generally available. There is no preference given to one particular client over another.

Information Flows and Interaction with Corporate Finance

Our corporate finance division sits behind a Chinese Wall and its activities are separate from those of the remainder of Cenkos. Personnel within our corporate broking team may, on occasion, become aware of price sensitive information or become involved in corporate finance activities. If this happens, the relevant personnel would be taken “over the wall” and would not be involved in the production of any investment research during the relevant period. This process is controlled by the Compliance Officer.

Personnel within the corporate broking department may put forward ideas to the corporate finance department and may assist in researching business opportunities (subject to having appropriate controls to prevent the relevant person gaining access to inside information). Corporate broking may also introduce potential clients to the corporate finance department.

If there is a possibility of the corporate finance department being appointed to act for a company, either generally or in respect of a particular transaction, the views of relevant personnel within the corporate broking department will be sought. For example, a view might be sought on the merits or value of the company concerned. If those views are negative, it is likely that the corporate finance department would decline to act. This enables us to avoid a later (and potentially embarrassing) divergence of view.

Cenkos does publish investment research in support of offerings of securities when we are acting for the issuer. All such investment research is prepared by personnel in the corporate broking team who do not have access to the information held within the corporate finance department. We will permit the issuer and/or the corporate finance department to review the investment research prior to distribution and to comment on the factual aspects only, but we do not permit the issuer or the corporate finance department to amend the substance of our opinions and/or recommendations. Such corporate broking personnel may also participate in marketing the security offering and otherwise be involved in the offering process, such as allocation or pricing. Notwithstanding the foregoing, in preparing the investment research, the relevant personnel are instructed to ignore any conflict of interest and to prepare the investment research which fully and fairly reflects their view of the issuer and/or the security.

Ordinarily, Cenkos will impose quiet periods in respect of the publication of investment research in the run-up to and following a securities offering. This will normally mean that Cenkos will not publish investment research less than 4 weeks prior to the offering nor for 30 days afterwards.

Remuneration of Relevant Personnel

The remuneration of the corporate broking personnel is dependent upon the performance of Cenkos as a firm and the performance of the relevant individual. In the context of Cenkos, the personnel in corporate broking will participate in many activities throughout any year, of which the preparation of investment research is a minor part. Remuneration reflects the overall role played by each individual and is not linked to particular corporate transactions.

Remuneration is decided by the Chief Executive in conjunction with the Management Committee. We do not believe that there is any incentive in the remuneration structure for those preparing investment research not to be objective in such preparation.

Avoiding Conflicts of Interest

The principal function in the preparation of our investment research is to provide our institutional clients with commentary on particular sectors, issuers, securities or investment strategies. Those personnel within the corporate broking department will also be liaising with their clients and may be involved in the execution of customer orders.

All personnel, whether in preparing investment research or not, are under instruction to report to the Compliance Officer any pressure (internal or external) placed on them. No member of staff may offer, give, solicit or accept any inducement in the context of his or her employment. This does not include the acceptance of gifts (of reasonable value) or reasonable hospitality, although each must be reported to the Compliance Officer.

Cenkos itself does not accept payment for the production of investment research.

All employees at Cenkos are required to comply with the personal account dealing rules. These procedures prohibit any employee from dealing ahead of the publication of any investment research and may not carry out a transaction within a suitable period after publication of investment research.

All individuals preparing investment research are required to produce material that is a full and fair reflection of their views. In doing so, each is required to ignore any conflict of interest that does or may exist. For example, conflicts of interest may exist because:

• Cenkos is acting for the company concerned in an offering;
• Cenkos is otherwise providing investment banking services to the company concerned;
• Cenkos provides market-making in the securities of the company;
• Cenkos has a position in the securities of the company;
• Cenkos is advising another company in respect of the company concerned.
• Disclosures will be made as appropriate.
• Investment research will not be shown to any individual within Cenkos who is involved in market-making or agency broking prior to its distribution.