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This document sets out Scimitar Equity, LLC, Inc's ("SERI") policy for managing conflicts of interest in connection with material SERI has deemed to qualify as INDEPENDENT and impartial research ("Research"). All research REVIEWS produced by SERI that are branded as "Equity Research" are impartial and are subject to this policy. REVIEWS branded as "Research" are produced exclusively by individuals who are employed within "SERI" (i.e., Research Analysts). This document is not intended to provide a comprehensive account of the procedures adopted by SERI, in connection with the management of conflicts of interest relating to Research, but is instead intended to be a statement of principles through which SERI seeks to manage such potential conflicts.
Identification of Conflicts
In order to identify potential conflicts of interest in relation to Research Reviews, SERI has one (1) professional (the Director of Research and Founder) dedicated to conflicts management to ensure that issues are dealt with swiftly and at an appropriate level within SERI and provide internal guidance in conflict matters to keep employees apprised of applicable regulations and internal policies. SERI has an Ethics and Code of Conduct policy in order to ensure that sensitive and/or confidential information held by individuals does not pass to other individuals unless there is a legitimate reason why such persons be given access to such information. In addition to establishing various information barriers, SERI will adopt and honor procedures designed to detect activity that might give rise to suspicion of the integrity of this policy and) the Ethics and Code of Conduct that could/might be breached.
Supervision of Research Analysts
- SERI's Ethics and Code of Conduct procedures are designed to ensure that research analysts operate within a framework designed to support and safeguard their independence.
- All research analysts are both supervised by, and report directly to: a dedicated Director of Research. We do not have investment banking capacities nor do we offer any form of investment banking services.
- Decisions on coverage, timing and content of Research Reviews are matters for the research analyst who is overseen by the Founder and Director of Research.
- Research analysts' remuneration is determined by the Director of Research. In addition to individual performance, remuneration of research analysts is dependent upon SERI's total revenues. No part of a research analyst's remuneration is directly or indirectly related to the specific recommendations or views expressed in any research report.
- Factors that the Director of Research may take into account in determining the remuneration of a particular Research Analyst include, amongst others: the quality and accuracy of the Research produced; individual performance and productivity.
The Publication of Research
- Inducements - Any decision to write Research (together with any decisions as to the content of any report) should be undertaken in the interests of SERI's clients. Accordingly, employees may NOT accept any inducement for the provision of favorable research reviews.
- Retaliation - Neither SERI nor its employees may retaliate or threaten to retaliate, directly or indirectly any research analyst for negative or otherwise unfavorable research that may adversely affect SERI's present clients.
- Editorial Control - Editorial control is at the discretion of the Director of Research. However, we do offer review for factual accuracy by the subject company. Research may be reviewed for factual accuracy, where permitted by regulation or regulatory agreements, by persons outside the Research Department for factual content. SERI also operates publication procedures designed to ensure that research is published to requisite professional standards and in accordance with applicable law, regulation and internal policies. Such standards include, but are not limited to, the proper verification of facts, the avoidance of flamboyant language, distinctions between facts and expressed opinions and the proper attribution of sources.
- Method of Communication - In order to ensure that SERI's clients continue to receive timely notification of the latest developments concerning the views of SERI's Research Analysts, SERI has in place an Ethics and Code of Conduct policy and procedures to ensure that research reports intended for publication are kept confidential until they are made available simultaneously to the public.
- Disclosure of Potential Conflicts of Interest - It is SERI's policy to disclose generally the existence of potential conflicts of interest where practicable, appropriate or required by law and subject to confidentiality.
- Compliance Restrictions - The Firm may, in certain circumstances, determine that it is necessary to either decline to initiate coverage, or otherwise restrict coverage AND DROP A CLIENT (whether due to regulatory, contractual or internal BILLING considerations) in order to properly manage potential conflicts of interest and other legal issues.
Research Analysts' Personal Account Investments
SERI has put in place policies and procedures to restrict Research Analysts in trading (for their personal account) in the type of securities in respect of the issuers that they cover, and to ensure that research analysts may NOT HOLD ANY such securities. In the event that such a holding were deemed to give rise to a potential conflict of interest in connection with any particular research review, then the research analyst would be REQUIRED AND ASKED TO SELL THAT SECURITY, then the sale would be disclosed in the following research review.
Notice
In providing a set of Ethics and Code of Conduct, as well as, procedures for Managing Conflicts of Interest through which SERI intends to manage any issues in connection with research reviews, SERI intends that this document should be for guidance only. Accordingly, this document is being provided (to the extent permitted by law) without liability, and SERI in publishing this document makes no representation or warranty as to how it may act in connection with any particular situation or set of circumstances that may arise. This document is not intended to create third party rights or duties that would not already exist if the policy had not been made available, nor is it intended to form part of any contract between SERI and any client.
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