APPENDIX A
ALPS Advisors, Inc.
Proxy Voting Policy, Procedures and Guidelines
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1.
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Policy Statement &
General Background
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An investment adviser that exercises voting
authority over clients’ proxies must adopt written policies and procedures that are reasonably designed to ensure that those
proxies are voted in the best economic interests of clients. An adviser’s policies and procedures must address how the adviser
resolves material conflicts of interest between its interests and those of its clients. An investment adviser must comply with
certain record keeping and disclosure requirements with respect to its proxy voting responsibilities. In addition, an investment
adviser to ERISA accounts has an affirmative obligation to vote proxies for an ERISA account, unless the client expressly retains
proxy voting authority.
With respect to investment companies registered
under the 1940 Act, any assignment of voting authority over the Funds’ voting securities is typically delegated to ALPS Advisors,
Inc. (“AAI”) as the Funds’ investment adviser, or the Funds’ sub-adviser by the respective Funds’
Board of Trustees/Directors. If the Funds’ day-to-day investment decisions are performed by the Funds’ investment sub-adviser(s),
Funds’ Board of Trustees/Directors may elect to delegate the responsibility of voting proxies to such sub-adviser to be voted
in accordance to the sub-adviser’s proxy voting policies and procedures in conformance with Rule 206(4)-6 under the Investment
Advisers Act of 1940, as amended. For securities in the portfolio of a Fund that is managed by more than one sub-adviser, each
sub-adviser shall make voting decisions pursuant to their own proxy voting policies and procedures, as adopted in conformance with
the Advisers Act for their respective portions of the Fund’s portfolio, unless directed otherwise. In addition, proxy voting
authority may be delegated to AAI where it serves as the Funds’ sub-adviser.
AAI has adopted and implemented the following
policies and procedures, which it believes are reasonably designed to: (1) ensure that proxies are voted in the best economic interest
of clients and (2) address material conflicts of interest that may arise. AAI will provide clients with a copy of its policies
and procedures, as they may be updated from time to time, upon request. Information regarding AAI’s proxy voting decisions
is confidential. Therefore, the information may be shared on a need to know basis only, including within AAI. Advisory clients
may obtain information on how their proxies were voted by AAI. However, AAI will not selectively disclose its investment company
clients’ proxy voting records to third parties; the investment company clients’ proxy records will be disclosed to
shareholders by publicly-available annual filings or each investment company’s proxy voting record for 12-month periods ending
June 30th.
All proxies
regarding client securities for which AAI has authority to vote will, unless AAI determines in accordance with policies stated
below to refrain from voting, be voted in a manner considered by AAI to be in the best interest of AAI’s clients. The best
interest of clients is defined for this purpose as the interest of enhancing or protecting the economic value of client accounts,
considered as a group rather than individually, as AAI determines in its sole and absolute discretion. There may also be instances
where a fund relies upon Section 12(d)(1)(F) of the 1940 Act, and by law, the fund may be required to vote proxies in the same
proportion as the vote of all other shareholders of the acquired fund (i.e., “echo vote”). In the event a client believes
that its other interests require a different vote, AAI will vote as the client clearly instructs, provided AAI receives such instructions
in time to act accordingly.
AAI endeavors to vote, in accordance with this
Policy, all proxies of which it becomes aware, subject to the following general exceptions (unless otherwise agreed) when AAI expects
to routinely refrain from voting:
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i.
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Proxies will usually not be voted in cases where the security has been loaned from the client’s
account and subsequently, AAI determines that the type of proxy issue is not material to shareholders. AAI will utilize the below
considerations to determine if a security then on loan should be recalled for voting purposes. Decisions will generally be made
on a case-by-case basis depending on whether, in AAI’s judgment,:
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the matter to be voted on has critical significance to the potential value of the security in question;
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the security represents a significant holding and whether the security is considered a long-term
holding; and
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AAI believes it can recall the security in time to cast the vote.
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ii.
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Proxies will usually not be voted in cases where AAI deems the costs to the client and/or the administrative
inconvenience of voting the security outweigh the benefit of doing so (e.g., international issuers who impose share blocking restrictions).
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AAI seeks to avoid the occurrence of actual
or apparent material conflicts of interest in the proxy voting process by voting in accordance with predetermined voting guidelines
and observing other procedures that are intended to guard against and manage conflicts of interest (refer to Section 2.b., Conflicts
of Interest, below).
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2.
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Operating
Procedures & Control Activities
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Where proxy voting is delegated to the sub-adviser,
the sub-adviser will adopt proxy voting policies and procedures in accordance in conformance with Rule 206(4)-6 under the Investment
Advisers Act of 1940, as amended. AAI has adopted the following proxy voting procedures and controls for any client securities
which AAI has authority to vote on:
AAI has established a Proxy Committee whose
standing members are determined by AAI’s Chief Compliance Officer. These members participate as voting authorities on the
Proxy Committee. Each standing member may designate a senior portfolio manager or a senior analyst officer to act as a substitute
in a given matter on their behalf. Additionally, the Proxy Committee regularly involves other associates who participate as needed
to enable effective execution of the Committee’s responsibilities.
The Proxy Committee’s functions
include, in part,
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i.
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direction of
the vote on proposals where there has been a recommendation to the Proxy Committee not to vote according to the predetermined Voting
Guidelines (stated in 2.c.i) or on proposals which require special, individual consideration in accordance with Section 2.c.iii.;
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ii.
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review periodically
this Proxy Voting Policy and Procedure to ensure consistency with internal policies, client disclosures and regulatory requirements;
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iii.
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development
and modification of Voting Procedures, as stated in Section 2.d., as it deems appropriate or necessary.
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For purposes of this policy, a material conflict
of interest is a relationship or activity engaged in by AAI, an AAI affiliate, or an AAI associate that creates an incentive (or
appearance thereof) to favor the interests of AAI, the affiliate, or associate, rather than the clients’ interests. For example,
AAI may have a conflict of interest if either AAI has a significant business relationship with a company that is soliciting a proxy,
or if an AAI associate involved in the proxy voting decision-making process has a significant personal or family relationship with
the particular company. A conflict of interest is considered to be “material” to the extent that a reasonable person
could expect the conflict to influence AAI’s decision on the particular vote at issue. In all cases where there is deemed
to be a material conflict of interest, AAI will seek to resolve it in the clients’ best interests.
AAI follows the proxy guidelines and uses other
research services provided by Institutional Shareholder Services, Inc. (“ISS”) or another independent third party.
In providing proxy voting services to AAI, ISS provides vote recommendations on a pre-determined policy. Generally, AAI will vote
proxies based on ISS’ pre-determined voting policy. In doing so, AAI demonstrates that its vote would not be a product of
a conflict of interest as AAI would have little or no discretion on how the proxy was voted.
AAI has undertaken a review of ISS’ conflicts
of interest procedures, and will continue to monitor them on an ongoing basis. In the event that AAI determines that it would be
appropriate to use another third party, it will undertake a similar conflicts of interest assessment review.
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c.
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Proxy Voting Guidelines
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i.
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AAI’s Proxy Voting
Guidelines – General Practices
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The Proxy Committee has adopted the guidelines
for voting proxies specified in Appendix A of this policy. AAI will use an independent, third-party vendor to implement its proxy
voting process as AAI’s proxy voting agent. In general, whenever a vote is solicited, ISS or another independent third party
will execute the vote according to AAI’s Voting Guidelines.
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ii.
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Ability to Vote Proxies Other than as Provided by Voting Guidelines
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A portfolio manager or other party involved
with a client’s account may conclude that the best interest of the firm’s client, as defined above, requires that a
proxy be voted in a manner that differs from the predetermined proxy Voting Guidelines. In this situation, he or she will request
that the Proxy Committee consider voting the proxy other than according to such Guidelines. If any person, group, or entity requests
the Proxy Committee (or any of its members) vote a proxy other than according to the predetermined Voting Guidelines, that person
will furnish to the Proxy Committee a written explanation of the reasons for the request and a description of the person’s,
group’s, or entity’s relationship, if any, with the parties proposing and/or opposing the matter’s adoption.
The Proxy Committee may consider the matter including any potential conflicts of interest. A research analyst or portfolio manager
must disclose in writing any inappropriate attempt to influence their recommendation or any other personal interest that they have
with the issuer.
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iii.
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Other
Proxy Proposals
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For the
following categories of proposals either the Proxy Committee will determine how proxies related to all such proposals will be
voted, or the proxies will be voted in accordance with ISS’ or a an individual client’s guidelines.
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New Proposals. For each new type of proposal that is expected to be proposed to shareholders
of multiple companies, the Proxy Committee will develop a Voting Guideline which will be incorporated into this Policy.
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Accounts Adhering to Taft Hartley Principles. All proposals for these accounts will
be voted according to the Taft Hartley Guidelines developed by ISS.
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Accounts Adhering to Socially Responsible Principles. All proposals for these accounts
will be voted according to the Socially Responsible Guidelines developed by ISS or as specified by the client.
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Proxies of International Issuers which Block Securities Sales between the Time a Shareholder
submits a Proxy and the Vote. In general, AAI will refrain from voting such securities. However, in the exceptional
circumstances that AAI determines that it would be appropriate to vote such proxies, all proposals for these securities will be
voted only on the specific instruction of the Proxy Committee and to the extent practicable in accordance with the Voting Guidelines
set forth in this Policy.
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Proxies of Investment Company Shares. Proposals on issues other than those provided
in Section 2.c.i will be voted on the specific instruction of the Proxy Committee.
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Executive/Director Compensation. Except as provided in Section 2.c.i, proposals relating
to compensation of any executive or director will be voted as recommended by ISS or as otherwise directed by the Proxy Committee.
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Preemptive Rights. Proposals to create or eliminate shareholder preemptive rights.
In evaluating these proposals the Proxy Committee will consider the size of the company and the nature of its shareholder base.
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The Proxy Committee has developed the
following procedures to aid the voting of proxies according to the Voting Guidelines. The Proxy Committee may revise these procedures
from time to time, as it deems necessary or appropriate to affect the purposes of this Policy.
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i.
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AAI will use an independent, third-party vendor, to implement its proxy voting process as AAI’s
proxy voting agent. This retention is subject to AAI continuously assessing the vendor’s independence from AAI and its affiliates,
and the vendor’s ability to perform its responsibilities (and, especially, its responsibility to vote client proxies in accordance
with AAI’s proxy voting guidelines) free of any actual, potential or apparent material conflicts of interests that may arise
between the interests of the vendor, its affiliates, the vendor’s other clients and the owners, officers or employees of
any such firm, on the one hand, and AAI’s clients, on the other hand. As means of performing this assessment, AAI will require
various reports and notices from the vendor, as well as periodic audits of the vendor’s voting record and other due diligence.
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ii.
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ISS will provide proxy analysis and record keeping services in addition to voting proxies on behalf
of AAI in accordance with this Policy.
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iii.
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On a daily basis, AAI or designee will send to ISS a holdings file detailing each equity holding
held in all accounts over which AAI has voting authority.
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iv.
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AAI will complete a Vote Authorization Registration with ISS for any new client, which will describe
how ballots will be executed on behalf of the client. In addition, AAI will complete and provide the client’s custodian bank
with a Letter of Authorization. The letter will serve as notice that AAI has retained ISS to act as the voting agent for the securities
held in the client’s account and will instruct the custodian bank to forward all ballots, meeting notices, and other proxy
materials to ISS.
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v.
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ISS will receive proxy material information from Proxy Edge or the custodian bank for the account.
This will include issues to be voted upon, together with a breakdown of holdings for AAI accounts. ISS will then reconcile information
it receives from Proxy Edge and custodian banks. Any discrepancies will be promptly noted and resolved by ISS, with notice to AAI.
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vi.
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Whenever a vote is solicited, ISS will execute the vote according to AAI’s Voting Guidelines
which will be delivered by AAI to ISS as set forth in Appendix A of these policies and procedures and anytime there is a material
change to these guidelines.
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If ISS is unsure how to vote a particular proxy, ISS will issue a request for voting instructions
to AAI over a secure website. AAI personnel will check this website regularly. The request will be accompanied by a recommended
vote. The recommended vote will be based upon ISS’ understanding of the Voting Guidelines previously delivered to ISS. AAI
will promptly provide ISS with any amendments or modifications to the Voting Guidelines if necessary. AAI will return a final instruction
to vote to ISS, which ISS will record with Proxy Edge or the custodian bank as our agent.
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vii.
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Each time that ISS will send AAI a request to vote, the request will be accompanied by the recommended
vote determined in accordance with AAI’s Voting Guidelines. ISS will vote as indicated in the request unless the client has
reserved discretion, the Proxy Committee determines that the best interest of clients requires another vote, or the proposal is
a matter as to which the Proxy Committee affords special, individual consideration under Section 2.c.ii. In such situations, ISS
will vote based on the direction of the client or the Proxy Committee, as the case may be. The interests of AAI’s Taft Hartley
or Socially Responsible clients may impact a proposal that normally should be voted in a certain way. ISS will inform AAI of all
proposals having impact on its Taft Hartley and or Socially Responsible clients. The Proxy Voting Committee will be consulted before
a vote is placed in cases where Taft Hartley or Socially Responsible issues are presented.
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viii.
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ISS will have procedures in place to ensure that a vote is cast on every security holding maintained
by AAI on which a vote is solicited unless otherwise directed by the Proxy Committee. On a yearly basis, or as required by our
clients, AAI will receive a report from ISS detailing AAI’s voting for the previous period.
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e.
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Proxy Advisory Firm Oversight
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In selecting a third-party proxy advisory firm,
AAI will perform an initial due diligence review to ensure that voting determinations are made in the best interests of AAI clients
and in accordance with these policies and procedures. AAI’s review will include, but is not limited to, assessing:
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The necessary resources to fulfill the proxy voting responsibilities;
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Policies and procedures with respect to obtaining issuer and client input on proxy voting policies;
and
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Transparency regarding voting recommendations and research methodologies.
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In addition to the initial evaluation of a
proxy advisory firm, AAI will conduct ongoing assessments of the proxy advisory firm’s business. Such reviews will occur
at periodic intervals and will include, but are not limited to:
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Summary of material changes, if any, to the proxy advisory firm’s business and how such changes
impact the services provided to AAI and its clients;
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Methodology updates to guidelines and voting recommendations; and
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Disclosure of conflicts of interest.
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Each Fund advised by AAI, where authorized
by its respective Board, may engage in securities lending transactions, to the extent permitted by the Fund’s investment
policies and limitations. The Adviser will be required to monitor for scheduled or anticipated proxy votes relating to securities
on loan and determine whether the securities should be recalled from loan on the relevant record date. There may be situations
where the Adviser may not be able to recall the security in time to cast the vote.
Managers and supervisory personnel are responsible
for ensuring that their associates understand and follow this policy and any applicable procedures adopted by the business group
to implement the policy. The Proxy Committee has ultimate responsibility for the implementation of this Policy.
With the exception of conflicts of interest-related
matters, issues arising under this policy should be escalated to AAI’s CCO, or designee. Issues involving potential or actual
conflicts of interest should be promptly communicated to Compliance or Legal. Compliance will notify the Funds’ Chief Compliance
Officer(s), if a material conflict of interest is deemed to have arisen.
AAI’s Compliance Department is primarily
responsible for overseeing the day-to-day operations of the proxy voting process. The Compliance Department’s monitoring
will take into account the following elements: (1) periodic review of ISS votes to ensure that ISS is accurately voting consistent
with AAI’s Proxy Guidelines and such voting recommendations are based on accurate and complete information; and (2) review
of the Funds’ N-PX report to ensure that it’s filed in a timely and accurate manner. Additionally, AAI will review
ISS’ conflicts of interest policies.
AAI’s Compliance Committee monitors proxy
matters for its clients including monitoring material conflicts of interest identified.
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j.
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Availability of Proxy Policy and Voting Record
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A summary disclosure regarding the provisions
of this Policy will be available in AAI’s Form ADV, to the extent AAI is required to prepare Part 2 to Form ADV. Upon receipt
of a Client’s request for more information, AAI will provide to the Client a copy of this Policy and/or how AAI voted proxies
for the Client pursuant to this Policy for up to a one-year period.
AAI will not selectively disclose its
investment company clients’ proxy voting records; rather, AAI will disclose such information by publicly available annual
filings. AAI will create and maintain records of each investment company’s proxy record for 12-month periods ended June 30th.
AAI will compile the following information for each matter relating to a portfolio security considered at any shareholder meeting
during the period covered by the annual report and which the company was entitled to vote:
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The name of the issuer of the security;
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The exchange ticker symbol of the portfolio security (if symbol is available
through reasonably practicable means);
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The Council on Uniform Securities Identification Procedures number for the
portfolio security (if number is available through reasonably practicable means);
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The shareholder meeting date;
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A brief identification of the matter voted on;
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Whether the matter was proposed by the issuer or by a security holder;
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Whether the company cast its vote on the matter;
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How the company cast its vote (e.g., for or against proposal, or abstain;
for or withhold regarding the election of directors); and
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Whether the company cast its vote for or against management.
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k.
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Other Recordkeeping Requirements
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Business groups and support partners are responsible
for maintaining all records necessary to evidence compliance with this policy. The records must be properly maintained and readily
accessible in order to evidence compliance with this policy.
These records include:
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Proxy Committee Meeting Minutes and Other Materials (routine oversight matters
are discussed within AAI’s Compliance Committee meetings and will be documented within the Compliance Committee’s materials);
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Analysis and Supporting Materials of Investment Management Personnel Concerning
Proxy Decisions and Recommendations;
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Conflicts of Interest Review Documentation, including Conflicts of Interest
Forms; and
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Client Communications Regarding Proxy Matters.
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Records should be retained for a period
of not less than six years. Records must be retained in an appropriate office of AAI for the first three years.
