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0001851077 pfemif:IfYouRedeemYourSharesClassA1Member 2026-10-27 2026-10-27 0001851077 pfemif:IfYouRedeemYourSharesInstitutionalClassMember 2026-10-27 2026-10-27 0001851077 pfemif:IfYouRedeemYourSharesClassA2Member 2026-10-27 2026-10-27 0001851077 pfemif:IfYouRedeemYourSharesClassA3Member 2026-10-27 2026-10-27 0001851077 pfemif:IfYouRedeemYourSharesClassA4Member 2026-10-27 2026-10-27 0001851077 pfemif:IfYouDoNotRedeemYourSharesClassA2Member 2026-10-27 2026-10-27 0001851077 pfemif:IfYouDoNotRedeemYourSharesClassA4Member 2026-10-27 2026-10-27 0001851077 pfemif:CommonSharesMember 2026-09-30 2026-09-30 pure iso4217:USD shares 0001851077 false PIMCO Flexible Emerging Markets Income Fund 333-254586 811-23648 N-2 N-2 true false 5 true true 9 true 1633 Broadway New York NY 10019 888 877-4626 Ryan G. Leshaw 650 Newport Center Drive Newport Beach CA 92660 As soon as practicable after the effective date of this Registration Statement false true false false false false false true 2026-10-30 false false false false false false true false true false No false false <div style="line-height:12.0pt;margin-top:2pt;text-align:left"> <div style="margin-top:2pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">This table is intended to assist investors in understanding the various </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">costs and expenses directly or indirectly associated with investing in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund. You may qualify for sales charge discounts on Class A-2 and/or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Class A-4 Common Shares of the Fund if you and your family invest, or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agree to invest in the future, in a certain amount of Class A-1, Class A-2, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Class A-3 and/or Class A-4 common shares of the Fund (to the extent </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">available) or other eligible closed-end interval funds that are sponsored </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by PIMCO. More information about these and other discounts is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">available in the “Plan of Distribution—Share Classes” section on page </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">112</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> of this prospectus, or from your financial advisor.</span></div> </div> <div style="line-height:12.0pt;margin-top:6pt;text-align:left"> <div style="margin-top:6pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Shareholder Transaction Expenses (fees paid directly from </span></span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">your investment):</span></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 1pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> </span></span></div> </div> <div style="line-height:0.0pt;margin-top:6pt;text-align:left"> <div style="margin-top:6pt"> </div> </div> <div style="margin-top:0.0pt"> <table cellpadding="0" cellspacing="0" style="text-align:start; border-bottom:0.5pt solid #00687D;empty-cells:show;width:260pt"> <tr style="height:17pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:4.5pt;padding-top:4.5pt;vertical-align:Bottom;width:110.17pt"> <div style="line-height:0.5pt;text-align:left"> <div style="margin-left: 3pt; margin-right: 2.25pt; text-align: center; white-space: nowrap; font-size: 7pt;"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> </span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:4.5pt;padding-top:4.5pt;vertical-align:Bottom;width:40.79pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Institutional</span></span></div> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Class</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:4.5pt;padding-top:4.5pt;vertical-align:Bottom;width:25.08pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Class</span></span></div> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">A-1</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:4.5pt;padding-top:4.5pt;vertical-align:Bottom;width:29.19pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Class</span></span></div> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">A-2</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:4.5pt;padding-top:4.5pt;vertical-align:Bottom;width:25.08pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Class</span></span></div> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">A-3</span></span></div> </div> </td> <td style="padding-bottom:4.5pt;padding-top:4.5pt;vertical-align:Bottom;width:29.69pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Class</span></span></div> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">A-4</span></span></div> </div> </td> </tr> <tr style="height:29pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:4.5pt;vertical-align:Top;width:110.17pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Maximum Initial Sales Charge (Load) </span></div> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Imposed on Purchases (as a </span></div> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">percentage of offering price)</span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:4.5pt;vertical-align:Top;width:40.79pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">None</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 4.5pt; position: relative; top: -3pt; letter-spacing: 0px;display:inline;">(1)</span> </div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:4.5pt;vertical-align:Top;width:25.08pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">None</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 4.5pt; position: relative; top: -3pt; letter-spacing: 0px;display:inline;">(1)</span> </div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:4.5pt;vertical-align:Top;width:29.19pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">3.00%</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 4.5pt; position: relative; top: -3pt; letter-spacing: 0px;display:inline;">(2)</span> </div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:4.5pt;vertical-align:Top;width:25.08pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">None</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 4.5pt; position: relative; top: -3pt; letter-spacing: 0px;display:inline;">(</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 4.5pt; position: relative; top: -3pt; letter-spacing: 0px;display:inline;">1)</span> </div> </div> </td> <td style="padding-bottom:3.5pt;padding-top:4.5pt;vertical-align:Top;width:29.69pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">3.00%</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 4.5pt; position: relative; top: -3pt; letter-spacing: 0px;display:inline;">(2)</span> </div> </div> </td> </tr> <tr style="height:36pt"> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:110.17pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Maximum Early Withdrawal Charge </span></div> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">(Load) (as a percentage of the lower of </span></div> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">the original purchase price or </span></div> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase price)</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:40.79pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">None</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:25.08pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">None</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:29.19pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">1.00%</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:25.08pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">None</span></div> </div> </td> <td style="background-color:#ECF6F8;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:29.69pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">1.00%</span></div> </div> </td> </tr> <tr style="height:9.5pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:110.17pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Dividend Reinvestment Fees</span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:40.79pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">None</span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:25.08pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">None</span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:29.19pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">None</span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:25.08pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">None</span></div> </div> </td> <td style="padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:29.69pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">None</span></div> </div> </td> </tr> </table> </div> <div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">1</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">While neither the Fund nor the Distributor impose an initial sales charge, if you buy </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Institutional Class, Class A-1 or Class A-3 Common Shares through certain financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">firms, they may directly charge you transaction or other fees in such amount as they </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">may determine. Please consult your financial firm for additional information.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; line-height: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="clear: both; position: relative; max-height: 0px;"></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">2</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Although the Fund is permitted to charge a maximum sales charge of 3.00%, the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">has elected to currently charge a maximum sales charge of 2.00%. See “Plan of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Distribution - Purchasing Shares - Reductions and Waivers of Initial Sales Charges and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">EWCs” in this prospectus for more information on sales charge waivers and discounts.</div><div style="clear: both; position: relative; max-height: 0px;"></div> 0 0 0.03 0 0.03 0 0 0.01 0 0.01 0 0 0 0 0 <div style="line-height:12.0pt;margin-top:6pt;text-align:left"> <div style="margin-top:6pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Annual Fund Operating Expenses (</span></span><span style="font-size: 9pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-family: Arial; line-height: 9pt;display:inline;"><span style="letter-spacing: 0px; top: 0px; line-height: 9pt;display:inline;"><span style="color: rgb(51, 51, 51); letter-spacing: 0px; top: 0px; line-height: 9pt;display:inline;"><span style="line-height: 9pt; font-size: 9pt; font-family: Arial;font-weight:bolder;display:inline;width:100%;">as a percentage of Net Assets Attributable to Common Shares</span></span></span></span></span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> (reflecting leverage </span></span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">attributable to reverse repurchase agreements representing </span></span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">approximately </span></span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">15.29</span></span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">% of the Fund’s average total managed </span></span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">assets or </span></span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">18.05</span></span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">% of the Fund’s average net assets attributable </span></span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">to common shares)):</span></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 1pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> </span></span></span></div> </div> <div style="line-height:0.0pt;margin-top:6pt;text-align:left"> <div style="margin-top:6pt"> </div> </div> <div style="margin-top:0.0pt"> <table cellpadding="0" cellspacing="0" style="text-align:start; border-bottom:0.5pt solid #00687D;empty-cells:show;width:260pt"> <tr style="height:17pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:4.5pt;padding-top:4.5pt;vertical-align:Bottom;width:93.62pt"> <div style="line-height:0.5pt;text-align:left"> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;"> </span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:4.5pt;padding-top:4.5pt;vertical-align:Bottom;width:40.79pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Institutional</span></span></div> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Class</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:4.5pt;padding-top:4.5pt;vertical-align:Bottom;width:31.27pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Class A-1</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:4.5pt;padding-top:4.5pt;vertical-align:Bottom;width:31.27pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Class A-2</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:4.5pt;padding-top:4.5pt;vertical-align:Bottom;width:31.27pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Class A-3</span></span></div> </div> </td> <td style="padding-bottom:4.5pt;padding-top:4.5pt;vertical-align:Bottom;width:31.77pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Class A-4</span></span></div> </div> </td> </tr> <tr style="height:13pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:4.5pt;vertical-align:Top;width:93.62pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Management Fees</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 4.5pt; margin-left: 0pt; position: relative; top: -3pt; letter-spacing: 0px;display:inline;">(1)</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:4.5pt;vertical-align:Top;width:40.79pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">1.54%</span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:4.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">1.54%</span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:4.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">1.54%</span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:4.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">1.54%</span></div> </div> </td> <td style="padding-bottom:3.5pt;padding-top:4.5pt;vertical-align:Top;width:31.77pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">1.54%</span></div> </div> </td> </tr> <tr style="height:20pt"> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:93.62pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Distribution and/or Service </span></div> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">(12b-1) Fees</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:40.79pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">N/A</span></span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.50%</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.50%</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.75%</span></div> </div> </td> <td style="background-color:#ECF6F8;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.77pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.75%</span></div> </div> </td> </tr> <tr style="height:20pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:93.62pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Interest Payments on Borrowed </span></div> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Funds</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 4.5pt; margin-left: 0pt; position: relative; top: -3pt; letter-spacing: 0px;display:inline;">(2)</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 4.5pt; margin-left: 0pt; position: relative; top: -3pt; letter-spacing: 0px;display:inline;">(3)</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:40.79pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.71%</span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.71%</span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.71%</span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.71%</span></div> </div> </td> <td style="padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.77pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.71%</span></div> </div> </td> </tr> <tr style="height:12pt"> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:93.62pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Other Expenses</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 4.5pt; margin-left: 0pt; position: relative; top: -3pt; letter-spacing: 0px;display:inline;">(4)</span></span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:40.79pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.08%</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.08%</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.08%</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.08%</span></div> </div> </td> <td style="background-color:#ECF6F8;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.77pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0.08%</span></div> </div> </td> </tr> <tr style="height:20pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:93.62pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Total Annual Fund </span></span></div> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Operating Expenses</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:40.79pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">2.33%</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">2.83%</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">2.83%</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">3.08%</span></span></div> </div> </td> <td style="padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.77pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">3.08%</span></span></div> </div> </td> </tr> <tr style="height:20pt"> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:93.62pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Fee Waiver and/or Expense </span></div> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Reimbursement</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 4.5pt; margin-left: 0pt; position: relative; top: -3pt; letter-spacing: 0px;display:inline;">(5)</span></span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:40.79pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">(0.01%)</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">(0.01%)</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">(0.01%)</span></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">(0.01%)</span></div> </div> </td> <td style="background-color:#ECF6F8;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:31.77pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">(0.01%)</span></div> </div> </td> </tr> <tr style="height:33.5pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:93.62pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Total Annual Fund </span></span></div> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Operating Expenses After </span></span></div> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Fee Waiver and/or Expense </span></span></div> <div style="margin-left:3pt;margin-right:2.25pt;text-align:Left;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Reimbursement</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:40.79pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">2.32%</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">2.82%</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">2.82%</span></span></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:31.27pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:2.25pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">3.07%</span></span></div> </div> </td> <td style="padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:31.77pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:2.25pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">3.07%</span></span></div> </div> </td> </tr> </table> </div> <div style="margin-top:0.0pt"></div> <div> <div style="clear:both;margin-top:2.5pt;position:relative;width:100%"> <div style="float:left;line-height:7pt;text-align:left;width:2.88pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 5pt; position: relative; top: 0px; letter-spacing: 0px;display:inline;">1</span></div> <div style="float:left;line-height:10.0pt;margin-left:7.12pt;text-align:left;width:245.00pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Management Fees include fees payable to the Investment Manager for advisory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">services and for supervisory, administrative and other services. The Fund pays for the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">advisory, supervisory and administrative services it requires under what is essentially </span> </div> </div> <div style="clear: both; position: relative; max-height: 0px;"></div> </div> <div style="line-height:10.0pt;margin-left:10pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">an all-in fee structure (the “unified management fee”). Pursuant to an investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">management agreement, PIMCO is paid a Management Fee of 1.30% of the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">average daily total managed assets. The Fund (and not PIMCO) is responsible for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">certain fees and expenses, which are reflected in the table above, that are not covered </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">by the unified management fee under the investment management agreement. Please </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">see “Management of the Fund – Investment Management Agreement” for an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">explanation of the unified management fee and definition of “total managed assets.”</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; line-height: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div> <div> <div style="clear:both;margin-top:2pt;position:relative;width:100%"> <div style="float:left;line-height:7pt;text-align:left;width:2.88pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 5pt; position: relative; top: 0px; letter-spacing: 0px;display:inline;">2</div></div> <div style="float:left;line-height:10.0pt;margin-left:7.12pt;text-align:left;width:245.00pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Reflects the Fund’s use of leverage in the form of reverse repurchase agreements </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">averaged over the fiscal year ended June 30, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">2026</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;"> which represented approximately </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">15.29</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">% of the Fund’s average total managed assets, including assets attributable to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">such leverage, (or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">18.05</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">% of the Fund’s average net assets attributable to common </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">shares), as of that date, at an estimated annual interest rate cost to the Fund of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">3.74</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">%, which is the weighted average interest rate cost during the fiscal year ended </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">June 30, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">2026</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">. See “Use of Leverage-Effects of Leverage.” The actual amount of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">interest expense borne by the Fund will vary over time in accordance with the level of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s use of leverage and variations in market interest rates. Borrowing expense is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">required to be treated as an expense of the Fund for accounting purposes. Any </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">associated income or gains (or losses) realized from leverage obtained through such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">instruments is not reflected in the Annual Expenses table above, but would be reflected </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">in the Fund’s performance results.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; line-height: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div> </div> <div style="clear: both; position: relative; max-height: 0px;"></div> </div> <div> <div style="clear:both;margin-top:2pt;position:relative;width:100%"> <div style="float:left;line-height:7pt;text-align:left;width:2.88pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 5pt; position: relative; top: 0px; letter-spacing: 0px;display:inline;">3</div></div> <div style="float:left;line-height:10.0pt;margin-left:7.12pt;text-align:left;width:245.00pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">“Interest Payments on Borrowed Funds” is borne by the Fund separately from the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">management fees paid to PIMCO. Excluding such expense, Total Annual Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Operating Expenses After Fee Waiver and/or Expense Reimbursement are estimated to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">1.61</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">%, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">2.11</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">%, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">2.11</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">%, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">2.36</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">% and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">2.36</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">% for Institutional Class, Class A-1, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Class A-2, Class A-3 and Class A-4 shares, respectively.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; line-height: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div> </div> <div style="clear: both; position: relative; max-height: 0px;"></div> </div> <div> <div style="clear:both;margin-top:2pt;position:relative;width:100%"> <div style="float:left;line-height:7pt;text-align:left;width:2.88pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 5pt; position: relative; top: 0px; letter-spacing: 0px;display:inline;">4</div></div> <div style="float:left;line-height:10.0pt;margin-left:7.12pt;text-align:left;width:245.00pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">“Other Expenses” are based on estimated amounts for the current fiscal year.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; line-height: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div> </div> <div style="clear: both; position: relative; max-height: 0px;"></div> </div> <div> <div style="clear:both;margin-top:2pt;position:relative;width:100%"> <div style="float:left;line-height:7pt;text-align:left;width:2.88pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 5pt; position: relative; top: 0px; letter-spacing: 0px;display:inline;">5</div></div> <div style="float:left;line-height:10.0pt;margin-left:7.12pt;text-align:left;width:245.00pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO has contractually agreed, through November 3, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">2027</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">, to waive its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">management fee, or reimburse the Fund, to the extent that organizational expenses </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">(including any initial offering expenses), pro rata share of expenses related to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">obtaining or maintaining a Legal Entity Identifier and pro rata Trustees’ fees exceed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">0.07% of the Fund’s average daily net assets. The Expense Limitation Agreement will </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">automatically renew for one-year terms unless PIMCO provides written notice to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Fund at least 30 days prior to the end of the current term, or unless the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">terminates the agreement upon 90 days notice of the Fund's investment management </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">agreement with PIMCO terminates. Under the Expense Limitation Agreement, if, in any </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">month in which the investment management agreement is in effect, the estimated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">annualized Specified Expenses for that month are less than the Expense Limit, PIMCO </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">is entitled to reimbursement by the Fund of any portion of the management fee waived </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">or reduced as set forth above during the previous thirty-six months, provided that such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">amount paid to PIMCO will not (1) together with the annualized Specified Expenses </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">exceed, for such month, the Expense Limit; (2) exceed the total Reimbursement </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Amount; or (3) include any amounts previously reimbursed to PIMCO. For the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">avoidance of doubt, any reimbursement of PIMCO’s management fee pursuant to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Expense Limitation Agreement plus any recoupment of Specified Expenses will not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">exceed the lesser of (i) the expense limit in effect at the time of waiver or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">reimbursement and (ii) the expense limit in effect at the time of recoupment.</div></div></div> </div> <div style="clear: both; position: relative; max-height: 0px;"></div> </div> <span style="line-height: 9pt; font-size: 9pt; font-family: Arial;font-weight:bolder;display:inline;width:100%;">as a percentage of Net Assets Attributable to Common Shares</span> 0.0154 0.0154 0.0154 0.0154 0.0154 0.005 0.005 0.0075 0.0075 0.0071 0.0071 0.0071 0.0071 0.0071 0.0008 0.0008 0.0008 0.0008 0.0008 0.0233 0.0283 0.0283 0.0308 0.0308 -0.0001 -0.0001 -0.0001 -0.0001 -0.0001 0.0232 0.0282 0.0282 0.0307 0.0307 <span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Management Fees include fees payable to the Investment Manager for advisory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">services and for supervisory, administrative and other services. The Fund pays for the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">advisory, supervisory and administrative services it requires under what is essentially </span> <div style="line-height:10.0pt;margin-left:10pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">an all-in fee structure (the “unified management fee”). Pursuant to an investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">management agreement, PIMCO is paid a Management Fee of 1.30% of the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">average daily total managed assets. The Fund (and not PIMCO) is responsible for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">certain fees and expenses, which are reflected in the table above, that are not covered </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">by the unified management fee under the investment management agreement. Please </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">see “Management of the Fund – Investment Management Agreement” for an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">explanation of the unified management fee and definition of “total managed assets.”</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; line-height: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div> “Other Expenses” are based on estimated amounts for the current fiscal year. <div style="line-height:14.0pt;margin-top:10pt;text-align:left"> <div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Example</span></span></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">As required by relevant SEC regulations, the following example </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">illustrates the expenses (including any applicable sales charge) that you </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would pay on a $1,000 investment in the Common Shares, assuming a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">5% annual return</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 6.5pt; position: relative; top: -4.25pt; letter-spacing: 0px;display:inline;">(1)(2)</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">:</span></div> </div> <div style="line-height:12.0pt;margin-top:6pt;text-align:left"> <div style="margin-top:6pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;">If you redeem your shares at the end of each period:</div></div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 1pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;"> </div></div></div> </div> <div style="line-height:0.0pt;margin-top:6pt;text-align:left"> <div style="margin-top:6pt"> </div> </div> <div style="margin-top:0.0pt"> <table cellpadding="0" cellspacing="0" style="text-align:start; border-bottom:0.5pt solid #00687D;empty-cells:show;width:260pt"> <tr style="height:8.5pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Bottom;width:132.84pt"> <div style="line-height:0.5pt;text-align:left"> <div style="margin-left:3pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="display:inline;font-weight:bolder;display:inline;"> </div></div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Bottom;width:29.55pt"> <div style="line-height:7pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="display:inline;font-weight:bolder;display:inline;">1 Year</div></div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Bottom;width:32.32pt"> <div style="line-height:7pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="display:inline;font-weight:bolder;display:inline;">3 Years</div></div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Bottom;width:32.32pt"> <div style="line-height:7pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="display:inline;font-weight:bolder;display:inline;">5 Years</div></div></div> </div> </td> <td style="padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Bottom;width:32.96pt"> <div style="line-height:7pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:3pt;text-align:Center;white-space:nowrap"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="display:inline;font-weight:bolder;display:inline;">10 Years</div></div></div> </div> </td> </tr> <tr style="height:12pt"> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:132.84pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:3pt;margin-right:5.75pt;text-align:Left;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Institutional Class</div></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:29.55pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$24</div></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$73</div></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$124</div></div> </div> </td> <td style="background-color:#ECF6F8;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.96pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:3pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$267</div></div> </div> </td> </tr> <tr style="height:12pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:132.84pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:3pt;margin-right:5.75pt;text-align:Left;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Class A-1</div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:29.55pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$29</div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$88</div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$149</div></div> </div> </td> <td style="padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.96pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:3pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$316</div></div> </div> </td> </tr> <tr style="height:12pt"> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:132.84pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:3pt;margin-right:5.75pt;text-align:Left;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Class A-2</div></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:29.55pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$68</div></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$115</div></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$175</div></div> </div> </td> <td style="background-color:#ECF6F8;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.96pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:3pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$336</div></div> </div> </td> </tr> <tr style="height:12pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:132.84pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:3pt;margin-right:5.75pt;text-align:Left;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Class A-3</div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:29.55pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$31</div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$95</div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$162</div></div> </div> </td> <td style="padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.96pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:3pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$339</div></div> </div> </td> </tr> <tr style="height:9pt"> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:132.84pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:3pt;margin-right:5.75pt;text-align:Left;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Class A-4</div></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:29.55pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$70</div></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$122</div></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$187</div></div> </div> </td> <td style="background-color:#ECF6F8;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:32.96pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:3pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$359</div></div> </div> </td> </tr> </table> </div> <div style="line-height:17.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;">If you do not redeem your <div style="letter-spacing: 0px; top: 0px;display:inline;">shares</div>:</div></div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 1pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;"> </div></div></div> <div style="line-height:0.0pt;margin-top:6pt;text-align:left"> <div style="margin-top:6pt"> </div> </div> <div style="margin-top:0.0pt"> <table cellpadding="0" cellspacing="0" style="text-align:start; border-bottom:0.5pt solid #00687D;empty-cells:show;width:260pt"> <tr style="height:8.5pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Bottom;width:132.84pt"> <div style="line-height:0.5pt;text-align:left"> <div style="margin-left:3pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="display:inline;font-weight:bolder;display:inline;"> </div></div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Bottom;width:29.55pt"> <div style="line-height:7pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="display:inline;font-weight:bolder;display:inline;">1 Year</div></div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Bottom;width:32.32pt"> <div style="line-height:7pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="display:inline;font-weight:bolder;display:inline;">3 Years</div></div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Bottom;width:32.32pt"> <div style="line-height:7pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="display:inline;font-weight:bolder;display:inline;">5 Years</div></div></div> </div> </td> <td style="padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Bottom;width:32.96pt"> <div style="line-height:7pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:3pt;text-align:Center;white-space:nowrap"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="display:inline;font-weight:bolder;display:inline;">10 Years</div></div></div> </div> </td> </tr> <tr style="height:12pt"> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:132.84pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:3pt;margin-right:5.75pt;text-align:Left;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Class A-2</div></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:29.55pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$58</div></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$115</div></div> </div> </td> <td style="background-color:#ECF6F8;border-right:0.5pt solid #FFFFFF;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$175</div></div> </div> </td> <td style="background-color:#ECF6F8;padding-bottom:3.5pt;padding-top:3.5pt;vertical-align:Top;width:32.96pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:3pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$336</div></div> </div> </td> </tr> <tr style="height:9pt"> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:132.84pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:3pt;margin-right:5.75pt;text-align:Left;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Class A-4</div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:29.55pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$60</div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$122</div></div> </div> </td> <td style="border-right:0.5pt solid #FFFFFF;padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:32.32pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:5.75pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$187</div></div> </div> </td> <td style="padding-bottom:2.5pt;padding-top:3.5pt;vertical-align:Top;width:32.96pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:5.75pt;margin-right:3pt;text-align:Center;white-space:nowrap"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">$359</div></div> </div> </td> </tr> </table> </div> <div> <div style="clear:both;margin-top:2.5pt;position:relative;width:100%"> <div style="float:left;line-height:7pt;text-align:left;width:2.88pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 5pt; position: relative; top: 0px; letter-spacing: 0px;display:inline;">1</div></div> <div style="float:left;line-height:10.0pt;margin-left:7.12pt;text-align:left;width:245.00pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;">The example above should not be considered a representation of future </div></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;">expenses. Actual expenses may be higher or lower than those shown.</div></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;"> The </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">example assumes that the estimated Interest Payments on Borrowed Funds and Other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Expenses set forth in the Annual Fund Operating Expenses table are accurate, that the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Total Annual Fund Operating Expenses (as described above) remain the same for all </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">time periods shown, and that all dividends and distributions are reinvested at NAV and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">takes into account the effect of the fee waiver and/or expense reimbursement (if any) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">during the full contractual term of such fee waiver and/or expense reimbursement. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Actual expenses may be greater or less than those assumed. Moreover, the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">actual rate of return may be greater or less than the hypothetical 5% annual return </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">shown in the example. In addition to the fees and expenses described above, you may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">also be required to pay transaction or other fees on purchases of Institutional Class, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Class A-1, Class A-2, Class A-3 or Class A-4 Common Shares of the Fund, which are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">not reflected in the example.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; line-height: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div> </div> <div style="clear: both; position: relative; max-height: 0px;"></div> </div> <div> <div style="clear:both;margin-top:2.0pt;position:relative;width:100%"> <div style="float:left;line-height:7pt;text-align:left;width:2.88pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 5pt; position: relative; top: 0px; letter-spacing: 0px;display:inline;">2</div></div> <div style="float:left;line-height:10.0pt;margin-left:7.12pt;text-align:left;width:245.00pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">The applicable initial sales charge reflected in the example for Class A-2 and Class A-4 </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares of the Fund is 2.00%. Although the Fund is permitted to charge a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">maximum initial sales charge of 3.00% for these share classes, the Fund has elected to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 8pt; letter-spacing: 0px; top: 0px;display:inline;">currently charge a maximum initial sales charge of 2.00%.</div></div> </div> <div style="clear: both; position: relative; max-height: 0px;"></div> </div> 24 73 124 267 29 88 149 316 68 115 175 336 31 95 162 339 70 122 187 359 58 115 175 336 60 122 187 359 <div style="line-height:14.0pt;margin-top:10pt;text-align:left"> <div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">The Fund’s Investment Objective and Strategies</span></span></div> </div> <div style="line-height:12.0pt;margin-top:2pt;text-align:left"> <div style="margin-top:2pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">When used in this prospectus, the term “invest” includes both direct </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investing and indirect investing and the term “investments” includes </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">both direct investments and indirect investments. For example, the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may invest indirectly by investing in derivatives or through its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subsidiaries. The Fund may be exposed to the different types of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments described below through its Subsidiaries. The allocation of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s portfolio in a Subsidiary will vary over time and might not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">always include all of the different types of investments described herein.</span></div> </div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"> <div style="margin-top:10pt"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;">Investment Objective</div></div></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investment objective is to seek to provide attractive </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk-adjusted returns and current income.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund seeks to achieve its investment objective by investing, under </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">normal circumstances, across a wide array of instruments, including </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from sovereign, quasi-sovereign and corporate borrowers, that are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economically tied to “emerging market” countries. The Fund utilizes a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">flexible asset allocation strategy among multiple public and private </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit sectors in the emerging market credit markets, including corporate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt (including, among other things, fixed-, variable- and floating-rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bonds, loans, convertible and contingent convertible securities and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">stressed, distressed and defaulted debt securities issued by corporations </div></div> </div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or other business entities), mortgage-related and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consumer-related instruments, collaterali<div style="display:inline;">zed </div>debt obligations, including, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">without limitation, collateralized loan obligations, government, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sovereign and quasi-sovereign debt and other fixed-, variable- and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">floating-rate income-producing securities. The Fund may invest without </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limitation</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> in investment grade debt securities and in below investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">grade debt securities (commonly referred to as “high yield” securities or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">“junk bonds”), including securities of defaulted, stressed, distressed and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">defaulted issuers. No assurance can be given that the Fund’s investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">objective will be achieved, and you could lose all of your investment in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"> <div style="margin-top:10pt"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;">Portfolio Management Strategies</div></div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;"> </div></div></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO serves as the Investment Manager of the Fund and manages the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s portfolio. See “Management of the Fund.” The portfolio </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">management strategies and techniques to be utilized by PIMCO are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">described below.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div> </div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"> <div style="margin-top:10pt"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;">Flexible Allocation Strategy</div></div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;"> </div></div></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In managing the Fund, PIMCO employs an active approach to allocation </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">among multiple credit sectors based on, among other things, market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions, valuation assessments, economic outlook, credit market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trends and other economic factors. With PIMCO’s macroeconomic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">analysis as the basis for top-down investment decisions, including </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geographic and credit sector emphasis, the Fund expects to focus on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">seeking attractive risk-adjusted returns across multiple credit sectors. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO may choose to focus on particular countries or emerging market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regions, asset classes, industries and sectors to the exclusion of others </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at any time and from time to time based on market conditions and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">factors. The relative value assessment within credit sectors draws on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO’s regional and sector specialist insights.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div> </div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"> <div style="margin-top:10pt"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;">Investment Selection Strategies</div></div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;"> </div></div></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Once the Fund’s top-down, portfolio positioning decisions have been </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">made as described above, PIMCO generally selects particular </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments for the Fund by employing a bottom-up, disciplined credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">approach which is driven by fundamental, independent research within </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">each sector represented in the Fund, with a focus on seeking to identify </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities and other instruments with solid and/or improving </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fundamentals. PIMCO utilizes strategies that focus on credit quality </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">analysis, duration management and other risk management techniques. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO attempts to identify, through fundamental research driven by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">independent credit analysis and proprietary analytical tools, debt </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations and other income-producing securities that provide positive </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk-adjusted returns based on its analysis of the issuer’s credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">characteristics and the position of the security in the issuer’s capital </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">structure.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Consideration of yield is only one component of the portfolio managers’ </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">approach in managing the Fund. PIMCO also attempts to identify </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments that may appreciate in value based on PIMCO’s assessment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the issuer’s credit characteristics, forecast for interest rates and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">outlook for particular countries/regions, currencies, industries, sectors </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and the global economy and bond markets generally.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div> </div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;">Credit Quality</div></div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest without limitation in debt instruments that are, at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the time of purchase, rated below “investment grade” by at least one of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Moody's, S&amp;P or Fitch, or unrated but determined by PIMCO to be of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">comparable quality to securities so rated. “Investment grade” means a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rating, in the case of Moody’s, of Baa3 or higher, or in the case of S&amp;P </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and Fitch, of BBB-or higher. The Fund may invest in securities of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">stressed, distressed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or defaulted issuers, which include securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at risk of being in default as to the repayment of principal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or interest at the time of acquisition by the Fund or that are rated in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the lower rating categories by one or more </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">NRSROs</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> (for example, Ca or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lower by Moody’s or CC or lower by S&amp;P or Fitch) or, if unrated, are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">determined by PIMCO to be of comparable quality</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> to securities so rated</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may also invest in defaulted securities and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debtor-in-possession financings. Debt instruments of below investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">grade quality</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and in debtor-in-possession financings,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> are regarded as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">having predominantly speculative characteristics with respect to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capacity to pay interest and repay principal, and are commonly referred </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to as “high yield” securities or “junk bonds.” Debt instruments in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lowest investment grade category may also be considered to possess </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">some speculative characteristics by certain ratings agencies. The Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may, for hedging, investing or leveraging purposes, make use of credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default swaps (which includes buying and/or selling credit default </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">swaps), which are contracts whereby one party makes periodic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments to a counterparty in exchange for the right to receive from the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparty a payment equal to the par (or other agreed-upon) value </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of a referenced debt obligation in the event of a default or other credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">event by the issuer of the debt obligation.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;">Independent Credit Analysis</div></div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO relies primarily on its own analysis of the credit quality and risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with individual debt instruments considered for the Fund, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rather than relying exclusively on rating agencies or third-party research. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s portfolio managers utilize this information in an attempt to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">manage credit risk and to identify investments that are undervalued </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or that offer attractive yields relative to PIMCO’s assessment of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">their credit characteristics. This aspect of PIMCO’s capabilities will be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particularly important in light of the Fund’s plans to invest in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments that are tied economically to emerging markets, and to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent that the Fund invests in high yield securities.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><div style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;">Duration Management</div></div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-weight:bolder;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund has no targeted average portfolio duration and the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">average portfolio duration may vary significantly depending on market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions and other factors. It is expected that the Fund normally will </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have a short to longer average portfolio duration (i.e., within a zero to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">12 year range), as calculated by the Investment Manager, although it </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be shorter or longer at any time depending on market conditions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other factors. For example, if the Fund has an average portfolio </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">duration of 12 years, a 1% increase in interest rates would tend to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">correspond to a 12% decrease in the value of the Fund’s portfolio. There </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is no limit on the maturity or duration of any individual security in which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund may invest. Duration is a measure used to determine the </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sensitivity of a security’s price to changes in interest rates. The Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">duration strategy may entail maintaining a negative average portfolio </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">duration from time to time, meaning the portfolio would tend to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase in value in response to an increase in interest rates. For </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">example, if the Fund has a negative average portfolio duration, a 1% </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase in interest rates would tend to correspond to a 1% increase<div style="display:inline;"> in</div> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the value of the Fund’s portfolio for every year of negative duration. A </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">negative average portfolio duration would potentially benefit the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portfolio in an environment of rising market interest rates, but would </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally adversely impact the portfolio in an environment of falling or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">neutral market interest rates. PIMCO may also utilize certain strategies </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including, without limitation, investments in structured notes or interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate futures contracts or swap, cap, floor or collar transactions, for the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purpose of reducing the interest rate sensitivity of the Fund’s portfolio, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">although there is no assurance that it will do so or that such strategies </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will be successful. The foregoing is a description of interest rate duration </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">management only. The credit spread duration of the Fund's portfolio </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may vary, in some cases, significantly, from its interest rate duration.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Effects of Leverage</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The following table is furnished in response to requirements of the SEC. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">It is designed to illustrate the effects of leverage through the use of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">senior securities, as that term is defined under Section 18 of the 1940 </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Act, on Common Share total return, assuming investment portfolio total </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">returns (consisting of income and changes in the value of investments </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">held in the Fund’s portfolio) of -10%, -5%, 0%, 5% and 10%. Although </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not considered senior securities, the table below reflects the Fund’s use </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of leverage in the form of reverse repurchase agreements as of June 30, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">2026</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> averaged over the fiscal year ended June 30, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">2026</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, which </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">represented approximately </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">15.29</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">% of the Fund’s average total </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">managed assets (including assets attributable to such leverage) at an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">estimated annual average effective interest expense rate of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">3.74</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">% </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payable by the Fund on such instruments which is the weighted average </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rate cost during the fiscal year ended June 30, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">2026</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. Based on </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such estimated annual effective interest expense rate, the annual return </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the Fund’s portfolio must experience (net of non-interest expenses) </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in order to cover such costs is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">0.57</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">%. The information below does not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reflect the Fund’s use of certain other forms of economic leverage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">achieved through the use of other instruments or transactions not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">considered to be senior securities under the 1940 Act, such as credit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default swaps or other derivative instruments. The assumed investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portfolio returns in the table below are hypothetical figures and are not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">necessarily indicative of the investment portfolio returns expected to be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">experienced by the Fund. Your actual returns may be greater or less than </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">those appearing below. In addition, actual borrowing expenses </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with reverse repurchase agreements (or borrowings, if any) </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">used by the Fund may vary frequently and may be significantly higher or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lower than the rate used for the example below.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 1pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></span></div></div> <table cellpadding="0" cellspacing="0" style="text-align:start; border-bottom:0.5pt solid #00687D;empty-cells:show;width:260pt"> <tr style="height:14pt"> <td style="background-color:#FFFFFF;padding-bottom:3pt;padding-top:3pt;vertical-align:Top;width:109.73pt"><div style="line-height:7.5pt;text-align:left"><div style="margin-left:3pt;margin-right:4pt;text-align:Left;white-space:nowrap"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Assumed Portfolio Total Return</span></div></div></td> <td style="background-color:#FFFFFF;padding-bottom:3pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:34.47pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:26.47pt"><div style="display:flex;margin:auto;width:28.47pt"><div style="display:flex;white-space:nowrap;width:28.47pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0.28pt; letter-spacing: 0px; top: 0px;display:inline;">(10.00)%</span></div> </div></div></td> <td style="background-color:#FFFFFF;padding-bottom:3pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:30.87pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:22.87pt"><div style="display:flex;margin:auto;width:24.87pt"><div style="display:flex;white-space:nowrap;width:24.87pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0.28pt; letter-spacing: 0px; top: 0px;display:inline;">(5.00)%</span></div> </div></div></td> <td style="background-color:#FFFFFF;padding-bottom:3pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:28.93pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:20.93pt"><div style="display:flex;margin:auto;width:22.93pt"><div style="display:flex;white-space:nowrap;width:22.93pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 2.22pt; letter-spacing: 0px; top: 0px;display:inline;">0.00%</span></div> </div></div></td> <td style="background-color:#FFFFFF;padding-bottom:3pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:26.71pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:18.71pt"><div style="display:flex;margin:auto;width:20.71pt"><div style="display:flex;white-space:nowrap;width:20.71pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">5.00%</span></div> </div></div></td> <td style="background-color:#FFFFFF;padding-bottom:3pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:29.31pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:1.5pt;text-align:right;width:22.31pt"><div style="display:flex;margin:auto;width:24.31pt"><div style="display:flex;white-space:nowrap;width:24.31pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">10.00%</span></div> </div></div></td></tr> <tr style="height:16pt"> <td style="background-color:azure;padding-bottom:2pt;padding-top:3pt;vertical-align:Top;width:109.73pt"><div style="line-height:7.5pt;text-align:left"><div style="margin-left:3pt;margin-right:4pt;text-align:Left;white-space:nowrap"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares Total Return (net of </span></div><div style="margin-left:3pt;margin-right:4pt;text-align:Left;white-space:nowrap"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">expenses)</span></div></div></td> <td style="background-color:azure;padding-bottom:2pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:34.47pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:26.47pt"><div style="display:flex;margin:auto;width:28.47pt"><div style="display:flex;white-space:nowrap;width:28.47pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">-12.48%</span></div> </div></div></td> <td style="background-color:azure;padding-bottom:2pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:30.87pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:22.87pt"><div style="display:flex;margin:auto;width:24.87pt"><div style="display:flex;white-space:nowrap;width:24.87pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">-6.58%</span></div> </div></div></td> <td style="background-color:azure;padding-bottom:2pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:28.93pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:20.93pt"><div style="display:flex;margin:auto;width:22.93pt"><div style="display:flex;white-space:nowrap;width:22.93pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">-0.68%</span></div> </div></div></td> <td style="background-color:azure;padding-bottom:2pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:26.71pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:18.71pt"><div style="display:flex;margin:auto;width:20.71pt"><div style="display:flex;white-space:nowrap;width:20.71pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">5.23%</span></div> </div></div></td> <td style="background-color:azure;padding-bottom:2pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:29.31pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:1.5pt;text-align:right;width:22.31pt"><div style="display:flex;margin:auto;width:24.31pt"><div style="display:flex;white-space:nowrap;width:24.31pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">11.13%</span></div> </div></div></td></tr></table><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares Total Return is composed of two elements—the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distributions paid by the Fund to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shareholders</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> (the amount of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which is largely determined by the net investment income of the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">after paying dividend payments on any preferred shares issued by the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund and expenses on any forms of leverage outstanding) and gains or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">losses on the value of the securities and other instruments the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">owns. As required by SEC rules, the table assumes that the Fund is more </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">likely to suffer capital losses than to enjoy capital appreciation. For </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">example, to assume a total return (before expenses) of 0%, the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">must assume that the income it receives on its investments is entirely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">offset by losses in the value of those investments. This table reflects </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">hypothetical performance of the Fund’s portfolio and not the actual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance of the Fund’s Common Shares, the value of which is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">determined by market forces and other factors.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Should the Fund elect to add additional leverage, any benefits of such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leverage cannot be fully achieved until the proceeds resulting from the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">use of such leverage have been received by the Fund and invested in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accordance with the Fund’s investment objective and policies. As noted </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">above, the Fund’s willingness to use additional leverage, and the extent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to which leverage is used at any time, will depend on many factors, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including, among other things, PIMCO’s assessment of the yield curve </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">environment, interest rate trends, market conditions and other factors.</div></div></div> <table cellpadding="0" cellspacing="0" style="text-align:start; border-bottom:0.5pt solid #00687D;empty-cells:show;width:260pt"> <tr style="height:14pt"> <td style="background-color:#FFFFFF;padding-bottom:3pt;padding-top:3pt;vertical-align:Top;width:109.73pt"><div style="line-height:7.5pt;text-align:left"><div style="margin-left:3pt;margin-right:4pt;text-align:Left;white-space:nowrap"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Assumed Portfolio Total Return</span></div></div></td> <td style="background-color:#FFFFFF;padding-bottom:3pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:34.47pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:26.47pt"><div style="display:flex;margin:auto;width:28.47pt"><div style="display:flex;white-space:nowrap;width:28.47pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0.28pt; letter-spacing: 0px; top: 0px;display:inline;">(10.00)%</span></div> </div></div></td> <td style="background-color:#FFFFFF;padding-bottom:3pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:30.87pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:22.87pt"><div style="display:flex;margin:auto;width:24.87pt"><div style="display:flex;white-space:nowrap;width:24.87pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0.28pt; letter-spacing: 0px; top: 0px;display:inline;">(5.00)%</span></div> </div></div></td> <td style="background-color:#FFFFFF;padding-bottom:3pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:28.93pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:20.93pt"><div style="display:flex;margin:auto;width:22.93pt"><div style="display:flex;white-space:nowrap;width:22.93pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 2.22pt; letter-spacing: 0px; top: 0px;display:inline;">0.00%</span></div> </div></div></td> <td style="background-color:#FFFFFF;padding-bottom:3pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:26.71pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:18.71pt"><div style="display:flex;margin:auto;width:20.71pt"><div style="display:flex;white-space:nowrap;width:20.71pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">5.00%</span></div> </div></div></td> <td style="background-color:#FFFFFF;padding-bottom:3pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:29.31pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:1.5pt;text-align:right;width:22.31pt"><div style="display:flex;margin:auto;width:24.31pt"><div style="display:flex;white-space:nowrap;width:24.31pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">10.00%</span></div> </div></div></td></tr> <tr style="height:16pt"> <td style="background-color:azure;padding-bottom:2pt;padding-top:3pt;vertical-align:Top;width:109.73pt"><div style="line-height:7.5pt;text-align:left"><div style="margin-left:3pt;margin-right:4pt;text-align:Left;white-space:nowrap"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares Total Return (net of </span></div><div style="margin-left:3pt;margin-right:4pt;text-align:Left;white-space:nowrap"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">expenses)</span></div></div></td> <td style="background-color:azure;padding-bottom:2pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:34.47pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:26.47pt"><div style="display:flex;margin:auto;width:28.47pt"><div style="display:flex;white-space:nowrap;width:28.47pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">-12.48%</span></div> </div></div></td> <td style="background-color:azure;padding-bottom:2pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:30.87pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:22.87pt"><div style="display:flex;margin:auto;width:24.87pt"><div style="display:flex;white-space:nowrap;width:24.87pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">-6.58%</span></div> </div></div></td> <td style="background-color:azure;padding-bottom:2pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:28.93pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:20.93pt"><div style="display:flex;margin:auto;width:22.93pt"><div style="display:flex;white-space:nowrap;width:22.93pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">-0.68%</span></div> </div></div></td> <td style="background-color:azure;padding-bottom:2pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:26.71pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:4pt;text-align:right;width:18.71pt"><div style="display:flex;margin:auto;width:20.71pt"><div style="display:flex;white-space:nowrap;width:20.71pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">5.23%</span></div> </div></div></td> <td style="background-color:azure;padding-bottom:2pt;padding-top:3pt;vertical-align:Top;white-space:nowrap;width:29.31pt"><div style="line-height:7.5pt;margin-left:4pt;margin-right:1.5pt;text-align:right;width:22.31pt"><div style="display:flex;margin:auto;width:24.31pt"><div style="display:flex;white-space:nowrap;width:24.31pt"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; letter-spacing: 0px; top: 0px;display:inline;">11.13%</span></div> </div></div></td></tr></table> 0.1248 0.0658 0.0068 0.0523 0.1113 <div style="line-height:14.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Principal Risks of the Fund</span></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 12pt; line-height: 14pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:2pt;text-align:left"><div style="margin-top:2pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The NAV of the Common Shares will fluctuate with and be affected by, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">among other things, various principal risks of the Fund and its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments which are summarized below. The Fund is subject to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">principal risks noted below, whether through the Fund’s direct </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments, investments by its Subsidiaries or derivatives positions.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">New/Small Fund Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">A new or smaller fund’s performance may not represent how the fund is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expected to or may perform in the long term if and when it becomes </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">larger and has fully implemented its investment strategies. Investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">positions may have a disproportionate impact (negative or positive) on </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance in a new and smaller fund, such as the Fund. New and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">smaller funds may also require a period of time before they are invested </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in securities that meet their investment objectives and policies and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">achieve a representative portfolio composition. Fund performance may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be lower or higher during this “ramp-up” period, and may also be more </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatile, than would be the case after the fund is fully invested. Similarly, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a new or smaller fund’s investment strategy may require a longer period </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of time to show returns that are representative of the strategy. New </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">funds have limited performance histories for investors to evaluate and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">new and smaller funds may not attract sufficient assets to achieve </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment and trading efficiencies. If a new or smaller fund were to fail </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to successfully implement its investment strategies or achieve its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment objectives, performance may be negatively impacted, and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any resulting liquidation could create negative transaction costs for the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fund and tax consequences for investors.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div> <div style="line-height:12.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Emerging Markets Risk</span></span></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Foreign (non-U.S.) investment risk may be particularly high to the extent </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the Fund invests in securities of issuers based in or doing business </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in emerging market countries or invests in securities denominated in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currencies of emerging market countries. Investing in securities of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers based in or doing business in emerging markets entails all of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks of investing in foreign securities noted below, but to a heightened </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">degree.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments in emerging market countries pose a greater degree of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systemic risk (i.e., the risk of a cascading collapse of multiple institutions </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">within a country, and even multiple national economies). The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">inter-relatedness of economic and financial institutions within and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">among emerging market economies has deepened over the years, with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the effect that institutional failures and/or economic difficulties that are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of initially limited scope may spread throughout a country, a region or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">all or most emerging market countries. This may undermine any attempt </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by the Fund to reduce risk through geographic diversification of its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portfolio.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There is a heightened possibility of imposition of withholding or other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taxes on interest or dividend income or capital gains generated from </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">emerging market securities. Governments of emerging market countries </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may engage in confiscatory taxation or expropriation of income and/or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets to raise revenues or to pursue a domestic political agenda. In the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">past, emerging market countries have nationalized assets, companies </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and even entire sectors, including the assets of foreign investors, with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">inadequate or no compensation to the prior owners. There can be no </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assurance that the Fund will not suffer a loss of any or all of its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments, or interest or dividends thereon, due to adverse fiscal or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other policy changes in emerging market countries.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There is also a greater risk that an emerging market government may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">take action that impedes or prevents the Fund from taking income </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or capital gains earned in the local currency and converting into </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. dollars (i.e., “repatriating” local currency investments or profits). </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain emerging market countries have sought to maintain foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exchange reserves and/or address the economic volatility and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dislocations caused by the large international capital flows by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">controlling or restricting the conversion of the local currency into other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currencies. This risk tends to become more acute when economic </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions otherwise worsen. There can be no assurance that if the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">earns income or capital gains in an emerging market currency or PIMCO </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise seeks to withdraw the Fund’s investments from a given </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">emerging market country, capital controls imposed by such country will </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not prevent, or cause significant expense, or delay in, doing so.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Bankruptcy law and creditor reorganization processes may differ </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">substantially from those in the United States, resulting in greater </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">uncertainty as to the rights of creditors, the enforceability of such rights, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reorganization timing and the classification, seniority and treatment of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">claims. In certain emerging market countries, although bankruptcy laws </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have been enacted, the process for reorganization remains highly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">uncertain. In addition, it may be impossible to seek legal redress against </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">an issuer that is a sovereign state.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Emerging market countries typically have less established regulatory, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disclosure, legal, accounting, recordkeeping and financial reporting </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systems than those in more developed markets, which may increase the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potential for market manipulation or reduce the scope or quality of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial information available to investors. Governments in emerging </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market countries are often less stable and more likely to take extra-legal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">action with respect to companies, industries, assets, or foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ownership than those in more developed markets. Moreover, it can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more difficult for investors to bring litigation or enforce judgments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">against issuers in emerging markets or for U.S. regulators to bring </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">enforcement actions, or obtain information needed to pursue or enforce </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such judgments, against such issuers. In addition, foreign companies </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with securities listed on U.S. exchanges may be delisted if they do not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">meet U.S. accounting standards and auditor oversight requirements, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may decrease the liquidity and value of the securities. The Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may also be subject to emerging markets risk if it invests in derivatives </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or other securities or instruments whose value or return are related to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the value or returns of emerging markets securities.</div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Other heightened risks associated with emerging markets investments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">include without limitation, (i) risks due to less social, political and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economic stability; (ii) the smaller size of the market for such securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and a lower volume of trading, resulting in a lack of liquidity and in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">price volatility; (iii) certain national policies which may restrict the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment opportunities, including sanctions and restrictions on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investing in issuers or industries deemed sensitive to relevant national </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interests and requirements that government approval be obtained prior </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to investment by foreign persons; (iv) certain national policies that may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrict the Fund’s repatriation of investment income, capital or the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds of sales of securities, including temporary restrictions on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">foreign capital remittances; (v) the lack of uniform accounting and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">auditing standards and/or standards that may be significantly different </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from the standards required in the United States; (vi) less publicly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">available financial and other information regarding issuers; (vii) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potential difficulties in enforcing contractual obligations; and (viii) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">higher rates of inflation, higher interest rates and other economic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">concerns. Countries with emerging securities markets may additionally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">experience problems with share registration, settlement and custody, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may result in losses to the Fund. The Fund may invest to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">substantial extent in emerging market securities that are denominated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in local currencies, subjecting the Fund to a greater degree of foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency risk. Also, investing in emerging market countries may entail </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchases of securities of issuers that are insolvent, bankrupt or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise of questionable ability to satisfy their payment obligations as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">they become due, subjecting the Fund to a greater amount of credit risk </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or high yield risk. The economy of some emerging markets may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particularly exposed to or affected by a certain industry or sector, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">therefore issuers and/or securities of such emerging markets may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more affected by the performance of such industries or sectors.</div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The currencies of emerging market countries may experience significant </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">declines against the U.S. dollar, and devaluation may occur subsequent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to investments in these currencies by the Fund. Many emerging market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries have experienced substantial, and in some periods extremely </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">high, rates of inflation for many years. Inflation and rapid fluctuations in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">inflation rates have had, and may continue to have, negative effects on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the economies and securities markets of certain emerging market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Emerging securities markets may have different clearance and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">settlement procedures, which may be unable to keep pace with the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volume of securities transactions or otherwise make it difficult to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">engage in such transactions. Settlement problems may cause the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to miss attractive investment opportunities, hold a portion of the assets </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in cash pending investment, or be delayed in disposing of a portfolio </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security. Such a delay could result in possible liability to a purchaser of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the security. Custody services in many emerging market countries </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">remain undeveloped. The Fund will be investing in emerging market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries where the current law and market practice carry fewer </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">safeguards than in more developed markets, including the protection of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">client securities against claims from general creditors in the event of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insolvency of an agent selected to hold securities on behalf of the Fund, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and the Fund’s custodian and the Investment Manager have assumed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">no liability for losses resulting from the Fund acting in accordance with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such practice.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">For the avoidance of doubt, the emerging markets in which the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may invest include frontier markets. Frontier market countries are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">emerging market countries, but generally have smaller economies or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">less mature capital markets than more developed emerging markets, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and, as a result, the risks of investing in emerging market countries are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">magnified in frontier countries. The markets of frontier countries typically </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have low trading volumes and the potential for extreme price volatility </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and illiquidity. This volatility may be further heightened by the actions of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a few major investors. For example, a substantial increase or decrease in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cash flows of funds investing in these markets could significantly affect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">local stock prices and, therefore, the net asset value of Fund shares. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">These factors make investing in frontier countries significantly riskier </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than in other countries, including other <div style="display:inline;">emerging </div>market countries.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Foreign (Non-U.S.) Investment Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Foreign (non-U.S.) securities may experience more rapid and extreme </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes in value than securities of U.S. issuers or securities that trade </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exclusively in U.S. markets. The securities markets of many foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(non-U.S.)</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> countries are relatively small</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> or less developed</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, with a limited </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">number of companies representing a small number of industries. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Additionally, issuers of foreign (non-U.S.) securities are usually not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to the same degree of regulation as U.S. issuers. Financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Reporting, legal, corporate governance, accounting, auditing and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">custody standards of foreign countries differ, in some cases significantly, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from U.S. standards. Global economies and financial markets are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">becoming increasingly interconnected, and conditions and events in one </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">country, region or financial market may adversely impact issuers in a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">different country, region or financial market. Foreign (non-U.S.) market </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trading hours, clearance and settlement procedures, and holiday </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">schedules may limit the Fund's ability to buy and sell securities. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments in foreign (non-U.S.) markets may also be adversely </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affected by governmental actions such as the imposition of capital </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">controls, nationalization of companies or industries, expropriation of </span></span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets or the imposition of punitive taxes. The governments of certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries may prohibit or impose substantial restrictions on foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(non-U.S.) investing in their capital markets or in certain sectors or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">industries</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, which can decrease the investment opportunities for the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund subject to such limits</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions may be imposed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">after the Fund has invested in a jurisdiction and potentially force the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund to block the investment, to block or reject payments due in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">connection with the investment, to be unable to divest or transfer an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">asset or to dispose of an investment at an inopportune time or price. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Furthermore, repatriation of investment income,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital and the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds of sales by foreign investors may require governmental </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registration and/or approval in some countries. In addition, a foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(non-U.S.) government may limit or cause delay in the convertibility or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repatriation of its currency which would adversely affect the U.S. dollar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value and/or liquidity of investments denominated in that currency. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain foreign (non-U.S.) investments may become less liquid in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">response to market developments or adverse investor perceptions, or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">become illiquid after purchase by the Fund, particularly during periods </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of market turmoil</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and may render holdings in that foreign (non-U</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">S.)</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">country illiquid or even worthless.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> A reduction in trading in securities of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers located in countries whose economies are heavily dependent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">upon trading with key partners may have an adverse impact on the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's investments.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Also, nationalization, expropriation or confiscatory taxation, unstable </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">governments, decreased market liquidity, currency blockage, market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disruptions, political changes, security suspensions</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">diplomatic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developments, trade restrictions (including tariffs) or the imposition of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions or other similar measures could adversely affect the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments in a foreign (non-U.S.) country and may render holdings in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that foreign (non-U.S.) country illiquid or even worthless. In the event of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">nationalization, expropriation or other confiscation, the Fund could lose </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its entire investment in foreign (non-U.S.) securities. The type and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">severity of sanctions and other similar measures, including counter </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions and other retaliatory actions, that may be imposed could vary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">broadly in scope, and their impact is difficult to ascertain. These types of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">measures may include, but are not limited to, banning a sanctioned </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">country or certain persons or entities associated with such country from </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">global payment systems that facilitate cross-border payments, restricting </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities transactions, restricting dealings with entities that are critical </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the infrastructure of securities and related transactions in specific </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">jurisdictions, restricting transactions in specified sectors of certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries, and freezing the assets of particular countries, entities or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">persons. The imposition of sanctions and other similar measures could</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impact the Fund's portfolio holdings by</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, among other things, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reducing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">their</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> value and/or liquidity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or causing a</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">downgrade</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit ratings</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these measures could</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency devaluation or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatility, and increased market volatility and</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">/or economic</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> disruption in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the securities or sanctioned country and throughout the world. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Sanctions and other similar measures could directly or indirectly limit or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prevent the Fund from buying and selling securities, receiving interest or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">principal payments due on the securities, significantly delay or prevent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the settlement of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities transactions, and adversely impact the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's liquidity and performance and/or prevent the liquidation</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">closure </div></div></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or other activities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of a portfolio holding sanctioned securities. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> government may renegotiate some of its global trade relationships </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with foreign governments and may impose or threaten to impose </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant tariffs. The imposition of tariffs, trade restrictions, currency </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions or similar actions (or retaliatory measures taken in response </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to such actions) could contribute to volatility or overall declines in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and global investment markets.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Adverse conditions in a certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">region can adversely affect securities of other countries whose </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economies appear to be unrelated. To the extent that the Fund invests a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant portion of its assets in a specific geographic region or in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities denominated in a particular foreign (non-U.S.) currency, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund will generally have more exposure to regional economic risks, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including weather emergencies and natural disasters, associated with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">foreign (non-U.S.) investments. Additionally, events and evolving </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions in certain markets or regions may alter the risk profile of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments tied to those markets or regions. This may cause </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments tied to such markets or regions to become riskier or more </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatile, even when investments in such markets or regions were </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perceived as comparatively stable historically. Foreign (non-U.S.) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities may also be less liquid (particularly during market closures </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">due to local market holidays or other reasons) and more difficult to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value than securities of U.S. issuers.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Many U.S. securities transitioned to a T+1 (trade date plus one day) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">settlement cycle, while securities trading in non-U.S. markets typically </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operate on T+2 or longer settlement cycles. This settlement mismatch </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">can create operational and liquidity risks for the Fund, including </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficulties in funding U.S. settlements from proceeds of non-U.S. asset </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sales, increased foreign exchange transaction risk, and the potential for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">settlement failures or delays in cross-border transactions.</div></div></div></div><div style="margin-top:6pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; font-style: normal; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;">Investments in China.</div></div></div><div style="color: rgb(0, 0, 0); font-family: Arial; font-size: 10pt; font-style: normal; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;"> </div></div></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The Fund may invest in securities and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments that are economically tied to the People's Republic of China </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(excluding Hong Kong, Macau and Taiwan for the purpose of this </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disclosure) (“PRC”). In determining whether an instrument is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economically tied to the PRC, PIMCO uses the criteria for determining </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">whether an instrument is economically tied to an emerging market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">country as set forth above. Investing in securities and instruments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economically tied to the PRC subjects the Fund to certain of the risks of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investing in foreign (non-U.S.) securities and emerging market securities, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as well as additional risks specific to China. These additional risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">include (without limitation): (a) inefficiencies resulting from erratic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">growth; (b) the unavailability of consistently-reliable economic data or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial data; (c) potentially high rates of inflation; (d) dependence on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exports and international trade, including the risk of increased trade </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tariffs, outbound investment measures, sanctions and embargoes; (e) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">relatively high levels of asset price volatility; (f) potential shortage of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity and limited accessibility by foreign (non-U.S.) investors </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(including as a result of sanctions); (g) greater competition from </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regional economies and territorial and other disputes with other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries; (h) fluctuations in currency exchange rates or currency </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">devaluation by the PRC government or central bank, particularly in light </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the relative lack of currency hedging instruments and controls on the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to exchange local currency for U.S. dollars; (i) the relatively small </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">size and absence of operating history of many PRC companies; (j) the </div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developing nature of the legal and regulatory framework for securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets, custody arrangements and commerce; (k) uncertainty and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potential changes with respect to the rules and regulations of the QFII </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">program and other market access programs through which such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments are made; (l) the commitment of the PRC government to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">continue with its economic reforms; (m) PRC regulators may suspend </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trading in PRC issuers (or permit such issuers to suspend trading) during </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market disruptions, and that such suspensions may be widespread and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase the risk of market manipulation; (n) different regulatory and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">audit requirements related to the quality of financial statements of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Chinese issuers; (o) limitations on the ability to inspect the quality of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">audits performed in the PRC, particularly the Public Company </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Accounting Oversight Board’s (“PCAOB’s”) lack of access to inspect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PCAOB-registered accounting firms in the PRC; (p) <div style="display:inline;">limitations </div>on the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability of U.S. authorities to enforce actions against non-U.S. companies </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and non-U.S. persons; and (q) limitations on the rights and remedies of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investors as a matter of law. In addition, there also exists control on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">foreign (non-U.S.) investment in the PRC and limitations on repatriation </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of invested capital.</div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may obtain exposure to companies based or operated in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PRC by investing through legal structures known as variable interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entities (“VIEs”), which are offshore holding companies that provide </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exposure to PRC-based or operated companies through contractual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arrangements. Investments in VIEs are subject to unique risks in addition </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to those risks generally associated with investments in the PRC, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including (without limitation): (i) breach of the contractual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arrangements; (ii) difficulty of enforcing the contractual arrangements </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">outside of the U.S.; and (iii) intervention by the PRC government to limit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or eliminate the remedies and rights available to the offshore company </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and its investors in the event of a breach of the contractual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arrangement. There is also the risk that the PRC might prohibit the use </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of VIEs or eliminate their ability to transmit economic or governance </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rights to non-Chinese investors at any time, which could result in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments in VIEs losing all or substantially all of their value. Any of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the foregoing risks and events could negatively impact the Fund's </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance, which may result in significant losses with little or no </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recourse available.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In recent years, certain governmental <div style="display:inline;">bod</div>ies (including the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. government) have considered and, in some cases, imposed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions, trade and investment restrictions and notification </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">requirements on the PRC (as well as Hong Kong and Macau), and it is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">possible that additional restrictions may be imposed or retaliatory action </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be taken in the future. In addition, the U.S. government has </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">implemented the Outbound Investment Security Program. This program </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currently focuses on investments in certain national security sectors </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(e.g., semiconductors, artificial intelligence, and quantum information </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">technology), and it may expand to cover additional sectors over time. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Complying with such restrictions may prevent a Fund from pursuing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain investments, cause delays or other impediments with respect to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consummating such investments, require notification of such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments to government authorities, require divestment or freezing of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments on unfavorable terms, render divestment of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underperforming investments impracticable, negatively impact a Fund’s </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to achieve its investment objective, prevent the Fund from </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">receiving payments otherwise due it, require a Fund to obtain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information about underlying investors, increase diligence and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">similar costs to the Fund, render valuation of China-related investments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">challenging, or require a Fund to consummate an investment on terms </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that are less advantageous than would be the case absent such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions. Any of these outcomes could adversely affect the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance with respect to such investments, and thus a Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance as a whole.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Given the complex and evolving relationship between the PRC and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain other countries, it is difficult to predict the impact of such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions on market conditions. Foreign (non-U.S.) relations, such as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the PRC-U.S. relationship regarding trade, currency exchange, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intellectual property protection, among other things, could also have </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">implications with respect to capital flow and business operations. For </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">example, U.S. social, political, regulatory and economic conditions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prompting changes in laws and policies governing foreign (non-U.S.) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trade, manufacturing, developments and investments in the PRC could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limit the Fund’s ability to access certain opportunities in PRC or restrict </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transaction with certain PRC issuers and, as a result, could adversely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the performance of the Fund’s investments.</div></div></div><div style="margin-top:6pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; font-style: normal; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;">Investments in Russia.</div></div></div><div style="color: rgb(0, 0, 0); font-family: Arial; font-size: 10pt; font-style: normal; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;"> </div></div></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The Fund may invest in securities and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments that are economically tied to Russia. Investments in Russia </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are subject to various risks such as, but not limited to political, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economic, legal, market and currency risks. The risks include uncertain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">political and economic policies, short -term market volatility, poor </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accounting standards, corruption and crime, an inadequate regulatory </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">system, regional armed conflict and unpredictable taxation. Investments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in Russia are particularly subject to the risk that further economic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions, export and import controls, and other similar measures may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be imposed by the United States and/or other countries. Other similar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">measures may include, but are not limited to, banning or expanding </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bans on Russia or certain persons or entities associated with Russia </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from global payment systems that facilitate cross-border payments, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restricting the settlement of securities transactions by certain investors, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and freezing Russian assets or those of particular countries, entities or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">persons with ties to Russia (e.g., Belarus). Such sanctions and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">similar measures - which may impact companies in many sectors, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including energy, financial services, technology, accounting, quantum </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">computing, shipping, aviation, metals and mining, defense, architecture, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">engineering, construction, manufacturing and transportation, among </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">others - and Russia's countermeasures may negatively impact the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's performance and/or ability to achieve its investment objectives. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">For example, certain investments may be prohibited and/or existing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments may become illiquid (e.g., in the event that transacting in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain existing investments is prohibited, securities markets close, or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market participants cease transacting in certain investments in light of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geopolitical events, sanctions or related considerations), which could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">render any such securities held by the Fund unmarketable for an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">indefinite period of time and/or cause the Fund to sell other portfolio </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">holdings at a disadvantageous time or price or to continue to hold </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments that the Fund no longer seeks to hold. In addition, such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions or other similar measures, and the Russian government's </div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">response, could result in a downgrade of Russia's credit rating or of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities of issuers located in or economically tied to Russia, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">devaluation of Russia's currency and/or increased volatility with respect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to Russian securities and the ruble. Moreover, disruptions caused by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Russian military action or other actions (including cyberattacks, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">espionage or other asymmetric measures) or resulting actual or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">threatened responses to such activity may impact Russia's economy and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Russian and other issuers of securities in which the Fund is invested. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Such resulting actual or threatened responses may include, but are not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limited to, purchasing and financing restrictions, withdrawal of financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intermediaries, boycotts or changes in consumer or purchaser </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">preferences, sanctions, export and import controls, tariffs or cyberattacks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on the Russian government, Russian companies or Russian individuals, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including politicians. Any actions by Russia made in response to such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions or retaliatory measures could further impair the value and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity of Fund investments. Sanctions and other similar measures </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have resulted in defaults on debt obligations by certain corporate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers and the Russian Federation that could lead to cross-defaults or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cross-accelerations on other obligations of these issuers. The Russian </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities market is characterized by limited volume of trading, resulting </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in difficulty in obtaining accurate prices and trading. These issues can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">magnified as a result of sanctions and other similar measu<div style="display:inline;">re</div>s that may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be imposed and the Russian government's response.</div></div><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Russian securities market, as compared to U.S. markets, has </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant price volatility, less liquidity, a smaller market capitalization </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and a smaller number of traded securities. There may be little publicly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">available information about issuers. Settlement, clearing and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registration of securities transactions are subject to risks. Prior to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">implementation of the National Settlement Depository (“NSD”), a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recognized central securities depository, there was no central </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registration system for equity share registration in Russia, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registration was carried out by either the issuers themselves or by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registrars located throughout Russia. Title to Russian equities held </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">through the NSD is now based on the records of the NSD and not the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registrars. Although the implementation of the NSD has enhanced the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">efficiency and transparency of the Russian securities market, issues </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">resulting in loss can still occur. In addition, sanctions by the European </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Union against the NSD, as well as the potential for sanctions by other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">governments, could make it more difficult to conduct or confirm </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions involving Russian securities. Ownership of securities issued </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by Russian companies that are not held through depositories such as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the NSD may be recorded by companies themselves and by registrars. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Moreover, changes in Russian laws and regulations could require the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transfer of securities from the NSD to registrars or other parties outside </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of standard custodial arrangements</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, which could lead to additional risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and possible conflicts with U</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">S.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">laws.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> In such cases, the risk is increased </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the Fund could lose ownership rights through fraud, negligence or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">oversight. While applicable Russian regulations impose liability on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registrars for losses resulting from their errors, it may be difficult for the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund to enforce any rights it may have against the registrar or issuer of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the securities in the event of loss of share registration. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers and registrars are still prominent in the validation and approval </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of documentation requirements for corporate action processing in </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">Russia. Because the documentation requirements and approval criteria </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">vary between registrars and issuers, there remain unclear and </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">inconsistent market standards in the Russian market with respect to the </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">completion and submission of corporate action elections. In addition, </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">sanctions or Russian countermeasures may prohibit or limit the Fund's </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">ability to participate in corporate actions, and therefore require the Fund </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">to forego voting on or receiving funds that would otherwise be </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">beneficial to the Fund. To the extent that the Fund suffers a loss relating </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">to title or corporate actions relating to its portfolio securities, it may be </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">difficult for the Fund to enforce its rights or otherwise remedy the loss. </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">Russian securities laws may not recognize foreign nominee accounts </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">held with a custodian bank, and therefore the custodian may be </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">considered the ultimate owner of securities they hold for their clients. </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">Adverse currency exchange rates are a risk and there may be a lack of </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">available currency hedging instruments. Investments in Russia may be </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">subject to the risk of nationalization or expropriation of assets. Oil, </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">natural gas, metals, minerals and timber account for a significant </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">portion of Russia's exports, leaving the country vulnerable to swings in </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">world prices and to sanctions or other actions that may be directed at </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">the Russian economy as a whole or at Russian oil, natural gas, metals, </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">minerals or timber industries.</div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Sovereign Debt Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may have substantial exposure to emerging market sovereign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt, including quasi-sovereign debt. Sovereign debt includes securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issued or guaranteed by foreign sovereign governments or their </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agencies, authorities, political subdivisions or instrumentalities. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Quasi-sovereign obligations typically are issued by companies or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agencies that may receive financial support or backing from a sovereign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">government or in which the government owns a majority of the issuer’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">voting shares. Quasi-sovereign obligations are typically less liquid and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">less standardized than direct sovereign obligations.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition to the other risks applicable to debt investments, sovereign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt may decline in value as a result of default or other adverse credit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">event resulting from an issuer’s inability or unwillingness to make </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">principal or interest payments in a timely fashion. A sovereign entity’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">failure to make timely payments on its debt can result from many </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">factors, including, without limitation, insufficient foreign (non-U.S.) </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency reserves or an inability to sufficiently manage fluctuations in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">relative currency valuations, an inability or unwillingness to satisfy the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">demands of creditors and/or relevant supranational entities regarding </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt service or economic reforms, the size of the debt burden relative to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economic output and tax revenues, cash flow difficulties and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">political and social considerations. The risk of loss to the Fund in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">event of a sovereign debt default or other adverse credit event is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">heightened by the unlikelihood of any formal recourse or means to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">enforce its rights as a holder of the sovereign debt. In addition, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sovereign debt restructurings, which may be shaped by entities and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">factors beyond the Fund’s control, may result in a loss in value of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s sovereign debt holdings.</span></div></div><div style="line-height:12.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Currency Risk</span></span></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Currency risk may be <span style="display:inline;">par</span>ticul<span style="display:inline;">arl</span>y high because the Fund may, at times </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or in general, have substantial exposure to emerging market currencies, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and engage in foreign currency transactions that are economically tied </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to emerging market countries. These currency transactions may present </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market, credit, currency, liquidity, legal, political, headline, reputational </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other risks different from, or greater than, the risks of investing in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developed foreign (non-U.S.) currencies or engaging in foreign currency </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions that are economically tied to developed foreign countries.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments denominated in foreign (non-U.S.) currencies or that trade </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in and receive revenues in, foreign (non-U.S.) currencies, derivatives or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other instruments that provide exposure to foreign (non-U.S.) </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currencies, are subject to the risk that those currencies will decline in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value relative to the U.S. dollar, or, in the case of hedging positions, that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the U.S. dollar will decline in value relative to the currency being </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">hedged.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Currency rates in foreign (non-U.S.) countries may fluctuate significantly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">over short periods of time for a number of reasons, including changes in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest or inflation rates, balance of payments and governmental </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">surpluses or deficits, intervention (or the failure to intervene) by U.S. or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">foreign (non-U.S.) governments, central banks or supranational entities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such as the International Monetary Fund, the imposition of currency </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">controls or other political developments in the United States or abroad. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">As a result, the Fund’s investments in or exposure to foreign (non-U.S.) </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currencies and/or foreign (non-U.S.) currency-denominated securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may reduce the returns of the Fund. Currency risk may be particularly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">high to the extent that the Fund invests in foreign (non-U.S.) currencies </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or engages in foreign currency transactions that are economically tied to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">emerging market countries. These currency transactions may present </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market, credit, currency, liquidity, legal, political and other risks different </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from, or greater than, the risks of investing in developed foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(non-U.S.) currencies or engaging in foreign currency transactions that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are economically tied to developed foreign countries. Devaluation of a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency by a country's government or banking authority can </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significantly impact the value of any investments denominated in that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency. These fluctuations may have a significant adverse impact on </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the value of the Fund’s portfolio and/or the level of Fund distributions </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">made to Common Shareholders. There is no assurance that a hedging </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategy, if used, will be successful. The Fund may also be adversely </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impacted by expenses incurred by converting between currencies to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchase and sell securities not valued in the U.S. dollar, as well as by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency restrictions, exchange control regulation, or governmental </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions that limit or otherwise delay the Fund’s ability to convert </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currencies.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Moreover, currency hedging techniques may be unavailable with respect </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to emerging market currencies. As a result, the Fund’s investments in or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exposure to foreign (non-U.S.) currencies and/or foreign (non-U.S.) </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency-denominated, and especially emerging market-currency </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">denominated, securities may reduce the returns of the Fund.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The local emerging market currencies in which the Fund may be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invested from time to time may experience substantially greater </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatility against the U.S. dollar than the major convertible currencies of </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developed countries. Some of the local currencies in which the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may invest are neither freely convertible into one of the major currencies </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">nor internationally traded. The local currencies may be convertible into </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other currencies only inside the relevant emerging market where the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limited availability of such other currencies may tend to inflate their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">values relative to the local currency in question. Such internal exchange </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets can therefore be said to be neither liquid nor competitive. In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, many of the currencies of emerging market countries in which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund may invest have experienced steady devaluation relative to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">freely convertible currencies.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Continuing uncertainty as to the status of the euro and the European </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Monetary Union (“EMU”) has created significant volatility in currency </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and financial markets generally. Any partial or complete dissolution of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the EMU could have significant adverse effects on currency and financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets, and on the values of the Fund’s portfolio investments. If one or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more EMU countries were to stop using the euro as its primary currency, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s investments in such countries may be redenominated into a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">different or newly adopted currency. As a result, the value of those </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments could decline significantly and unpredictably. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities or other investments that are redenominated may be subject </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to foreign currency risk, liquidity risk and valuation risk to a greater </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent than similar investments currently denominated in euros. To the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent a currency used for redenomination purposes is not specified in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">respect of certain EMU-related investments, or should the euro cease to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be used entirely, the currency in which such investments are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">denominated may be unclear, making such investments particularly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficult to value or dispose of. The Fund may incur additional expenses </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the extent it is required to seek judicial or other clarification of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">denomination or value of such securities.</div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There can be no assurance that if the Fund earns income or capital gains </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in a non-U.S. country or PIMCO otherwise seeks to withdraw the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments from a given country, capital controls imposed by such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">country will not prevent, or cause significant expense in, doing so.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Market Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The market price of securities owned by the Fund may fluctuate, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sometimes rapidly or unpredictably. Securities may decline in value due </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a variety of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">factors affecting (or perceiving to affect) securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets generally or particular industries</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sectors </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or companies </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">represented in the securities markets. The value of a security may decline </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">due to general market conditions that are not specifically related to a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particular company, such as real or perceived adverse economic </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions, changes in the general outlook for corporate earnings, levels </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of public debt and deficits, changes in inflation, interest or currency </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rates, financial system instability, adverse changes to credit markets or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adverse investor sentiment generally. The value of a security may also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decline due to factors that affect a particular industry or industries, such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as labor shortages or increased production costs and competitive </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions within an industry. During a general downturn in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities markets, multiple asset classes may decline in value </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">simultaneously even if the performance of those asset classes is not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise historically correlated. Investments may also be negatively </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impacted by market disruptions and by attempts by other market </span></span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participants to manipulate the prices of particular investments. Equity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities generally have greater price volatility than fixed income </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities. Credit ratings downgrades may also negatively affect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities held by the Fund. Even when markets perform well, there is no </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assurance that the investments held by the Fund will increase in value </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">along with the broader market.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, market risk includes the risk that geopolitical and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">events will disrupt the economy on a national or global level. For </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instance, actual or threatened war, terrorism, social </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or political </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unrest, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recessions, supply chain disruptions, market manipulation, government </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">defaults, government shutdowns, political and regulatory changes, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">diplomatic developments or the imposition of sanctions and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">similar measures, including the imposition of tariffs, or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. economic policies and any related public health emergencies (such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as the spread of infectious diseases, pandemics and epidemics), </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">natural/environmental disasters or events, climate-change and climate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">related events can all negatively impact the securities markets, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could cause the Fund to lose value. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">This includes reliance on global </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">supply chains that are susceptible to disruptions resulting from, among </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other things, war and other armed conflicts, tariffs, extreme weather </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">events, and natural disasters.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> These events could reduce consumer </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">demand or economic output, result in market closures, changes in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates, inflation/deflation, travel restrictions or quarantines, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significantly adversely impact the economy.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">As computing technology and data analytics continually advance there </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">has been an increasing trend towards machine driven and artificially </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intelligent trading systems, particularly providing such systems with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increasing levels of autonomy in trading decisions. Regulators of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial markets have become increasingly focused on the potential </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impact of artificial intelligence on investment activities and may issue </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulations that are intended to affect the use of artificial technology in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trading activities. Any such regulations may not have the intended </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">effect</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on financial markets. Moreover, advancements in artificial intelligence </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other technologies may suffer from the introduction of errors, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">defects or security vulnerabilities which can go undetected. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Issues in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">construction and implementation of artificial intelligence</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(AI) systems </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">models</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including software issues,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> issues related to the use of AI </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and machine learning</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other technological issues) may adversely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impact the Fund.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> AI systems may contain design flaws or faulty </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assumptions,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rely on incomplete or inaccurate data inputs,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficult to interpret or audit</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">domestic political environment, as well as political and diplomatic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">events within the United States and abroad, such the U.S. budget and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deficit reduction plan and foreign policy tensions with foreign nations, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including embargoes, tariffs, sanctions, trade wars, and other similar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developments, has in the past resulted, and may in the future result, in a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">government shutdown or otherwise adversely affect the U.S. regulatory </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">landscape, the general market environment and/or investor sentiment, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which could have an adverse impact on the Fund’s investments and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operations. Additional and/or prolonged U.S. federal government </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shutdowns, U.S. foreign policy, the imposition of tariffs, or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. economic policies and any related domestic and/or geopolitical </div></div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tensions may affect investor and consumer confidence and may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adversely impact financial markets and the broader economy, perhaps </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">suddenly and to a significant degree. Governmental and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">quasi-governmental authorities and regulators throughout the world </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have previously responded to serious economic disruptions with a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">variety of significant fiscal and monetary policy changes, including but </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not limited to, direct capital infusions into companies, new monetary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">programs and dramatically lower interest rates. An unexpected or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sudden reversal of these policies, or the ineffectiveness of these policies, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could increase volatility in securities markets, which could adversely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the Fund’s investments. Any market disruptions could also prevent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund from executing advantageous investment decisions in a timely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">manner. Funds that have focused their investments in a region enduring </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geopolitical market disruption will face higher risks of loss. Thus, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investors should closely monitor current market conditions to determine </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">whether the Fund meets their individual financial needs and tolerance </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for risk.</div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">When inflationary price movements occur, fixed income securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets may experience heightened levels of interest rate, volatility and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity risk.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Interest rate increases </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the future could cause the value </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of a fund that invests in fixed income securities to decrease, which could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">force the Fund to liquidate investments at disadvantageous times or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prices,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> therefore adversely affecting the Fund and its shareholders.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Higher interest rates generally lower the values of</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> real estate-related </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. When this does not occur as expected</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">it presents an increased </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk of a correction or severe downturn in real-estate related asset </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prices,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> which could, by extension, adversely impact the value of other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments (such as loans, securitized debt and other fixed income </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities). Such an impact could materialize in one real estate sector </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and not another, or in a different manner in different real estate sectors. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Examples of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks faced by real estate-related assets include: tenant </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">vacancy rates, increased tenant turnover and tenant concentration; </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">general real estate headwinds, including delinquencies and difficulties in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collecting rents and other payments (which increases the risk of owners </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">being unable to pay or otherwise defaulting on their own borrowings </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and obligations); decreases in property values; increases in inflation, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">upkeep costs and other expenses; fluctuations in rents; and increased </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">concentration in ownership of certain types of properties.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Exchanges and securities markets may close early, close late or issue </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trading halts on specific securities, which may result in, among other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">things, the Fund being unable to buy or sell certain securities or financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments at an advantageous time or accurately price its portfolio </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Asset Allocation Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investment performance depends upon how its assets are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">allocated and reallocated. A principal risk of investing in the Fund is that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO may make less than optimal or poor asset allocation decisions. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO employs an active approach to allocation among multiple fixed </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income sectors, but there is no guarantee that such allocation </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">techniques will produce the desired results. It is possible that PIMCO </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will focus on an investment that performs poorly or underperforms other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments under various market conditions. The Fund could experience </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">losses as a result of these allocation decisions, which could result in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund being underweight or overweight in sectors, asset classes, or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geographies that perform differently than expected.</div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Issuer Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The value of a security may decline for a number of reasons that directly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">relate to the issuer, such as management performance, major litigation, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investigations or other controversies, changes in the issuer’s financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">condition or credit rating, changes in government regulations affecting </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the issuer or its competitive environment and strategic initiatives such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as mergers, acquisitions or dispositions and the market response to any </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such initiatives, financial leverage, reputation or reduced demand for the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer’s goods or services, as well as the historical and prospective </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">earnings of the issuer and the value of its assets. A change in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial condition of a single issuer may affect one or more other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers or securities markets as a whole. These risks can apply to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares issued by the Fund and to the issuers of securities and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other instruments in which the Fund invests.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Repurchase Offers Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">As described under “Periodic Repurchase Offers” above, the Fund is an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">“interval fund” and, in order to provide liquidity to shareholders, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund, subject to applicable law,conducts quarterly repurchase offers of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s outstanding Common Shares at NAV, subject to approval of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Board. In all cases, repurchase offers will be for at least 5% and not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more than 25% of its outstanding Common Shares at NAV, pursuant to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Rule 23c-3 under the 1940 Act. The Fund currently expects to conduct </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">quarterly repurchase offers for 5% of its outstanding Common Shares </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under ordinary circumstances. The Fund believes that these repurchase </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">offers are generally beneficial to the Fund’s shareholders and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchases generally will be funded from available cash or sales of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portfolio securities. However, repurchase offers and the need to fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase obligations may affect the ability of the Fund to be fully </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invested or force the Fund to maintain a higher percentage of its assets </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in liquid investments, which may harm the Fund’s investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance. Moreover, diminution in the size of the Fund through </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchases may result in untimely sales of portfolio securities (with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated imputed transaction costs, which may be significant), and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may limit the ability of the Fund to participate in new investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">opportunities or to achieve its investment objective. The Fund may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accumulate cash by holding back (i.e., not reinvesting) payments </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">received in connection with the Fund’s investments. The Fund believes </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that payments received in connection with the Fund’s investments will </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generate sufficient cash to meet the maximum potential amount of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s repurchase obligations. If at any time cash and other liquid </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets held by the Fund are not sufficient to meet the Fund’s repurchase </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations, the Fund intends, if necessary, to sell investments. To the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent the Fund employs investment leverage, repurchases of Common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shares would compound the adverse effects of leverage in a declining </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market. In addition, if the Fund borrows to finance repurchases, interest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on that borrowing will negatively affect Common Shareholders who do </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not tender their Common Shares by increasing the Fund’s expenses and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reducing any net investment income. If a repurchase offer is </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">oversubscribed, the Fund may, but is not required to, determine to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase the amount repurchased by up to 2% of the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">outstanding shares as of the date of the Repurchase Request Deadline. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In the event that the Fund determines not to repurchase more than the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase offer amount, or if shareholders tender more than the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase offer amount plus 2% of the Fund’s outstanding shares as of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the date of the Repurchase Request Deadline, the Fund will repurchase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Common Shares tendered on a pro rata basis, and shareholders will </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have to wait until the next repurchase offer to make another repurchase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">request. As a result, shareholders may be unable to liquidate all or a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">given percentage of their investment in the Fund during a particular </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase offer. Notwithstanding the foregoing, the Fund may accept </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">all Common Shares tendered for repurchase by shareholders who own </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">less than one hundred Common Shares and who tender all of their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares, before prorating Common Shares tendered by other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shareholders; provided that, if a shareholder holds shares through a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial intermediary, such intermediary may not be willing or able to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arrange for this treatment on such shareholder's behalf. Some </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shareholders, in anticipation of proration, may tender more Common </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shares than they wish to have repurchased in a particular quarter, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">thereby increasing the likelihood that proration will occur. A shareholder </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be subject to market and other risks, and the NAV of Common </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shares tendered in a repurchase offer may decline between the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Repurchase Request Deadline and the date on which the NAV for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tendered Common Shares is determined. In addition, the repurchase of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common <div style="display:inline;">Shares </div>by the Fund may be a taxable event to shareholders.</div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Large Shareholder Risk</span></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent a large proportion of the Common Shares are held by a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">small number of shareholders (or a single shareholder), including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affiliates of the Investment Manager, the Fund may be adversely </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impacted if such shareholders purchase or request repurchases of large </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">amounts of Common Shares. For example, it is possible that in response </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to a repurchase offer, the total amount of Common Shares tendered by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a small number of shareholders (or a single shareholder) may exceed </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the number of Common Shares that the Fund has offered to repurchase. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">If a repurchase offer is oversubscribed, the Fund will repurchase only a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pro rata portion of the Common Shares tendered by each shareholder. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, substantial repurchases of Common Shares could result in a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decrease in the Fund's net assets, resulting in an increase in the Fund's </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">total annual operating expense ratio. See “Repurchase Offers Risk” </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">above for additional information about certain risks related to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Repurchase Offers.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Management Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund is subject to management risk because it is an actively </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">managed investment portfolio. PIMCO </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will apply investment techniques </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and risk analysis </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and may,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">some cases, use proprietary models that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are developed and maintained by PIMCO in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">making investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decisions for the Fund</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> may determine that certain factors are more </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant than others</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> can be no guarantee that these decisions </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will produce the desired results or that the due diligence conducted by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> expose all material risks associated with an investment. </span></span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Additionally, PIMCO </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not be able to identify suitable investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">opportunities and may face competition from other investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">managers when identifying and consummating certain investments</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may determine that certain factors are more significant than others</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain securities or other instruments in which the Fund seeks to invest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not be available in the quantities desired</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, including in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">circumstances where other funds for which PIMCO acts as investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adviser, including funds with names, investment objectives and policies, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or portfolio management teams, similar to the Fund, are seeking to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invest in the same or similar securities or instruments</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulatory restrictions, actual or perceived conflicts of interest or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">considerations may cause PIMCO to restrict or prohibit participation in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain investments. In such circumstances, PIMCO </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may determine to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchase other securities or instruments as substitutes. Such substitute </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities or instruments may not perform as intended, which could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result in losses to the Fund. To the extent the Fund employs strategies </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">targeting perceived pricing inefficiencies, arbitrage strategies or similar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategies, it is subject to the risk that the pricing or valuation of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities and instruments involved in such strategies may change </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unexpectedly, which may result in reduced returns or losses to the Fund.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Additionally, legislative, regulatory or tax developments may adversely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect management of the Fund.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The Fund is also subject to the risk that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deficiencies in the internal systems or controls of PIMCO or another </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">service provider will cause losses for the Fund or hinder Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operations. For example, trading delays or errors (both human and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systemic) could prevent the Fund from purchasing a security expected to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">appreciate in value. Additionally, actual or potential conflicts of interest, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">legislative, regulatory or tax restrictions, policies or developments may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the investment techniques available to PIMCO </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in connection with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">managing the Fund and may also adversely affect the ability of the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to achieve its investment objective. There also can be no assurance that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">all of the personnel of PIMCO will continue to be associated with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO for any length of time. The loss of the services of one or more key </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">employees of PIMCO could have an adverse impact on the Fund’s ability </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to realize its investment objective.</div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, the Fund may rely on various third-party sources to calculate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its NAV. As a result, the Fund is subject to certain operational risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with reliance on service providers and service providers’ data </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sources. In particular, errors or systems failures and other technological </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issues may adversel<div style="display:inline;">y i</div>mpact the Fund’s calculations of its NAV, and such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">NAV calculation issues may result in inaccurately calculated NAVs, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">delays in NAV calculation and/or the inability to calculate NAVs over </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extended periods. The Fund may be unable to recover any losses </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with such failures.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Interest Rate Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Interest rate risk is the risk that fixed income securities and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments in the Fund’s portfolio will fluctuate in value because of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes, or the anticipation of changes, in interest rates. Factors </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including central bank monetary policy, rising inflation rates, and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes in general economic conditions may cause interest rates to rise, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which could cause the value of the Fund’s investments to decline. For </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">example, as nominal interest rates rise, the value of certain securities </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">held by the Fund is likely to decrease. Interest rate changes can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sudden and unpredictable, and the Fund may experience losses as a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result of movements in interest rates. The Fund may not be able to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">hedge against changes in interest rates or may choose not to do so for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cost or other reasons.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> In addition, any hedges may not work as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intended.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Further, fixed income securities with longer durations tend to be more </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sensitive to changes in interest rates, usually making them more volatile</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than securities with shorter durations</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The values of equity and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-fixed income securities may also decline due to fluctuations.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prices of fixed-income securities generally are more sensitive to changes </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in interest rates as the duration of those securities increases; securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with longer durations are subject to greater price volatility in a rising </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate environment.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Duration is a measure used to determine the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sensitivity of a security’s price to changes in interest rates that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incorporates a security’s yield, coupon, final maturity and call features, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">among other characteristics. Duration is useful primarily as a measure of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the sensitivity of a fixed income security’s market price to interest rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(i.e., yield) movements. All other things remaining equal, for each one </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">percentage point increase in interest rates, the value of a portfolio of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fixed income investments would generally be expected to decline by one </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">percent for every year of the portfolio’s average duration above zero. For </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">example, the value of a portfolio of fixed income securities with an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">average duration of eight years would generally be expected to decline </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by approximately 8% if interest rates rose by one percentage point.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Dividend-paying equity securities, particularly those whose market price </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is closely related to their yield, may be more sensitive to changes in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates. During periods of rising interest rates, the values of such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities may decline and may result in losses to the Fund. Variable and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">floating rate securities generally are less sensitive to interest rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes but may decline in value if their interest rates do not rise as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">much, or as quickly, as interest rates in general. Conversely, floating rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities will not generally increase in value if interest rates decline. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Inverse floating rate securities may decrease in value if interest rates </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase. Inverse floating rate securities may also exhibit greater price </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatility than a fixed rate obligation with similar credit quality. When </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund holds variable or floating rate securities, a decrease (or, in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">case of inverse floating rate securities, an increase) in market interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rates will adversely affect the income received from such securities and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the NAV of the Fund’s shares.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">A wide variety of factors can cause interest rates or yields of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Treasury securities (or yields of other types of bonds) to rise, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including but not limited to central bank monetary policies, changing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">inflation or real growth rates, general economic conditions, increasing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bond issuances or reduced market demand for low yielding investments. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Risks associated with changes in interest rates are heightened under </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain market conditions</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such as during times when the U.S.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Federal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Reserve (the “Federal Reserve”) adjusts its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">monetary policy</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">whether by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">raising or lowering</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> interest rates</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, or when such rates remain at elevated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or historically low levels for a prolonged period</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. Further, in market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">environments where interest rates are rising, issuers may be less willing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or able to make principal and interest payments on fixed-income </div></div></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments when due. Actions by governments and central banking </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">authorities can result in increases or decreases in interest rates. Periods </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of higher inflation could cause such authorities to raise interest rates, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may adversely affect the Fund and its investments.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes in monetary policy may exacerbate the risks associated with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changing interest rates.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">During periods of very low or negative interest rates, the Fund may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unable to maintain positive returns. Very low or negative interest rates </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may magnify interest rate risk. Changing interest rates, including rates </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that fall below zero, may have unpredictable effects on markets, may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result in heightened market volatility and may detract from Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance to the extent the Fund is exposed to such interest rates.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Measures such as average duration may not accurately reflect the true </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rate sensitivity of the Fund. This is especially the case if the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consists of securities with widely varying durations. Therefore, if the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund has an average duration that suggests a certain level of interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate risk, the Fund may in fact be subject to greater interest rate risk </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than the average would suggest. This risk is greater to the extent the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund uses leverage or derivatives in connection with the management </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the Fund</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, which would be magnified in the event that initial or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">variation margin is not provided by the counterparty to such transaction </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(or not provided below a certain threshold amount)</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Convexity is an additional measure used to understand a security's or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's interest rate sensitivity. Convexity measures the rate of change of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">duration in response to changes in interest rates. With respect to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security’s price, a larger convexity (positive or negative) may imply more </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dramatic price changes in response to changing interest rates. Convexity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be positive or negative. Negative convexity implies that interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate increases result in increased duration and vice versa, meaning </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increased sensitivity in prices in response to changes in interest rates. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Thus, securities with negative convexity, which may include bonds with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">traditional call features and certain mortgage-backed securities, may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">experience greater losses in periods of rising interest rates. Accordingly, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">if the Fund holds such securities, the Fund may be subject to a greater </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk of losses in<div style="display:inline;"> pe</div>riods of rising interest rates.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Credit Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund could experience losses if the issuer or guarantor of a fixed </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income security (including a security purchased with securities lending </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateral), </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the counterparty to a derivatives contract, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a repurchase </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agreement, a borrower of portfolio securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or the issuer or guarantor </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of collateral, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or a loan of portfolio securities is unable or unwilling, or is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perceived (whether by market participants, rating agencies, pricing </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">services or otherwise) as unable or unwilling, to make timely principal </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or interest payments or to otherwise honor its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The risk that such issuer, guarantor or counterparty is less willing or able </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to do so is heightened in market environments where interest rates are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changing, notably when rates are rising. The downgrade of the credit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rating of a security or of the issuer of a security held by the Fund may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decrease its value. Measures such as average credit quality may not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accurately reflect the true credit risk of the Fund. This is especially the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">case if the Fund consists of securities with widely varying credit ratings. </span></span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Securities are subject to varying degrees of credit risk, which are often </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reflected in credit ratings. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">This</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> risk is greater to the extent the Fund uses </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leverage or derivatives in connection with the management of the Fund, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which would be magnified in the event that initial or variation margin is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not provided by the counterparty to such transaction (or not provided </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">below a certain threshold amount). Rising or high interest rates may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deteriorate the credit quality of an issuer or counterparty, particularly if </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">an issuer or counterparty faces challenges rolling or refinancing its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations. The Fund’s investments may be adversely affected if any of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the issuers it is invested in are subject to an actual or perceived </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(whether by market participants, rating agencies, pricing services or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise) deterioration to their credit quality.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Credit risk includes credit spread risk, which is the risk that credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">spreads (i.e., the difference in yield between securities that is due to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">differences in their actual or perceived credit quality) may increase when </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the market believes that investments generally have a greater risk of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default. Increasing credit spreads may reduce the market values of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s investments. Credit spreads often increase more for lower rated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and unrated securities than for investment grade securities. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">when credit spreads increase, reductions in market value will generally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be greater for longer-maturity securities. Further, credit spread duration </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(a measure of credit spread risk) can vary significantly from interest rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">duration (e.g., for floating rate debt securities, credit spread duration </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">typically will be higher than interest rate duration). The Fund may add </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit spread duration to its portfolio, for example through the use of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives (e.g., credit default swaps), even while it has lower interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate duration. The credit spread duration of the Fund’s portfolio may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">vary, in some cases significantly, from its interest rate duration.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Corporate Debt Securities Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The market value of corporate debt securities generally may be expected </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to rise and fall inversely with interest rates. The value of intermediate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and longer-term corporate debt securities normally fluctuates more in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">response to changes in interest rates than does the value of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shorter-term corporate debt securities. The market value of a corporate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt security also may be affected by factors directly relating to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer, such as investors’ perceptions of the creditworthiness of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer, the issuer’s financial performance, perceptions of the issuer in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">marketplace, performance of management of the issuer, the issuer’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital structure and use of financial leverage and demand for the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer’s goods and services. Certain risks associated with investments in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">corporate debt securities are described elsewhere in this prospectus in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">further detail. There is a risk that the issuers of corporate debt securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not be able to meet their obligations on interest or principal </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments at the time called for by an instrument. The Fund may invest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in below investment grade corporate bonds, often referred to as “high </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">yield” securities or “junk bonds.” High yield corporate bonds are often </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">high risk and have speculative characteristics. High yield corporate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bonds may be particularly susceptible to adverse issuer-specific </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developments. High yield corporate bonds are subject to the risks </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">described under “Principal Risks of the Fund—High Yield Securities </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Risk.” In addition, certain corporate debt securities may be highly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">customized and as a result may be subject to, among others, liquidity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and valuation/pricing transparency risks.</div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Mortgage-Related and Other Asset-Backed Instruments Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The mortgage-related assets in which the Fund may invest include, but </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are not limited to, any security, instrument or other asset that is related </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to U.S. or non-U.S. mortgages, including those issued by private </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">originators or issuers, or issued or guaranteed as to principal or interest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by the U.S. government or its agencies or instrumentalities or by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-U.S. governments or authorities, such as, without limitation, assets </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">representing interests in, collateralized or backed by, or whose values </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are determined in whole or in part by reference to any number of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgages or pools of mortgages or the payment experience of such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgages or pools of mortgages, including REMICs, which could </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">include Re-REMICs, mortgage pass-through securities, inverse floaters, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">CMOs, CLOs, multi-class pass-through securities, private mortgage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pass-through securities, stripped mortgage securities (generally </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest-only and principal-only securities), mortgage-related asset </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">backed securities and mortgage-related loans (including through </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participations, assignments, originations and whole loans), including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">commercial and residential mortgage loans. Exposures to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-related assets through derivatives or other financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments will be considered investments in mortgage-related assets.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may also invest in other types of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">asset-backed securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(“</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ABS</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">”)</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, including CDOs, CBOs and CLOs and other similarly structured </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> CLOs, CDOs and their underlying loan obligations are typically </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not registered for sale to the public and therefore are subject to certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions on transfer and sale, potentially making them less liquid </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than other types of securities. There is no guarantee that an active </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">secondary market will exist or be maintained for any given CLO or CDO </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest. Additionally, when the Fund purchases a newly issued CLO or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">CDO security in the primary market (rather than from the secondary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market), there may be a delayed settlement period during which the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity of such security may be further reduced.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Mortgage-related and other asset-backed instruments represent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interests in “pools” of mortgages or other assets such as consumer </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans or receivables held in trust and often involve risks that are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">different from or possibly more acute than risks associated with other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">types of debt instruments.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Generally, rising interest rates tend to extend the duration of fixed rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-related assets, making them more sensitive to changes in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates. Compared to other fixed income investments with similar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">maturity and credit, mortgage-related securities may increase in value to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a lesser extent when interest rates decline and may decline in value to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">similar or greater extent when interest rates rise. As a result, in a period </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of rising interest rates, the Fund may exhibit additional volatility since </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">individual mortgage holders are less likely to exercise prepayment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">options, thereby putting additional downward pressure on the value of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these securities and potentially causing the Fund to experience losses. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">This is known as extension risk. Mortgage-backed securities can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">highly sensitive to rising interest rates, such that even small movements </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">can cause the Fund to lose value. Mortgage-backed securities, and in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particular those not backed by a government guarantee, are subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit risk. When interest rates decline, borrowers may pay off their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgages sooner than expected. This can reduce the returns of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund because the Fund may have to reinvest that money at the lower </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prevailing interest rates. In addition, the creditworthiness, servicing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">practices, and financial viability of the servicers of the underlying </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage pools present significant risks. For instance, a servicer may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">required to make advances in respect of delinquent loans underlying the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-related securities; however, servicers experiencing financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficulties may not be able to perform these obligations. Additionally, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">both mortgage-related securities and asset-backed securities are subject </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to risks associated with fraud or negligence by, or defalcation of, their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">servicers. These securities are also subject to the risks of the underlying </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans. In some circumstances, a servicer’s or originator’s mishandling of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">documentation related to the underlying collateral (e.g., failure to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">properly document a security interest in the underlying collateral) may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the rights of security holders in and to the underlying collateral. In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, the underlying loans may have been extended pursuant to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">inappropriate underwriting guidelines, to no underwriting guidelines at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">all, or to fraudulent origination practices. The owner of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-backed security’s ability to recover against the sponsor, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">servicer or originator is uncertain and is often limited. The Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments in other asset-backed instruments are subject to risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">similar to those associated with mortgage-related assets, as well as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">additional risks associated with the nature of the assets and the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">servicing of those assets. Payment of principal and interest on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">asset-backed instruments may be largely dependent upon the cash </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">flows generated by the assets backing the instruments, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">asset-backed instruments may not have the benefit of any security </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest in the related assets.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subordinate mortgage-backed or asset-backed instruments are paid </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest only to the extent that there are funds available to make </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments. To the extent the collateral pool includes a large percentage </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of delinquent loans, there is a risk that interest payments on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subordinate mortgage-backed or asset-backed instruments will not be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fully paid.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There are multiple tranches of mortgage-backed and asset-backed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments, offering investors various maturity and credit risk </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">characteristics. For example, tranches may be categorized as senior, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mezzanine, and subordinated/equity or “first loss.” The most senior </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tranche of a mortgage-backed or asset-backed instrument generally has </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the greatest collateralization and generally pays the lowest interest rate. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">If there are defaults or the collateral otherwise underperforms, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">scheduled payments to senior tranches generally take precedence over </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">those of mezzanine tranches, and scheduled payments to mezzanine </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tranches take precedence over those to subordinated/equity tranches. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Lower tranches represent lower degrees of credit quality and pay higher </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates intended to compensate for the attendant risks. The return </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on the lower tranches is especially sensitive to the rate of defaults in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateral pool. The lowest tranche (i.e., the “equity” or “residual” </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tranche) generally specifically receives the residual interest payments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(i.e., money that is left over after the higher tranches have been paid </div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and expenses of the issuing entities have been paid) rather than a fixed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rate. The Fund may also invest in the residual or equity tranches </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of mortgage-related and other asset-backed instruments, which may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">referred to as subordinate mortgage-backed or asset-backed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments and interest-only mortgage-backed or asset-backed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments. The Fund expects that investments in subordinate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-backed and other asset-backed instruments will be subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks arising from delinquencies and foreclosures, thereby exposing its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment portfolio to potential losses. Subordinate securities of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-backed and other asset-backed instruments are also subject </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to greater credit risk than those mortgage-backed or other asset-backed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments that are more highly rated.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The mortgage markets in the United States and in various foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries have experienced extreme difficulties in the past that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adversely affected the performance and market value of certain of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's mortgage-related investments. Delinquencies and losses on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">residential and commercial mortgage loans (especially subprime and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">second-lien mortgage loans) may increase, and a decline in or flattening </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of housing and other real property values may exacerbate such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">delinquencies and losses. In addition, reduced investor demand for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage loans and mortgage-related securities and increased investor </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">yield requirements have caused limited liquidity in the secondary market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for mortgage-related securities, which can adversely affect the market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value of mortgage-related securities. It is possible that such limited </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity in such secondary markets could continue or worsen.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">With respect to risk retention tranches (i.e., eligible residual interests </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">initially held by the sponsors of CMBS and other eligible securitizations </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pursuant to the U.S. Risk Retention Rules), a third-party purchaser, such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as the Fund, must hold its retained interest, unhedged, for at least five </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">years following the closing of the CMBS transaction, after which it is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entitled to transfer its interest in the securitization to another person </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that meets the requirements for a third-party purchaser. Even after the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">required holding period has expired, due to the generally illiquid nature </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of such investments, no assurance can be given as to what, if any, exit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategies will ultimately be available for any given position.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, there is limited guidance on the application of the final </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Risk Retention Rules to specific securitization structures. There can </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be no assurance that the applicable federal agencies charged with the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">implementation of the final U.S. Risk Retention Rules (e.g., the FDIC, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Comptroller of the Currency, the Federal Reserve Board, the SEC, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Department of Housing and Urban Development, and the Federal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Housing Finance Agency) could not take positions in the future that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">differ from the interpretation of such rules taken or embodied in such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securitizations, or that the final U.S. Risk Retention Rules will not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">change.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Furthermore, in situations where the Fund invests in risk retention </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tranches of securitizations structured by third parties, the Fund may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">required to execute one or more letters or other agreements, the exact </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">form and nature of which will vary (each, a “Risk Retention </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Agreement”) under which it will make certain undertakings designed to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ensure such securitization complies with the U.S. Risk Retention Rules. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Such Risk Retention Agreements may include a variety of </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">representations, warranties, covenants and other indemnities, each of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may run to various transaction parties. If the Fund breaches any </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">undertakings in any Risk Retention Agreement, it will be exposed to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">claims by the other parties thereto, including for any losses incurred as a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result of such breach, which could be significant and exceed the value of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s investments. Direct investments in mortgages and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">types of collateral are subject to risks similar (and in some cases to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">greater degree) to those described above.</div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Privately-Issued Mortgage-Related Securities Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There are no direct or indirect government or agency guarantees of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments in pools created by non-governmental issuers. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Non-governmental or private-label asset-backed securities are not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">guaranteed, directly or indirectly, by any government, government </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agency or instrumentality.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Privately-issued mortgage-related securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are also not subject to the same underwriting requirements for the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underlying mortgages that are applicable to those mortgage-related </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities that have a government or government-sponsored entity </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">guarantee.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Privately-issued mortgage-related securities are not traded on an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exchange and there may be a limited market for the securities, especially </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">when there is a perceived weakness in the mortgage and real estate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market sectors. Without an active trading market, mortgage-related </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities held in the Fund’s portfolio may be particularly difficult to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value because of the complexities involved in assessing the value of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underlying mortgage loans. Additionally, privately-issued </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-related securities, such as privately-held or non-traded REITs, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may bear higher fees than publicly-traded REITs. Privately-held REITs </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally are exempt from registration under the Securities Act and, as </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such, are not subject to the same disclosure requirements as REITs </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registered under the Securities Act, which may make privately-held REITs </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more difficult to evaluate from an investment perspective.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Subprime Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Loans, and debt instruments collateralized by loans (including Alt </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Lending ABS), acquired by the Fund may be subprime in quality, or may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">become subprime in quality. Although there is no specific legal or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market definition of “subprime,” subprime loans are generally </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">understood to refer to loans made to borrowers that display poor credit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">histories and other characteristics that correlate with a higher default </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk. Accordingly, subprime loans, and debt instruments secured by such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans (including Alt Lending ABS), have speculative characteristics and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are subject to heightened risks, including the risk of nonpayment of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest or repayment of principal, and the risks associated with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments in high yield securities. In addition, these instruments could </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be subject to increased regulatory scrutiny. The Fund is not restricted by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any particular borrower credit risk criteria and/or qualifications when </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">acquiring loans or debt instruments collateralized by loans.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Municipal Bond Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investing in the municipal bond market involves the risks of investing in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt securities generally and certain other risks. The amount of public </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information available about the municipal bonds in which the Fund may </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invest is generally less than that for corporate equities or bonds, and the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment performance of the Fund’s investment in municipal bonds </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may therefore be more dependent on the analytical abilities of PIMCO </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than its investments in taxable bonds. The secondary market for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipal bonds, particularly below investment grade bonds in which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund may invest, also tends to be less well developed or liquid than </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">many other securities markets, which may adversely affect the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to sell municipal bonds at attractive prices or value municipal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bonds.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The ability of municipal issuers to make timely payments of interest and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">principal may be diminished during general economic downturns, by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">litigation, legislation or political events, or by the bankruptcy of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer. Budgetary constraints of local, state, and federal governments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">upon which the issuers may be relying for funding may also impact </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Municipal Bonds. Laws, referenda, ordinances or regulations enacted in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the future by Congress or state legislatures or the applicable </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">governmental entity could extend the time for payment of principal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or interest, or impose other constraints on enforcement of such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations, or on the ability of municipal issuers to levy taxes. Issuers of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipal securities also might seek protection under the bankruptcy </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">laws. In the event of bankruptcy of such an issuer, the Fund could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">experience delays in collecting principal and interest and the Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not, in all circumstances, be able to collect all principal and interest to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which it is entitled. To enforce its rights in the event of a default in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment of interest or repayment of principal, or both, the Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">take possession of and manage the assets securing the issuer's </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations on such securities, which may increase the Fund's operating </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expenses. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The differences in priorities</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perspectives</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and economic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interests of bondholders and</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> taxpayers or users of facilities financed by</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipal bonds </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may affect the remedies available to the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">event of a default</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Adverse economic, business, legal or political developments might </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect all or a substantial portion of the Fund's municipal bonds in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">same manner. The Fund will be particularly subject to these risks to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent that it focuses its investments in municipal bonds in a particular </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">state or geographic region. Municipal securities may also have exposure </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to potential risks resulting from climate change and environmental </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">events, including extreme weather, flooding, fires and other natural </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disasters. Climate risks, if materialized, can adversely impact a municipal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer’s financial plans in current or future years or may impair a funding </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">source for municipal issuer’s revenue bonds. As a result, the impact of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">climate risks could adversely impact the value of the Fund’s municipal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities investments.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in trust certificates issued in tender option bond </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">programs. In these programs, a trust typically issues two classes of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certificates and uses the proceeds to purchase municipal securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">having relatively long maturities and bearing interest at a fixed interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate substantially higher than prevailing short-term tax-exempt rates. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There is a risk that the Fund will not be considered the owner of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tender option bond for federal income tax purposes, and thus will not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be entitled to treat such interest as exempt from federal income tax. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain tender option bonds may be less liquid or may become less </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquid as a result of, among other things, a credit rating downgrade, a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment default or a disqualification from tax-exempt status. The Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment in the securities issued by a tender option bond trust may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">involve greater risk and volatility than an investment in a fixed rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bond, and the value of such securities may decrease significantly when </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market interest rates increase. Tender option bond trusts could be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">terminated due to market, credit or other events beyond the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">control, which could require the Fund to dispose of portfolio investments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at inopportune times and prices. The Fund may use a tender option </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bond program as a way of achieving leverage in its portfolio, in which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">case the Fund will be subject to leverage risk. The use of tender option </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bonds will impact the Fund's duration and cause the Fund to be subject </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to increased duration and interest rate risk.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in revenue bonds, which are typically issued to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fund a wide variety of capital projects including electric, gas, water and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sewer systems; highways, bridges and tunnels; port and airport facilities; </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">colleges and universities; and hospitals. Because the principal security </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for a revenue bond is generally the net revenues derived from a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particular facility or group of facilities or, in some cases, from the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds of a special excise or other specific revenue source or annual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">revenues, there is no guarantee that the particular project will generate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">enough revenue to pay its obligations, in which case the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance may be adversely affected.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in participations in lease obligations or installment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchase contract obligations of municipal authorities or entities. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Although a municipal lease obligation does not constitute a general </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligation of the municipality for which the municipality's taxing power </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is pledged, a municipal lease obligation is ordinarily backed by the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipality's covenant to budget for, appropriate and make the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments due under the municipal lease obligation. However, certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipal lease obligations contain “non-appropriation” clauses, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provide that the municipality has no obligation to make lease or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">installment purchase payments in future years unless money is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">appropriated for such purpose on a yearly basis. In the case of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">“non-appropriation” lease, the Fund's ability to recover under the lease </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the event of non-appropriation or default will be limited solely to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repossession of the leased property, without recourse to the general </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit of the lessee, and the disposition or re-leasing of the property </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">might prove difficult.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Municipal securities are also subject to interest rate, credit, and liquidity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The tax-exempt status of municipal securities is subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">legislative risk. Congress or state legislatures could enact laws that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">eliminate or reduce the tax-exempt status of interest payments on some </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or all municipal securities, which could adversely affect the Fund and its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shareholders.</div></div></div></div><div style="line-height:12.0pt;margin-left:10pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: Arial; font-size: 10pt; font-style: normal; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;">Interest Rate Risk</div></div></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The value of municipal securities, similar to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other fixed income securities, will likely drop as interest rates rise in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the general market. Conversely, when rates decline, bond prices </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally rise.</div></div></div></div><div style="line-height:12.0pt;margin-left:10pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: Arial; font-size: 10pt; font-style: normal; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;">Credit Risk</div></div></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The risk that a borrower may be unable to make </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest or principal payments when they are due. Funds that invest in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipal securities rely on the ability of the issuer to service its debt. </div></div></div></div><div style="line-height:12.0pt;margin-left:10pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">This subjects the Fund to credit risk in that the municipal issuer may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be fiscally unstable or exposed to large liabilities that could impair its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to honor its financial obligations. Municipal issuers with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant debt service requirements, in the near-to mid-term; </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unrated issuers and those with less capital and liquidity to absorb </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">additional expenses may be most at risk. To the extent the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invests in lower quality or high yield municipal securities, it may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more sensitive to the adverse credit events in the municipal market. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The treatment of municipalities in bankruptcy is more uncertain, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potentially more adverse to debt holders, than for corporate issues.</div></div><div style="line-height:12.0pt;margin-left:10pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: Arial; font-size: 10pt; font-style: normal; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;">Liquidity Risk</div></div></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The risk that investors may have difficulty finding a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">buyer when they seek to sell, and therefore, may be forced to sell at a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">discount to the market value. Liquidity may sometimes be impaired in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the municipal market and because the Fund primarily invests in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipal securities, it may find it difficult to purchase or sell such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities at opportune times. The municipal securities market can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">susceptible to increases in volatility and decreases in liquidity. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Liquidity can decline unpredictably in response to a variety of factors, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including overall economic conditions or credit tightening. Increases </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in volatility and decreases in liquidity also may be caused by a rise in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates (or the expectation of a rise in interest rates). Liquidity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">can be impaired due to interest rate concerns, credit events, or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">general supply and demand imbalances. Depending on the particular </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer and current economic conditions, municipal securities could be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deemed more volatile investments.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition to general municipal market risks, different municipal sectors </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may face different risks. For instance, general obligation bonds are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">secured by the full faith, credit, and taxing power of the municipality </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuing the obligation. As such, timely payment depends on the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipality's ability to raise tax revenue and maintain a fiscally sound </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">budget. The timely payments may also be influenced by any unfunded </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pension liabilities or other post-employee benefit plan liabilities.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Revenue bonds are secured by special tax revenues or other revenue </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sources. If the specified revenues do not materialize, then the bonds </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not be repaid.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Private activity bonds are yet another type of municipal security. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Municipalities use private activity bonds to finance the development of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">industrial facilities for use by private enterprise. Principal and interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments are to be made by the private enterprise benefiting from the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">development, which means that the holder of the bond is exposed to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the risk that the private issuer may default on the bond.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Moral obligation bonds are usually issued by special purpose public </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entities. If the public entity defaults, repayment becomes a “moral </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligation” instead of a legal one. The lack of a legally enforceable right </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to payment in the event of default poses a special risk for a holder of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the bond because it has little or no ability to seek recourse in the event </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of default.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, a significant restructuring of federal income tax rates or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">even serious discussion on the topic in Congress could cause municipal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bond prices to fall. The demand for municipal securities is strongly </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">influenced by the value of tax-exempt income to investors relative to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taxable income. Lower income tax rates potentially reduce the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">advantage of owning municipal securities.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Similarly, changes to state or federal regulation tied to a specific sector, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such as the hospital sector, could have an impact on the revenue stream </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for a given subset of the market.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Municipal notes are similar to general municipal debt obligations, but </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">they generally possess shorter <div style="display:inline;">terms</div>. Municipal notes can be used to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provide interim financing and may not be repaid if anticipated revenues </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are not realized.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">High Yield Securities Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent that the Fund invests in high yield securities and unrated </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities of similar credit quality (commonly known as “high yield </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities” or “junk bonds”), the Fund may be subject to greater levels </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of market risk, credit risk, call risk and liquidity risk than funds that do </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not invest in such securities, which could have a negative effect on the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">NAV and market price of the Fund's Common Shares or Common Share </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dividends. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">High yield securities involve the risk of substantial or total </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loss of principal, and their values may be more volatile than other types </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of securities. High yield securities may be issued by companies that are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restructuring, are smaller and less creditworthy or are more highly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leveraged or indebted than other companies, or are financially </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distressed, and therefore they typically have more difficulty making </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">scheduled payments of principal and interest than issuers of higher </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rated investments.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> These securities are considered predominantly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">speculative by ratings agencies with respect to an issuer's continuing </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to make principal and interest payments, and their value may be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more volatile than other types of securities</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and may result in substantial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or total loss of income and principal</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. An economic downturn or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">individual issuer developments could adversely affect the market for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these securities and reduce the Fund's ability to sell these securities at </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">an advantageous time or price. An economic downturn could also lead </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to a higher non-payment rate and, a high yield security may lose </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant market value before a default occurs. The Fund may purchase </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distressed securities that are in default or the issuers of which are in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bankruptcy, which involve heightened risks.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></span></div></div><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">High yield securities structured as zero-coupon bonds or pay-in-kind </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities tend to be especially volatile as they are particularly sensitive </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to downward pricing pressures from rising interest rates or widening </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">spreads and may require the Fund to make taxable distributions of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">imputed income without receiving the actual cash currency. Issuers of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">high yield securities may have the right to “call” or redeem the issue </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prior to maturity, which may result in the Fund having to reinvest the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds in other high yield securities or similar instruments that may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pay lower interest rates. The Fund may also be subject to greater levels </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of liquidity risk than funds that do not invest in high yield securities. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Consequently, transactions in high yield securities may involve greater </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">costs than transactions in more actively traded securities. A lack of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">publicly</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> available information, irregular trading activity and wide bid/ask </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">spreads among other factors, may, in certain circumstances, make high </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">yield debt more difficult to sell at an advantageous time or price than </span></span></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other types of securities or instruments. These factors may result in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund being unable to realize full value for these securities and/or may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result in the Fund not receiving the proceeds from a sale of a high yield </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security for an extended period after such sale, each of which could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result in losses to the Fund. Because of the risks involved in investing in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">high yield securities, an investment in the Fund should be considered </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">speculative.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In general, lower rated debt securities carry a greater degree of risk that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the issuer will lose its ability to make interest and principal payments, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which could have a negative effect on the Fund. Securities of below </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment grade quality are regarded as having predominantly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">speculative characteristics with respect to capacity to pay interest and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repay principal and are commonly referred to as “high yield” securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or “junk bonds.” High yield securities involve a greater risk of default </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and their prices are generally more volatile and sensitive to actual or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perceived negative developments. Debt securities in the lowest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment grade category also may be considered to possess some </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">speculative characteristics by certain rating agencies. The Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchase stressed or distressed securities that are in default or the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers of which are in bankruptcy, which involve heightened risks. An </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economic downturn could severely affect the ability of issuers </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(particularly those that are highly leveraged) to service or repay their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt obligations. Lower-rated securities are generally less liquid than </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">higher-rated securities, which may have an adverse effect on the Fund's </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to dispose of them. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">High yield securities are particularly sensitive </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to adverse economic, market, industry or issuer-specific developments, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may result in an increased incidence of default.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> For example, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under adverse market or economic conditions, the secondary market for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">below investment grade securities could contract further, independent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of any specific adverse changes in the condition of a particular issuer, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and certain securities in the Fund's portfolio may become illiquid or less </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquid. As a result, the Fund could find it more difficult to sell these </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities or may be able to sell these securities only at prices lower </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than if such securities were widely traded. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In the event of default, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund may incur additional expenses to seek recovery or to negotiate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">new terms with a defaulting issuer.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> To the extent the Fund focuses on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">below investment grade debt obligations, PIMCO's capabilities in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">analyzing credit quality and associated risks will be particularly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">important, and there can be no assurance that PIMCO will be successful </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in this regard. Due to the risks involved in investing in high yield </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities, an investment in the Fund should be considered speculative. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund's credit quality policies apply only at the time a security is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchased, and the Fund is not required to dispose of a security in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">event that a rating agency or PIMCO downgrades its assessment of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit characteristics of a particular issue. In determining whether to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">retain or sell such a security, PIMCO may consider factors including, but </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not limited to, PIMCO's assessment of the credit quality of the issuer of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such security, the price at which such security could be sold and the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rating, if any, assigned to such security by other rating agencies. Analysis </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of creditworthiness may be more complex for issuers of high yield </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities than for issuers of higher quality debt securities.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Distressed and Defaulted Securities Risk</span></span></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments in the securities of financially distressed issuers involve </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">substantial risks, including the risk of default. Distressed securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally trade significantly below “par” or full value because </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments in such securities and debt of distressed issuers or issuers in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default are considered speculative and involve substantial risks in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition to the risks of investing in high-yield bonds. Such investments </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be in default at the time of investment. In addition, these securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may fluctuate more in price, and are typically less liquid. The Fund also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will be subject to significant uncertainty as to when, and in what </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">manner, and for what value obligations evidenced by securities of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financially distressed issuers will eventually be satisfied. Defaulted </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations might be repaid only after lengthy workout or bankruptcy </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceedings, during which the issuer might not make any interest or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other payments. In any such proceeding relating to a defaulted </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligation, the Fund may lose its entire investment or may be required </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to accept cash or securities with a value substantially less than its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">original investment. Moreover, any securities received by the Fund upon </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">completion of a workout or bankruptcy proceeding may be less liquid, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">speculative or restricted as to resale. Similarly, if the Fund participates in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">negotiations with respect to any exchange offer or plan of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reorganization with respect to the securities of a distressed issuer, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund may be restricted from disposing of such securities. To the extent </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the Fund becomes involved in such proceedings, the Fund may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have a more active participation in the affairs of the issuer than that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assumed generally by an investor. The Fund may incur additional </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expenses to the extent it is required to seek recovery upon a default in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the payment of principal or interest on its portfolio holdings.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Also among the risks inherent in investments in a troubled issuer is that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">it frequently may be difficult to obtain information as to the true </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial condition of such issuer. PIMCO’s judgments about the credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">quality of a financially distressed issuer and the relative value of its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities may prove to be wrong.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Senior Debt Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> be subject to greater levels of credit risk than funds that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">do not invest in below investment grade senior debt. The Fund may also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be subject to greater levels of liquidity risk than funds that do not invest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in senior debt. Restrictions on transfers in loan agreements, a lack of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">publicly available information and other factors may, in certain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instances, make senior debt more difficult to sell at an advantageous </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time or price than other types of securities or instruments. Additionally, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">if the issuer of senior debt prepays, the Fund will have to consider </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reinvesting the proceeds in other senior debt or similar instruments that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may pay lower interest rates.</span></span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Loans and Other Indebtedness; Loan Acquisitions, </span></span><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Participations and Assignments Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Loan interests may take the form of (i) direct interests acquired during a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">primary distribution or other purchase of a loan, (ii) loans originated by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund or (iii) assignments of, novations of or participations in all or a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portion of a loan acquired in secondary markets. In addition to credit </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk and interest rate risk, the Fund's exposure to loan interests may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to additional risks. For example, purchasers of loans and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">forms of direct indebtedness depend primarily upon the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">creditworthiness of the borrower for payment of principal and interest. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Loans are subject to the risk that scheduled interest or principal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments will not be made in a timely manner or at all, either of which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may adversely affect the value of the loan. If the Fund does not receive </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">scheduled interest or principal payments on such indebtedness, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">’</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">s share price and yield could be adversely affected. Loans that are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fully secured may offer the Fund more protection than an unsecured </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loan in the event of non-payment of scheduled interest or principal if </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund is able to access and monetize the collateral. However, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateral underlying a loan, if any, may be unavailable or insufficient to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">satisfy a borrower</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">’</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">s obligation. If the Fund becomes owner, whole or in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">part, of any collateral after a loan is foreclosed, the Fund may incur costs </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with owning and/or monetizing its ownership of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateral.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">During periods of deteriorating economic conditions, such as recessions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or periods of rising unemployment, or changing interest rates (notably </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increases), delinquencies and losses generally increase, sometimes </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dramatically, with respect to obligations under such loans. An economic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">downturn or individual corporate developments could adversely affect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the market for these instruments and reduce the Fund’s ability to sell </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these instruments at an advantageous time or price. An economic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">downturn could also lead to a higher non-payment rate and, a loan may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lose significant market value before a default occurs.</div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments in loans through a purchase of a loan, loan origination or a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">direct assignment of a financial institution’s interests with respect to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loan may involve additional risks to the Fund. For example, if a loan is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">foreclosed, the Fund could become owner, in whole or in part, of any </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateral, which could include, among other assets, real estate or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">real or personal property, and would bear the costs and liabilities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with owning and holding or disposing of the collateral.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Moreover, the purchaser of an assignment typically succeeds to all the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rights and obligations under the loan agreement with the same rights </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and obligations as the assigning lender. Assignments may, however, be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arranged through private negotiations between potential assignees and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potential assignors, and the rights and obligations acquired by the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchaser of an assignment may differ from, and be more limited than, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">those held by the assigning lender. The Fund may also invest in loans </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that are not secured by collateral which typically present greater risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than collateralized loans.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may obtain exposure to loans made to private investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">vehicles, including private funds that are not registered under the 1940 </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Act. Such loans may be for various purposes, including but not limited </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to, subscription line or “sub-line” credit facilities secured by the uncalled </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital commitments of such private investment vehicles' investors. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Although such capital commitments are typically subject to legally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">binding agreements, there can be no assurance that the investors will </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">meet their funding obligations when called. As a result, the Fund may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to the risk of delay or default in repayment of the loan, which </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could negatively impact the Fund's performance. Additionally, the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may face liquidity risks if the private investment vehicle is unable to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">draw on capital commitments in a timely manner.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In connection with purchasing loan participations, the Fund generally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will have no right to enforce compliance by the borrower with the terms </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the loan agreement relating to the loan, nor any rights of set-off </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">against the borrower, and the Fund may not directly benefit from any </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateral supporting the loan in which it has purchased the loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participation. As a result, the Fund will be subject to the credit risk of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">both the borrower and the lender that is selling the participation. In the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">event of the insolvency of the lender selling a participation, the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be treated as a general creditor of the lender and may not benefit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from any set-off between the lender and the borrower. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">A bankruptcy </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">court may restructure the payment obligations under the loan so as to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reduce the amount to which the Fund would be entitled or extended the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time for payment. A court could subordinate the Fund's rights to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rights of other creditors of the borrower under applicable law. Various </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">laws enacted for the protection of borrowers may apply to loans, and a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bankruptcy proceeding against a borrower could delay or limit the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability of the Fund to collect principal and interest payments on such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Certain loan participations may be structured in a manner </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">designed to prevent purchasers of participations from being subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the credit risk of the lender, but even under such a structure, in the event </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the lender’s insolvency, the lender’s servicing of the participation may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be delayed and the assignability of the participation impaired.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may have difficulty disposing of loans and loan participations. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Because there may not be a liquid market for many such investments, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund anticipates that such investments could be sold only to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limited number of institutional investors. The lack of a liquid secondary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market may have an adverse impact on the value of such investments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and the Fund</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">’</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">s ability to dispose of particular loans and loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participations when that would be desirable, including in response to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">specific economic event such as a deterioration in the creditworthiness </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the borrower. The lack of a liquid secondary market for loans and loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participations also may make it more difficult for the Fund to assign a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value to these securities for purposes of valuing the Fund</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">’</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">s portfolio.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments in loans may include participations in bridge loans, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are loans taken out by borrowers for a short period (typically less than </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">one year) pending arrangement of more permanent financing through, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for example, the issuance of bonds, frequently high yield bonds issued </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for the purpose of acquisitions.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments in loans may include </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">acquisitions</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> of, or participation in, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">delayed draw and delayed funding loans and revolving credit facilities. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">These commitments may have the effect of requiring the Fund to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase its investment in a borrower at a time when it might not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise decide to do so (including at a time when the company</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">’</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial condition makes it unlikely that such amounts will be repaid). </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Delayed draw and delayed funding loans and revolving credit facilities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be subject to restrictions on transfer, and only limited opportunities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may exist to resell such instruments. As a result, the Fund may be unable </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to sell such investments at an opportune time or may have to resell </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">them at less than fair market value. Further, the Fund may need to hold </div></div></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquid assets in order to provide funding for these types of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">commitments, meaning the Fund may not be able to invest in other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">attractive investments, or the Fund may need to liquidate existing assets </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in order to provide such funding.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> More generally, sales of the Fund's </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portfolio holdings may result in short-term capital gains (which are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally taxed to shareholders at ordinary income tax rates when </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distributed net of short-term capital losses and net of long-term capital </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">losses), potentially subjecting shareholders of the Fund to adverse tax </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consequences.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in debtor-in-possession financings (commonly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">known as “DIP financings”). DIP financings are arranged when an entity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">seeks the protections of the bankruptcy court under Chapter 11 of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Bankruptcy Code. These financings allow the entity to continue its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">business operations while reorganizing under Chapter 11. Such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financings constitute senior liens on an unencumbered security (i.e., a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security not subject to other creditors' claims). There is a risk that the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entity will not emerge from Chapter 11 and be forced to liquidate its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets under Chapter 7 of the U.S. Bankruptcy Code. In the event of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidation, the Fund's only recourse will be against the property </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securing the DIP financing.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in loans used to finance the cost of construction, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">acquisition, development, and/ or rehabilitation of a property including, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">but not limited to, development of single-family for-sale homes, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">multi-family rentals and/or commercial facilities. Such construction </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lending may expose the Fund to increased risk of non-payment and loss </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">because the loan is not backed by a finished project. Such risk may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">depend on the nature of the construction and the relevant counterparty </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or counterparties, which may include, but not be limited to, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">homebuilders, private developers and/or entities with limited capital. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Repayment of these types of loans may depend on the borrower’s ability </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to secure permanent “take-out” financing, which requires the successful </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">completion of the project, or operation of the property with an income </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">stream sufficient to meet operating and loan expenses. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these types of loans are subject to the risk of errors in estimations of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">property’s value at completion of construction and the estimated cost of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">construction, as well as the risk that the projects may not be completed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and have limited liquidity.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent the Fund invests in loans, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including, but not limited to, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bank loans, non-syndicated loans, the residual or equity tranches of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-related and other asset-backed securities, which may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">referred to as subordinate mortgage-backed or asset-backed securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and interest-only mortgage-backed or asset-backed securities, and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or originates loans,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> the Fund may be subject to greater </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">levels of credit risk, call risk, settlement risk, risk of subordination to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other creditors, insufficient or lack of protection under federal securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">laws and liquidity risk. These instruments are considered predominantly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">speculative with respect to an issuer’s continuing ability to make </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">principal and interest payments and may be more volatile than other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">types of securities. The Fund may also be subject to greater levels of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity risk than funds that do not invest in loans. In addition, the loans </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in which the Fund invests may not be listed on any exchange and a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">secondary market for such loans may be comparatively illiquid relative </div></div></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to markets for other more liquid fixed income securities. Consequently, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions in loans may involve greater costs than transactions in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more actively traded securities. In connection with certain loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions, transaction costs that are borne by the Fund may include </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the expenses of third parties that are retained to assist with reviewing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and conducting diligence, negotiating, structuring and servicing a loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transaction, and/or providing other services in connection therewith. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Furthermore, the Fund may incur such costs in connection with loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions that are pursued by the Fund but not ultimately </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consummated (so-called “broken deal costs”).</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Restrictions on transfers in loan agreements, a lack of publicly available </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information, irregular trading activity and wide bid/ask spreads, among </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other factors, may, in certain circumstances, make loans more difficult to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sell at an advantageous time or price than other types of securities or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments. These factors may result in the Fund being unable to realize </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">full value for the loans and/or may result in the Fund not receiving the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds from a sale of a loan for an extended period after such sale, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">each of which could result in losses to the Fund. Some loans may have </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extended trade settlement periods, including settlement periods of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">greater than seven days, which may result in cash not being </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">immediately available to the Fund. If an issuer of a loan prepays or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">redeems the loan prior to maturity, the Fund may have to reinvest the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds in other loans or similar instruments that may pay lower </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates. Because of such risks involved in investing in loans, an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment in the Fund should be considered speculative.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investments in subordinated and unsecured loans generally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are subject to similar risks as those associated with investments in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">secured loans. Subordinated or unsecured loans are lower in priority of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment to secured loans and are subject to the additional risk that the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cash flow of the borrower and property securing the loan or debt, if any, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be insufficient to meet scheduled payments after giving effect to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the senior secured obligations of the borrower. This risk is generally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">higher for subordinated unsecured loans or debt, which are not backed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by a security interest in any specific collateral. Subordinated and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unsecured loans generally have greater price volatility than secured </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans and may be less liquid. There is also a possibility that originators </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will not be able to sell participations in subordinated or unsecured </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans, which would create greater credit risk exposure for the holders of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such loans. Subordinate and unsecured loans share the same risks as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other below investment grade securities.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There may be less readily available information about most loans and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the underlying borrowers than is the case for many other types of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities. Loans may be issued by borrowers that are not subject to SEC </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reporting requirements and therefore may not be required to file reports </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with the SEC or may file reports that are not required to comply with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">SEC form requirements. In addition, such borrowers may be subject to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">less stringent liability disclosure regime than companies subject to SEC </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reporting requirements. Loans may not be considered “securities,” and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchasers, such as the Fund, therefore may not be entitled to rely on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the anti-fraud protections of the federal securities laws. Because there is </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limited public information available regarding loan investments, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund is particularly dependent on the analytical abilities of the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investment Manager</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Economic exposure to loan interests through the use of derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions may involve greater risks than if the Fund had invested in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the loan interest directly during a primary distribution, through direct </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">originations or through assignments of, novations of or participations in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a loan acquired in secondary markets since, in addition to the risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">described above, certain derivative transactions may be subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leverage risk and greater illiquidity risk, counterparty risk, valuation risk </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other risks.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Loan Origination Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may originate loans, including, without limitation, residential </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or commercial real estate or mortgage-related loans, consumer </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans or other types of loans, which may be in the form of, and without </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limitation as to a loan’s level of seniority within a capital structure, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">whole loans, assignments, participations, secured and unsecured notes, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">senior and second lien loans, mezzanine loans, bridge loans or similar </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments. The Fund may originate loans to corporations and/or other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">legal entities and individuals, including foreign (non-U.S.) and emerging </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market entities and individuals. Loans may carry significant credit risks </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(for example, a borrower may not have a credit rating or score or may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have a rating or score that indicates significant credit risk). This may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">include loans to public or private firms or individuals, such as in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">connection with housing development projects. The loans the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invests in or originates may vary in maturity and/or duration. The Fund is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not limited in the amount, size or type of loans it may invest in and/or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">originate, including with respect to a single borrower or with respect to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">borrowers that are determined to be below investment grade, other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than pursuant to any applicable law. The Fund's investment in or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">origination of loans may also be limited by the requirements the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intends to observe under Subchapter M of the Code in order to qualify </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as a RIC. The Fund may subsequently offer such investments for sale to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">third parties; provided, that there is no assurance that the Fund will </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">complete the sale of such an investment. If the Fund is unable to sell, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assign or successfully close transactions for the loans that it originates, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund will be forced to hold its interest in such loans for an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">indeterminate period of time. This could result in the Fund's investments </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">having high exposure to certain borrowers. The Fund will be responsible </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for the expenses associated with originating a loan (whether or not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consummated). This may include significant legal and due diligence </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expenses, which will be indirectly borne by the Fund and Common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shareholders.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Bridge loans are generally made with the expectation that the borrower </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will be able to obtain permanent financing in the near future. Any delay </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in obtaining permanent financing subjects the bridge loan investor to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increased risk. A borrower's use of bridge loans also involves the risk </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the borrower may be unable to locate permanent financing to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">replace the bridge loan, which may impair the borrower's perceived </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">creditworthiness.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Loan origination and servicing companies are routinely involved in legal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceedings concerning matters that arise in the ordinary course of their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">business. In addition, a number of participants in the loan origination </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and servicing industry (including control persons of industry </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participants) have been the subject of regulatory actions by state </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulators, including state attorneys general, and by the federal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">government. Governmental investigations, examinations or regulatory </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">actions, or private lawsuits, including purported class action lawsuits, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may adversely affect such companies' financial results. To the extent the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund engages in origination and/or servicing directly, or has a financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest in, or is otherwise affiliated with, an origination or servicing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">company, the Fund will be subject to enhanced risks of litigation, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulatory actions and other proceedings. As a result, the Fund may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">required to pay legal fees, settlement costs, damages, penalties or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">charges, any or all of which could materially adversely affect the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and its holdings.</div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Foreign Loan Originations Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may originate loans to foreign entities and individuals, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including foreign (non-U.S.) and emerging market entities and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">individuals. Such loans may involve risks not ordinarily associated with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exposure to loans to United States entities and individuals. The foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lending industry may be subject to less governmental supervision and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulation than exists in the United States; conversely, foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulatory regimes applicable to the lending industry may be more </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">complex and more restrictive than those in the United States, resulting </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in higher costs associated with such investments, and such regulatory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regimes may be subject to interpretation or change without prior notice </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to investors, such as the Fund. Foreign lending may not be subject to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accounting, auditing, and financial reporting standards and practices </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">comparable to those in the United States</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Due to differences in legal </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systems, there may be difficulty in obtaining or enforcing a court </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">judgment outside the United States</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> In addition, to the extent that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments are made in a limited number of countries, events in those </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries will have a more significant impact on the Fund. The Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans to foreign entities and individuals may be subject to risks of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increased transaction costs, potential delays in settlement or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unfavorable differences between the U.S. economy and foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economies.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s exposure to loans to foreign entities and individuals may be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to withholding and other foreign taxes, which may adversely </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the net return on such investments. In addition, fluctuations in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">foreign currency exchange rates and exchange controls may adversely </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the market value of the Fund’s exposure to loans to foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entities and individuals. The Fund is unlikely to be able to pass through </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to its shareholders foreign income tax credits in respect of any foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income taxes it pays.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Privacy and Data Security Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Gramm-Leach-Bliley Act (“GLBA”) and other laws limit the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disclosure of certain non-public personal information about a consumer </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to non-affiliated third parties and require financial institutions to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disclose certain privacy policies and practices with respect to </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information sharing with both affiliates and non-affiliated third parties. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Many states and a number of non-U.S. jurisdictions have enacted </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">privacy and data security laws requiring safeguards on the privacy and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security of consumers’ personally identifiable information. Other laws </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deal with obligations to safeguard and dispose of private information in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a manner designed to avoid its dissemination. Privacy rules adopted by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the U.S. Federal Trade Commission and SEC implement the GLBA and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other requirements and govern the disclosure of consumer financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information by certain financial institutions, ranging from banks to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">private investment funds. U.S. platforms following certain models </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally are required to have privacy policies that conform to these </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">GLBA and other requirements. In addition, such platforms typically have </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">policies and procedures intended to maintain platform participants’ </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">personal information securely and dispose of it properly.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund generally does not intend to obtain or hold borrowers’ </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-public personal information, and the Fund has implemented </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">procedures reasonably designed to prevent the disclosure of borrowers’ </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-public personal information to the Fund. However, service providers </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the Fund or its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subsidiaries</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, including their custodians and the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">platforms acting as loan servicers for the Fund or its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subsidiaries</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obtain, hold or process such information. The Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and entities that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interact with the Fund, including service providers, custodians and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">platforms are susceptible to operational, information security and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">related cybersecurity risks. The Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cannot guarantee the security of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-public personal information in the possession of such a service </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provider and cannot guarantee that service providers have been and will </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">continue to comply with the GLBA, other data security and privacy laws </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and any other related regulatory requirements. Violations of the GLBA </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other laws could subject the Fund to litigation and/or fines, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">penalties or other regulatory action, which, individually or in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">aggregate, could have an adverse effect on the Fund. The Fund may also </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">face regulations related to privacy and data security in the other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">jurisdictions in which the Fund invests.</div></div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Platform Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Alt Lending ABS in which the Fund may invest are typically not listed </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on any securities exchange and not registered under the Securities Act. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, the Fund anticipates that these instruments may only be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sold to a limited number of investors and may have a limited or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-existent secondary market. Accordingly, the Fund currently expects </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that certain of the investments it may make in Alt Lending ABS will face </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">heightened levels of liquidity risk. Although currently there is generally </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">no reliable, active secondary market for certain Alt Lending ABS, a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">secondary market for these Alt Lending ABS may develop. If the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchases Alt Lending ABS on an alternative lending platform, the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will have the right to receive principal and interest payments due on </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans underlying the Alt Lending ABS only if the platform servicing the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans receives the borrower’s payments on such loans and passes such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments through to the Fund. If a borrower is unable or fails to make </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments on a loan for any reason, the Fund may be greatly limited in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its ability to recover any outstanding principal or interest due, as (among </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other reasons) the Fund may not have direct recourse against the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">borrower or may otherwise be limited in its ability to directly enforce its </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rights under the loan, whether through the borrower or the platform </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">through which such loan was originated, the loan may be unsecured or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under-collateralized and/or it may be impracticable to commence a legal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeding against the defaulting borrower.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may have limited knowledge about the underlying loans and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is dependent upon the platform for information regarding underlying </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans. Although PIMCO may conduct diligence on the platforms, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund generally does not have the ability to independently verify the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information provided by the platforms, other than payment information </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regarding loans underlying the Alt Lending ABS owned by the Fund, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which the Fund observes directly as payments are received. With respect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to Alt Lending ABS that the Fund purchases in the secondary market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(i.e., not directly from an alternative lending platform), the Fund may not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perform the same level of diligence on such platform or at all. The Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not review the particular characteristics of the loans collateralizing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">an Alt Lending ABS, but rather negotiate in advance with platforms the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">general criteria of the underlying loans. As a result, the Fund is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dependent on the platforms’ ability to collect, verify and provide </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information to the Fund about each loan and borrower.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund relies on the borrower’s credit information, which is provided </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by the platforms. However, such information may be out of date, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incomplete or inaccurate and may, therefore, not accurately reflect the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">borrower’s actual creditworthiness. Platforms may not have an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligation to update borrower information, and, therefore, the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not be aware of any impairment in a borrower’s creditworthiness </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subsequent to the making of a particular loan. The platforms’ credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decisions and scoring models may be based on algorithms that could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potentially contain programming or other errors or prove to be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ineffective or otherwise flawed. This could adversely affect loan pricing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">data and approval processes and could cause loans to be mispriced or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">misclassified, which could ultimately have a negative impact on the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s performance.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, the underlying loans, in some cases, may be affected by the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">success of the platforms through which they are facilitated. Therefore, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disruptions in the businesses of such platforms may also negatively </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impact the value of the Fund’s investments. In addition, disruption in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">business of a platform could limit or eliminate the ability of the Fund to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invest in loans originated by that platform, and therefore the Fund could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lose some or all of the benefit of its diligence effort with respect to that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">platform.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Platforms are for-profit businesses that, as a general matter, generate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">revenue by collecting fees on funded loans from borrowers and by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assessing a loan servicing fee on investors, which may be a fixed annual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">amount or a percentage of the loan or amounts collected. This business </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could be disrupted in multiple ways; for example, a platform could file </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for bankruptcy or a platform might suffer reputational harm from </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">negative publicity about the platform or alternative lending more </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally and the loss of investor confidence in the event that a loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">facilitated through the platform is not repaid and the investor loses </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">money on its investment. Many platforms and/or their affiliates have </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incurred operating losses since their inception and may continue to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incur net losses in the future, particularly as their businesses grow and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">they incur additional operating expenses.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Platforms may also be forced to defend legal action taken by regulators </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or governmental bodies. Alternative lending is a newer industry </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operating in an evolving legal environment. Platforms may be subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk of litigation alleging violations of law and/or regulations, including, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for example, consumer protection laws, whether in the U.S. or in foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">jurisdictions. Platforms may be unsuccessful in defending against such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lawsuits or other actions and, in addition to the costs incurred in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fighting any such actions, platforms may be required to pay money in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">connection with the judgments, settlements or fines or may be forced to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">modify the terms of its borrower loans, which could cause the platform </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to realize a loss or receive a lower return on a loan than originally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">anticipated.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Platforms may also be parties to litigation or other legal action in an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">attempt to protect or enforce their rights or those of affiliates, including </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intellectual property rights, and may incur similar costs in connection </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with any such efforts.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investments in Alt Lending ABS may expose the Fund to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit risk of the issuer. Generally, such instruments are unsecured </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations of the issuer; an issuer that becomes subject to bankruptcy </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceedings may be unable to make full and timely payments on its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations to the Fund, even if the payments on the underlying loan or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans continue to be made timely and in full. In addition, when the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">owns Alt Lending ABS, the Fund and its custodian generally do not have </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a contractual relationship with, or personally identifiable information </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regarding, individual borrowers, so the Fund will not be able to enforce </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underlying loans directly against borrowers and may not be able to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">appoint an alternative servicing agent in the event that a platform or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">third-party servicer, as applicable, ceases to service the underlying loans. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Therefore, the Fund is more dependent on the platform for servicing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than if the Fund had owned whole loans through the platform. Where </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such interests are secured, the Fund relies on the platform to perfect the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s security interest. In addition, there may be a delay between the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time the Fund commits to purchase an instrument issued by a platform, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its affiliate or a special purpose entity sponsored by the platform or its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affiliate and the issuance of such instrument and, during such delay, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">funds committed to such an investment will not earn interest on the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment nor will they be available for investment in other alternative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lending-related instruments, which will reduce the effective rate of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">return on the investment. The Fund’s investments in Alt Lending ABS </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be illiquid.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Liquidity Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent consistent with the applicable liquidity requirements for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interval funds under Rule 23c-3 of the 1940 Act, the Fund may invest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">without </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limitation</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> in illiquid investments. Liquidity risk exists when </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particular investments are difficult to purchase or sell. Illiquid </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments are investments that the Fund reasonably expects cannot </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be sold or disposed of in current market conditions in seven calendar </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">days or less without the sale or disposition significantly changing the </span></span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market value of the investment. Illiquid investments may become harder </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to value, especially in changing markets. The Fund's investments in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">illiquid investments may reduce the returns of the Fund because it may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be unable to sell the illiquid investments at an advantageous time or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">price or possibly require the Fund to dispose of other investments at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unfavorable times or prices in order to satisfy its obligations, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could prevent the Fund from taking advantage of other investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">opportunities. Illiquidity can be caused by, among other things, a drop in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">overall market trading volume, an inability to find a willing buyer, or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">legal restrictions on the securities’ resale</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, capital controls, delays or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limits on repatriation of local currency, or insolvency of local </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">governments</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. Additionally, the market for certain investments may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">become illiquid under adverse market or economic conditions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">independent of any specific adverse changes in the conditions of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particular issuer, such as during </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes in</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">elevated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatility,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market or geopolitical disruptions</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, economic uncertainty or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">public health crises</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. There can be no assurance that an investment that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is deemed to be liquid when purchased will continue to be liquid while </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">it is held by a fund and/or when a fund wishes to dispose of it. Bond </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets have consistently grown over </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> while the capacity for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">traditional dealer counterparties to engage in fixed income trading has </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not kept pace </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with the growth of bond markets and may remain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">constrained</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. As a result, dealer inventories of corporate bonds, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provide a core indication of the ability of financial intermediaries to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">“make markets,” </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">remain limited relative to the size of the market</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Because market makers seek to provide stability to a market through </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">their intermediary services, the significant reduction in dealer inventories </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could potentially lead to decreased liquidity and increased volatility in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the fixed income markets</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">especially</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> during periods of economic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">uncertainty</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> or market stress</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In such cases, the Fund, due to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the difficulty in purchasing and selling </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such securities or instruments, may be unable to achieve its desired level </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of exposure to a certain sector. To the extent that the Fund's principal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment strategies involve securities of companies with smaller </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market capitalizations, foreign (non-U.S.) securities, Rule 144A </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities, illiquid sectors of fixed income securities, derivatives or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities with substantial market and/or credit risk, the Fund will tend </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to have the greatest exposure to liquidity risk.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Further, fixed income securities with longer durations until maturity face </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">heightened levels of liquidity risk as compared to fixed income securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with shorter durations until maturity. The risks associated with illiquid </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments may be particularly acute in situations in which the Fund's </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operations require cash (such as in connection with repurchase offers) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and could result in the Fund borrowing to meet its short-term needs or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incurring losses on the sale of illiquid instruments. It may also be the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">case that other market participants may be attempting to liquidate fixed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income holdings at the same time as the Fund, causing increased supply </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the market and contributing to liquidity risk and downward pricing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pressure.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent the Fund invests in Alt <div style="display:inline;">Lending </div>ABS, the Alt Lending ABS in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which the Fund invests are typically not listed on any securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exchange and not registered under the Securities Act. In <div style="display:inline;">addition</div>, the </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund anticipates that these instruments may only be sold to a limited </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">number of investors and may have a limited or non-existent secondary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market. Accordingly, the Fund currently expects that certain of its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments in Alt Lending ABS will face heightened levels of liquidity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk. Although currently there is generally no active reliable, secondary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market for certain Alt Lending ABS, a secondary market for these </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">alternative lending-related instruments may develop.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Liquidity risk also refers to the risk that the Fund may be required to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">hold additional cash or sell other investments in order to obtain cash to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">close out derivatives or meet the liquidity demands that derivatives can </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">create to make payments of margin, collateral, or settlement payments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to counterparties. The Fund may have to sell a security at a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disadvantageous time or price to meet such obligations.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The action(s) of governments and regulators may have the effect of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reducing market liquidity, market resiliency and money supply.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">“Covenant-Lite” Obligations Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Covenant-lite obligations contain fewer maintenance covenants than </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other obligations, or no maintenance covenants, and may not include </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">terms that allow the lender to monitor the performance of the borrower </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and declare a default if certain criteria are breached, which would allow </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the lender to restructure the loan or take other action intended to help </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mitigate losses. Covenant-lite loans carry a risk that the borrower could </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transfer or encumber its assets, which could reduce the amount of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets that can be used to satisfy debts and result in losses for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debtholders. Covenant-lite loans may carry more risk than traditional </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans as they allow individuals and corporations to engage in activities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that would otherwise be difficult or impossible under a covenant-heavy </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loan agreement. In the event of default, covenant-lite loans may exhibit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">diminished recovery values as the lender may not have the opportunity </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to negotiate with the borrower prior to default.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Reinvestment Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Income from the Fund’s portfolio will decline if and when the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invests the proceeds from matured, traded or called debt obligations at </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market interest rates that are below the portfolio’s current earnings </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate.For instance, during periods of declining interest rates, an issuer of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt obligations may exercise an option to redeem securities prior to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">maturity, forcing the Fund to invest in lower-yielding securities. The Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">also may choose to sell higher yielding portfolio securities and to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchase lower yielding securities to achieve greater portfolio </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">diversification, because the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investment Manager believes</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> the current </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">holdings are overvalued or for other investment-related reasons. A </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decline in income received by the Fund from its investments is likely to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have a negative effect on dividend levels and the market price, NAV </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or overall return of the Common Shares.</span></span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Call Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Call risk refers to the possibility that an issuer may exercise its right to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">redeem a fixed income security earlier than expected (a call). Issuers </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may call outstanding securities prior to their maturity for a number of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reasons (e.g., declining interest rates, changes in credit spreads and </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">improvements in the issuer’s credit quality)</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, and changes in the rate at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which prepayments or redemptions occur can affect the return on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment of these securities</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. If an issuer calls a security in which the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund has invested, the Fund may not recoup the full amount of its initial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment or may not realize the full anticipated earnings from the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment and may be forced to reinvest in lower-yielding securities, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities with greater credit risks or securities with other, less favorable </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">features.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Real Estate Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent that the Fund invests directly or indirectly in real estate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments, including investments in equity or debt securities issued by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">private and public REITs, real estate operating companies (“REOCs”), </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">private or public real estate-related loans</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">real estate-linked derivative </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and pooled investment vehicles (including registered </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment companies and private funds or other pooled investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">vehicles that would qualify as “investment companies” under the 1940 </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Act but for an applicable exemption or exclusion) that invest in real </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">estate investments</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, it will be subject to the risks associated with owning </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">real estate and with the real estate industry generally. These </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments carry increased risks, which include, but are not limited to: </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the burdens of ownership of real property; general and local economic </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions (such as an oversupply of space or a reduction in demand for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">space); fluctuations in the supply and demand for properties (including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">competition based on rental rates); energy and supply shortages; </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fluctuations in average occupancy and room rates; the attractiveness, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">type and location of the properties and changes in the relative </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">popularity of commercial properties as an investment; the financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">condition and resources of tenants, buyers and sellers of properties; </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increased mortgage defaults; the quality of maintenance, insurance and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">management services; changes in the availability of debt financing </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may render the sale or refinancing of properties difficult or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impracticable; changes in building, environmental and other laws </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or regulations (including those governing usage and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">improvements), fiscal policies and zoning laws; changes in real property </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tax rates; changes in interest rates and the availability of mortgage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">funds which may render the sale or refinancing of properties difficult or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impracticable; changes in operating costs and expenses; energy and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">supply shortages; uninsured losses or delays from casualties or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">condemnation; negative developments in the economy that depress </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">travel or leasing activity; environmental liabilities; contingent liabilities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on disposition of assets; uninsured or uninsurable casualties; </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insurance </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">costs or the lack of availability of insurance coverage;</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> acts of God, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including earthquakes, hurricanes and other natural disasters; social </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unrest and civil disturbances, epidemics, pandemics or other public </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">crises; terrorist attacks and war; risks and operating problems arising </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">out of the presence of certain construction materials, structural or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">property level latent defects, work stoppages, shortages of labor, strikes, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">union relations and contracts, fluctuating prices and supply of labor </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or other labor-related factor; and other factors which are beyond </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the control of PIMCO and its affiliates. In addition, the Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments will be subject to various risks which could cause </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fluctuations in occupancy, rental rates, operating income and expenses </span></span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or which could render the sale or financing of its properties difficult or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unattractive. For example, following the termination or expiration of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tenant’s lease, there may be a period of time before receiving rental </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments under a replacement lease. During that period, the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would continue to bear fixed expenses such as interest, real estate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taxes, maintenance and other operating expenses. In addition, declining </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economic conditions may impair the ability to attract replacement </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tenants and achieve rental rates equal to or greater than the rents paid </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under previous leases. Increased competition for tenants may require </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital improvements to properties which would not have otherwise </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">been planned.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Ultimately, to the extent it is not possible to renew leases or re-let space </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as leases expire, decreased cash flow from tenants will result, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could adversely impact the Fund’s operating results.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Real estate values have historically been cyclical. As the general </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economy grows, demand for real estate increases and occupancies and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rents may increase. As occupancies and rents increase, property values </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase, and new development occurs. As development may occur, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">occupancies, rents and property values may decline. Because leases are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">usually entered into for long periods and development activities often </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">require extended times to complete, the real estate value cycle often </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lags the general business cycle. Because of this cycle, real estate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">companies may incur large swings in their profits and the prices of their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities. Developments following the onset of COVID-19 have </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adversely impacted certain commercial real estate markets, causing the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deferral of mortgage payments, renegotiated commercial mortgage </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans, commercial real estate vacancies or outright mortgage defaults. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">These developments accelerated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">macro trends such as work from home </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and online shopping which have negatively impacted (and may continue </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to negatively impact) certain industries, such as brick-and-mortar retail.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The total returns available from investments in real estate generally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">depend on the amount of income and capital appreciation generated by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the related properties. The performance of real estate, and thereby the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund, will be reduced by any related expenses, such as expenses paid </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">directly at the property level and other expenses that are capitalized or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise embedded into the cost basis of the real estate.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Separately, certain service providers to the Fund and/or its Subsidiaries, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as applicable, with respect to its real estate or real estate-related </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments may be owned by, employed by, or otherwise related to, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO, Allianz SE, their affiliates and/or their respective employees, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consultants and other personnel. PIMCO may, in its sole discretion, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">determine to provide, or engage or recommend an affiliate of PIMCO to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provide, certain services to the Fund, instead of engaging or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recommending one or more third parties to provide such services. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subject to the governance requirements of a particular fund and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">applicable law, PIMCO or its affiliates, as applicable, will receive </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">compensation in connection with the provision of such services. As a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result, PIMCO faces a conflict of interest when selecting or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recommending service providers for the Fund. Fees paid to an affiliated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">service provider will be determined in PIMCO's commercially reasonable </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">discretion. Although PIMCO has adopted various policies and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">procedures intended to mitigate or otherwise manage conflicts of </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest with respect to affiliated service providers, there can be no </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">guarantee that such policies and procedures (which may be modified or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">terminated at any time in PIMCO's sole discretion) will be successful.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investments in real estate (including indirectly through </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">private funds treated as partnerships for U.S. federal income tax </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purposes) will potentially be limited by the Fund’s intention to qualify as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a RIC and will potentially limit the Fund’s ability to so qualify. Income </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and gains from direct investments in real estate do not constitute </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">qualifying income to a RIC for purposes of the 90% gross income test </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">described below. If the Fund's income or gain from a particular </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment were determined to constitute nonqualifying income, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in certain cases may be determined retroactively, and the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">nonqualifying income from all sources were to exceed 10% of its gross </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income in any taxable year, or the Fund’s nonqualifying income in any </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taxable year otherwise exceeded 10% of its gross income, the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would fail to qualify as a RIC unless it were eligible to and did pay a tax </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at the Fund level. See “Tax Risk” below for additional details.</div></div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Private Funds Risk – Tax Risk</span></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Special tax risks are associated with an investment in the Fund. The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund intends to qualify and elect to be treated as a RIC under </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subchapter M of the Code. As such, the Fund must satisfy, among other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">requirements, diversification and 90% gross income requirements, and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a requirement that it distribute at least 90% of its ordinary income and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">net short-term gains in the form of deductible dividends. Each of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">aforementioned ongoing requirements for qualification for the favorable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tax treatment available to RICs requires that the Fund obtain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information from or about the Private Funds in which the Fund is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invested. However, Private Funds generally are not obligated to disclose </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the contents of their portfolios. This lack of transparency may make it </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficult for the Investment Manager to monitor the sources of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s income and the diversification of its assets, and otherwise to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">comply with Subchapter M of the Code. Ultimately this may limit the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">universe of Private Funds in which the Fund can invest and may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adversely bear on the Fund’s ability to qualify as a RIC under Subchapter </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">M of the Code. The Fund expects to receive information from each </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Private Fund regarding its investment performance on a regular basis. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Private Funds and other entities classified as partnerships for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. federal income tax purposes may generate income allocable to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund that is not qualifying income for purposes of the 90% gross </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income test. In order to meet the 90% gross income test, the Fund may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">structure its investments in a manner that potentially increases the taxes </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">imposed thereon or in respect thereof. Because the Fund may not have </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">timely or complete information concerning the amount or sources of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such a Private Fund’s income until such income has been earned by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Private Fund or until a substantial amount of time thereafter, it may be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficult for the Fund to satisfy the 90% gross income test.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In the event that the Fund believes that it is possible that it will fail the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">asset diversification requirement at the end of any quarter of a taxable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">year, it may seek to take certain actions to avert such failure, including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by acquiring additional investments to come into compliance with the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">asset diversification tests or by disposing of non-diversified assets. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Although the Code affords the Fund the opportunity, in certain </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">circumstances, to cure a failure to meet the asset diversification test, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including by disposing of non-diversified assets within six months, there </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be constraints on the Fund’s ability to dispose of its interest in a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Private Fund that limit utilization of this cure period.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund must distribute at least 90% of its investment company </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taxable income, in a manner qualifying for the dividends-paid </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deduction, to qualify as a RIC, and must distribute substantially all of its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income in order to avoid a fund-level tax. In addition, if the Fund were </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to fail to distribute in a calendar year a sufficient amount of its income </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for such year, it would be subject to an excise tax. The determination of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the amount of distributions sufficient to qualify as a RIC and avoid a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fund-level income or excise tax will depend on income and gain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information that must be obtained from the underlying Private Funds. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investment in Private Funds may make it difficult to estimate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s income and gains in a timely fashion, which may increase the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">likelihood that the Fund will be liable for the excise tax with respect to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain undistributed amounts. See “Principal Risks of the Fund—Tax </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Risk” in this Prospectus and “Taxation” in the Statement of Additional </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Information.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">U.S. Government Securities Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain U.S. government securities, such as U.S. Treasury bills, notes, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bonds</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and mortgage-related securities guaranteed by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Government </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">National Mortgage Association (“</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">GNMA</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">”)</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, are supported by the full </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">faith and credit of the United States; others, such as those of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">FHLBs</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">FHLMC</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, are supported by the right of the issuer to borrow from </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the U.S. Treasury; others, such as those of the FNMA, are supported by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the discretionary authority of the U.S. government to purchase the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agency’s obligations; and still others are supported only by the credit of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the agency, instrumentality or corporation. U.S. government securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are subject to market risk, interest rate risk and credit risk. Although </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">legislation has been enacted to support certain government sponsored </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entities, including the FHLBs, FHLMC and FNMA, there is no assurance </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the obligations of such entities will be satisfied in full, or that such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations will not decrease in value or default. It is difficult, if not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impossible, to predict the future political, regulatory or economic </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes that could impact the government sponsored entities and the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">values of their related securities or obligations. In addition, certain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">governmental entities, including FNMA and FHLMC, have been subject </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to regulatory scrutiny regarding their accounting policies and practices </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other concerns that may result in legislation, changes in regulatory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">oversight and/or other consequences that could adversely affect the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit quality, availability or investment character of securities issued by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these entities. Yields available from U.S. government debt securities are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally lower than the yields available from such other securities. The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">values of U.S. government securities change as interest rates fluctuate.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Periodically, uncertainty regarding the status of negotiations in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. government to increase the statutory debt ceiling could increase the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk that the U.S. government may default on payments on certain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. government securities, cause the credit rating of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. government to be downgraded, increase volatility in the stock and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bond markets, result in higher interest rates, reduce prices of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Treasury and other securities, and/or increase the costs of various </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">kinds of debt. If a government-sponsored entity is negatively impacted </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by legislative or regulatory action (or lack thereof), is unable to meet its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations, or its creditworthiness declines, the performance of a fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that holds securities of the entity will be adversely impacted.</div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Convertible Securities Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Convertible securities are fixed income securities, preferred securities or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other securities that are convertible into or exercisable for common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">stock of the issuer (or cash or securities of equivalent value) at either a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">stated price or a stated rate. Convertible debt securities pay interest and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">convertible preferred stocks pay dividends until they mature or are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">converted, exchanged or redeemed. The market values of convertible </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities may decline as interest rates increase and, conversely, may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase as interest rates decline. A convertible security’s market value, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">however, tends to reflect the market price of the common stock of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuing company when that stock price approaches or is greater than </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the convertible security’s “conversion price.” The conversion price is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">defined as the predetermined price at which the convertible security </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could be exchanged for the associated stock. Certain types of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">convertible securities may decline in value or lose their value entirely in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the event the issuer’s financial condition becomes significantly impaired. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">As the market price of the underlying common stock declines, the price </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the convertible security tends to be influenced more by the yield of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the convertible security. Thus, it may not decline in price to the same </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent as the underlying common stock. In the event of a liquidation of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the issuing company, holders of convertible securities may be paid </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">before the company’s common stockholders but after holders of any </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">senior debt obligations of the company. Consequently, the issuer’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">convertible securities generally entail less risk than its common stock </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">but more risk than its other debt obligations. Convertible securities are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">often rated below investment grade or not rated.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Contingent Convertible Securities Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">CoCos have no stated maturity, have fully discretionary coupons and are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">typically issued in the form of subordinated debt instruments. CoCos </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally either convert into equity or have their principal written down </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(including potentially to zero) upon the occurrence of certain triggering </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">events (“triggers”) linked to regulatory capital thresholds or regulatory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">actions relating to the issuer’s continued viability. As a result, an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment by the Fund in CoCos is subject to the risk that coupon (</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; font-style: normal; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-style:italic;display:inline;">i.e.</span></span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest) payments may be cancelled by the issuer or a regulatory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">authority in order to help the issuer absorb losses and the risk of total </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loss. If such an event occurs, an investor may not have any rights to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repayment of the principal amount of the securities. Additionally, an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investor may not be able to collect interest payments or dividends on </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such securities. An investment by the Fund in CoCos is also subject to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the risk that, in the event of the liquidation, dissolution or winding-up of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">an issuer prior to a trigger event, the Fund’s rights and claims will </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally rank junior to the claims of holders of the issuer’s other debt </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations and CoCos may also be treated as junior to an issuer’s other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations and securities. In addition, if CoCos held by the Fund are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">converted into the issuer’s underlying equity securities following a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trigger event, the Fund’s holding may be further subordinated due to </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the conversion from a debt</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">-</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">-</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">equity instrument. Further, the value of an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment in CoCos is unpredictable and will be influenced by many </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">factors and risks, including interest rate risk, credit risk, market risk and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity risk. An investment by the Fund in CoCos may result in losses to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Valuation Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain securities in which the Fund i<span style="display:inline;">nves</span>ts may be less liquid and more </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficult to value than other types of securities. Investments for which </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market quotations are not readily available are valued at fair value as </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">determined in good faith pursuant to Rule 2a-5 under the 1940 Act. Fair </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value pricing may require subjective determinations about the value of a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security or other asset. As a result, there can be no assurance that fair </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value pricing will result in adjustments to the prices of securities or other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets or that fair value pricing will reflect actual market value, and it is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">possible that the fair value determined for a security or other asset will </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be materially different from quoted or published prices, from the prices </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">used by others for the same security or other asset and/or from the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value that actually could be or is realized upon the sale of that security </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or other asset.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Leverage Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s use of leverage (as described under “Use of Leverage” in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">body of this prospectus) creates the opportunity for increased Common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Share net income, but also creates special risks for Common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shareholders (including an increased risk of loss). To the extent used, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">there is no assurance that the Fund’s leveraging strategies will be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">successful. Leverage is a speculative technique that may expose the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund to greater risk and increased costs. The Fund’s assets attributable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to leverage, if any, will be invested in accordance with the Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment objective and policies as described in this prospectus. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Interest expense payable by the Fund with respect to derivatives and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other forms of leverage, and dividends payable with respect to preferred </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shares outstanding, if any, will generally be based on shorter-term </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates that would be periodically reset. So long as the Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portfolio investments provide a higher rate of return (net of applicable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund expenses) than the interest expenses and other costs to the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of such leverage, the investment of the proceeds thereof will generate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more income than will be needed to pay the costs of the leverage. If so, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and all other things being equal, the excess may be used to pay higher </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dividends to Common Shareholders than if the Fund were not so </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leveraged. If, however, shorter-term interest rates rise relative to the rate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of return on the Fund’s portfolio, the interest and other costs to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund of leverage could exceed the rate of return on the debt obligations </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other investments held by the Fund, thereby reducing return to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shareholders. When the Fund reduces or discontinues its use </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of leverage (“deleveraging”), </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">it may be required to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sell portfolio </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities at inopportune times to repay leverage obligations, which </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could result in realized losses and a decrease in the Fund's </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">NAV</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Deleveraging involves complex operational processes, including the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">coordination of asset sales, repayment of debt, and potential </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restructuring of the Fund's capital and may involve significant costs, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including transaction costs associated with the sale of portfolio </span></span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities, prepayment penalties on borrowed funds, and, if applicable, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fees related to the redemption of preferred shares. Leveraging </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions pursued by the Fund may increase its duration and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sensitivity to interest rate changes and other market risks. The Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">continue to use leverage even if available financing rates are higher </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than anticipated returns, including, for example, in cases where </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deleveraging, including any expenses related thereto, might be viewed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as detrimental to the Fund’s portfolio. In addition, fees and expenses of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any form of leverage used by the Fund will be borne entirely by the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shareholders (and not by preferred shareholders, if any) and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will reduce the investment return of the Common Shares. Therefore, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">there can be no assurance that the Fund’s use of leverage will result in a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">higher yield on the Common Shares, and it may result in losses. In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, any preferred shares issued by the Fund are expected to pay </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cumulative dividends, which may tend to increase leverage risk. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Leverage creates several major types of risks for Common Shareholders, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including:</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div><div style="clear:both;margin-top:6pt;position:relative;width:100%"><div style="float:left;line-height:12.0pt;margin-left:10pt;text-align:left;width:5.56pt"><div style="color: rgb(30, 130, 151); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">■</div></div><div style="float:left;line-height:12.0pt;margin-left:6.44pt;text-align:left;width:233.00pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the likelihood of greater volatility of NAV of Common Shares, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the investment return to Common Shareholders, than a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">comparable portfolio without leverage;</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="clear: both; position: relative; max-height: 0px;"> </div></div><div><div style="clear:both;position:relative;width:100%"><div style="float:left;line-height:12.0pt;margin-left:10pt;text-align:left;width:5.56pt"><div style="color: rgb(30, 130, 151); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">■</div></div><div style="float:left;line-height:12.0pt;margin-left:6.44pt;text-align:left;width:233.00pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the possibility either that Common Share dividends will fall if the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest and other costs of leverage rise, or that dividends paid on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares will fluctuate because such costs vary over time; </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="clear: both; position: relative; max-height: 0px;"> </div></div><div><div style="clear:both;position:relative;width:100%"><div style="float:left;line-height:12.0pt;margin-left:10pt;text-align:left;width:5.56pt"><div style="color: rgb(30, 130, 151); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">■</div></div><div style="float:left;line-height:12.0pt;margin-left:6.44pt;text-align:left;width:233.00pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the effects of leverage in a declining market or a rising interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate environment, as leverage is likely to cause a greater decline in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the NAV of the Common Shares than if the Fund were not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leveraged.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="clear: both; position: relative; max-height: 0px;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, the counterparties to the Fund’s leveraging transactions and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any preferred shareholders of the Fund will have complete priority of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment over the Fund’s Common Shareholders.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Reverse repurchase agreements involve the risks that the interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income earned on the investment of the proceeds will be less than the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest expense and Fund expenses associated with the repurchase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agreement, that the market value of the securities sold by the Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decline below the price at which the Fund is obligated to repurchase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such securities and that the securities may not be returned to the Fund. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There is no assurance that reverse repurchase agreements can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">successfully employed. Dollar roll/buyback transactions involve the risk </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the market value of the securities the Fund is required to purchase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may decline below the agreed upon repurchase price of those securities. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Successful use of dollar rolls/buybacks may depend upon the Investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Manager’s ability to correctly predict interest rates and prepayments. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There is no assurance that dollar rolls/buybacks can be successfully </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">employed. In connection with reverse repurchase agreements and dollar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rolls/buybacks, the Fund will also be subject to counterparty risk with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">respect to the purchaser of the securities. If the broker/dealer to whom </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund sells securities becomes insolvent, the Fund’s right to purchase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or repurchase securities may be restricted.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may engage in total return swaps, reverse repurchases, loans </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of portfolio securities, short sales and when-issued, delayed delivery and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">forward commitment transactions, credit default swaps, basis swaps </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other swap agreements<div style="display:inline;">, purc</div>hases or sales of futures and forward </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contracts (including foreign currency exchange contracts), call and put </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">options or other derivatives. The Fund’s use of such transactions gives </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rise to associated leverage risks described above, and may adversely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the Fund’s income, distributions and total returns to Common </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shareholders. To the extent that any offsetting positions do not behave </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in relation to one another as expected, the Fund may perform as if it is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leveraged through use of these derivative strategies.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Any total return swaps, reverse repurchases, loans of portfolio securities, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">short sales and when-issued, delayed delivery and forward commitment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions, credit default swaps, basis swaps and other swap </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agreements, purchases or sales of futures and forward contracts </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(including foreign currency exchange contracts), call and put options or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other derivatives by the Fund or counterparties to the Fund’s other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leveraging transactions, if any, would have seniority over the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Because the fees received by the Investment Manager may increase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">depending on the types of leverage utilized by the Fund, the Investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Manager has a financial incentive for the Fund to use certain forms of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leverage, which may create a conflict of interest between the Investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Manager, on the one hand, and the Common Shareholders, on the other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">hand. </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent that any Subsidiary of the Fund directly incurs leverage in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the form of debt or preferred shares, the amount of such leverage used </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by the Fund and such Subsidiaries will be consolidated and treated as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">senior securities for purposes of complying with the 1940 Act’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limitations on leverage by the Fund.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Focused Investment Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent that the Fund focuses its investments in a particular sector, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">it may be susceptible to loss due to adverse developments affecting that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sector, including (but not limited to): governmental regulation; inflation; </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rising interest rates; cost increases in raw materials, fuel and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operating expenses; technological innovations that may render existing </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">products and equipment obsolete; competition from new entrants; high </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">research and development costs; increased costs associated with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">compliance with environmental or other governmental regulations; and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other economic, business or political developments specific to that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sector. Furthermore, the Fund may invest a substantial portion of its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets in companies in related sectors that may share common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">characteristics, are often subject to similar business risks and regulatory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">burdens, and whose securities may react similarly to the types of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developments described above, which will subject the Fund to greater </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk. The Fund also will be subject to focused investment risk to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent that it invests a substantial portion of its assets in a particular </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer, market, asset class, country or geographic region.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Equity Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Equity securities represent an ownership interest, or the right to acquire </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">an ownership interest, in an issuer. Equity securities also include, among </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other things, common stocks, preferred securities, convertible stocks and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">warrants. The values of equity securities, such as common stocks and </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">preferred securities, may decline due to general market conditions that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are not specifically related to a particular company, such as real or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perceived adverse economic conditions, changes in the general outlook </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for corporate earnings, changes in inflation, interest or currency rates, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial system instability or adverse investor sentiment generally. They </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may also decline due to factors that affect a particular industry or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">industries, such as regulatory changes, labor shortages or increased </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">production costs and competitive conditions within an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">industry.Conversely, a change in financial condition or other event </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affecting a single issuer or industry may adversely impact securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets as a whole. Equity securities generally have greater price </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatility than most fixed income securities. These risks are generally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">magnified in the case of equity investments in distressed companies.</div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Other Pooled Investment Vehicles Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subject to applicable limits under the 1940 Act, the Fund may invest in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other pooled investment vehicles, including investment companies, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">private funds or other pooled investment vehicles that would qualify as </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">“investment companies” under the 1940 Act but for an applicable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exemption or exclusion, including but not limited to Sections 3(c)(1) or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">3(c)(7) of the 1940 Act (“Private Funds”). When investing in an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment company, the Fund will generally bear its ratable share of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that investment company's expenses and would remain subject to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment of the Fund's investment management fees and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expenses with respect to assets so invested. Common Shareholders </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would therefore be subject to duplicative expenses to the extent the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund invests in other investment companies. In addition, other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment companies may utilize leverage, in which case an investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would subject the Fund to additional risks associated with leverage. Due </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to its own financial interest or other business considerations, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investment Manager may choose to invest a portion of the Fund’s assets </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in investment companies sponsored or managed by the Investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Manager or its related parties in lieu of investments by the Fund directly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in portfolio securities, or may choose to invest in such investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">companies over investment companies sponsored or managed by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">others. Participation in a cash sweep program where the Fund's </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">uninvested cash balance is used to purchase shares of affiliated or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unaffiliated money market funds or cash management pooled </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment vehicles at the end of each day subjects the Fund to the risks </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with the underlying money market funds or cash </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">management pooled investment vehicles, including liquidity risk. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Applicable law may limit the Fund’s ability to invest in other investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">companies.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent the Fund invests through one or more Private Funds, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund would be exposed to the risks associated with such Private Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments. The Fund’s investments in Private Funds would not be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to the protections afforded to shareholders under the 1940 Act. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">These protections include, among others, certain corporate governance </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">standards, such as the requirement of having a certain percentage of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the directors serving on a board as independent directors, statutory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">protections against self-dealing by Private Fund managers, and leverage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limitations. By investing in Private Funds indirectly through the Fund, a </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shareholder would bear two layers of asset-based fees and expenses – </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at the Fund level and the Private Fund level – in addition to indirectly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bearing any performance fees charged by the Private Fund.</div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Derivatives Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may, but is not required to, utilize a variety of derivative </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments (both long and short positions) for investment or risk </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">management purposes. Additionally, the Fund may invest in futures and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other derivatives that provide equity exposures, including for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">equitization and hedging purposes, using derivatives that provide </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exposure that is not identical to the instruments or markets in which the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund seeks to invest 80% of its assets. Derivatives or other similar </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments (referred to collectively as “derivatives”) are financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contracts whose value depends on, or is derived from, the value of an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underlying asset, reference rate or index. For example, the Fund may use </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivative instruments for purposes of increasing liquidity, providing </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">efficient portfolio management, broadening investment opportunities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(including taking short or negative positions), implementing a tax or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cash management strategy, gaining exposure to a particular security or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">segment of the market, modifying the effective duration of the Fund's </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portfolio investments and/or enhancing total return. Investments in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives may take the form of buying and/or writing (selling) </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives, and/or the Fund may otherwise become an obligor under a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives transaction. These transactions may produce short-term </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital gains in the form of premiums or other returns for the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(which may support, constitute and/or increase the distributions paid by, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or the yield of, the Fund) but create the risk of losses that can </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significantly exceed such current income or other returns. For example, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the premium received for writing a call option may be dwarfed by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">losses the Fund may incur if the call option is exercised, and derivative </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions where the Fund is an obligor can produce an up-front </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">benefit, but the potential for leveraged losses. The distributions, or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distribution rates, paid by the Fund should not be viewed as the total </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">returns or overall performance of the Fund. These strategies may also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">produce adverse tax consequences (for example, the Fund’s income and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">gain-generating strategies may generate current income and gains, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including short-term capital gains, taxable as ordinary income) and limit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s opportunity to profit or otherwise benefit from certain gains. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may enter into opposing derivative transactions, or otherwise </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">take opposing positions. Such transactions can generate distributable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">gains (which, as noted elsewhere, may be taxed as ordinary income) and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">create the risk of losses and NAV declines.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may engage in investment strategies, including the use of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives, to, among other things, generate current, distributable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income, even if such strategies could potentially result in declines in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s net asset value. The Fund’s income and gain-generating </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategies, including certain derivatives strategies, may generate current </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income and gains, including short-term capital gains, taxable as </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ordinary income sufficient to support distributions, even in situations </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">when the Fund has experienced a decline in net assets due to, for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">example, adverse changes in the broad U.S. or non-U.S. securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets or the Fund’s portfolio of investments, or arising from its use of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives. Consequently, Fund shareholders may receive distributions </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to tax at ordinary income rates at a time when their investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the Fund has declined in value, which may be economically similar to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a taxable return of capital.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The use of derivatives involves risks different from, and possibly greater </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than, the risks associated with investing directly in securities and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">traditional investments. Derivatives, which may increase market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exposure, are subject to a number of risks, including leverage risk, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity risk (which may be heightened for highly-customized </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives), interest rate risk, market risk, counterparty (including credit) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk, operational risk (such as documentation issues, settlement issues </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and systems failures), legal risk (such as insufficient documentation, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insufficient capacity or authority of a counterparty, and issues with the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">legality or enforceability of a contract), management risk, risks arising </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from changes in applicable regulatory requirements, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">governmental risk, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions risk,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> risks arising from margin requirements and risks arising </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from mispricing or valuation complexity (including the risk of improper </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">valuation), </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as well as the risks associated with the underlying asset, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reference rate or index</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. They also involve the risk that changes in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value of a derivative instrument may not correlate perfectly with the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underlying asset, rate or index. By investing in a derivative instrument, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund could lose more than the initial amount invested, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives may increase the volatility of the Fund, especially in unusual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or extreme market conditions. In addition, the use of derivatives may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cause the Fund’s investment returns to be impacted by the performance </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of assets the Fund does not own, potentially resulting in the Fund’s total </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment exposure exceeding the value of its portfolio. Certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives have the potential for unlimited loss, regardless of the size of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the initial investment. The Fund may utilize asset segregation and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">posting of collateral for risk management or other purposes. The Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be required to hold additional cash or sell other investments in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">order to obtain cash to close out a position and changes in the value of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a derivative may also create margin delivery or settlement payment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations for the Fund. Also, suitable derivative transactions may not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be available in all circumstances and there can be no assurance that the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund will engage in these transactions to reduce exposure to other risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">when that would be beneficial or that, if used, such strategies will be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">successful. The Fund's use of derivatives may increase or accelerate the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">amount of taxes payable by Common Shareholders.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Non-centrally-cleared </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">over</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">-the-counter (“OTC”) derivatives are also </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to the risk that a counterparty to the transaction will not fulfill </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its contractual obligations to the other party, as many of the protections </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">afforded to centrally-cleared derivative transactions might not be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">available for non-centrally-cleared OTC derivatives. The primary credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk on derivatives that are exchange-traded or traded through a central </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">clearing counterparty resides with the Fund's clearing broker, or the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">clearinghouse.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Derivatives that are cleared by a central clearing organization can still </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be subject to different risks, including the creditworthiness of the central </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">clearing organization and its members.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, derivatives that are traded on an exchange are subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the risk that an exchange may limit the maximum daily price fluctuation </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of a derivative contract and restrict or suspend trading of a contract that </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">has reached a limit. Such limit governs only price movements of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contract during a particular trading day and therefore does not limit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potential losses because the limit may work to prevent the liquidation of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unfavorable positions. A daily limit may be reached for several </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consecutive days with little or no trading.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Participation in the markets for derivative instruments involves </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment risks and transaction costs to which the Fund may not be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject absent the use of these strategies. The skills needed to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">successfully execute derivative strategies may be different from those </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">needed for other types of transactions. If the Fund incorrectly forecasts </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the value and/or creditworthiness of securities, currencies, interest rates, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparties or other economic factors involved in a derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transaction, the Fund might have been in a better position if the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">had not entered into such derivative transaction. In evaluating the risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and contractual obligations associated with particular derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments or other similar investments, it is important to consider that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain derivative transactions, absent a default or termination event, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may only be modified or terminated by mutual consent of the Fund and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its counterparty.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">It may not be possible for the Fund to modify, terminate, or offset the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's obligations or the Fund's exposure to the risks associated with a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivative transaction prior to its scheduled termination or maturity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">date, which may create a possibility of increased volatility and/or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decreased liquidity to the Fund.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Because the markets for certain derivative instruments (including </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets located in foreign countries) are relatively new and still </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developing, appropriate derivative transactions may not be available in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">all circumstances for risk management or other purposes. Upon the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expiration of a particular contract, the Fund may wish to retain the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s position in the derivative instrument by entering into a similar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contract but may be unable to do so if the counterparty to the original </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contract is unwilling to enter into the new contract and no other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">appropriate counterparty can be found. When such markets are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unavailable, the Fund will be subject to increased liquidity and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment risk.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may enter into opposite sides of interest rate swap and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives for the principal purpose of generating distributable gains on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the one side (characterized as ordinary income for tax purposes) that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are not part of the Fund’s duration or yield curve management </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategies (“paired swap transactions”), and with a substantial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">possibility that the Fund will experience a corresponding capital loss </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and decline in NAV with respect to the opposite side transaction (to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent it does not have corresponding offsetting capital gains). </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Consequently, Common Shareholders may receive distributions and owe </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tax on amounts that are effectively a taxable return of the shareholder’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment in the Fund, at a time when their investment in the Fund has </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">declined in value, which tax may be at ordinary income rates. In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, the Fund’s use of derivatives may cause the Fund to realize </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">higher amounts of short-term capital gains (generally taxed at ordinary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income tax rates), potentially subjecting shareholders of the Fund to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adverse tax consequences. The tax treatment of certain derivatives in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which the Fund invests may be unclear <div style="display:inline;">and </div>thus subject to </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recharacterization. Any recharacterization of payments made or received </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by the Fund pursuant to derivatives potentially could affect the amount, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">timing or character of Fund distributions. In addition, the tax treatment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of such investment strategies may be changed by regulation or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">When a derivative is used as a hedge against a position that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund holds, any loss generated by the derivative generally should be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">substantially offset by gains on the hedged investment, and vice versa.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">More generally, sales of the Fund’s portfolio holdings may result in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">short-term capital gains (which are generally taxed to shareholders at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ordinary income tax rates when distributed net of short-term capital </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">losses and net of long-term capital losses), potentially subjecting </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shareholders of the Fund to adverse tax consequences.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Although hedging can reduce or eliminate losses, it can also reduce or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">eliminate gains. Hedges are sometimes subject to imperfect matching </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">between the derivative and the underlying instrument, and there can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">no assurance that the Fund's hedging transactions will be effective. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Derivatives used for hedging or risk management may not operate as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intended or may expose the Fund to additional risks. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives used for hedging may partially protect the Fund from the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks they were intended to hedge yet not fully mitigate the impact of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such risks. The regulation of the derivatives markets has increased over </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time, and additional future regulation of the derivatives markets may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">make derivatives more costly, may limit the availability or reduce the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity of derivatives, or may otherwise adversely affect the value or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance of derivatives. Any such adverse future developments could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impair the effectiveness or raise the costs of the Fund’s derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions, impede the employment of the Fund’s derivatives </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategies, or adversely affect the Fund’s performance and cause the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund to lose value.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Credit Default Swaps Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Credit default swap agreements may involve greater risks than if the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund had invested in the reference obligation directly since, in addition </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to general market risks, credit default swaps are subject to leverage risk, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">illiquidity risk, counterparty risk and credit risk. A buyer generally also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will lose its investment and recover nothing should no credit event occur </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and the swap is held to its termination date. If a credit event were to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">occur, the value of any deliverable obligation received by the seller (if </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any), coupled with the upfront or periodic payments previously received, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be less than the full notional value it pays to the buyer, resulting in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a loss of value to the seller. When the Fund acts as a seller of a credit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default swap, it is exposed to many of the same risks of leverage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">described herein. As the seller, the Fund would receive a stream of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments over the term of the swap agreement provided that no event </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of default has occurred with respect to the referenced debt obligation </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">upon which the swap is based. The Fund would effectively add leverage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to its portfolio because, if a default occurs, the stream of payments may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">stop and, in addition to its total net assets, the Fund would be subject to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment exposure on the notional amount of the swap.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Although the Fund may seek to realize gains by selling credit default </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">swaps that increase in value, to realize gains on selling credit default </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">swaps, an active secondary market for such instruments must exist or </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund must otherwise be able to close out these transactions at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">advantageous times. In addition to the risk of losses described above, if </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">no such secondary market exists or the Fund is otherwise unable to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">close out these transactions at advantageous times, selling credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default swaps may not be profitable for the Fund.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The market for credit default swaps has become more volatile as the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">creditworthiness of certain counterparties has been questioned and/or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">downgraded. The Fund will be subject to credit risk with respect to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparties to the credit default swap contract (whether a clearing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">corporation or another third party). If a counterparty’s credit becomes </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significantly impaired, multiple requests for collateral posting in a short </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">period of time could increase the risk that the Fund may not receive </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adequate collateral. The Fund may exit its obligations under a credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default swap only by terminating the contract and paying applicable </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">breakage fees, or by entering into an offsetting credit default swap </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">position, which may cause the Fund to incur more losses.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obtain no or limited recovery in a bankruptcy or other reorganizational </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceedings, and any recovery may be significantly delayed.</div></div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Structured Investments Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Holders of structured products, including structured notes, credit-linked </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">notes and other types of structured products, bear the risks of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underlying investments, index or reference obligation and are subject to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparty risk. The Fund may have the right to receive payments only </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from the structured product, and generally does not have direct rights </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">against the issuer or the entity that sold the assets to be securitized. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">While certain structured products enable the investor to acquire </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interests in a pool of securities without the brokerage and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expenses associated with directly holding the same securities, investors </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in structured products generally pay their share of the structured </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">product’s administrative and other expenses. Although it is difficult to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">predict whether the prices of indexes and securities underlying </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">structured products will rise or fall, these prices (and, therefore, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prices of structured products) are generally influenced by the same types </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of political and economic events that affect issuers of securities and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital markets generally. If the issuer of a structured product uses </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shorter term financing to purchase longer term securities, the issuer may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be forced to sell its securities at below market prices if it experiences </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficulty in obtaining such financing, which may adversely affect the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value of the structured products owned by the Fund. Structured </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">products generally entail risks associated with derivative instruments.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Counterparty Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund will be subject to credit risk with respect to the counterparties </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the derivative contracts and other instruments entered into by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund or held by special purpose or structured vehicles in which the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invests. For example, if a bank at which the Fund or issuer has an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">account fails, any cash or other assets in bank or custody accounts, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may be substantial in size, could be temporarily inaccessible or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">permanently lost by the Fund or issuer. In the event that the Fund enters </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">into a derivative transaction with a counterparty that subsequently </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">becomes insolvent or becomes the subject of a bankruptcy case, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivative transaction may be terminated in accordance with its terms </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and the Fund’s ability to realize its rights under the derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instrument and its ability to distribute the proceeds could be adversely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affected. If a counterparty becomes bankrupt or otherwise fails to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perform its obligations under a derivative contract due to financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficulties, the Fund may experience significant delays in obtaining any </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recovery (including recovery of any collateral it has provided to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparty) in a dissolution, assignment for the benefit of creditors, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidation, winding-up, bankruptcy</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> or other analogous proceeding. In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, in the event of the insolvency of a counterparty to a derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transaction, the derivative transaction would typically be terminated at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its fair market value. If the Fund is owed this fair market value in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">termination of the derivative transaction and its claim is unsecured, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund will be treated as a general creditor of such counterparty</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and will </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not have any claim with respect to any underlying security or asset. The </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund may obtain only a limited recovery or may obtain no recovery in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such circumstances. Counterparty credit risk also includes the related </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk of having concentrated exposure to a single counterparty, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may increase potential losses if the counterparty were to become </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insolvent. While the Fund may seek to manage its counterparty risk by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transacting with a number of counterparties, concerns about the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">solvency of, or a default by, one large market participant could lead to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant impairment of liquidity and other adverse consequences for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other counterparties.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Confidential Information Access Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In managing the Fund (and other PIMCO clients), PIMCO may from time </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to time have the opportunity to receive material, non-public information </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(“Confidential Information”) about the issuers of certain investments, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including, without limitation, senior floating rate loans, other loans and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">related investments being considered for acquisition by the Fund or held </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the Fund’s portfolio. For example, an issuer of privately placed loans </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">considered by the Fund may offer to provide PIMCO with financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information and related documentation regarding the issuer that is not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">publicly available. Pursuant to applicable policies and procedures, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO may (but is not required to) seek to avoid receipt of Confidential </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Information </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">about such issuers</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> so as to avoid possible restrictions on its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to purchase and sell investments on behalf of the Fund and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">clients to which such Confidential Information relates. In such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">circumstances, the Fund (and other PIMCO clients) may be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disadvantaged in comparison to other investors, including with respect </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the price the Fund pays or receives when it buys or sells an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment. Further, PIMCO’s and the Fund’s abilities to assess the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">desirability of proposed consents, waivers or amendments with respect </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to certain investments may be compromised if they are not privy to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">available Confidential Information. PIMCO may also determine to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">receive such Confidential Information in certain circumstances under its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">applicable policies and procedures. If PIMCO intentionally or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unintentionally comes into possession of Confidential Information, it </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be unable, potentially for a substantial period of time, to purchase </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or sell investments to which such Confidential Information relates.</span></span></div></div><div style="line-height:12.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Private Placements Risk</span></span></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">A private placement involves the sale of securities that have not been </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registered under the Securities Act, or relevant provisions of applicable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-U.S. law, to certain institutional and qualified individual purchasers, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such as the Fund. In addition to the general risks to which all securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are subject, securities received in a private placement generally are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to strict restrictions on resale, and there may be no liquid </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">secondary market or ready purchaser for such securities. See “Principal </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Risks of the Fund—Liquidity Risk.” Therefore, the Fund may be unable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to dispose of such securities when it desires to do so, or at the most </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">favorable time or price. Private placements may also raise valuation </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks. See “Principal Risks of the Fund—Valuation Risk.” The Fund may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">also have to bear the expense of registering the securities for resale and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the risk of substantial delays in effecting the registration. Additionally, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the purchase price and subsequent valuation of private placements </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">typically reflect a discount, which may be significant, from the market </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">price of comparable securities for which a more liquid market exists.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Inflation/Deflation Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Inflation risk is the risk that the value of assets or income from the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s investments will be worth less in the future as inflation decreases </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the value of payments at future dates. As inflation increases, the real </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value of the Fund’s portfolio could decline. Inflation rates may change </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">frequently and significantly as a result of various factors, including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unexpected shifts in the domestic or global economy or changes in fiscal </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or monetary policies </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(or the expectation of such changes)</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. Deflation risk </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is the risk that prices throughout the economy decline over time. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Deflation may have an adverse effect on the creditworthiness of issuers </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and may make issuer default more likely, which may result in a decline </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the value of the Fund’s portfolio and Common Shares.</span></span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Insurance-Linked and Other Instruments Risk</span></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in insurance-linked instruments and similar </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments (which may include, for example, exposure to reinsurance </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contracts (through sidecars or otherwise), event-linked bonds, such as </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">catastrophe and resilience bonds, and securities relating to life </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insurance policies, annuity contracts and premium finance loans). The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund could lose a portion or all of the principal it has invested in these </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">types of investments, and the right to additional interest and/or dividend </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments with respect to the investments, upon the occurrence of one </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or more trigger events, as defined within the terms of an investment. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Trigger events may include natural or other perils of a specific size or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">magnitude that occur in a designated geographic region during a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">specified time period, and/or that involve losses or other metrics that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exceed a specific amount. The Fund may also invest in insurance-linked </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments that are subject to “indemnity triggers.” An indemnity </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trigger is a mechanism where the payout to the investor is based on the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">actual losses incurred by the insurer and come into play when losses </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from a specified event exceed a designated level. Insurance-linked </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments subject to indemnity triggers are often regarded as being </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to potential moral hazard, since such insurance-linked </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments are triggered by actual losses of the ceding sponsor and the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ceding sponsor may have an incentive to take actions and/or risks that </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would have an adverse effect on the Fund. There is no way to accurately </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">predict whether a trigger event will occur and, accordingly, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insurance-linked instruments and similar investments carry significant </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk. In addition to the specified trigger events, these types of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments may expose the Fund to other risks, including but not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limited to issuer (credit) default, adverse regulatory or jurisdictional </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interpretations and adverse tax consequences.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may also gain exposure to reinsurance contracts (through </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insurance-linked securities, sidecars or otherwise). This exposure may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">include “excess of loss” contracts, wherein liability arises only if and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">when losses exceed a specified amount, and proportional reinsurance, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">wherein a pro rata portion of the premiums and liabilities of the cedant </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with a specified business or a portfolio of insurance contracts </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are linked to the investment. Investments linked to reinsurance </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions may involve significant insurance brokerage fees, fronting </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fees and other transaction costs.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">A series of major triggering events could cause the failure of a reinsurer. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Similarly, to the extent the Fund invests in reinsurance-related securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for which a triggering event occurs, losses associated with such event </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will result in losses to the Fund and a series of major triggering events </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affecting a large portion of the reinsurance-related securities held by the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund may result in substantial losses to the Fund. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unexpected events such as natural disasters or terrorist attacks could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lead to government intervention. Political, judicial and legal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developments affecting the reinsurance industry could also create new </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and expanded theories of liability or regulatory or other requirements; </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such changes could have a material adverse effect on a Fund. In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, the litigation environment in catastrophe-exposed states or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regions could impact the frequency and severity of insurance claims, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">litigation costs could decrease the value of a Fund’s investment in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">products linked to reinsurance contracts. In recent years, capital market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participants have been increasingly active in the reinsurance market and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets for related risks. Increased competition could result in fewer </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">submissions, lower premium rates and less favorable policy terms and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain insurance-linked instruments and similar investments may have </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limited liquidity, or may be illiquid. The Fund has limited transparency </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">into the individual contracts underlying certain insurance-linked </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments and similar investments, which may make the risk </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assessment of them more difficult. These types of investments may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficult to value.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The aforementioned instruments may include longevity and mortality </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments, including indirect investment in pools of insurance-related </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">longevity and mortality investments, including life insurance policies, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">annuity contracts and premium finance loans. Such investments are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to “longevity risk” and/or “mortality risk.” Longevity risk is the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk that members of a reference population will live longer, on average, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than anticipated. Mortality risk is the risk that members of a reference </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">population will live shorter, on average, than anticipated. Changes in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these rates can significantly affect the liabilities and cash needs of life </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insurers, annuity providers and pension funds. The terms of a longevity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bond typically provide that the investor in the bond will receive less than </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the bond’s par amount at maturity if the actual average longevity (life </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">span) of a specified population of people observed over a specified </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">period of time (typically measured by a longevity index) is higher than a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">specified level. If longevity is higher than expected, the bond will return </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">less than its par amount at maturity. A mortality bond, in contrast to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">longevity bond, typically provides that the investor in the bond will </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">receive less than the bond’s par amount at maturity if the mortality rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of a specified population of people observed over a specified period of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time (typically measured by a mortality index) is higher than a specified </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">level.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">During their term, both longevity bonds and mortality bonds typically </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pay a floating rate of interest to investors. Longevity and mortality </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments purchased by the Fund involve the risk of incorrectly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">predicting the actual level of longevity or mortality, as applicable, for the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reference population of people. With respect to mortality investments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">held by the Fund, there is also the risk that an epidemic or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">catastrophic event could strike the reference population, resulting in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortality rates exceeding expectations. The Fund may also gain this type </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of exposure through event-linked derivative instruments, such as swaps, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that are contingent on or formulaically related to longevity or mortality </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Regulatory Changes Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Financial entities, such as investment companies and investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">advisers, are generally subject to extensive government regulation and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intervention. Government regulation and/or intervention may change </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the way the Fund is regulated, affect the expenses incurred directly by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund and the value of its investments, and limit and /or preclude the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s ability to achieve its investment objective. Government </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulation may change frequently and may have significant adverse </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consequences. The Fund and the Investment Manager have historically </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">been eligible for exemptions from certain regulations. However, there is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">no assurance that the Fund and the Investment Manager will continue </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to be eligible for such exemptions.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Moreover, government regulation may have unpredictable and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unintended effects. Legislative or regulatory actions to address </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perceived liquidity or other issues in fixed income markets generally, or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in particular markets such as the municipal securities market, may alter </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or impair the Fund’s ability to pursue its investment objective or utilize </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain investment strategies and techniques.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">While there continues to be uncertainty about the full impact of these </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other regulatory changes, it is the case that the Fund will be subject </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to a more complex regulatory framework, and may incur additional </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">costs to comply with new requirements as well as to monitor for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">compliance in the future. Actions by governmental entities may also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impact certain instruments in which the Fund invests and reduce market </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity and resiliency.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Recent policy initiatives undertaken by the U.S. government have the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potential to impact international relations, trade agreements, and the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">overall regulatory environment in ways that could create uncertainty </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and instability in domestic and global markets, and could adversely </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the investment performance of the Fund. In particular, actions </span></span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taken by the U.S. government in respect of international trade relations </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could lead to trade wars, increased costs for imported goods, disruptions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in supply chains, reduced foreign investment, and instability in regions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">where the Fund invests.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Tax Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund has elected to be treated as a RIC under Subchapter M of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Code and intends each year to qualify and be eligible to be treated as </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such, so that it generally will not be subject to U.S. federal income tax </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on its net investment income or net short-term or long-term capital </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">gains that are timely distributed (or deemed distributed, as described </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">below) to shareholders. In order to qualify and be eligible for such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">treatment, the Fund must meet certain asset diversification tests, derive </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at least 90% of its gross income for such year from certain types of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">qualifying income, and distribute to its shareholders at least 90% of its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">“investment company taxable income” as that term is defined in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Code (which includes, among other things, dividends, taxable interest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and the excess of any net short-term capital gains over net long-term </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital losses, as reduced by certain deductible expenses) and net </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tax-exempt income, for such year.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investment strategy will potentially be limited by its intention </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to qualify for treatment as a RIC and can limit the Fund’s ability to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">qualify as such. The tax treatment of certain of the Fund’s investments </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under one or more of the qualification or distribution tests applicable to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">RICs is uncertain. An adverse determination or future guidance by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">IRS or a change in law might affect the Fund's ability to qualify or be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">eligible for treatment as a RIC. Income and gains from certain of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's activities may not constitute qualifying income to a RIC for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purposes of the 90% gross income test. If the Fund’s income or gain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from a particular investment or activity were determined to constitute </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">nonqualifying income, which in certain cases may be determined </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">retroactively, and the Fund's nonqualifying income from all sources </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">were to exceed 10% of its gross income in any taxable year, the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would fail to qualify as a RIC unless it were eligible to and did pay a tax </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at the Fund level. See “Taxation” in the Statement of Additional </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Information for additional details.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">If, in any year, the Fund were to fail to qualify for treatment as a RIC </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under the Code and were ineligible to or did not otherwise cure such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">failure, the Fund would be subject to tax on its taxable income at </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">corporate rates and, when such income is distributed, shareholders </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would be subject to further tax on such distributions to the extent of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's current or accumulated earnings and profits.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent the Fund invests through one or more subsidiaries, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund may be required to include in gross income for U.S. federal income </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tax purposes all of the subsidiary’s income, whether or not such income </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is distributed by the subsidiary, and the Fund may generally have to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">treat such income as ordinary income, regardless of the character of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subsidiary’s underlying income or gains. If a net loss is realized by a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subsidiary, such loss is not generally available to offset the income </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">earned by the Fund, and such loss cannot be carried forward to offset </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taxable income of the Fund or the subsidiary in future periods.</span></div></div><div style="line-height:12.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Potential Conflicts of Interest Risk—Allocation of Investment </span></span><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Opportunities</span></span></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Investment Manager and its affiliates are involved worldwide with a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">broad spectrum of financial services and asset management activities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and may engage in the ordinary course of business in activities in which </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">their interests or the interests of their clients may conflict with those of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund. The Investment Manager may provide investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">management services to other funds and discretionary managed </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accounts that follow an investment program similar to that of the Fund. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subject to the requirements of the 1940 Act, the Investment Manager </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intends to engage in such activities and may receive compensation from </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">third parties for its services. The results of the Fund’s investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">activities may differ from those of the Fund’s affiliates, or another </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">account managed by the Investment Manager or its affiliates, and it is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">possible that the Fund could sustain losses during periods in which one </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or more of the Fund’s affiliates and/or other accounts managed by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investment Manager or its affiliates, including proprietary accounts, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">achieve profits on their trading.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Repurchase Agreements Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may enter into repurchase agreements, in which the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchases a security from a bank or broker-dealer, which agrees to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase the security at the Fund’s cost plus interest within a specified </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time. Entering into repurchase agreements allows the Fund to earn a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">return on cash in the Fund's portfolio that would otherwise remain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">un-invested. Repurchase agreements may involve risks in the event of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default or insolvency of the counterparty, including possible delays or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions upon the Fund's ability to sell the underlying securities and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">additional expenses in seeking to enforce the Fund's rights and recover </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any losses. Although the Fund seeks to limit the credit risk under a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase agreement by carefully selecting counterparties and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accepting only high quality collateral, some credit risk remains. The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparty could default which may make it necessary for the Fund to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incur expenses to liquidate the collateral. The security subject to a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase agreement may be or become illiquid. These events could </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">also trigger adverse tax consequences for the Fund.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In December 2023, the U.S. Securities and Exchange Commission </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adopted rule amendments that are expected to result in the Fund being </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">required to clear all or substantially all of its repurchase agreements </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateralized by U.S. Treasury securities as of June 30, 2027 where a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">direct participant in any covered clearing agency is the counterparty. The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund may incur costs in connection with entering into new agreements </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(or amending existing agreements) with counterparties who are direct </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participants of a covered clearing agency and potentially other market </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participants and taking other actions to comply with the new </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">requirements. In addition, upon the compliance date, the costs and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">benefits of entering into repurchase agreements collateralized by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Treasury securities to the Fund may be impacted as compared to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such repurchase agreements prior to the compliance date.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div> <div style="line-height:12.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Distribution Rate Risk</span></span></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s distribution rate may be affected by numerous factors, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including but not limited to changes in realized and projected market </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">returns, fluctuations in market interest rates, Fund performance, and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other factors. There can be no assurance that a change in market </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions or other factors will not result in a change in the Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distribution rate or that the rate will be sustainable in the future. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Additionally, the distribution rate is not indicative of the Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance and may not correlate with the actual returns generated by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s investments.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">For instance, during periods of low or declining interest rates, the Fund's </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distributable income and dividend levels may decline for many reasons. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">For example, the Fund may have to deploy uninvested assets (whether </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds from matured, traded or called debt obligations or other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sources) in new, lower yielding instruments. Additionally, payments from </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain instruments that may be held by the Fund (such as variable and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">floating rate securities) may be negatively impacted by declining interest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rates, which may also lead to a decline in the Fund’s distributable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income and dividend levels. The distribution rate is not indicative of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's performance and may not correlate with the actual returns </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generated by the Fund's investments.</span></span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Zero-Coupon Bonds, Step-Ups and Payment-In-Kind Securities </span></span><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The market prices of zero-coupon, step-ups and payment-in-kind </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities are generally more volatile than the prices of securities that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pay interest periodically and in cash, and are likely to respond to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes in interest rates to a greater degree than other types of debt </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities with similar maturities and credit quality. Because </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">zero-coupon securities bear no interest, their prices are especially </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatile and, because zero-coupon bondholders do not receive interest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments, the prices of zero-coupon securities generally fall more </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dramatically </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">when interest rates rise </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than those of bonds that pay </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest on a current basis</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Zero coupon bonds, step-ups and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment-in-</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">kind securities allow an issuer to avoid or delay the need to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generate cash to meet current interest payments and, as a result, may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">involve greater credit risk than bonds that pay interest currently or in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cash</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. The market for zero-coupon and payment-in-kind securities may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">suffer decreased liquidity. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Payment-in-kind securities may present </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">challenging fair valuation considerations because the accruals require </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">judgments about the collectability of deferred payments and the value </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of any associated collateral. Further, even if the conditions for income </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accrual under U.S.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> GAAP are satisfied, a borrower could default when </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">actual payment is due upon maturity.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> In addition, as these securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not pay cash interest, the Fund’s investment exposure to these </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities and their risks, including credit risk, will increase during the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time these securities are held in the Fund’s portfolio. Further, to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">maintain its qualification for treatment as a RIC and to avoid Fund-level </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. federal income and/or excise taxes, the Fund is required to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distribute to its shareholders any income it is deemed to have received </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with respect to</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> such investments, notwithstanding that cash has not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">been received currently, and the value of paid-in-kind interest. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Consequently, the Fund may have to dispose of portfolio securities </span></span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under disadvantageous circumstances to generate the cash, or may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have to leverage itself by borrowing the cash to satisfy this distribution </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">requirement. The required distributions, if any, would result in an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase in the Fund’s exposure to these securities.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Risk Retention Investment Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in risk retention tranches of CMBS or other eligible </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securitizations, if any (“risk retention tranches”), which are eligible </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">residual interests typically held by the sponsors of such securitizations </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pursuant to the final rules implementing the credit risk retention </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">requirements of Section 941 of the Dodd-Frank Act (the “U.S. Risk </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Retention Rules”). In the case of CMBS transactions, for example, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Risk Retention Rules permit all or a portion of the retained credit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk associated with certain securitizations (i.e., retained risk) to be held </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by an unaffiliated “third party purchaser,” such as the Fund, if, among </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other requirements, the third-party purchaser holds its retained interest, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unhedged, for at least five years following the closing of the CMBS </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transaction, after which it is entitled to transfer its interest in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securitization to another person that meets the requirements for a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">third-party purchaser. Even after the required holding period has </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expired, due to the generally illiquid nature of such investments, no </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assurance can be given as to what, if any, exit strategies will ultimately </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be available for any given position.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, there is limited guidance on the application of the final </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Risk Retention Rules to specific securitization structures. There can </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be no assurance that the applicable federal agencies charged with the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">implementation of the final U.S. Risk Retention Rules (the Federal </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Deposit Insurance Corporation, the Comptroller of the Currency, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Federal Reserve Board, the SEC, the Department of Housing and Urban </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Development, and the Federal Housing Finance Agency) could not take </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">positions in the future that differ from the interpretation of such rules </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taken or embodied in such securitizations, or that the final U.S. Risk </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Retention Rules will not change.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Furthermore, in situations where the Fund invests in risk retention </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tranches of securitizations structured by third parties, the Fund may be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">required to execute one or more letters or other agreements, the exact </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">form and nature of which will vary (each, a “Risk Retention </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Agreement”) under which it will make certain undertakings designed to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ensure such securitization complies with the final U.S. Risk Retention </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Rules. Such Risk Retention Agreements may include a variety of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">representations, warranties, covenants and other indemnities, each of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may run to various transaction parties. If the Fund breaches any </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">undertakings in any Risk Retention Agreement, it will be exposed to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">claims by the other parties thereto, including for any losses incurred as a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result of such breach , which could be significant and exceed the value </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the Fund's investments.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Subsidiary Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent the Fund invests through one or more of its Subsidiaries, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund would be exposed to the risks associated with such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subsidiary’s investments. Such Subsidiaries would likely not be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registered as investment companies under the 1940 Act and therefore </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would not be subject to all of the investor protections of the 1940 Act. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Changes in the laws of the United States and/or the jurisdiction in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which a Subsidiary is organized could result in the inability of the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or the Subsidiary to operate as intended and could adversely affect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund.</div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Portfolio Turnover Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Investment Manager manages the Fund without regard generally to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions on portfolio turnover. The use of futures contracts and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivative instruments with relatively short maturities may tend to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exaggerate the portfolio turnover rate for the Fund. Trading in fixed </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income securities does not generally involve the payment of brokerage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">commissions, but does involve indirect transaction costs. The use of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">futures contracts and other derivative instruments may involve the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment of commissions to futures commission merchants or other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intermediaries. Higher portfolio turnover involves correspondingly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">greater expenses to the Fund, including brokerage commissions or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dealer mark-ups and other transaction costs on the sale of securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and reinvestments in other securities</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, which directly reduce net returns </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to investors</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. The higher the rate of portfolio turnover of the Fund, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">higher these transaction costs borne by the Fund generally will be. Such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sales may result in realization of taxable capital gains (including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">short-term capital gains, which are generally taxed to shareholders </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">holding shares in taxable accounts </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at ordinary income tax rates when </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distributed net of short-term capital losses and net long-term capital </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">losses), and may adversely impact the Fund’s after-tax returns. The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">realization of short-term capital gains may also cause adverse tax </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consequences for the Fund’s shareholders. See “Tax Matters.”</span></span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Operational Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">An investment in the Fund, like any fund, can involve operational </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">technology </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks arising from factors such as processing errors, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">communication errors,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> human errors, inadequate or failed internal or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">external processes, failures in systems and technology, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cybersecurity </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incidents, the potential use of artificial intelligence and machine </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">learning,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> changes in personnel and errors caused by third-party service </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">providers. The occurrence of any of these failures, errors or breaches </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could result in a loss of information, regulatory scrutiny, reputational </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">damage or other events, any of which could have a material adverse </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">effect on the Fund. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Operational and technology risks for the issuers </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could also result in material adverse consequences for such issuers and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may cause the Fund's investments in such issuers to lose value.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> While </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund seeks to minimize such events through controls and oversight, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">there may still be failures that could cause losses to the Fund.</span></span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Market Disruptions Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund is subject to investment and operational risks associated with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial, economic and other global market developments and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disruptions, including those <span style="display:inline;">arising </span>from war, military conflicts, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geopolitical disputes, terrorism, social or political unrest, recessions, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">supply chain disruptions, tariffs and other restrictions on trade, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions, market manipulation, government interventions, defaults and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shutdowns, political changes or diplomatic developments, public health </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">emergencies (such as the spread of infectious diseases, pandemics and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">epidemics), bank failures, natural/environmental disasters, climate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">change and climate related events, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">responses to government actions or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interventions (the threat or imposition of tariffs, trade restrictions, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency restrictions, or similar actions),</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> which can all negatively impact </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the securities markets, interest rates, auctions, secondary trading, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ratings, credit risk, inflation, deflation and other factors relating to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s investments or the Investment Manager’s operations and the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value of an investment in the Fund, its distributions and its returns. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">These events can also impair the technology and other operational </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systems upon which the Fund’s service providers, including PIMCO as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s investment adviser, rely, and could otherwise disrupt the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s service providers’ ability to fulfill their obligations to the Fund. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Furthermore, events involving limited liquidity, defaults, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-performance or other adverse developments that affect financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">institutions or the financial services industry generally, or concerns or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rumors about any events of these kinds or other similar risks, have in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">past and may in the future lead to market-wide liquidity problems.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Geopolitical Conflicts Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The occurrence of geopolitical conflicts, war or terrorist activities could </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have adverse impacts on markets in various and unpredictable ways. For </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">example, the armed conflict among the United States, Israel, and Iran </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">has caused, and could continue to cause, significant market disruptions </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and volatility. The conflict has had a particular negative impact on oil </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and gas markets, which could have a broader adverse effect on many </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sectors of the global economy in the future. In addition, following </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Russia's large-scale invasion of Ukraine in February 2022, Russia, and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other countries, persons and entities that were viewed as having </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provided material aid to Russia's aggression against Ukraine, became </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the subject of economic sanctions and import and export controls </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">imposed by countries throughout the world, including the United States. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Such measures have had and may continue to have an adverse effect on </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Russian, Belarusian and other securities and economies. Additional </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">examples include, but are not limited to, heightened concerns of trade </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disputes, which could result in increased tariffs, trade restrictions or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other retaliatory countermeasures. The extent, duration and impact of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geopolitical conflicts and related market impacts are difficult to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ascertain, but could be significant and could have significant adverse </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">effects on regional and global economies and the markets for certain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities and commodities, such as oil, natural gas, steel and aluminum, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as well as other sectors, and on the Fund’s investments.</span></span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Cyber Security Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">As the use of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">complex information technology and communication </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systems</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, including cloud-based technology, has become more prevalent </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and interconnected in the course of business, the Fund is potentially </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more susceptible to operational and information security risks resulting </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from breaches in cyber security, including: processing and human errors, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">inadequate or failed internal or external processes, failures in system </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and technology, errors in algorithms used with respect to Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operations and changes in personnel. A breach in cyber security refers to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">both intentional and unintentional cyber events from outside threat </span></span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">actors or internal resources that may, among other things, cause the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund to lose proprietary information, suffer data corruption and/or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">destruction, lose operational capacity, result in the unauthorized release </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or other misuse of confidential information, or otherwise disrupt normal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">business operations. Geopolitical tensions can increase the scale and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sophistication of deliberate cybersecurity attacks, particularly those from </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">nation-states or from entities with nation-state backing, who may desire </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to use cybersecurity attacks to cause damage or create leverage against </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geopolitical rivals. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The increasing use of artificial intelligence, machine </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">learning, and automated algorithmic systems — both by the Fund and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its service providers and by malicious actors — introduces additional </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cybersecurity vulnerabilities, including the risk that AI systems may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exploited, manipulated, or produce unintended outputs that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">compromise the security or integrity of Fund operations or data.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Cyber </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security breaches may involve unauthorized access to the Fund’s digital </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information systems (e.g., through “hacking” or malicious software </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">coding), and may come from multiple sources, including outside attacks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such as denial-of-service attacks (i.e., efforts to make network services </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unavailable to intended users) or cyber extortion, including exfiltration </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of data held for ransom and/or “ransomware” attacks that renders </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systems inoperable until the ransom is paid, or insider actions (e.g., </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intentionally or unintentionally harmful acts of PIMCO personnel). In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, cyber security breaches involving the Fund’s third party service </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">providers (including but not limited to advisers, sub-advisers, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">administrators, transfer agents, custodians, vendors, suppliers, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distributors and other third parties), trading counterparties or issuers in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which the Fund invests can also subject the Fund to many of the same </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks associated with direct cyber security breaches or extortion of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">company data. PIMCO’s use of cloud-based service providers could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">heighten or change these risks. In addition, work-from-home </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arrangements by the Fund, the Investment Manager or their service </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">providers could increase all of the above risks, create additional data </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and information accessibility concerns, and make the Fund, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investment Manager or their service providers susceptible to operational </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disruptions, any of which could adversely impact their operations.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Cyber security failures or breaches may result in financial losses to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund and its shareholders. For example, cyber security failures or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">breaches involving trading counterparties or issuers in which the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invests could adversely impact such counterparties or issuers and cause </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s investment to lose value. These failures or breaches may also </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result in disruptions to business operations, potentially resulting in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial losses; interference with the Fund’s ability to calculate its NAV, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">process shareholder transactions or otherwise transact business with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shareholders; impediments to trading; violations of applicable privacy </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other laws; regulatory fines; penalties; third-party claims in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">litigation; reputational damage; reimbursement or other compensation </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">costs; additional compliance and cyber security risk management costs </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other adverse consequences. In addition, substantial costs may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incurred in order to prevent any cyber incidents in the future.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Like with operational risk in general, the Fund has established business </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">continuity plans and risk management systems designed to reduce the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks associated with cyber security. However, there are inherent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limitations in these plans and systems, including that certain risks may </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not have been identified, in large part because different or unknown </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">threats may emerge in the future. As such, there is no guarantee that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such efforts will succeed, e<div style="display:inline;">sp</div>ecially because the Fund does not directly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">control the cyber security systems of issuers in which the Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invest, trading counterparties or third-party service providers to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund. Such entities have experienced cyber attacks and other attempts </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to gain unauthorized access to systems from time to time, and there is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">no guarantee that efforts to prevent or mitigate the effects of such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">attacks or other attempts to gain unauthorized access will be successful. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There is also a risk that cyber security breaches may not be detected. The </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund and its shareholders may suffer losses as a result of a cyber </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security breach related to the Fund, its service providers, trading </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparties or the issuers in which the Fund invests.</div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Non-Diversification Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund is “non-diversified,” which means that the Fund may invest a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant portion of its assets in the securities of a smaller number of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers than a diversified fund. Focusing investments in a small number </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of issuers increases risk. A fund that invests in a relatively smaller </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">number of issuers is more susceptible to risks associated with a single </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economic, political or regulatory occurrence than a diversified fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">might be. Some of those issuers also may present substantial credit or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other risks. Similarly, the Fund may be subject to increased economic, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">business or political risk to the extent that it invests a substantial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portion of its assets in a particular currency, in a group of related </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">industries, in a particular issuer, in the bonds of similar projects or in a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">narrowly defined geographic area outside the U.S. Notwithstanding the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s status as a “non-diversified” investment company under the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">1940 Act, the Fund intends to qualify as a regulated investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">company accorded special tax treatment under the Code, which </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">imposes its own diversification requirements.</span></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Short Exposure Risk</span></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s short sales </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> short positions, if any, are subject to special </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks. A short sale involves the sale by the Fund of a security that it does </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not own with the hope of purchasing the same security at a later date at </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a lower price. The Fund may also enter into a short position through a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">forward commitment or a short derivative position through a futures </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contract or swap agreement. If the price of the security or derivative has </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increased during this time, then the Fund will incur a loss equal to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase in price from the time that the short sale was entered into plus </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any transaction costs (i.e., premiums and interest) paid to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">broker-dealer to borrow securities. Therefore, short sales involve the risk </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that losses may be exaggerated, potentially losing more money than the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">actual cost of the investment. By contrast, a loss on a long position </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arises from decreases in the value of the security and is limited by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fact that a security’s value cannot decrease below zero. By investing the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds received from selling securities short, the Fund could be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deemed to be employing a form of leverage, which creates special risks. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The use of leverage may increase the Fund’s exposure to long security </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">positions and make any change in the Fund’s NAV greater than it would </span></span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be without the use of leverage. This could result in increased volatility of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">returns. There is no guarantee that any leveraging strategy the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">employs will be successful during any period in which it is employed.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In times of unusual or adverse market, economic, regulatory, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">environmental or political conditions, the Fund may not be able, fully or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">partially, to implement its short selling strategy. Periods of unusual or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adverse market, economic, environmental, regulatory or political </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions generally may exist for long periods of time. In response to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market events, the SEC and regulatory authorities in other jurisdictions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may adopt (and in certain cases, have adopted) bans on, and/or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reporting requirements for, short sales of certain securities, including </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">short positions on such securities acquired through swaps. Restrictions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on and/or reporting of short selling and short positions may negatively </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impact and materially impair the Fund's ability to execute certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions. Also, there is the risk that the third party to the short sale </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or short position will not fulfill its contractual obligations, causing a loss </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the Fund.</div></div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Certain Affiliations</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain broker-dealers may be considered to be affiliated persons of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund and/or the Investment Manager due to their possible affiliations </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with Allianz SE, the ultimate parent of the Investment Manager, or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">another Allianz entity. Allianz Asset Management of America LP merged </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with Allianz Asset Management of America LLC (“Allianz Asset </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Management”), with the latter being the surviving entity, effective </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">January 1, 2023. Following the merger, Allianz Asset Management is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO’s managing member and direct parent entity. Absent an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exemption from the SEC or other regulatory relief, the Fund is generally </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">precluded from effecting certain principal transactions with affiliated </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">brokers, and its ability to purchase securities being underwritten by an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affiliated broker or a syndicate including an affiliated broker, or to utilize </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affiliated brokers for agency transactions, is subject to restrictions. This </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could limit the Fund’s ability to engage in securities transactions and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">take advantage of market opportunities.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The 1940 Act imposes significant limits on co-investment with affiliates </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the Fund. The Fund has received exemptive relief from the SEC that, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the extent the Fund relies on such relief, permits it to (among other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">things) co-invest alongside certain other persons in privately negotiated </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments, including certain affiliates of the Investment Manager and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain public or private funds managed by the Investment Manager and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its affiliates, subject to certain terms and conditions. The exemptive relief </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from the SEC with respect to co-investments imposes a number of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions on any co-investments made in reliance on such relief that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may limit or restrict the Fund’s ability to participate in an investment or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">require it to participate in an investment to a lesser extent, which could </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">negatively impact the Fund’s ability to execute its desired investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategy and its returns. Subject to applicable law, the Fund may also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invest alongside other PIMCO managed funds and accounts, including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">private funds and affiliates of the Investment Manager, without relying </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on the exemptive relief. Pursuant to co-investment exemptive relief, to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the extent the Fund relies on such relief, the Fund will be able to invest </span></div></div> <div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in opportunities in which PIMCO and/or its affiliates has an investment, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and PIMCO and/or its affiliates will be able to invest in opportunities in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which a fund has made an investment.</div></div><div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Anti-Takeover Provisions</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s Amended and Restated Agreement and Declaration of Trust</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">includes provisions that could limit the ability of other entities or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">persons to acquire control of the Fund or to convert the Fund to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">open-end status. See “Anti-Takeover and Other Provisions in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Declaration of Trust and Bylaws.”</span></span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">New/Small Fund Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">A new or smaller fund’s performance may not represent how the fund is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expected to or may perform in the long term if and when it becomes </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">larger and has fully implemented its investment strategies. Investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">positions may have a disproportionate impact (negative or positive) on </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance in a new and smaller fund, such as the Fund. New and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">smaller funds may also require a period of time before they are invested </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in securities that meet their investment objectives and policies and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">achieve a representative portfolio composition. Fund performance may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be lower or higher during this “ramp-up” period, and may also be more </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatile, than would be the case after the fund is fully invested. Similarly, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a new or smaller fund’s investment strategy may require a longer period </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of time to show returns that are representative of the strategy. New </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">funds have limited performance histories for investors to evaluate and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">new and smaller funds may not attract sufficient assets to achieve </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment and trading efficiencies. If a new or smaller fund were to fail </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to successfully implement its investment strategies or achieve its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment objectives, performance may be negatively impacted, and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any resulting liquidation could create negative transaction costs for the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fund and tax consequences for investors.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div> <div style="line-height:12.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Emerging Markets Risk</span></span></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Foreign (non-U.S.) investment risk may be particularly high to the extent </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the Fund invests in securities of issuers based in or doing business </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in emerging market countries or invests in securities denominated in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currencies of emerging market countries. Investing in securities of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers based in or doing business in emerging markets entails all of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks of investing in foreign securities noted below, but to a heightened </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">degree.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments in emerging market countries pose a greater degree of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systemic risk (i.e., the risk of a cascading collapse of multiple institutions </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">within a country, and even multiple national economies). The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">inter-relatedness of economic and financial institutions within and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">among emerging market economies has deepened over the years, with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the effect that institutional failures and/or economic difficulties that are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of initially limited scope may spread throughout a country, a region or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">all or most emerging market countries. This may undermine any attempt </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by the Fund to reduce risk through geographic diversification of its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portfolio.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There is a heightened possibility of imposition of withholding or other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taxes on interest or dividend income or capital gains generated from </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">emerging market securities. Governments of emerging market countries </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may engage in confiscatory taxation or expropriation of income and/or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets to raise revenues or to pursue a domestic political agenda. In the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">past, emerging market countries have nationalized assets, companies </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and even entire sectors, including the assets of foreign investors, with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">inadequate or no compensation to the prior owners. There can be no </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assurance that the Fund will not suffer a loss of any or all of its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments, or interest or dividends thereon, due to adverse fiscal or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other policy changes in emerging market countries.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There is also a greater risk that an emerging market government may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">take action that impedes or prevents the Fund from taking income </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or capital gains earned in the local currency and converting into </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. dollars (i.e., “repatriating” local currency investments or profits). </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain emerging market countries have sought to maintain foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exchange reserves and/or address the economic volatility and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dislocations caused by the large international capital flows by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">controlling or restricting the conversion of the local currency into other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currencies. This risk tends to become more acute when economic </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions otherwise worsen. There can be no assurance that if the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">earns income or capital gains in an emerging market currency or PIMCO </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise seeks to withdraw the Fund’s investments from a given </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">emerging market country, capital controls imposed by such country will </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not prevent, or cause significant expense, or delay in, doing so.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Bankruptcy law and creditor reorganization processes may differ </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">substantially from those in the United States, resulting in greater </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">uncertainty as to the rights of creditors, the enforceability of such rights, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reorganization timing and the classification, seniority and treatment of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">claims. In certain emerging market countries, although bankruptcy laws </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have been enacted, the process for reorganization remains highly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">uncertain. In addition, it may be impossible to seek legal redress against </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">an issuer that is a sovereign state.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Emerging market countries typically have less established regulatory, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disclosure, legal, accounting, recordkeeping and financial reporting </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systems than those in more developed markets, which may increase the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potential for market manipulation or reduce the scope or quality of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial information available to investors. Governments in emerging </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market countries are often less stable and more likely to take extra-legal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">action with respect to companies, industries, assets, or foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ownership than those in more developed markets. Moreover, it can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more difficult for investors to bring litigation or enforce judgments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">against issuers in emerging markets or for U.S. regulators to bring </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">enforcement actions, or obtain information needed to pursue or enforce </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such judgments, against such issuers. In addition, foreign companies </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with securities listed on U.S. exchanges may be delisted if they do not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">meet U.S. accounting standards and auditor oversight requirements, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may decrease the liquidity and value of the securities. The Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may also be subject to emerging markets risk if it invests in derivatives </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or other securities or instruments whose value or return are related to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the value or returns of emerging markets securities.</div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Other heightened risks associated with emerging markets investments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">include without limitation, (i) risks due to less social, political and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economic stability; (ii) the smaller size of the market for such securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and a lower volume of trading, resulting in a lack of liquidity and in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">price volatility; (iii) certain national policies which may restrict the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment opportunities, including sanctions and restrictions on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investing in issuers or industries deemed sensitive to relevant national </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interests and requirements that government approval be obtained prior </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to investment by foreign persons; (iv) certain national policies that may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrict the Fund’s repatriation of investment income, capital or the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds of sales of securities, including temporary restrictions on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">foreign capital remittances; (v) the lack of uniform accounting and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">auditing standards and/or standards that may be significantly different </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from the standards required in the United States; (vi) less publicly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">available financial and other information regarding issuers; (vii) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potential difficulties in enforcing contractual obligations; and (viii) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">higher rates of inflation, higher interest rates and other economic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">concerns. Countries with emerging securities markets may additionally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">experience problems with share registration, settlement and custody, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may result in losses to the Fund. The Fund may invest to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">substantial extent in emerging market securities that are denominated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in local currencies, subjecting the Fund to a greater degree of foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency risk. Also, investing in emerging market countries may entail </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchases of securities of issuers that are insolvent, bankrupt or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise of questionable ability to satisfy their payment obligations as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">they become due, subjecting the Fund to a greater amount of credit risk </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or high yield risk. The economy of some emerging markets may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particularly exposed to or affected by a certain industry or sector, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">therefore issuers and/or securities of such emerging markets may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more affected by the performance of such industries or sectors.</div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The currencies of emerging market countries may experience significant </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">declines against the U.S. dollar, and devaluation may occur subsequent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to investments in these currencies by the Fund. Many emerging market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries have experienced substantial, and in some periods extremely </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">high, rates of inflation for many years. Inflation and rapid fluctuations in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">inflation rates have had, and may continue to have, negative effects on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the economies and securities markets of certain emerging market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Emerging securities markets may have different clearance and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">settlement procedures, which may be unable to keep pace with the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volume of securities transactions or otherwise make it difficult to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">engage in such transactions. Settlement problems may cause the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to miss attractive investment opportunities, hold a portion of the assets </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in cash pending investment, or be delayed in disposing of a portfolio </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security. Such a delay could result in possible liability to a purchaser of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the security. Custody services in many emerging market countries </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">remain undeveloped. The Fund will be investing in emerging market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries where the current law and market practice carry fewer </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">safeguards than in more developed markets, including the protection of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">client securities against claims from general creditors in the event of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insolvency of an agent selected to hold securities on behalf of the Fund, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and the Fund’s custodian and the Investment Manager have assumed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">no liability for losses resulting from the Fund acting in accordance with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such practice.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">For the avoidance of doubt, the emerging markets in which the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may invest include frontier markets. Frontier market countries are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">emerging market countries, but generally have smaller economies or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">less mature capital markets than more developed emerging markets, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and, as a result, the risks of investing in emerging market countries are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">magnified in frontier countries. The markets of frontier countries typically </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have low trading volumes and the potential for extreme price volatility </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and illiquidity. This volatility may be further heightened by the actions of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a few major investors. For example, a substantial increase or decrease in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cash flows of funds investing in these markets could significantly affect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">local stock prices and, therefore, the net asset value of Fund shares. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">These factors make investing in frontier countries significantly riskier </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than in other countries, including other <div style="display:inline;">emerging </div>market countries.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Foreign (Non-U.S.) Investment Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Foreign (non-U.S.) securities may experience more rapid and extreme </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes in value than securities of U.S. issuers or securities that trade </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exclusively in U.S. markets. The securities markets of many foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(non-U.S.)</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> countries are relatively small</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> or less developed</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, with a limited </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">number of companies representing a small number of industries. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Additionally, issuers of foreign (non-U.S.) securities are usually not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to the same degree of regulation as U.S. issuers. Financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Reporting, legal, corporate governance, accounting, auditing and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">custody standards of foreign countries differ, in some cases significantly, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from U.S. standards. Global economies and financial markets are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">becoming increasingly interconnected, and conditions and events in one </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">country, region or financial market may adversely impact issuers in a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">different country, region or financial market. Foreign (non-U.S.) market </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trading hours, clearance and settlement procedures, and holiday </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">schedules may limit the Fund's ability to buy and sell securities. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments in foreign (non-U.S.) markets may also be adversely </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affected by governmental actions such as the imposition of capital </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">controls, nationalization of companies or industries, expropriation of </span></span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets or the imposition of punitive taxes. The governments of certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries may prohibit or impose substantial restrictions on foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(non-U.S.) investing in their capital markets or in certain sectors or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">industries</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, which can decrease the investment opportunities for the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund subject to such limits</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions may be imposed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">after the Fund has invested in a jurisdiction and potentially force the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund to block the investment, to block or reject payments due in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">connection with the investment, to be unable to divest or transfer an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">asset or to dispose of an investment at an inopportune time or price. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Furthermore, repatriation of investment income,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital and the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds of sales by foreign investors may require governmental </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registration and/or approval in some countries. In addition, a foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(non-U.S.) government may limit or cause delay in the convertibility or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repatriation of its currency which would adversely affect the U.S. dollar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value and/or liquidity of investments denominated in that currency. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain foreign (non-U.S.) investments may become less liquid in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">response to market developments or adverse investor perceptions, or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">become illiquid after purchase by the Fund, particularly during periods </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of market turmoil</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and may render holdings in that foreign (non-U</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">S.)</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">country illiquid or even worthless.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> A reduction in trading in securities of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers located in countries whose economies are heavily dependent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">upon trading with key partners may have an adverse impact on the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's investments.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Also, nationalization, expropriation or confiscatory taxation, unstable </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">governments, decreased market liquidity, currency blockage, market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disruptions, political changes, security suspensions</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">diplomatic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developments, trade restrictions (including tariffs) or the imposition of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions or other similar measures could adversely affect the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments in a foreign (non-U.S.) country and may render holdings in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that foreign (non-U.S.) country illiquid or even worthless. In the event of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">nationalization, expropriation or other confiscation, the Fund could lose </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its entire investment in foreign (non-U.S.) securities. The type and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">severity of sanctions and other similar measures, including counter </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions and other retaliatory actions, that may be imposed could vary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">broadly in scope, and their impact is difficult to ascertain. These types of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">measures may include, but are not limited to, banning a sanctioned </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">country or certain persons or entities associated with such country from </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">global payment systems that facilitate cross-border payments, restricting </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities transactions, restricting dealings with entities that are critical </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the infrastructure of securities and related transactions in specific </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">jurisdictions, restricting transactions in specified sectors of certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries, and freezing the assets of particular countries, entities or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">persons. The imposition of sanctions and other similar measures could</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impact the Fund's portfolio holdings by</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, among other things, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reducing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">their</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> value and/or liquidity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or causing a</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">downgrade</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit ratings</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these measures could</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency devaluation or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatility, and increased market volatility and</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">/or economic</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> disruption in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the securities or sanctioned country and throughout the world. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Sanctions and other similar measures could directly or indirectly limit or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prevent the Fund from buying and selling securities, receiving interest or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">principal payments due on the securities, significantly delay or prevent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the settlement of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities transactions, and adversely impact the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's liquidity and performance and/or prevent the liquidation</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">closure </div></div></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or other activities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of a portfolio holding sanctioned securities. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> government may renegotiate some of its global trade relationships </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with foreign governments and may impose or threaten to impose </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant tariffs. The imposition of tariffs, trade restrictions, currency </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions or similar actions (or retaliatory measures taken in response </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to such actions) could contribute to volatility or overall declines in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and global investment markets.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Adverse conditions in a certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">region can adversely affect securities of other countries whose </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economies appear to be unrelated. To the extent that the Fund invests a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant portion of its assets in a specific geographic region or in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities denominated in a particular foreign (non-U.S.) currency, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund will generally have more exposure to regional economic risks, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including weather emergencies and natural disasters, associated with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">foreign (non-U.S.) investments. Additionally, events and evolving </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions in certain markets or regions may alter the risk profile of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments tied to those markets or regions. This may cause </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments tied to such markets or regions to become riskier or more </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatile, even when investments in such markets or regions were </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perceived as comparatively stable historically. Foreign (non-U.S.) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities may also be less liquid (particularly during market closures </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">due to local market holidays or other reasons) and more difficult to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value than securities of U.S. issuers.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Many U.S. securities transitioned to a T+1 (trade date plus one day) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">settlement cycle, while securities trading in non-U.S. markets typically </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operate on T+2 or longer settlement cycles. This settlement mismatch </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">can create operational and liquidity risks for the Fund, including </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficulties in funding U.S. settlements from proceeds of non-U.S. asset </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sales, increased foreign exchange transaction risk, and the potential for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">settlement failures or delays in cross-border transactions.</div></div></div></div><div style="margin-top:6pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; font-style: normal; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;">Investments in China.</div></div></div><div style="color: rgb(0, 0, 0); font-family: Arial; font-size: 10pt; font-style: normal; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;"> </div></div></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The Fund may invest in securities and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments that are economically tied to the People's Republic of China </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(excluding Hong Kong, Macau and Taiwan for the purpose of this </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disclosure) (“PRC”). In determining whether an instrument is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economically tied to the PRC, PIMCO uses the criteria for determining </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">whether an instrument is economically tied to an emerging market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">country as set forth above. Investing in securities and instruments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economically tied to the PRC subjects the Fund to certain of the risks of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investing in foreign (non-U.S.) securities and emerging market securities, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as well as additional risks specific to China. These additional risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">include (without limitation): (a) inefficiencies resulting from erratic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">growth; (b) the unavailability of consistently-reliable economic data or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial data; (c) potentially high rates of inflation; (d) dependence on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exports and international trade, including the risk of increased trade </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tariffs, outbound investment measures, sanctions and embargoes; (e) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">relatively high levels of asset price volatility; (f) potential shortage of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity and limited accessibility by foreign (non-U.S.) investors </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(including as a result of sanctions); (g) greater competition from </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regional economies and territorial and other disputes with other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries; (h) fluctuations in currency exchange rates or currency </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">devaluation by the PRC government or central bank, particularly in light </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the relative lack of currency hedging instruments and controls on the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to exchange local currency for U.S. dollars; (i) the relatively small </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">size and absence of operating history of many PRC companies; (j) the </div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developing nature of the legal and regulatory framework for securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets, custody arrangements and commerce; (k) uncertainty and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potential changes with respect to the rules and regulations of the QFII </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">program and other market access programs through which such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments are made; (l) the commitment of the PRC government to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">continue with its economic reforms; (m) PRC regulators may suspend </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trading in PRC issuers (or permit such issuers to suspend trading) during </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market disruptions, and that such suspensions may be widespread and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase the risk of market manipulation; (n) different regulatory and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">audit requirements related to the quality of financial statements of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Chinese issuers; (o) limitations on the ability to inspect the quality of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">audits performed in the PRC, particularly the Public Company </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Accounting Oversight Board’s (“PCAOB’s”) lack of access to inspect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PCAOB-registered accounting firms in the PRC; (p) <div style="display:inline;">limitations </div>on the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability of U.S. authorities to enforce actions against non-U.S. companies </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and non-U.S. persons; and (q) limitations on the rights and remedies of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investors as a matter of law. In addition, there also exists control on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">foreign (non-U.S.) investment in the PRC and limitations on repatriation </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of invested capital.</div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may obtain exposure to companies based or operated in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PRC by investing through legal structures known as variable interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entities (“VIEs”), which are offshore holding companies that provide </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exposure to PRC-based or operated companies through contractual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arrangements. Investments in VIEs are subject to unique risks in addition </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to those risks generally associated with investments in the PRC, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including (without limitation): (i) breach of the contractual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arrangements; (ii) difficulty of enforcing the contractual arrangements </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">outside of the U.S.; and (iii) intervention by the PRC government to limit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or eliminate the remedies and rights available to the offshore company </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and its investors in the event of a breach of the contractual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arrangement. There is also the risk that the PRC might prohibit the use </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of VIEs or eliminate their ability to transmit economic or governance </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rights to non-Chinese investors at any time, which could result in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments in VIEs losing all or substantially all of their value. Any of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the foregoing risks and events could negatively impact the Fund's </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance, which may result in significant losses with little or no </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recourse available.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In recent years, certain governmental <div style="display:inline;">bod</div>ies (including the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. government) have considered and, in some cases, imposed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions, trade and investment restrictions and notification </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">requirements on the PRC (as well as Hong Kong and Macau), and it is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">possible that additional restrictions may be imposed or retaliatory action </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be taken in the future. In addition, the U.S. government has </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">implemented the Outbound Investment Security Program. This program </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currently focuses on investments in certain national security sectors </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(e.g., semiconductors, artificial intelligence, and quantum information </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">technology), and it may expand to cover additional sectors over time. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Complying with such restrictions may prevent a Fund from pursuing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain investments, cause delays or other impediments with respect to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consummating such investments, require notification of such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments to government authorities, require divestment or freezing of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments on unfavorable terms, render divestment of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underperforming investments impracticable, negatively impact a Fund’s </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to achieve its investment objective, prevent the Fund from </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">receiving payments otherwise due it, require a Fund to obtain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information about underlying investors, increase diligence and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">similar costs to the Fund, render valuation of China-related investments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">challenging, or require a Fund to consummate an investment on terms </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that are less advantageous than would be the case absent such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions. Any of these outcomes could adversely affect the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance with respect to such investments, and thus a Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance as a whole.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Given the complex and evolving relationship between the PRC and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain other countries, it is difficult to predict the impact of such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions on market conditions. Foreign (non-U.S.) relations, such as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the PRC-U.S. relationship regarding trade, currency exchange, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intellectual property protection, among other things, could also have </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">implications with respect to capital flow and business operations. For </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">example, U.S. social, political, regulatory and economic conditions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prompting changes in laws and policies governing foreign (non-U.S.) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trade, manufacturing, developments and investments in the PRC could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limit the Fund’s ability to access certain opportunities in PRC or restrict </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transaction with certain PRC issuers and, as a result, could adversely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the performance of the Fund’s investments.</div></div></div><div style="line-height:12.0pt;margin-top:6pt;text-align:left"><div style="margin-top:6pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; font-style: normal; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;">Investments in Russia.</div></div></div><div style="color: rgb(0, 0, 0); font-family: Arial; font-size: 10pt; font-style: normal; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;"> </div></div></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The Fund may invest in securities and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments that are economically tied to Russia. Investments in Russia </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are subject to various risks such as, but not limited to political, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economic, legal, market and currency risks. The risks include uncertain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">political and economic policies, short -term market volatility, poor </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accounting standards, corruption and crime, an inadequate regulatory </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">system, regional armed conflict and unpredictable taxation. Investments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in Russia are particularly subject to the risk that further economic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions, export and import controls, and other similar measures may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be imposed by the United States and/or other countries. Other similar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">measures may include, but are not limited to, banning or expanding </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bans on Russia or certain persons or entities associated with Russia </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from global payment systems that facilitate cross-border payments, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restricting the settlement of securities transactions by certain investors, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and freezing Russian assets or those of particular countries, entities or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">persons with ties to Russia (e.g., Belarus). Such sanctions and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">similar measures - which may impact companies in many sectors, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including energy, financial services, technology, accounting, quantum </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">computing, shipping, aviation, metals and mining, defense, architecture, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">engineering, construction, manufacturing and transportation, among </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">others - and Russia's countermeasures may negatively impact the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's performance and/or ability to achieve its investment objectives. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">For example, certain investments may be prohibited and/or existing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments may become illiquid (e.g., in the event that transacting in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain existing investments is prohibited, securities markets close, or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market participants cease transacting in certain investments in light of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geopolitical events, sanctions or related considerations), which could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">render any such securities held by the Fund unmarketable for an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">indefinite period of time and/or cause the Fund to sell other portfolio </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">holdings at a disadvantageous time or price or to continue to hold </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments that the Fund no longer seeks to hold. In addition, such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions or other similar measures, and the Russian government's </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">response, could result in a downgrade of Russia's credit rating or of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities of issuers located in or economically tied to Russia, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">devaluation of Russia's currency and/or increased volatility with respect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to Russian securities and the ruble. Moreover, disruptions caused by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Russian military action or other actions (including cyberattacks, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">espionage or other asymmetric measures) or resulting actual or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">threatened responses to such activity may impact Russia's economy and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Russian and other issuers of securities in which the Fund is invested. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Such resulting actual or threatened responses may include, but are not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limited to, purchasing and financing restrictions, withdrawal of financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intermediaries, boycotts or changes in consumer or purchaser </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">preferences, sanctions, export and import controls, tariffs or cyberattacks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on the Russian government, Russian companies or Russian individuals, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including politicians. Any actions by Russia made in response to such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions or retaliatory measures could further impair the value and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity of Fund investments. Sanctions and other similar measures </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have resulted in defaults on debt obligations by certain corporate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers and the Russian Federation that could lead to cross-defaults or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cross-accelerations on other obligations of these issuers. The Russian </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities market is characterized by limited volume of trading, resulting </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in difficulty in obtaining accurate prices and trading. These issues can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">magnified as a result of sanctions and other similar measu<div style="display:inline;">re</div>s that may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be imposed and the Russian government's response.</div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Russian securities market, as compared to U.S. markets, has </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant price volatility, less liquidity, a smaller market capitalization </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and a smaller number of traded securities. There may be little publicly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">available information about issuers. Settlement, clearing and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registration of securities transactions are subject to risks. Prior to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">implementation of the National Settlement Depository (“NSD”), a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recognized central securities depository, there was no central </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registration system for equity share registration in Russia, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registration was carried out by either the issuers themselves or by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registrars located throughout Russia. Title to Russian equities held </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">through the NSD is now based on the records of the NSD and not the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registrars. Although the implementation of the NSD has enhanced the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">efficiency and transparency of the Russian securities market, issues </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">resulting in loss can still occur. In addition, sanctions by the European </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Union against the NSD, as well as the potential for sanctions by other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">governments, could make it more difficult to conduct or confirm </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions involving Russian securities. Ownership of securities issued </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by Russian companies that are not held through depositories such as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the NSD may be recorded by companies themselves and by registrars. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Moreover, changes in Russian laws and regulations could require the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transfer of securities from the NSD to registrars or other parties outside </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of standard custodial arrangements</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, which could lead to additional risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and possible conflicts with U</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">S.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">laws.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> In such cases, the risk is increased </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the Fund could lose ownership rights through fraud, negligence or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">oversight. While applicable Russian regulations impose liability on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registrars for losses resulting from their errors, it may be difficult for the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund to enforce any rights it may have against the registrar or issuer of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the securities in the event of loss of share registration. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers and registrars are still prominent in the validation and approval </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of documentation requirements for corporate action processing in </div></div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">Russia. Because the documentation requirements and approval criteria </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">vary between registrars and issuers, there remain unclear and </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">inconsistent market standards in the Russian market with respect to the </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">completion and submission of corporate action elections. In addition, </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">sanctions or Russian countermeasures may prohibit or limit the Fund's </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">ability to participate in corporate actions, and therefore require the Fund </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">to forego voting on or receiving funds that would otherwise be </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">beneficial to the Fund. To the extent that the Fund suffers a loss relating </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">to title or corporate actions relating to its portfolio securities, it may be </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">difficult for the Fund to enforce its rights or otherwise remedy the loss. </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">Russian securities laws may not recognize foreign nominee accounts </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">held with a custodian bank, and therefore the custodian may be </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">considered the ultimate owner of securities they hold for their clients. </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">Adverse currency exchange rates are a risk and there may be a lack of </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">available currency hedging instruments. Investments in Russia may be </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">subject to the risk of nationalization or expropriation of assets. Oil, </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">natural gas, metals, minerals and timber account for a significant </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">portion of Russia's exports, leaving the country vulnerable to swings in </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">world prices and to sanctions or other actions that may be directed at </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">the Russian economy as a whole or at Russian oil, natural gas, metals, </div><div style="color:#333333;font-family:Arial Narrow;font-size:10pt;display:inline;">minerals or timber industries.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Sovereign Debt Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may have substantial exposure to emerging market sovereign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt, including quasi-sovereign debt. Sovereign debt includes securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issued or guaranteed by foreign sovereign governments or their </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agencies, authorities, political subdivisions or instrumentalities. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Quasi-sovereign obligations typically are issued by companies or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agencies that may receive financial support or backing from a sovereign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">government or in which the government owns a majority of the issuer’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">voting shares. Quasi-sovereign obligations are typically less liquid and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">less standardized than direct sovereign obligations.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition to the other risks applicable to debt investments, sovereign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt may decline in value as a result of default or other adverse credit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">event resulting from an issuer’s inability or unwillingness to make </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">principal or interest payments in a timely fashion. A sovereign entity’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">failure to make timely payments on its debt can result from many </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">factors, including, without limitation, insufficient foreign (non-U.S.) </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency reserves or an inability to sufficiently manage fluctuations in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">relative currency valuations, an inability or unwillingness to satisfy the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">demands of creditors and/or relevant supranational entities regarding </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt service or economic reforms, the size of the debt burden relative to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economic output and tax revenues, cash flow difficulties and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">political and social considerations. The risk of loss to the Fund in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">event of a sovereign debt default or other adverse credit event is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">heightened by the unlikelihood of any formal recourse or means to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">enforce its rights as a holder of the sovereign debt. In addition, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sovereign debt restructurings, which may be shaped by entities and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">factors beyond the Fund’s control, may result in a loss in value of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s sovereign debt holdings.</span></div></div> <div style="line-height:12.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Currency Risk</span></span></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Currency risk may be <span style="display:inline;">par</span>ticul<span style="display:inline;">arl</span>y high because the Fund may, at times </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or in general, have substantial exposure to emerging market currencies, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and engage in foreign currency transactions that are economically tied </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to emerging market countries. These currency transactions may present </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market, credit, currency, liquidity, legal, political, headline, reputational </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other risks different from, or greater than, the risks of investing in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developed foreign (non-U.S.) currencies or engaging in foreign currency </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions that are economically tied to developed foreign countries.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments denominated in foreign (non-U.S.) currencies or that trade </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in and receive revenues in, foreign (non-U.S.) currencies, derivatives or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other instruments that provide exposure to foreign (non-U.S.) </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currencies, are subject to the risk that those currencies will decline in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value relative to the U.S. dollar, or, in the case of hedging positions, that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the U.S. dollar will decline in value relative to the currency being </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">hedged.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Currency rates in foreign (non-U.S.) countries may fluctuate significantly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">over short periods of time for a number of reasons, including changes in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest or inflation rates, balance of payments and governmental </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">surpluses or deficits, intervention (or the failure to intervene) by U.S. or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">foreign (non-U.S.) governments, central banks or supranational entities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such as the International Monetary Fund, the imposition of currency </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">controls or other political developments in the United States or abroad. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">As a result, the Fund’s investments in or exposure to foreign (non-U.S.) </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currencies and/or foreign (non-U.S.) currency-denominated securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may reduce the returns of the Fund. Currency risk may be particularly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">high to the extent that the Fund invests in foreign (non-U.S.) currencies </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or engages in foreign currency transactions that are economically tied to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">emerging market countries. These currency transactions may present </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market, credit, currency, liquidity, legal, political and other risks different </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from, or greater than, the risks of investing in developed foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(non-U.S.) currencies or engaging in foreign currency transactions that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are economically tied to developed foreign countries. Devaluation of a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency by a country's government or banking authority can </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significantly impact the value of any investments denominated in that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency. These fluctuations may have a significant adverse impact on </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the value of the Fund’s portfolio and/or the level of Fund distributions </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">made to Common Shareholders. There is no assurance that a hedging </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategy, if used, will be successful. The Fund may also be adversely </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impacted by expenses incurred by converting between currencies to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchase and sell securities not valued in the U.S. dollar, as well as by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency restrictions, exchange control regulation, or governmental </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions that limit or otherwise delay the Fund’s ability to convert </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currencies.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Moreover, currency hedging techniques may be unavailable with respect </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to emerging market currencies. As a result, the Fund’s investments in or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exposure to foreign (non-U.S.) currencies and/or foreign (non-U.S.) </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency-denominated, and especially emerging market-currency </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">denominated, securities may reduce the returns of the Fund.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The local emerging market currencies in which the Fund may be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invested from time to time may experience substantially greater </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatility against the U.S. dollar than the major convertible currencies of </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developed countries. Some of the local currencies in which the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may invest are neither freely convertible into one of the major currencies </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">nor internationally traded. The local currencies may be convertible into </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other currencies only inside the relevant emerging market where the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limited availability of such other currencies may tend to inflate their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">values relative to the local currency in question. Such internal exchange </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets can therefore be said to be neither liquid nor competitive. In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, many of the currencies of emerging market countries in which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund may invest have experienced steady devaluation relative to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">freely convertible currencies.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Continuing uncertainty as to the status of the euro and the European </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Monetary Union (“EMU”) has created significant volatility in currency </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and financial markets generally. Any partial or complete dissolution of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the EMU could have significant adverse effects on currency and financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets, and on the values of the Fund’s portfolio investments. If one or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more EMU countries were to stop using the euro as its primary currency, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s investments in such countries may be redenominated into a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">different or newly adopted currency. As a result, the value of those </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments could decline significantly and unpredictably. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities or other investments that are redenominated may be subject </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to foreign currency risk, liquidity risk and valuation risk to a greater </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent than similar investments currently denominated in euros. To the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent a currency used for redenomination purposes is not specified in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">respect of certain EMU-related investments, or should the euro cease to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be used entirely, the currency in which such investments are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">denominated may be unclear, making such investments particularly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficult to value or dispose of. The Fund may incur additional expenses </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the extent it is required to seek judicial or other clarification of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">denomination or value of such securities.</div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There can be no assurance that if the Fund earns income or capital gains </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in a non-U.S. country or PIMCO otherwise seeks to withdraw the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments from a given country, capital controls imposed by such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">country will not prevent, or cause significant expense in, doing so.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Market Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The market price of securities owned by the Fund may fluctuate, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sometimes rapidly or unpredictably. Securities may decline in value due </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a variety of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">factors affecting (or perceiving to affect) securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets generally or particular industries</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sectors </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or companies </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">represented in the securities markets. The value of a security may decline </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">due to general market conditions that are not specifically related to a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particular company, such as real or perceived adverse economic </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions, changes in the general outlook for corporate earnings, levels </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of public debt and deficits, changes in inflation, interest or currency </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rates, financial system instability, adverse changes to credit markets or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adverse investor sentiment generally. The value of a security may also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decline due to factors that affect a particular industry or industries, such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as labor shortages or increased production costs and competitive </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions within an industry. During a general downturn in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities markets, multiple asset classes may decline in value </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">simultaneously even if the performance of those asset classes is not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise historically correlated. Investments may also be negatively </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impacted by market disruptions and by attempts by other market </span></span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participants to manipulate the prices of particular investments. Equity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities generally have greater price volatility than fixed income </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities. Credit ratings downgrades may also negatively affect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities held by the Fund. Even when markets perform well, there is no </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assurance that the investments held by the Fund will increase in value </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">along with the broader market.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, market risk includes the risk that geopolitical and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">events will disrupt the economy on a national or global level. For </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instance, actual or threatened war, terrorism, social </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or political </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unrest, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recessions, supply chain disruptions, market manipulation, government </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">defaults, government shutdowns, political and regulatory changes, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">diplomatic developments or the imposition of sanctions and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">similar measures, including the imposition of tariffs, or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. economic policies and any related public health emergencies (such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as the spread of infectious diseases, pandemics and epidemics), </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">natural/environmental disasters or events, climate-change and climate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">related events can all negatively impact the securities markets, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could cause the Fund to lose value. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">This includes reliance on global </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">supply chains that are susceptible to disruptions resulting from, among </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other things, war and other armed conflicts, tariffs, extreme weather </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">events, and natural disasters.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> These events could reduce consumer </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">demand or economic output, result in market closures, changes in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates, inflation/deflation, travel restrictions or quarantines, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significantly adversely impact the economy.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">As computing technology and data analytics continually advance there </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">has been an increasing trend towards machine driven and artificially </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intelligent trading systems, particularly providing such systems with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increasing levels of autonomy in trading decisions. Regulators of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial markets have become increasingly focused on the potential </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impact of artificial intelligence on investment activities and may issue </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulations that are intended to affect the use of artificial technology in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trading activities. Any such regulations may not have the intended </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">effect</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on financial markets. Moreover, advancements in artificial intelligence </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other technologies may suffer from the introduction of errors, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">defects or security vulnerabilities which can go undetected. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Issues in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">construction and implementation of artificial intelligence</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(AI) systems </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">models</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including software issues,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> issues related to the use of AI </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and machine learning</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other technological issues) may adversely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impact the Fund.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> AI systems may contain design flaws or faulty </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assumptions,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rely on incomplete or inaccurate data inputs,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficult to interpret or audit</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">domestic political environment, as well as political and diplomatic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">events within the United States and abroad, such the U.S. budget and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deficit reduction plan and foreign policy tensions with foreign nations, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including embargoes, tariffs, sanctions, trade wars, and other similar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developments, has in the past resulted, and may in the future result, in a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">government shutdown or otherwise adversely affect the U.S. regulatory </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">landscape, the general market environment and/or investor sentiment, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which could have an adverse impact on the Fund’s investments and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operations. Additional and/or prolonged U.S. federal government </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shutdowns, U.S. foreign policy, the imposition of tariffs, or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. economic policies and any related domestic and/or geopolitical </div></div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tensions may affect investor and consumer confidence and may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adversely impact financial markets and the broader economy, perhaps </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">suddenly and to a significant degree. Governmental and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">quasi-governmental authorities and regulators throughout the world </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have previously responded to serious economic disruptions with a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">variety of significant fiscal and monetary policy changes, including but </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not limited to, direct capital infusions into companies, new monetary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">programs and dramatically lower interest rates. An unexpected or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sudden reversal of these policies, or the ineffectiveness of these policies, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could increase volatility in securities markets, which could adversely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the Fund’s investments. Any market disruptions could also prevent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund from executing advantageous investment decisions in a timely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">manner. Funds that have focused their investments in a region enduring </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geopolitical market disruption will face higher risks of loss. Thus, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investors should closely monitor current market conditions to determine </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">whether the Fund meets their individual financial needs and tolerance </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for risk.</div></div><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">When inflationary price movements occur, fixed income securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets may experience heightened levels of interest rate, volatility and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity risk.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Interest rate increases </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the future could cause the value </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of a fund that invests in fixed income securities to decrease, which could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">force the Fund to liquidate investments at disadvantageous times or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prices,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> therefore adversely affecting the Fund and its shareholders.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Higher interest rates generally lower the values of</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> real estate-related </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. When this does not occur as expected</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">it presents an increased </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk of a correction or severe downturn in real-estate related asset </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prices,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> which could, by extension, adversely impact the value of other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments (such as loans, securitized debt and other fixed income </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities). Such an impact could materialize in one real estate sector </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and not another, or in a different manner in different real estate sectors. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Examples of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks faced by real estate-related assets include: tenant </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">vacancy rates, increased tenant turnover and tenant concentration; </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">general real estate headwinds, including delinquencies and difficulties in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collecting rents and other payments (which increases the risk of owners </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">being unable to pay or otherwise defaulting on their own borrowings </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and obligations); decreases in property values; increases in inflation, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">upkeep costs and other expenses; fluctuations in rents; and increased </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">concentration in ownership of certain types of properties.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Exchanges and securities markets may close early, close late or issue </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trading halts on specific securities, which may result in, among other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">things, the Fund being unable to buy or sell certain securities or financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments at an advantageous time or accurately price its portfolio </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Asset Allocation Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investment performance depends upon how its assets are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">allocated and reallocated. A principal risk of investing in the Fund is that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO may make less than optimal or poor asset allocation decisions. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO employs an active approach to allocation among multiple fixed </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income sectors, but there is no guarantee that such allocation </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">techniques will produce the desired results. It is possible that PIMCO </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will focus on an investment that performs poorly or underperforms other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments under various market conditions. The Fund could experience </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">losses as a result of these allocation decisions, which could result in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund being underweight or overweight in sectors, asset classes, or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geographies that perform differently than expected.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Issuer Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The value of a security may decline for a number of reasons that directly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">relate to the issuer, such as management performance, major litigation, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investigations or other controversies, changes in the issuer’s financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">condition or credit rating, changes in government regulations affecting </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the issuer or its competitive environment and strategic initiatives such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as mergers, acquisitions or dispositions and the market response to any </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such initiatives, financial leverage, reputation or reduced demand for the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer’s goods or services, as well as the historical and prospective </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">earnings of the issuer and the value of its assets. A change in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial condition of a single issuer may affect one or more other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers or securities markets as a whole. These risks can apply to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares issued by the Fund and to the issuers of securities and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other instruments in which the Fund invests.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Repurchase Offers Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">As described under “Periodic Repurchase Offers” above, the Fund is an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">“interval fund” and, in order to provide liquidity to shareholders, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund, subject to applicable law,conducts quarterly repurchase offers of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s outstanding Common Shares at NAV, subject to approval of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Board. In all cases, repurchase offers will be for at least 5% and not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more than 25% of its outstanding Common Shares at NAV, pursuant to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Rule 23c-3 under the 1940 Act. The Fund currently expects to conduct </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">quarterly repurchase offers for 5% of its outstanding Common Shares </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under ordinary circumstances. The Fund believes that these repurchase </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">offers are generally beneficial to the Fund’s shareholders and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchases generally will be funded from available cash or sales of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portfolio securities. However, repurchase offers and the need to fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase obligations may affect the ability of the Fund to be fully </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invested or force the Fund to maintain a higher percentage of its assets </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in liquid investments, which may harm the Fund’s investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance. Moreover, diminution in the size of the Fund through </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchases may result in untimely sales of portfolio securities (with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated imputed transaction costs, which may be significant), and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may limit the ability of the Fund to participate in new investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">opportunities or to achieve its investment objective. The Fund may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accumulate cash by holding back (i.e., not reinvesting) payments </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">received in connection with the Fund’s investments. The Fund believes </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that payments received in connection with the Fund’s investments will </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generate sufficient cash to meet the maximum potential amount of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s repurchase obligations. If at any time cash and other liquid </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets held by the Fund are not sufficient to meet the Fund’s repurchase </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations, the Fund intends, if necessary, to sell investments. To the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent the Fund employs investment leverage, repurchases of Common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shares would compound the adverse effects of leverage in a declining </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market. In addition, if the Fund borrows to finance repurchases, interest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on that borrowing will negatively affect Common Shareholders who do </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not tender their Common Shares by increasing the Fund’s expenses and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reducing any net investment income. If a repurchase offer is </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">oversubscribed, the Fund may, but is not required to, determine to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase the amount repurchased by up to 2% of the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">outstanding shares as of the date of the Repurchase Request Deadline. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In the event that the Fund determines not to repurchase more than the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase offer amount, or if shareholders tender more than the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase offer amount plus 2% of the Fund’s outstanding shares as of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the date of the Repurchase Request Deadline, the Fund will repurchase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Common Shares tendered on a pro rata basis, and shareholders will </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have to wait until the next repurchase offer to make another repurchase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">request. As a result, shareholders may be unable to liquidate all or a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">given percentage of their investment in the Fund during a particular </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase offer. Notwithstanding the foregoing, the Fund may accept </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">all Common Shares tendered for repurchase by shareholders who own </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">less than one hundred Common Shares and who tender all of their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares, before prorating Common Shares tendered by other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shareholders; provided that, if a shareholder holds shares through a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial intermediary, such intermediary may not be willing or able to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arrange for this treatment on such shareholder's behalf. Some </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shareholders, in anticipation of proration, may tender more Common </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shares than they wish to have repurchased in a particular quarter, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">thereby increasing the likelihood that proration will occur. A shareholder </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be subject to market and other risks, and the NAV of Common </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shares tendered in a repurchase offer may decline between the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Repurchase Request Deadline and the date on which the NAV for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tendered Common Shares is determined. In addition, the repurchase of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common <div style="display:inline;">Shares </div>by the Fund may be a taxable event to shareholders.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Large Shareholder Risk</span></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent a large proportion of the Common Shares are held by a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">small number of shareholders (or a single shareholder), including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affiliates of the Investment Manager, the Fund may be adversely </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impacted if such shareholders purchase or request repurchases of large </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">amounts of Common Shares. For example, it is possible that in response </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to a repurchase offer, the total amount of Common Shares tendered by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a small number of shareholders (or a single shareholder) may exceed </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the number of Common Shares that the Fund has offered to repurchase. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">If a repurchase offer is oversubscribed, the Fund will repurchase only a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pro rata portion of the Common Shares tendered by each shareholder. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, substantial repurchases of Common Shares could result in a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decrease in the Fund's net assets, resulting in an increase in the Fund's </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">total annual operating expense ratio. See “Repurchase Offers Risk” </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">above for additional information about certain risks related to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Repurchase Offers.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Management Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund is subject to management risk because it is an actively </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">managed investment portfolio. PIMCO </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will apply investment techniques </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and risk analysis </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and may,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">some cases, use proprietary models that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are developed and maintained by PIMCO in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">making investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decisions for the Fund</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> may determine that certain factors are more </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant than others</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> can be no guarantee that these decisions </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will produce the desired results or that the due diligence conducted by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> expose all material risks associated with an investment. </span></span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Additionally, PIMCO </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not be able to identify suitable investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">opportunities and may face competition from other investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">managers when identifying and consummating certain investments</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may determine that certain factors are more significant than others</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain securities or other instruments in which the Fund seeks to invest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not be available in the quantities desired</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, including in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">circumstances where other funds for which PIMCO acts as investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adviser, including funds with names, investment objectives and policies, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or portfolio management teams, similar to the Fund, are seeking to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invest in the same or similar securities or instruments</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulatory restrictions, actual or perceived conflicts of interest or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">considerations may cause PIMCO to restrict or prohibit participation in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain investments. In such circumstances, PIMCO </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may determine to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchase other securities or instruments as substitutes. Such substitute </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities or instruments may not perform as intended, which could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result in losses to the Fund. To the extent the Fund employs strategies </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">targeting perceived pricing inefficiencies, arbitrage strategies or similar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategies, it is subject to the risk that the pricing or valuation of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities and instruments involved in such strategies may change </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unexpectedly, which may result in reduced returns or losses to the Fund.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Additionally, legislative, regulatory or tax developments may adversely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect management of the Fund.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The Fund is also subject to the risk that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deficiencies in the internal systems or controls of PIMCO or another </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">service provider will cause losses for the Fund or hinder Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operations. For example, trading delays or errors (both human and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systemic) could prevent the Fund from purchasing a security expected to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">appreciate in value. Additionally, actual or potential conflicts of interest, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">legislative, regulatory or tax restrictions, policies or developments may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the investment techniques available to PIMCO </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in connection with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">managing the Fund and may also adversely affect the ability of the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to achieve its investment objective. There also can be no assurance that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">all of the personnel of PIMCO will continue to be associated with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO for any length of time. The loss of the services of one or more key </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">employees of PIMCO could have an adverse impact on the Fund’s ability </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to realize its investment objective.</div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, the Fund may rely on various third-party sources to calculate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its NAV. As a result, the Fund is subject to certain operational risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with reliance on service providers and service providers’ data </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sources. In particular, errors or systems failures and other technological </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issues may adversel<div style="display:inline;">y i</div>mpact the Fund’s calculations of its NAV, and such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">NAV calculation issues may result in inaccurately calculated NAVs, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">delays in NAV calculation and/or the inability to calculate NAVs over </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extended periods. The Fund may be unable to recover any losses </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with such failures.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Interest Rate Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Interest rate risk is the risk that fixed income securities and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments in the Fund’s portfolio will fluctuate in value because of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes, or the anticipation of changes, in interest rates. Factors </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including central bank monetary policy, rising inflation rates, and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes in general economic conditions may cause interest rates to rise, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which could cause the value of the Fund’s investments to decline. For </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">example, as nominal interest rates rise, the value of certain securities </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">held by the Fund is likely to decrease. Interest rate changes can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sudden and unpredictable, and the Fund may experience losses as a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result of movements in interest rates. The Fund may not be able to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">hedge against changes in interest rates or may choose not to do so for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cost or other reasons.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> In addition, any hedges may not work as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intended.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Further, fixed income securities with longer durations tend to be more </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sensitive to changes in interest rates, usually making them more volatile</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than securities with shorter durations</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The values of equity and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-fixed income securities may also decline due to fluctuations.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prices of fixed-income securities generally are more sensitive to changes </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in interest rates as the duration of those securities increases; securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with longer durations are subject to greater price volatility in a rising </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate environment.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Duration is a measure used to determine the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sensitivity of a security’s price to changes in interest rates that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incorporates a security’s yield, coupon, final maturity and call features, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">among other characteristics. Duration is useful primarily as a measure of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the sensitivity of a fixed income security’s market price to interest rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(i.e., yield) movements. All other things remaining equal, for each one </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">percentage point increase in interest rates, the value of a portfolio of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fixed income investments would generally be expected to decline by one </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">percent for every year of the portfolio’s average duration above zero. For </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">example, the value of a portfolio of fixed income securities with an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">average duration of eight years would generally be expected to decline </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by approximately 8% if interest rates rose by one percentage point.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Dividend-paying equity securities, particularly those whose market price </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is closely related to their yield, may be more sensitive to changes in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates. During periods of rising interest rates, the values of such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities may decline and may result in losses to the Fund. Variable and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">floating rate securities generally are less sensitive to interest rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes but may decline in value if their interest rates do not rise as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">much, or as quickly, as interest rates in general. Conversely, floating rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities will not generally increase in value if interest rates decline. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Inverse floating rate securities may decrease in value if interest rates </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase. Inverse floating rate securities may also exhibit greater price </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatility than a fixed rate obligation with similar credit quality. When </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund holds variable or floating rate securities, a decrease (or, in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">case of inverse floating rate securities, an increase) in market interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rates will adversely affect the income received from such securities and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the NAV of the Fund’s shares.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">A wide variety of factors can cause interest rates or yields of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Treasury securities (or yields of other types of bonds) to rise, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including but not limited to central bank monetary policies, changing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">inflation or real growth rates, general economic conditions, increasing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bond issuances or reduced market demand for low yielding investments. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Risks associated with changes in interest rates are heightened under </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain market conditions</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such as during times when the U.S.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Federal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Reserve (the “Federal Reserve”) adjusts its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">monetary policy</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">whether by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">raising or lowering</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> interest rates</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, or when such rates remain at elevated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or historically low levels for a prolonged period</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. Further, in market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">environments where interest rates are rising, issuers may be less willing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or able to make principal and interest payments on fixed-income </div></div></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments when due. Actions by governments and central banking </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">authorities can result in increases or decreases in interest rates. Periods </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of higher inflation could cause such authorities to raise interest rates, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may adversely affect the Fund and its investments.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes in monetary policy may exacerbate the risks associated with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changing interest rates.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">During periods of very low or negative interest rates, the Fund may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unable to maintain positive returns. Very low or negative interest rates </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may magnify interest rate risk. Changing interest rates, including rates </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that fall below zero, may have unpredictable effects on markets, may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result in heightened market volatility and may detract from Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance to the extent the Fund is exposed to such interest rates.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Measures such as average duration may not accurately reflect the true </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rate sensitivity of the Fund. This is especially the case if the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consists of securities with widely varying durations. Therefore, if the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund has an average duration that suggests a certain level of interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate risk, the Fund may in fact be subject to greater interest rate risk </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than the average would suggest. This risk is greater to the extent the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund uses leverage or derivatives in connection with the management </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the Fund</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, which would be magnified in the event that initial or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">variation margin is not provided by the counterparty to such transaction </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(or not provided below a certain threshold amount)</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Convexity is an additional measure used to understand a security's or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's interest rate sensitivity. Convexity measures the rate of change of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">duration in response to changes in interest rates. With respect to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security’s price, a larger convexity (positive or negative) may imply more </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dramatic price changes in response to changing interest rates. Convexity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be positive or negative. Negative convexity implies that interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate increases result in increased duration and vice versa, meaning </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increased sensitivity in prices in response to changes in interest rates. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Thus, securities with negative convexity, which may include bonds with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">traditional call features and certain mortgage-backed securities, may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">experience greater losses in periods of rising interest rates. Accordingly, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">if the Fund holds such securities, the Fund may be subject to a greater </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk of losses in<div style="display:inline;"> pe</div>riods of rising interest rates.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Credit Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund could experience losses if the issuer or guarantor of a fixed </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income security (including a security purchased with securities lending </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateral), </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the counterparty to a derivatives contract, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a repurchase </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agreement, a borrower of portfolio securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or the issuer or guarantor </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of collateral, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or a loan of portfolio securities is unable or unwilling, or is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perceived (whether by market participants, rating agencies, pricing </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">services or otherwise) as unable or unwilling, to make timely principal </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or interest payments or to otherwise honor its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The risk that such issuer, guarantor or counterparty is less willing or able </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to do so is heightened in market environments where interest rates are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changing, notably when rates are rising. The downgrade of the credit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rating of a security or of the issuer of a security held by the Fund may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decrease its value. Measures such as average credit quality may not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accurately reflect the true credit risk of the Fund. This is especially the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">case if the Fund consists of securities with widely varying credit ratings. </span></span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Securities are subject to varying degrees of credit risk, which are often </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reflected in credit ratings. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">This</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> risk is greater to the extent the Fund uses </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leverage or derivatives in connection with the management of the Fund, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which would be magnified in the event that initial or variation margin is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not provided by the counterparty to such transaction (or not provided </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">below a certain threshold amount). Rising or high interest rates may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deteriorate the credit quality of an issuer or counterparty, particularly if </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">an issuer or counterparty faces challenges rolling or refinancing its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations. The Fund’s investments may be adversely affected if any of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the issuers it is invested in are subject to an actual or perceived </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(whether by market participants, rating agencies, pricing services or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise) deterioration to their credit quality.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Credit risk includes credit spread risk, which is the risk that credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">spreads (i.e., the difference in yield between securities that is due to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">differences in their actual or perceived credit quality) may increase when </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the market believes that investments generally have a greater risk of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default. Increasing credit spreads may reduce the market values of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s investments. Credit spreads often increase more for lower rated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and unrated securities than for investment grade securities. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">when credit spreads increase, reductions in market value will generally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be greater for longer-maturity securities. Further, credit spread duration </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(a measure of credit spread risk) can vary significantly from interest rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">duration (e.g., for floating rate debt securities, credit spread duration </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">typically will be higher than interest rate duration). The Fund may add </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit spread duration to its portfolio, for example through the use of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives (e.g., credit default swaps), even while it has lower interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate duration. The credit spread duration of the Fund’s portfolio may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">vary, in some cases significantly, from its interest rate duration.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Corporate Debt Securities Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The market value of corporate debt securities generally may be expected </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to rise and fall inversely with interest rates. The value of intermediate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and longer-term corporate debt securities normally fluctuates more in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">response to changes in interest rates than does the value of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shorter-term corporate debt securities. The market value of a corporate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt security also may be affected by factors directly relating to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer, such as investors’ perceptions of the creditworthiness of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer, the issuer’s financial performance, perceptions of the issuer in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">marketplace, performance of management of the issuer, the issuer’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital structure and use of financial leverage and demand for the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer’s goods and services. Certain risks associated with investments in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">corporate debt securities are described elsewhere in this prospectus in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">further detail. There is a risk that the issuers of corporate debt securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not be able to meet their obligations on interest or principal </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments at the time called for by an instrument. The Fund may invest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in below investment grade corporate bonds, often referred to as “high </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">yield” securities or “junk bonds.” High yield corporate bonds are often </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">high risk and have speculative characteristics. High yield corporate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bonds may be particularly susceptible to adverse issuer-specific </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developments. High yield corporate bonds are subject to the risks </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">described under “Principal Risks of the Fund—High Yield Securities </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Risk.” In addition, certain corporate debt securities may be highly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">customized and as a result may be subject to, among others, liquidity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and valuation/pricing transparency risks.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Mortgage-Related and Other Asset-Backed Instruments Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The mortgage-related assets in which the Fund may invest include, but </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are not limited to, any security, instrument or other asset that is related </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to U.S. or non-U.S. mortgages, including those issued by private </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">originators or issuers, or issued or guaranteed as to principal or interest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by the U.S. government or its agencies or instrumentalities or by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-U.S. governments or authorities, such as, without limitation, assets </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">representing interests in, collateralized or backed by, or whose values </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are determined in whole or in part by reference to any number of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgages or pools of mortgages or the payment experience of such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgages or pools of mortgages, including REMICs, which could </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">include Re-REMICs, mortgage pass-through securities, inverse floaters, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">CMOs, CLOs, multi-class pass-through securities, private mortgage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pass-through securities, stripped mortgage securities (generally </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest-only and principal-only securities), mortgage-related asset </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">backed securities and mortgage-related loans (including through </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participations, assignments, originations and whole loans), including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">commercial and residential mortgage loans. Exposures to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-related assets through derivatives or other financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments will be considered investments in mortgage-related assets.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may also invest in other types of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">asset-backed securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(“</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ABS</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">”)</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, including CDOs, CBOs and CLOs and other similarly structured </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> CLOs, CDOs and their underlying loan obligations are typically </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not registered for sale to the public and therefore are subject to certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions on transfer and sale, potentially making them less liquid </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than other types of securities. There is no guarantee that an active </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">secondary market will exist or be maintained for any given CLO or CDO </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest. Additionally, when the Fund purchases a newly issued CLO or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">CDO security in the primary market (rather than from the secondary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market), there may be a delayed settlement period during which the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity of such security may be further reduced.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Mortgage-related and other asset-backed instruments represent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interests in “pools” of mortgages or other assets such as consumer </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans or receivables held in trust and often involve risks that are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">different from or possibly more acute than risks associated with other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">types of debt instruments.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Generally, rising interest rates tend to extend the duration of fixed rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-related assets, making them more sensitive to changes in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates. Compared to other fixed income investments with similar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">maturity and credit, mortgage-related securities may increase in value to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a lesser extent when interest rates decline and may decline in value to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">similar or greater extent when interest rates rise. As a result, in a period </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of rising interest rates, the Fund may exhibit additional volatility since </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">individual mortgage holders are less likely to exercise prepayment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">options, thereby putting additional downward pressure on the value of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these securities and potentially causing the Fund to experience losses. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">This is known as extension risk. Mortgage-backed securities can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">highly sensitive to rising interest rates, such that even small movements </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">can cause the Fund to lose value. Mortgage-backed securities, and in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particular those not backed by a government guarantee, are subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit risk. When interest rates decline, borrowers may pay off their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgages sooner than expected. This can reduce the returns of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund because the Fund may have to reinvest that money at the lower </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prevailing interest rates. In addition, the creditworthiness, servicing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">practices, and financial viability of the servicers of the underlying </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage pools present significant risks. For instance, a servicer may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">required to make advances in respect of delinquent loans underlying the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-related securities; however, servicers experiencing financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficulties may not be able to perform these obligations. Additionally, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">both mortgage-related securities and asset-backed securities are subject </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to risks associated with fraud or negligence by, or defalcation of, their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">servicers. These securities are also subject to the risks of the underlying </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans. In some circumstances, a servicer’s or originator’s mishandling of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">documentation related to the underlying collateral (e.g., failure to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">properly document a security interest in the underlying collateral) may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the rights of security holders in and to the underlying collateral. In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, the underlying loans may have been extended pursuant to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">inappropriate underwriting guidelines, to no underwriting guidelines at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">all, or to fraudulent origination practices. The owner of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-backed security’s ability to recover against the sponsor, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">servicer or originator is uncertain and is often limited. The Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments in other asset-backed instruments are subject to risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">similar to those associated with mortgage-related assets, as well as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">additional risks associated with the nature of the assets and the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">servicing of those assets. Payment of principal and interest on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">asset-backed instruments may be largely dependent upon the cash </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">flows generated by the assets backing the instruments, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">asset-backed instruments may not have the benefit of any security </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest in the related assets.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subordinate mortgage-backed or asset-backed instruments are paid </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest only to the extent that there are funds available to make </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments. To the extent the collateral pool includes a large percentage </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of delinquent loans, there is a risk that interest payments on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subordinate mortgage-backed or asset-backed instruments will not be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fully paid.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There are multiple tranches of mortgage-backed and asset-backed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments, offering investors various maturity and credit risk </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">characteristics. For example, tranches may be categorized as senior, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mezzanine, and subordinated/equity or “first loss.” The most senior </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tranche of a mortgage-backed or asset-backed instrument generally has </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the greatest collateralization and generally pays the lowest interest rate. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">If there are defaults or the collateral otherwise underperforms, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">scheduled payments to senior tranches generally take precedence over </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">those of mezzanine tranches, and scheduled payments to mezzanine </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tranches take precedence over those to subordinated/equity tranches. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Lower tranches represent lower degrees of credit quality and pay higher </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates intended to compensate for the attendant risks. The return </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on the lower tranches is especially sensitive to the rate of defaults in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateral pool. The lowest tranche (i.e., the “equity” or “residual” </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tranche) generally specifically receives the residual interest payments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(i.e., money that is left over after the higher tranches have been paid </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and expenses of the issuing entities have been paid) rather than a fixed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rate. The Fund may also invest in the residual or equity tranches </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of mortgage-related and other asset-backed instruments, which may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">referred to as subordinate mortgage-backed or asset-backed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments and interest-only mortgage-backed or asset-backed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments. The Fund expects that investments in subordinate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-backed and other asset-backed instruments will be subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks arising from delinquencies and foreclosures, thereby exposing its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment portfolio to potential losses. Subordinate securities of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-backed and other asset-backed instruments are also subject </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to greater credit risk than those mortgage-backed or other asset-backed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments that are more highly rated.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The mortgage markets in the United States and in various foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries have experienced extreme difficulties in the past that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adversely affected the performance and market value of certain of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's mortgage-related investments. Delinquencies and losses on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">residential and commercial mortgage loans (especially subprime and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">second-lien mortgage loans) may increase, and a decline in or flattening </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of housing and other real property values may exacerbate such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">delinquencies and losses. In addition, reduced investor demand for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage loans and mortgage-related securities and increased investor </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">yield requirements have caused limited liquidity in the secondary market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for mortgage-related securities, which can adversely affect the market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value of mortgage-related securities. It is possible that such limited </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity in such secondary markets could continue or worsen.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">With respect to risk retention tranches (i.e., eligible residual interests </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">initially held by the sponsors of CMBS and other eligible securitizations </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pursuant to the U.S. Risk Retention Rules), a third-party purchaser, such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as the Fund, must hold its retained interest, unhedged, for at least five </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">years following the closing of the CMBS transaction, after which it is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entitled to transfer its interest in the securitization to another person </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that meets the requirements for a third-party purchaser. Even after the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">required holding period has expired, due to the generally illiquid nature </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of such investments, no assurance can be given as to what, if any, exit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategies will ultimately be available for any given position.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, there is limited guidance on the application of the final </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Risk Retention Rules to specific securitization structures. There can </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be no assurance that the applicable federal agencies charged with the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">implementation of the final U.S. Risk Retention Rules (e.g., the FDIC, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Comptroller of the Currency, the Federal Reserve Board, the SEC, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Department of Housing and Urban Development, and the Federal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Housing Finance Agency) could not take positions in the future that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">differ from the interpretation of such rules taken or embodied in such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securitizations, or that the final U.S. Risk Retention Rules will not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">change.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Furthermore, in situations where the Fund invests in risk retention </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tranches of securitizations structured by third parties, the Fund may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">required to execute one or more letters or other agreements, the exact </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">form and nature of which will vary (each, a “Risk Retention </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Agreement”) under which it will make certain undertakings designed to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ensure such securitization complies with the U.S. Risk Retention Rules. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Such Risk Retention Agreements may include a variety of </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">representations, warranties, covenants and other indemnities, each of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may run to various transaction parties. If the Fund breaches any </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">undertakings in any Risk Retention Agreement, it will be exposed to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">claims by the other parties thereto, including for any losses incurred as a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result of such breach, which could be significant and exceed the value of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s investments. Direct investments in mortgages and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">types of collateral are subject to risks similar (and in some cases to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">greater degree) to those described above.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Privately-Issued Mortgage-Related Securities Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There are no direct or indirect government or agency guarantees of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments in pools created by non-governmental issuers. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Non-governmental or private-label asset-backed securities are not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">guaranteed, directly or indirectly, by any government, government </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agency or instrumentality.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Privately-issued mortgage-related securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are also not subject to the same underwriting requirements for the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underlying mortgages that are applicable to those mortgage-related </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities that have a government or government-sponsored entity </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">guarantee.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Privately-issued mortgage-related securities are not traded on an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exchange and there may be a limited market for the securities, especially </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">when there is a perceived weakness in the mortgage and real estate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market sectors. Without an active trading market, mortgage-related </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities held in the Fund’s portfolio may be particularly difficult to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value because of the complexities involved in assessing the value of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underlying mortgage loans. Additionally, privately-issued </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-related securities, such as privately-held or non-traded REITs, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may bear higher fees than publicly-traded REITs. Privately-held REITs </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally are exempt from registration under the Securities Act and, as </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such, are not subject to the same disclosure requirements as REITs </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registered under the Securities Act, which may make privately-held REITs </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more difficult to evaluate from an investment perspective.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Subprime Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Loans, and debt instruments collateralized by loans (including Alt </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Lending ABS), acquired by the Fund may be subprime in quality, or may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">become subprime in quality. Although there is no specific legal or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market definition of “subprime,” subprime loans are generally </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">understood to refer to loans made to borrowers that display poor credit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">histories and other characteristics that correlate with a higher default </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk. Accordingly, subprime loans, and debt instruments secured by such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans (including Alt Lending ABS), have speculative characteristics and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are subject to heightened risks, including the risk of nonpayment of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest or repayment of principal, and the risks associated with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments in high yield securities. In addition, these instruments could </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be subject to increased regulatory scrutiny. The Fund is not restricted by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any particular borrower credit risk criteria and/or qualifications when </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">acquiring loans or debt instruments collateralized by loans.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Municipal Bond Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investing in the municipal bond market involves the risks of investing in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt securities generally and certain other risks. The amount of public </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information available about the municipal bonds in which the Fund may </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invest is generally less than that for corporate equities or bonds, and the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment performance of the Fund’s investment in municipal bonds </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may therefore be more dependent on the analytical abilities of PIMCO </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than its investments in taxable bonds. The secondary market for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipal bonds, particularly below investment grade bonds in which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund may invest, also tends to be less well developed or liquid than </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">many other securities markets, which may adversely affect the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to sell municipal bonds at attractive prices or value municipal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bonds.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The ability of municipal issuers to make timely payments of interest and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">principal may be diminished during general economic downturns, by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">litigation, legislation or political events, or by the bankruptcy of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer. Budgetary constraints of local, state, and federal governments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">upon which the issuers may be relying for funding may also impact </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Municipal Bonds. Laws, referenda, ordinances or regulations enacted in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the future by Congress or state legislatures or the applicable </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">governmental entity could extend the time for payment of principal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or interest, or impose other constraints on enforcement of such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations, or on the ability of municipal issuers to levy taxes. Issuers of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipal securities also might seek protection under the bankruptcy </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">laws. In the event of bankruptcy of such an issuer, the Fund could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">experience delays in collecting principal and interest and the Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not, in all circumstances, be able to collect all principal and interest to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which it is entitled. To enforce its rights in the event of a default in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment of interest or repayment of principal, or both, the Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">take possession of and manage the assets securing the issuer's </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations on such securities, which may increase the Fund's operating </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expenses. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The differences in priorities</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perspectives</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and economic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interests of bondholders and</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> taxpayers or users of facilities financed by</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipal bonds </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may affect the remedies available to the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">event of a default</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Adverse economic, business, legal or political developments might </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect all or a substantial portion of the Fund's municipal bonds in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">same manner. The Fund will be particularly subject to these risks to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent that it focuses its investments in municipal bonds in a particular </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">state or geographic region. Municipal securities may also have exposure </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to potential risks resulting from climate change and environmental </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">events, including extreme weather, flooding, fires and other natural </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disasters. Climate risks, if materialized, can adversely impact a municipal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer’s financial plans in current or future years or may impair a funding </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">source for municipal issuer’s revenue bonds. As a result, the impact of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">climate risks could adversely impact the value of the Fund’s municipal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities investments.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in trust certificates issued in tender option bond </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">programs. In these programs, a trust typically issues two classes of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certificates and uses the proceeds to purchase municipal securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">having relatively long maturities and bearing interest at a fixed interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate substantially higher than prevailing short-term tax-exempt rates. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There is a risk that the Fund will not be considered the owner of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tender option bond for federal income tax purposes, and thus will not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be entitled to treat such interest as exempt from federal income tax. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain tender option bonds may be less liquid or may become less </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquid as a result of, among other things, a credit rating downgrade, a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment default or a disqualification from tax-exempt status. The Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment in the securities issued by a tender option bond trust may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">involve greater risk and volatility than an investment in a fixed rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bond, and the value of such securities may decrease significantly when </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market interest rates increase. Tender option bond trusts could be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">terminated due to market, credit or other events beyond the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">control, which could require the Fund to dispose of portfolio investments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at inopportune times and prices. The Fund may use a tender option </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bond program as a way of achieving leverage in its portfolio, in which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">case the Fund will be subject to leverage risk. The use of tender option </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bonds will impact the Fund's duration and cause the Fund to be subject </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to increased duration and interest rate risk.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in revenue bonds, which are typically issued to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fund a wide variety of capital projects including electric, gas, water and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sewer systems; highways, bridges and tunnels; port and airport facilities; </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">colleges and universities; and hospitals. Because the principal security </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for a revenue bond is generally the net revenues derived from a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particular facility or group of facilities or, in some cases, from the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds of a special excise or other specific revenue source or annual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">revenues, there is no guarantee that the particular project will generate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">enough revenue to pay its obligations, in which case the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance may be adversely affected.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in participations in lease obligations or installment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchase contract obligations of municipal authorities or entities. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Although a municipal lease obligation does not constitute a general </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligation of the municipality for which the municipality's taxing power </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is pledged, a municipal lease obligation is ordinarily backed by the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipality's covenant to budget for, appropriate and make the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments due under the municipal lease obligation. However, certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipal lease obligations contain “non-appropriation” clauses, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provide that the municipality has no obligation to make lease or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">installment purchase payments in future years unless money is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">appropriated for such purpose on a yearly basis. In the case of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">“non-appropriation” lease, the Fund's ability to recover under the lease </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the event of non-appropriation or default will be limited solely to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repossession of the leased property, without recourse to the general </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit of the lessee, and the disposition or re-leasing of the property </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">might prove difficult.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Municipal securities are also subject to interest rate, credit, and liquidity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The tax-exempt status of municipal securities is subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">legislative risk. Congress or state legislatures could enact laws that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">eliminate or reduce the tax-exempt status of interest payments on some </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or all municipal securities, which could adversely affect the Fund and its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shareholders.</div></div></div></div><div style="line-height:12.0pt;margin-left:10pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: Arial; font-size: 10pt; font-style: normal; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;">Interest Rate Risk</div></div></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The value of municipal securities, similar to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other fixed income securities, will likely drop as interest rates rise in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the general market. Conversely, when rates decline, bond prices </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally rise.</div></div></div></div><div style="line-height:12.0pt;margin-left:10pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: Arial; font-size: 10pt; font-style: normal; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;">Credit Risk</div></div></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The risk that a borrower may be unable to make </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest or principal payments when they are due. Funds that invest in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipal securities rely on the ability of the issuer to service its debt. </div></div></div></div><div style="line-height:12.0pt;margin-left:10pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">This subjects the Fund to credit risk in that the municipal issuer may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be fiscally unstable or exposed to large liabilities that could impair its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to honor its financial obligations. Municipal issuers with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant debt service requirements, in the near-to mid-term; </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unrated issuers and those with less capital and liquidity to absorb </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">additional expenses may be most at risk. To the extent the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invests in lower quality or high yield municipal securities, it may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more sensitive to the adverse credit events in the municipal market. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The treatment of municipalities in bankruptcy is more uncertain, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potentially more adverse to debt holders, than for corporate issues.</div></div><div style="line-height:12.0pt;margin-left:10pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: Arial; font-size: 10pt; font-style: normal; letter-spacing: 0px; top: 0px;display:inline;"><div style="font-style:italic;display:inline;"><div style="font-weight:bolder;display:inline;">Liquidity Risk</div></div></div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The risk that investors may have difficulty finding a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">buyer when they seek to sell, and therefore, may be forced to sell at a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">discount to the market value. Liquidity may sometimes be impaired in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the municipal market and because the Fund primarily invests in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipal securities, it may find it difficult to purchase or sell such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities at opportune times. The municipal securities market can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">susceptible to increases in volatility and decreases in liquidity. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Liquidity can decline unpredictably in response to a variety of factors, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including overall economic conditions or credit tightening. Increases </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in volatility and decreases in liquidity also may be caused by a rise in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates (or the expectation of a rise in interest rates). Liquidity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">can be impaired due to interest rate concerns, credit events, or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">general supply and demand imbalances. Depending on the particular </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer and current economic conditions, municipal securities could be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deemed more volatile investments.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition to general municipal market risks, different municipal sectors </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may face different risks. For instance, general obligation bonds are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">secured by the full faith, credit, and taxing power of the municipality </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuing the obligation. As such, timely payment depends on the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">municipality's ability to raise tax revenue and maintain a fiscally sound </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">budget. The timely payments may also be influenced by any unfunded </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pension liabilities or other post-employee benefit plan liabilities.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Revenue bonds are secured by special tax revenues or other revenue </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sources. If the specified revenues do not materialize, then the bonds </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not be repaid.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Private activity bonds are yet another type of municipal security. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Municipalities use private activity bonds to finance the development of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">industrial facilities for use by private enterprise. Principal and interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments are to be made by the private enterprise benefiting from the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">development, which means that the holder of the bond is exposed to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the risk that the private issuer may default on the bond.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Moral obligation bonds are usually issued by special purpose public </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entities. If the public entity defaults, repayment becomes a “moral </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligation” instead of a legal one. The lack of a legally enforceable right </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to payment in the event of default poses a special risk for a holder of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the bond because it has little or no ability to seek recourse in the event </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of default.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, a significant restructuring of federal income tax rates or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">even serious discussion on the topic in Congress could cause municipal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bond prices to fall. The demand for municipal securities is strongly </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">influenced by the value of tax-exempt income to investors relative to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taxable income. Lower income tax rates potentially reduce the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">advantage of owning municipal securities.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Similarly, changes to state or federal regulation tied to a specific sector, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such as the hospital sector, could have an impact on the revenue stream </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for a given subset of the market.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Municipal notes are similar to general municipal debt obligations, but </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">they generally possess shorter <div style="display:inline;">terms</div>. Municipal notes can be used to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provide interim financing and may not be repaid if anticipated revenues </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are not realized.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">High Yield Securities Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent that the Fund invests in high yield securities and unrated </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities of similar credit quality (commonly known as “high yield </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities” or “junk bonds”), the Fund may be subject to greater levels </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of market risk, credit risk, call risk and liquidity risk than funds that do </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not invest in such securities, which could have a negative effect on the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">NAV and market price of the Fund's Common Shares or Common Share </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dividends. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">High yield securities involve the risk of substantial or total </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loss of principal, and their values may be more volatile than other types </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of securities. High yield securities may be issued by companies that are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restructuring, are smaller and less creditworthy or are more highly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leveraged or indebted than other companies, or are financially </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distressed, and therefore they typically have more difficulty making </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">scheduled payments of principal and interest than issuers of higher </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rated investments.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> These securities are considered predominantly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">speculative by ratings agencies with respect to an issuer's continuing </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to make principal and interest payments, and their value may be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more volatile than other types of securities</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and may result in substantial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or total loss of income and principal</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. An economic downturn or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">individual issuer developments could adversely affect the market for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these securities and reduce the Fund's ability to sell these securities at </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">an advantageous time or price. An economic downturn could also lead </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to a higher non-payment rate and, a high yield security may lose </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant market value before a default occurs. The Fund may purchase </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distressed securities that are in default or the issuers of which are in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bankruptcy, which involve heightened risks.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">High yield securities structured as zero-coupon bonds or pay-in-kind </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities tend to be especially volatile as they are particularly sensitive </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to downward pricing pressures from rising interest rates or widening </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">spreads and may require the Fund to make taxable distributions of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">imputed income without receiving the actual cash currency. Issuers of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">high yield securities may have the right to “call” or redeem the issue </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prior to maturity, which may result in the Fund having to reinvest the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds in other high yield securities or similar instruments that may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pay lower interest rates. The Fund may also be subject to greater levels </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of liquidity risk than funds that do not invest in high yield securities. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Consequently, transactions in high yield securities may involve greater </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">costs than transactions in more actively traded securities. A lack of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">publicly</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> available information, irregular trading activity and wide bid/ask </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">spreads among other factors, may, in certain circumstances, make high </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">yield debt more difficult to sell at an advantageous time or price than </span></span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other types of securities or instruments. These factors may result in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund being unable to realize full value for these securities and/or may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result in the Fund not receiving the proceeds from a sale of a high yield </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security for an extended period after such sale, each of which could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result in losses to the Fund. Because of the risks involved in investing in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">high yield securities, an investment in the Fund should be considered </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">speculative.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In general, lower rated debt securities carry a greater degree of risk that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the issuer will lose its ability to make interest and principal payments, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which could have a negative effect on the Fund. Securities of below </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment grade quality are regarded as having predominantly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">speculative characteristics with respect to capacity to pay interest and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repay principal and are commonly referred to as “high yield” securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or “junk bonds.” High yield securities involve a greater risk of default </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and their prices are generally more volatile and sensitive to actual or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perceived negative developments. Debt securities in the lowest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment grade category also may be considered to possess some </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">speculative characteristics by certain rating agencies. The Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchase stressed or distressed securities that are in default or the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers of which are in bankruptcy, which involve heightened risks. An </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economic downturn could severely affect the ability of issuers </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(particularly those that are highly leveraged) to service or repay their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt obligations. Lower-rated securities are generally less liquid than </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">higher-rated securities, which may have an adverse effect on the Fund's </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to dispose of them. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">High yield securities are particularly sensitive </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to adverse economic, market, industry or issuer-specific developments, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may result in an increased incidence of default.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> For example, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under adverse market or economic conditions, the secondary market for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">below investment grade securities could contract further, independent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of any specific adverse changes in the condition of a particular issuer, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and certain securities in the Fund's portfolio may become illiquid or less </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquid. As a result, the Fund could find it more difficult to sell these </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities or may be able to sell these securities only at prices lower </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than if such securities were widely traded. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In the event of default, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund may incur additional expenses to seek recovery or to negotiate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">new terms with a defaulting issuer.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> To the extent the Fund focuses on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">below investment grade debt obligations, PIMCO's capabilities in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">analyzing credit quality and associated risks will be particularly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">important, and there can be no assurance that PIMCO will be successful </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in this regard. Due to the risks involved in investing in high yield </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities, an investment in the Fund should be considered speculative. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund's credit quality policies apply only at the time a security is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchased, and the Fund is not required to dispose of a security in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">event that a rating agency or PIMCO downgrades its assessment of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit characteristics of a particular issue. In determining whether to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">retain or sell such a security, PIMCO may consider factors including, but </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not limited to, PIMCO's assessment of the credit quality of the issuer of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such security, the price at which such security could be sold and the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rating, if any, assigned to such security by other rating agencies. Analysis </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of creditworthiness may be more complex for issuers of high yield </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities than for issuers of higher quality debt securities.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div> <div style="line-height:12.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Distressed and Defaulted Securities Risk</span></span></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments in the securities of financially distressed issuers involve </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">substantial risks, including the risk of default. Distressed securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally trade significantly below “par” or full value because </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments in such securities and debt of distressed issuers or issuers in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default are considered speculative and involve substantial risks in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition to the risks of investing in high-yield bonds. Such investments </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be in default at the time of investment. In addition, these securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may fluctuate more in price, and are typically less liquid. The Fund also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will be subject to significant uncertainty as to when, and in what </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">manner, and for what value obligations evidenced by securities of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financially distressed issuers will eventually be satisfied. Defaulted </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations might be repaid only after lengthy workout or bankruptcy </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceedings, during which the issuer might not make any interest or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other payments. In any such proceeding relating to a defaulted </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligation, the Fund may lose its entire investment or may be required </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to accept cash or securities with a value substantially less than its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">original investment. Moreover, any securities received by the Fund upon </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">completion of a workout or bankruptcy proceeding may be less liquid, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">speculative or restricted as to resale. Similarly, if the Fund participates in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">negotiations with respect to any exchange offer or plan of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reorganization with respect to the securities of a distressed issuer, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund may be restricted from disposing of such securities. To the extent </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the Fund becomes involved in such proceedings, the Fund may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have a more active participation in the affairs of the issuer than that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assumed generally by an investor. The Fund may incur additional </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expenses to the extent it is required to seek recovery upon a default in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the payment of principal or interest on its portfolio holdings.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Also among the risks inherent in investments in a troubled issuer is that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">it frequently may be difficult to obtain information as to the true </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial condition of such issuer. PIMCO’s judgments about the credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">quality of a financially distressed issuer and the relative value of its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities may prove to be wrong.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Senior Debt Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> be subject to greater levels of credit risk than funds that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">do not invest in below investment grade senior debt. The Fund may also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be subject to greater levels of liquidity risk than funds that do not invest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in senior debt. Restrictions on transfers in loan agreements, a lack of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">publicly available information and other factors may, in certain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instances, make senior debt more difficult to sell at an advantageous </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time or price than other types of securities or instruments. Additionally, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">if the issuer of senior debt prepays, the Fund will have to consider </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reinvesting the proceeds in other senior debt or similar instruments that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may pay lower interest rates.</span></span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Loans and Other Indebtedness; Loan Acquisitions, </span></span><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Participations and Assignments Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Loan interests may take the form of (i) direct interests acquired during a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">primary distribution or other purchase of a loan, (ii) loans originated by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund or (iii) assignments of, novations of or participations in all or a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portion of a loan acquired in secondary markets. In addition to credit </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk and interest rate risk, the Fund's exposure to loan interests may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to additional risks. For example, purchasers of loans and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">forms of direct indebtedness depend primarily upon the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">creditworthiness of the borrower for payment of principal and interest. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Loans are subject to the risk that scheduled interest or principal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments will not be made in a timely manner or at all, either of which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may adversely affect the value of the loan. If the Fund does not receive </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">scheduled interest or principal payments on such indebtedness, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">’</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">s share price and yield could be adversely affected. Loans that are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fully secured may offer the Fund more protection than an unsecured </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loan in the event of non-payment of scheduled interest or principal if </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund is able to access and monetize the collateral. However, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateral underlying a loan, if any, may be unavailable or insufficient to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">satisfy a borrower</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">’</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">s obligation. If the Fund becomes owner, whole or in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">part, of any collateral after a loan is foreclosed, the Fund may incur costs </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with owning and/or monetizing its ownership of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateral.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">During periods of deteriorating economic conditions, such as recessions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or periods of rising unemployment, or changing interest rates (notably </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increases), delinquencies and losses generally increase, sometimes </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dramatically, with respect to obligations under such loans. An economic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">downturn or individual corporate developments could adversely affect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the market for these instruments and reduce the Fund’s ability to sell </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these instruments at an advantageous time or price. An economic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">downturn could also lead to a higher non-payment rate and, a loan may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lose significant market value before a default occurs.</div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments in loans through a purchase of a loan, loan origination or a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">direct assignment of a financial institution’s interests with respect to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loan may involve additional risks to the Fund. For example, if a loan is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">foreclosed, the Fund could become owner, in whole or in part, of any </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateral, which could include, among other assets, real estate or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">real or personal property, and would bear the costs and liabilities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with owning and holding or disposing of the collateral.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Moreover, the purchaser of an assignment typically succeeds to all the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rights and obligations under the loan agreement with the same rights </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and obligations as the assigning lender. Assignments may, however, be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arranged through private negotiations between potential assignees and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potential assignors, and the rights and obligations acquired by the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchaser of an assignment may differ from, and be more limited than, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">those held by the assigning lender. The Fund may also invest in loans </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that are not secured by collateral which typically present greater risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than collateralized loans.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may obtain exposure to loans made to private investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">vehicles, including private funds that are not registered under the 1940 </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Act. Such loans may be for various purposes, including but not limited </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to, subscription line or “sub-line” credit facilities secured by the uncalled </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital commitments of such private investment vehicles' investors. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Although such capital commitments are typically subject to legally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">binding agreements, there can be no assurance that the investors will </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">meet their funding obligations when called. As a result, the Fund may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to the risk of delay or default in repayment of the loan, which </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could negatively impact the Fund's performance. Additionally, the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may face liquidity risks if the private investment vehicle is unable to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">draw on capital commitments in a timely manner.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In connection with purchasing loan participations, the Fund generally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will have no right to enforce compliance by the borrower with the terms </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the loan agreement relating to the loan, nor any rights of set-off </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">against the borrower, and the Fund may not directly benefit from any </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateral supporting the loan in which it has purchased the loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participation. As a result, the Fund will be subject to the credit risk of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">both the borrower and the lender that is selling the participation. In the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">event of the insolvency of the lender selling a participation, the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be treated as a general creditor of the lender and may not benefit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from any set-off between the lender and the borrower. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">A bankruptcy </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">court may restructure the payment obligations under the loan so as to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reduce the amount to which the Fund would be entitled or extended the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time for payment. A court could subordinate the Fund's rights to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rights of other creditors of the borrower under applicable law. Various </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">laws enacted for the protection of borrowers may apply to loans, and a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bankruptcy proceeding against a borrower could delay or limit the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability of the Fund to collect principal and interest payments on such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Certain loan participations may be structured in a manner </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">designed to prevent purchasers of participations from being subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the credit risk of the lender, but even under such a structure, in the event </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the lender’s insolvency, the lender’s servicing of the participation may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be delayed and the assignability of the participation impaired.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may have difficulty disposing of loans and loan participations. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Because there may not be a liquid market for many such investments, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund anticipates that such investments could be sold only to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limited number of institutional investors. The lack of a liquid secondary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market may have an adverse impact on the value of such investments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and the Fund</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">’</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">s ability to dispose of particular loans and loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participations when that would be desirable, including in response to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">specific economic event such as a deterioration in the creditworthiness </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the borrower. The lack of a liquid secondary market for loans and loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participations also may make it more difficult for the Fund to assign a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value to these securities for purposes of valuing the Fund</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">’</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">s portfolio.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments in loans may include participations in bridge loans, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are loans taken out by borrowers for a short period (typically less than </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">one year) pending arrangement of more permanent financing through, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for example, the issuance of bonds, frequently high yield bonds issued </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for the purpose of acquisitions.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investments in loans may include </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">acquisitions</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> of, or participation in, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">delayed draw and delayed funding loans and revolving credit facilities. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">These commitments may have the effect of requiring the Fund to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase its investment in a borrower at a time when it might not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise decide to do so (including at a time when the company</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">’</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial condition makes it unlikely that such amounts will be repaid). </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Delayed draw and delayed funding loans and revolving credit facilities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be subject to restrictions on transfer, and only limited opportunities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may exist to resell such instruments. As a result, the Fund may be unable </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to sell such investments at an opportune time or may have to resell </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">them at less than fair market value. Further, the Fund may need to hold </div></div></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquid assets in order to provide funding for these types of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">commitments, meaning the Fund may not be able to invest in other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">attractive investments, or the Fund may need to liquidate existing assets </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in order to provide such funding.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> More generally, sales of the Fund's </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portfolio holdings may result in short-term capital gains (which are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally taxed to shareholders at ordinary income tax rates when </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distributed net of short-term capital losses and net of long-term capital </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">losses), potentially subjecting shareholders of the Fund to adverse tax </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consequences.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in debtor-in-possession financings (commonly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">known as “DIP financings”). DIP financings are arranged when an entity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">seeks the protections of the bankruptcy court under Chapter 11 of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Bankruptcy Code. These financings allow the entity to continue its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">business operations while reorganizing under Chapter 11. Such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financings constitute senior liens on an unencumbered security (i.e., a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security not subject to other creditors' claims). There is a risk that the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entity will not emerge from Chapter 11 and be forced to liquidate its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets under Chapter 7 of the U.S. Bankruptcy Code. In the event of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidation, the Fund's only recourse will be against the property </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securing the DIP financing.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in loans used to finance the cost of construction, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">acquisition, development, and/ or rehabilitation of a property including, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">but not limited to, development of single-family for-sale homes, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">multi-family rentals and/or commercial facilities. Such construction </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lending may expose the Fund to increased risk of non-payment and loss </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">because the loan is not backed by a finished project. Such risk may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">depend on the nature of the construction and the relevant counterparty </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or counterparties, which may include, but not be limited to, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">homebuilders, private developers and/or entities with limited capital. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Repayment of these types of loans may depend on the borrower’s ability </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to secure permanent “take-out” financing, which requires the successful </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">completion of the project, or operation of the property with an income </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">stream sufficient to meet operating and loan expenses. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these types of loans are subject to the risk of errors in estimations of the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">property’s value at completion of construction and the estimated cost of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">construction, as well as the risk that the projects may not be completed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and have limited liquidity.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent the Fund invests in loans, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including, but not limited to, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bank loans, non-syndicated loans, the residual or equity tranches of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortgage-related and other asset-backed securities, which may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">referred to as subordinate mortgage-backed or asset-backed securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and interest-only mortgage-backed or asset-backed securities, and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or originates loans,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> the Fund may be subject to greater </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">levels of credit risk, call risk, settlement risk, risk of subordination to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other creditors, insufficient or lack of protection under federal securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">laws and liquidity risk. These instruments are considered predominantly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">speculative with respect to an issuer’s continuing ability to make </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">principal and interest payments and may be more volatile than other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">types of securities. The Fund may also be subject to greater levels of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity risk than funds that do not invest in loans. In addition, the loans </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in which the Fund invests may not be listed on any exchange and a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">secondary market for such loans may be comparatively illiquid relative </div></div></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to markets for other more liquid fixed income securities. Consequently, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions in loans may involve greater costs than transactions in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more actively traded securities. In connection with certain loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions, transaction costs that are borne by the Fund may include </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the expenses of third parties that are retained to assist with reviewing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and conducting diligence, negotiating, structuring and servicing a loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transaction, and/or providing other services in connection therewith. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Furthermore, the Fund may incur such costs in connection with loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions that are pursued by the Fund but not ultimately </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consummated (so-called “broken deal costs”).</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Restrictions on transfers in loan agreements, a lack of publicly available </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information, irregular trading activity and wide bid/ask spreads, among </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other factors, may, in certain circumstances, make loans more difficult to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sell at an advantageous time or price than other types of securities or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments. These factors may result in the Fund being unable to realize </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">full value for the loans and/or may result in the Fund not receiving the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds from a sale of a loan for an extended period after such sale, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">each of which could result in losses to the Fund. Some loans may have </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extended trade settlement periods, including settlement periods of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">greater than seven days, which may result in cash not being </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">immediately available to the Fund. If an issuer of a loan prepays or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">redeems the loan prior to maturity, the Fund may have to reinvest the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds in other loans or similar instruments that may pay lower </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates. Because of such risks involved in investing in loans, an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment in the Fund should be considered speculative.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investments in subordinated and unsecured loans generally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are subject to similar risks as those associated with investments in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">secured loans. Subordinated or unsecured loans are lower in priority of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment to secured loans and are subject to the additional risk that the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cash flow of the borrower and property securing the loan or debt, if any, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be insufficient to meet scheduled payments after giving effect to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the senior secured obligations of the borrower. This risk is generally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">higher for subordinated unsecured loans or debt, which are not backed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by a security interest in any specific collateral. Subordinated and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unsecured loans generally have greater price volatility than secured </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans and may be less liquid. There is also a possibility that originators </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will not be able to sell participations in subordinated or unsecured </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans, which would create greater credit risk exposure for the holders of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such loans. Subordinate and unsecured loans share the same risks as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other below investment grade securities.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There may be less readily available information about most loans and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the underlying borrowers than is the case for many other types of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities. Loans may be issued by borrowers that are not subject to SEC </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reporting requirements and therefore may not be required to file reports </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with the SEC or may file reports that are not required to comply with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">SEC form requirements. In addition, such borrowers may be subject to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">less stringent liability disclosure regime than companies subject to SEC </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reporting requirements. Loans may not be considered “securities,” and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchasers, such as the Fund, therefore may not be entitled to rely on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the anti-fraud protections of the federal securities laws. Because there is </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limited public information available regarding loan investments, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund is particularly dependent on the analytical abilities of the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investment Manager</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Economic exposure to loan interests through the use of derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions may involve greater risks than if the Fund had invested in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the loan interest directly during a primary distribution, through direct </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">originations or through assignments of, novations of or participations in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a loan acquired in secondary markets since, in addition to the risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">described above, certain derivative transactions may be subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leverage risk and greater illiquidity risk, counterparty risk, valuation risk </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other risks.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Loan Origination Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may originate loans, including, without limitation, residential </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or commercial real estate or mortgage-related loans, consumer </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans or other types of loans, which may be in the form of, and without </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limitation as to a loan’s level of seniority within a capital structure, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">whole loans, assignments, participations, secured and unsecured notes, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">senior and second lien loans, mezzanine loans, bridge loans or similar </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments. The Fund may originate loans to corporations and/or other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">legal entities and individuals, including foreign (non-U.S.) and emerging </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market entities and individuals. Loans may carry significant credit risks </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(for example, a borrower may not have a credit rating or score or may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have a rating or score that indicates significant credit risk). This may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">include loans to public or private firms or individuals, such as in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">connection with housing development projects. The loans the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invests in or originates may vary in maturity and/or duration. The Fund is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not limited in the amount, size or type of loans it may invest in and/or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">originate, including with respect to a single borrower or with respect to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">borrowers that are determined to be below investment grade, other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than pursuant to any applicable law. The Fund's investment in or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">origination of loans may also be limited by the requirements the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intends to observe under Subchapter M of the Code in order to qualify </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as a RIC. The Fund may subsequently offer such investments for sale to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">third parties; provided, that there is no assurance that the Fund will </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">complete the sale of such an investment. If the Fund is unable to sell, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assign or successfully close transactions for the loans that it originates, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund will be forced to hold its interest in such loans for an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">indeterminate period of time. This could result in the Fund's investments </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">having high exposure to certain borrowers. The Fund will be responsible </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for the expenses associated with originating a loan (whether or not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consummated). This may include significant legal and due diligence </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expenses, which will be indirectly borne by the Fund and Common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shareholders.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Bridge loans are generally made with the expectation that the borrower </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will be able to obtain permanent financing in the near future. Any delay </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in obtaining permanent financing subjects the bridge loan investor to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increased risk. A borrower's use of bridge loans also involves the risk </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the borrower may be unable to locate permanent financing to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">replace the bridge loan, which may impair the borrower's perceived </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">creditworthiness.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Loan origination and servicing companies are routinely involved in legal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceedings concerning matters that arise in the ordinary course of their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">business. In addition, a number of participants in the loan origination </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and servicing industry (including control persons of industry </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participants) have been the subject of regulatory actions by state </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulators, including state attorneys general, and by the federal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">government. Governmental investigations, examinations or regulatory </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">actions, or private lawsuits, including purported class action lawsuits, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may adversely affect such companies' financial results. To the extent the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund engages in origination and/or servicing directly, or has a financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest in, or is otherwise affiliated with, an origination or servicing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">company, the Fund will be subject to enhanced risks of litigation, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulatory actions and other proceedings. As a result, the Fund may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">required to pay legal fees, settlement costs, damages, penalties or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">charges, any or all of which could materially adversely affect the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and its holdings.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Foreign Loan Originations Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may originate loans to foreign entities and individuals, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including foreign (non-U.S.) and emerging market entities and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">individuals. Such loans may involve risks not ordinarily associated with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exposure to loans to United States entities and individuals. The foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lending industry may be subject to less governmental supervision and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulation than exists in the United States; conversely, foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulatory regimes applicable to the lending industry may be more </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">complex and more restrictive than those in the United States, resulting </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in higher costs associated with such investments, and such regulatory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regimes may be subject to interpretation or change without prior notice </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to investors, such as the Fund. Foreign lending may not be subject to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accounting, auditing, and financial reporting standards and practices </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">comparable to those in the United States</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Due to differences in legal </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systems, there may be difficulty in obtaining or enforcing a court </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">judgment outside the United States</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> In addition, to the extent that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments are made in a limited number of countries, events in those </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">countries will have a more significant impact on the Fund. The Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans to foreign entities and individuals may be subject to risks of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increased transaction costs, potential delays in settlement or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unfavorable differences between the U.S. economy and foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economies.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s exposure to loans to foreign entities and individuals may be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to withholding and other foreign taxes, which may adversely </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the net return on such investments. In addition, fluctuations in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">foreign currency exchange rates and exchange controls may adversely </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the market value of the Fund’s exposure to loans to foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entities and individuals. The Fund is unlikely to be able to pass through </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to its shareholders foreign income tax credits in respect of any foreign </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income taxes it pays.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Privacy and Data Security Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Gramm-Leach-Bliley Act (“GLBA”) and other laws limit the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disclosure of certain non-public personal information about a consumer </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to non-affiliated third parties and require financial institutions to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disclose certain privacy policies and practices with respect to </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information sharing with both affiliates and non-affiliated third parties. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Many states and a number of non-U.S. jurisdictions have enacted </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">privacy and data security laws requiring safeguards on the privacy and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security of consumers’ personally identifiable information. Other laws </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deal with obligations to safeguard and dispose of private information in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a manner designed to avoid its dissemination. Privacy rules adopted by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the U.S. Federal Trade Commission and SEC implement the GLBA and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other requirements and govern the disclosure of consumer financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information by certain financial institutions, ranging from banks to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">private investment funds. U.S. platforms following certain models </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally are required to have privacy policies that conform to these </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">GLBA and other requirements. In addition, such platforms typically have </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">policies and procedures intended to maintain platform participants’ </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">personal information securely and dispose of it properly.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund generally does not intend to obtain or hold borrowers’ </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-public personal information, and the Fund has implemented </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">procedures reasonably designed to prevent the disclosure of borrowers’ </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-public personal information to the Fund. However, service providers </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the Fund or its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subsidiaries</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, including their custodians and the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">platforms acting as loan servicers for the Fund or its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subsidiaries</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obtain, hold or process such information. The Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and entities that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interact with the Fund, including service providers, custodians and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">platforms are susceptible to operational, information security and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">related cybersecurity risks. The Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cannot guarantee the security of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-public personal information in the possession of such a service </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provider and cannot guarantee that service providers have been and will </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">continue to comply with the GLBA, other data security and privacy laws </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and any other related regulatory requirements. Violations of the GLBA </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other laws could subject the Fund to litigation and/or fines, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">penalties or other regulatory action, which, individually or in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">aggregate, could have an adverse effect on the Fund. The Fund may also </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">face regulations related to privacy and data security in the other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">jurisdictions in which the Fund invests.</div></div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Platform Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Alt Lending ABS in which the Fund may invest are typically not listed </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on any securities exchange and not registered under the Securities Act. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, the Fund anticipates that these instruments may only be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sold to a limited number of investors and may have a limited or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-existent secondary market. Accordingly, the Fund currently expects </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that certain of the investments it may make in Alt Lending ABS will face </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">heightened levels of liquidity risk. Although currently there is generally </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">no reliable, active secondary market for certain Alt Lending ABS, a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">secondary market for these Alt Lending ABS may develop. If the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchases Alt Lending ABS on an alternative lending platform, the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will have the right to receive principal and interest payments due on </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans underlying the Alt Lending ABS only if the platform servicing the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans receives the borrower’s payments on such loans and passes such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments through to the Fund. If a borrower is unable or fails to make </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments on a loan for any reason, the Fund may be greatly limited in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its ability to recover any outstanding principal or interest due, as (among </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other reasons) the Fund may not have direct recourse against the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">borrower or may otherwise be limited in its ability to directly enforce its </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rights under the loan, whether through the borrower or the platform </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">through which such loan was originated, the loan may be unsecured or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under-collateralized and/or it may be impracticable to commence a legal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeding against the defaulting borrower.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may have limited knowledge about the underlying loans and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is dependent upon the platform for information regarding underlying </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans. Although PIMCO may conduct diligence on the platforms, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund generally does not have the ability to independently verify the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information provided by the platforms, other than payment information </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regarding loans underlying the Alt Lending ABS owned by the Fund, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which the Fund observes directly as payments are received. With respect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to Alt Lending ABS that the Fund purchases in the secondary market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(i.e., not directly from an alternative lending platform), the Fund may not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perform the same level of diligence on such platform or at all. The Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not review the particular characteristics of the loans collateralizing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">an Alt Lending ABS, but rather negotiate in advance with platforms the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">general criteria of the underlying loans. As a result, the Fund is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dependent on the platforms’ ability to collect, verify and provide </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information to the Fund about each loan and borrower.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund relies on the borrower’s credit information, which is provided </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by the platforms. However, such information may be out of date, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incomplete or inaccurate and may, therefore, not accurately reflect the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">borrower’s actual creditworthiness. Platforms may not have an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligation to update borrower information, and, therefore, the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not be aware of any impairment in a borrower’s creditworthiness </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subsequent to the making of a particular loan. The platforms’ credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decisions and scoring models may be based on algorithms that could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potentially contain programming or other errors or prove to be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ineffective or otherwise flawed. This could adversely affect loan pricing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">data and approval processes and could cause loans to be mispriced or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">misclassified, which could ultimately have a negative impact on the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s performance.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, the underlying loans, in some cases, may be affected by the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">success of the platforms through which they are facilitated. Therefore, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disruptions in the businesses of such platforms may also negatively </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impact the value of the Fund’s investments. In addition, disruption in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">business of a platform could limit or eliminate the ability of the Fund to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invest in loans originated by that platform, and therefore the Fund could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lose some or all of the benefit of its diligence effort with respect to that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">platform.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Platforms are for-profit businesses that, as a general matter, generate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">revenue by collecting fees on funded loans from borrowers and by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assessing a loan servicing fee on investors, which may be a fixed annual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">amount or a percentage of the loan or amounts collected. This business </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could be disrupted in multiple ways; for example, a platform could file </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for bankruptcy or a platform might suffer reputational harm from </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">negative publicity about the platform or alternative lending more </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally and the loss of investor confidence in the event that a loan </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">facilitated through the platform is not repaid and the investor loses </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">money on its investment. Many platforms and/or their affiliates have </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incurred operating losses since their inception and may continue to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incur net losses in the future, particularly as their businesses grow and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">they incur additional operating expenses.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Platforms may also be forced to defend legal action taken by regulators </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or governmental bodies. Alternative lending is a newer industry </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operating in an evolving legal environment. Platforms may be subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk of litigation alleging violations of law and/or regulations, including, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for example, consumer protection laws, whether in the U.S. or in foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">jurisdictions. Platforms may be unsuccessful in defending against such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lawsuits or other actions and, in addition to the costs incurred in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fighting any such actions, platforms may be required to pay money in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">connection with the judgments, settlements or fines or may be forced to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">modify the terms of its borrower loans, which could cause the platform </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to realize a loss or receive a lower return on a loan than originally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">anticipated.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Platforms may also be parties to litigation or other legal action in an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">attempt to protect or enforce their rights or those of affiliates, including </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intellectual property rights, and may incur similar costs in connection </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with any such efforts.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investments in Alt Lending ABS may expose the Fund to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit risk of the issuer. Generally, such instruments are unsecured </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations of the issuer; an issuer that becomes subject to bankruptcy </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceedings may be unable to make full and timely payments on its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations to the Fund, even if the payments on the underlying loan or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans continue to be made timely and in full. In addition, when the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">owns Alt Lending ABS, the Fund and its custodian generally do not have </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a contractual relationship with, or personally identifiable information </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regarding, individual borrowers, so the Fund will not be able to enforce </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underlying loans directly against borrowers and may not be able to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">appoint an alternative servicing agent in the event that a platform or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">third-party servicer, as applicable, ceases to service the underlying loans. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Therefore, the Fund is more dependent on the platform for servicing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than if the Fund had owned whole loans through the platform. Where </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such interests are secured, the Fund relies on the platform to perfect the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s security interest. In addition, there may be a delay between the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time the Fund commits to purchase an instrument issued by a platform, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its affiliate or a special purpose entity sponsored by the platform or its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affiliate and the issuance of such instrument and, during such delay, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">funds committed to such an investment will not earn interest on the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment nor will they be available for investment in other alternative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lending-related instruments, which will reduce the effective rate of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">return on the investment. The Fund’s investments in Alt Lending ABS </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be illiquid.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Liquidity Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent consistent with the applicable liquidity requirements for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interval funds under Rule 23c-3 of the 1940 Act, the Fund may invest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">without </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limitation</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> in illiquid investments. Liquidity risk exists when </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particular investments are difficult to purchase or sell. Illiquid </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments are investments that the Fund reasonably expects cannot </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be sold or disposed of in current market conditions in seven calendar </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">days or less without the sale or disposition significantly changing the </span></span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market value of the investment. Illiquid investments may become harder </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to value, especially in changing markets. The Fund's investments in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">illiquid investments may reduce the returns of the Fund because it may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be unable to sell the illiquid investments at an advantageous time or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">price or possibly require the Fund to dispose of other investments at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unfavorable times or prices in order to satisfy its obligations, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could prevent the Fund from taking advantage of other investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">opportunities. Illiquidity can be caused by, among other things, a drop in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">overall market trading volume, an inability to find a willing buyer, or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">legal restrictions on the securities’ resale</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, capital controls, delays or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limits on repatriation of local currency, or insolvency of local </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">governments</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. Additionally, the market for certain investments may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">become illiquid under adverse market or economic conditions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">independent of any specific adverse changes in the conditions of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">particular issuer, such as during </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes in</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">elevated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatility,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market or geopolitical disruptions</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, economic uncertainty or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">public health crises</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. There can be no assurance that an investment that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is deemed to be liquid when purchased will continue to be liquid while </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">it is held by a fund and/or when a fund wishes to dispose of it. Bond </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets have consistently grown over </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> while the capacity for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">traditional dealer counterparties to engage in fixed income trading has </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not kept pace </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with the growth of bond markets and may remain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">constrained</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. As a result, dealer inventories of corporate bonds, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provide a core indication of the ability of financial intermediaries to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">“make markets,” </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">remain limited relative to the size of the market</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Because market makers seek to provide stability to a market through </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">their intermediary services, the significant reduction in dealer inventories </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could potentially lead to decreased liquidity and increased volatility in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the fixed income markets</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">especially</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> during periods of economic </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">uncertainty</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> or market stress</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In such cases, the Fund, due to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the difficulty in purchasing and selling </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such securities or instruments, may be unable to achieve its desired level </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of exposure to a certain sector. To the extent that the Fund's principal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment strategies involve securities of companies with smaller </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market capitalizations, foreign (non-U.S.) securities, Rule 144A </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities, illiquid sectors of fixed income securities, derivatives or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities with substantial market and/or credit risk, the Fund will tend </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to have the greatest exposure to liquidity risk.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Further, fixed income securities with longer durations until maturity face </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">heightened levels of liquidity risk as compared to fixed income securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with shorter durations until maturity. The risks associated with illiquid </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments may be particularly acute in situations in which the Fund's </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operations require cash (such as in connection with repurchase offers) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and could result in the Fund borrowing to meet its short-term needs or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incurring losses on the sale of illiquid instruments. It may also be the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">case that other market participants may be attempting to liquidate fixed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income holdings at the same time as the Fund, causing increased supply </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the market and contributing to liquidity risk and downward pricing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pressure.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent the Fund invests in Alt <div style="display:inline;">Lending </div>ABS, the Alt Lending ABS in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which the Fund invests are typically not listed on any securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exchange and not registered under the Securities Act. In <div style="display:inline;">addition</div>, the </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund anticipates that these instruments may only be sold to a limited </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">number of investors and may have a limited or non-existent secondary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market. Accordingly, the Fund currently expects that certain of its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments in Alt Lending ABS will face heightened levels of liquidity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk. Although currently there is generally no active reliable, secondary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market for certain Alt Lending ABS, a secondary market for these </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">alternative lending-related instruments may develop.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Liquidity risk also refers to the risk that the Fund may be required to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">hold additional cash or sell other investments in order to obtain cash to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">close out derivatives or meet the liquidity demands that derivatives can </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">create to make payments of margin, collateral, or settlement payments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to counterparties. The Fund may have to sell a security at a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disadvantageous time or price to meet such obligations.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The action(s) of governments and regulators may have the effect of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reducing market liquidity, market resiliency and money supply.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">“Covenant-Lite” Obligations Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Covenant-lite obligations contain fewer maintenance covenants than </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other obligations, or no maintenance covenants, and may not include </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">terms that allow the lender to monitor the performance of the borrower </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and declare a default if certain criteria are breached, which would allow </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the lender to restructure the loan or take other action intended to help </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mitigate losses. Covenant-lite loans carry a risk that the borrower could </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transfer or encumber its assets, which could reduce the amount of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets that can be used to satisfy debts and result in losses for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debtholders. Covenant-lite loans may carry more risk than traditional </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans as they allow individuals and corporations to engage in activities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that would otherwise be difficult or impossible under a covenant-heavy </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loan agreement. In the event of default, covenant-lite loans may exhibit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">diminished recovery values as the lender may not have the opportunity </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to negotiate with the borrower prior to default.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Reinvestment Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Income from the Fund’s portfolio will decline if and when the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invests the proceeds from matured, traded or called debt obligations at </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market interest rates that are below the portfolio’s current earnings </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate.For instance, during periods of declining interest rates, an issuer of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">debt obligations may exercise an option to redeem securities prior to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">maturity, forcing the Fund to invest in lower-yielding securities. The Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">also may choose to sell higher yielding portfolio securities and to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchase lower yielding securities to achieve greater portfolio </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">diversification, because the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investment Manager believes</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> the current </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">holdings are overvalued or for other investment-related reasons. A </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decline in income received by the Fund from its investments is likely to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have a negative effect on dividend levels and the market price, NAV </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or overall return of the Common Shares.</span></span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Call Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Call risk refers to the possibility that an issuer may exercise its right to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">redeem a fixed income security earlier than expected (a call). Issuers </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may call outstanding securities prior to their maturity for a number of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reasons (e.g., declining interest rates, changes in credit spreads and </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">improvements in the issuer’s credit quality)</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, and changes in the rate at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which prepayments or redemptions occur can affect the return on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment of these securities</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. If an issuer calls a security in which the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund has invested, the Fund may not recoup the full amount of its initial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment or may not realize the full anticipated earnings from the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment and may be forced to reinvest in lower-yielding securities, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities with greater credit risks or securities with other, less favorable </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">features.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Real Estate Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent that the Fund invests directly or indirectly in real estate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments, including investments in equity or debt securities issued by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">private and public REITs, real estate operating companies (“REOCs”), </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">private or public real estate-related loans</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">real estate-linked derivative </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and pooled investment vehicles (including registered </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment companies and private funds or other pooled investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">vehicles that would qualify as “investment companies” under the 1940 </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Act but for an applicable exemption or exclusion) that invest in real </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">estate investments</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, it will be subject to the risks associated with owning </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">real estate and with the real estate industry generally. These </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments carry increased risks, which include, but are not limited to: </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the burdens of ownership of real property; general and local economic </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions (such as an oversupply of space or a reduction in demand for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">space); fluctuations in the supply and demand for properties (including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">competition based on rental rates); energy and supply shortages; </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fluctuations in average occupancy and room rates; the attractiveness, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">type and location of the properties and changes in the relative </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">popularity of commercial properties as an investment; the financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">condition and resources of tenants, buyers and sellers of properties; </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increased mortgage defaults; the quality of maintenance, insurance and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">management services; changes in the availability of debt financing </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may render the sale or refinancing of properties difficult or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impracticable; changes in building, environmental and other laws </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or regulations (including those governing usage and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">improvements), fiscal policies and zoning laws; changes in real property </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tax rates; changes in interest rates and the availability of mortgage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">funds which may render the sale or refinancing of properties difficult or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impracticable; changes in operating costs and expenses; energy and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">supply shortages; uninsured losses or delays from casualties or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">condemnation; negative developments in the economy that depress </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">travel or leasing activity; environmental liabilities; contingent liabilities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on disposition of assets; uninsured or uninsurable casualties; </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insurance </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">costs or the lack of availability of insurance coverage;</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> acts of God, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including earthquakes, hurricanes and other natural disasters; social </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unrest and civil disturbances, epidemics, pandemics or other public </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">crises; terrorist attacks and war; risks and operating problems arising </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">out of the presence of certain construction materials, structural or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">property level latent defects, work stoppages, shortages of labor, strikes, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">union relations and contracts, fluctuating prices and supply of labor </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or other labor-related factor; and other factors which are beyond </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the control of PIMCO and its affiliates. In addition, the Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments will be subject to various risks which could cause </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fluctuations in occupancy, rental rates, operating income and expenses </span></span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or which could render the sale or financing of its properties difficult or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unattractive. For example, following the termination or expiration of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tenant’s lease, there may be a period of time before receiving rental </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments under a replacement lease. During that period, the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would continue to bear fixed expenses such as interest, real estate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taxes, maintenance and other operating expenses. In addition, declining </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economic conditions may impair the ability to attract replacement </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tenants and achieve rental rates equal to or greater than the rents paid </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under previous leases. Increased competition for tenants may require </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital improvements to properties which would not have otherwise </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">been planned.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Ultimately, to the extent it is not possible to renew leases or re-let space </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as leases expire, decreased cash flow from tenants will result, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could adversely impact the Fund’s operating results.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Real estate values have historically been cyclical. As the general </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economy grows, demand for real estate increases and occupancies and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rents may increase. As occupancies and rents increase, property values </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase, and new development occurs. As development may occur, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">occupancies, rents and property values may decline. Because leases are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">usually entered into for long periods and development activities often </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">require extended times to complete, the real estate value cycle often </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lags the general business cycle. Because of this cycle, real estate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">companies may incur large swings in their profits and the prices of their </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities. Developments following the onset of COVID-19 have </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adversely impacted certain commercial real estate markets, causing the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deferral of mortgage payments, renegotiated commercial mortgage </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loans, commercial real estate vacancies or outright mortgage defaults. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">These developments accelerated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">macro trends such as work from home </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and online shopping which have negatively impacted (and may continue </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to negatively impact) certain industries, such as brick-and-mortar retail.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The total returns available from investments in real estate generally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">depend on the amount of income and capital appreciation generated by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the related properties. The performance of real estate, and thereby the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund, will be reduced by any related expenses, such as expenses paid </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">directly at the property level and other expenses that are capitalized or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise embedded into the cost basis of the real estate.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Separately, certain service providers to the Fund and/or its Subsidiaries, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as applicable, with respect to its real estate or real estate-related </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments may be owned by, employed by, or otherwise related to, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO, Allianz SE, their affiliates and/or their respective employees, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consultants and other personnel. PIMCO may, in its sole discretion, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">determine to provide, or engage or recommend an affiliate of PIMCO to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provide, certain services to the Fund, instead of engaging or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recommending one or more third parties to provide such services. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subject to the governance requirements of a particular fund and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">applicable law, PIMCO or its affiliates, as applicable, will receive </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">compensation in connection with the provision of such services. As a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result, PIMCO faces a conflict of interest when selecting or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recommending service providers for the Fund. Fees paid to an affiliated </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">service provider will be determined in PIMCO's commercially reasonable </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">discretion. Although PIMCO has adopted various policies and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">procedures intended to mitigate or otherwise manage conflicts of </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest with respect to affiliated service providers, there can be no </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">guarantee that such policies and procedures (which may be modified or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">terminated at any time in PIMCO's sole discretion) will be successful.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investments in real estate (including indirectly through </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">private funds treated as partnerships for U.S. federal income tax </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purposes) will potentially be limited by the Fund’s intention to qualify as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a RIC and will potentially limit the Fund’s ability to so qualify. Income </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and gains from direct investments in real estate do not constitute </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">qualifying income to a RIC for purposes of the 90% gross income test </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">described below. If the Fund's income or gain from a particular </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment were determined to constitute nonqualifying income, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in certain cases may be determined retroactively, and the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">nonqualifying income from all sources were to exceed 10% of its gross </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income in any taxable year, or the Fund’s nonqualifying income in any </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taxable year otherwise exceeded 10% of its gross income, the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would fail to qualify as a RIC unless it were eligible to and did pay a tax </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at the Fund level. See “Tax Risk” below for additional details.</div></div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Private Funds Risk – Tax Risk</span></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Special tax risks are associated with an investment in the Fund. The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund intends to qualify and elect to be treated as a RIC under </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subchapter M of the Code. As such, the Fund must satisfy, among other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">requirements, diversification and 90% gross income requirements, and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a requirement that it distribute at least 90% of its ordinary income and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">net short-term gains in the form of deductible dividends. Each of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">aforementioned ongoing requirements for qualification for the favorable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tax treatment available to RICs requires that the Fund obtain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information from or about the Private Funds in which the Fund is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invested. However, Private Funds generally are not obligated to disclose </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the contents of their portfolios. This lack of transparency may make it </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficult for the Investment Manager to monitor the sources of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s income and the diversification of its assets, and otherwise to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">comply with Subchapter M of the Code. Ultimately this may limit the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">universe of Private Funds in which the Fund can invest and may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adversely bear on the Fund’s ability to qualify as a RIC under Subchapter </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">M of the Code. The Fund expects to receive information from each </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Private Fund regarding its investment performance on a regular basis. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Private Funds and other entities classified as partnerships for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. federal income tax purposes may generate income allocable to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund that is not qualifying income for purposes of the 90% gross </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income test. In order to meet the 90% gross income test, the Fund may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">structure its investments in a manner that potentially increases the taxes </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">imposed thereon or in respect thereof. Because the Fund may not have </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">timely or complete information concerning the amount or sources of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such a Private Fund’s income until such income has been earned by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Private Fund or until a substantial amount of time thereafter, it may be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficult for the Fund to satisfy the 90% gross income test.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In the event that the Fund believes that it is possible that it will fail the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">asset diversification requirement at the end of any quarter of a taxable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">year, it may seek to take certain actions to avert such failure, including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by acquiring additional investments to come into compliance with the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">asset diversification tests or by disposing of non-diversified assets. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Although the Code affords the Fund the opportunity, in certain </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">circumstances, to cure a failure to meet the asset diversification test, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including by disposing of non-diversified assets within six months, there </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be constraints on the Fund’s ability to dispose of its interest in a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Private Fund that limit utilization of this cure period.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund must distribute at least 90% of its investment company </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taxable income, in a manner qualifying for the dividends-paid </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deduction, to qualify as a RIC, and must distribute substantially all of its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income in order to avoid a fund-level tax. In addition, if the Fund were </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to fail to distribute in a calendar year a sufficient amount of its income </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for such year, it would be subject to an excise tax. The determination of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the amount of distributions sufficient to qualify as a RIC and avoid a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fund-level income or excise tax will depend on income and gain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information that must be obtained from the underlying Private Funds. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investment in Private Funds may make it difficult to estimate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s income and gains in a timely fashion, which may increase the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">likelihood that the Fund will be liable for the excise tax with respect to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain undistributed amounts. See “Principal Risks of the Fund—Tax </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Risk” in this Prospectus and “Taxation” in the Statement of Additional </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Information.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">U.S. Government Securities Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain U.S. government securities, such as U.S. Treasury bills, notes, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bonds</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and mortgage-related securities guaranteed by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Government </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">National Mortgage Association (“</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">GNMA</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">”)</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, are supported by the full </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">faith and credit of the United States; others, such as those of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">FHLBs</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">FHLMC</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, are supported by the right of the issuer to borrow from </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the U.S. Treasury; others, such as those of the FNMA, are supported by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the discretionary authority of the U.S. government to purchase the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agency’s obligations; and still others are supported only by the credit of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the agency, instrumentality or corporation. U.S. government securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are subject to market risk, interest rate risk and credit risk. Although </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">legislation has been enacted to support certain government sponsored </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entities, including the FHLBs, FHLMC and FNMA, there is no assurance </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the obligations of such entities will be satisfied in full, or that such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations will not decrease in value or default. It is difficult, if not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impossible, to predict the future political, regulatory or economic </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes that could impact the government sponsored entities and the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">values of their related securities or obligations. In addition, certain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">governmental entities, including FNMA and FHLMC, have been subject </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to regulatory scrutiny regarding their accounting policies and practices </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other concerns that may result in legislation, changes in regulatory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">oversight and/or other consequences that could adversely affect the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">credit quality, availability or investment character of securities issued by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these entities. Yields available from U.S. government debt securities are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally lower than the yields available from such other securities. The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">values of U.S. government securities change as interest rates fluctuate.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Periodically, uncertainty regarding the status of negotiations in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. government to increase the statutory debt ceiling could increase the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk that the U.S. government may default on payments on certain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. government securities, cause the credit rating of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. government to be downgraded, increase volatility in the stock and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bond markets, result in higher interest rates, reduce prices of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Treasury and other securities, and/or increase the costs of various </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">kinds of debt. If a government-sponsored entity is negatively impacted </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by legislative or regulatory action (or lack thereof), is unable to meet its </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations, or its creditworthiness declines, the performance of a fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that holds securities of the entity will be adversely impacted.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Convertible Securities Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Convertible securities are fixed income securities, preferred securities or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other securities that are convertible into or exercisable for common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">stock of the issuer (or cash or securities of equivalent value) at either a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">stated price or a stated rate. Convertible debt securities pay interest and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">convertible preferred stocks pay dividends until they mature or are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">converted, exchanged or redeemed. The market values of convertible </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities may decline as interest rates increase and, conversely, may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase as interest rates decline. A convertible security’s market value, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">however, tends to reflect the market price of the common stock of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuing company when that stock price approaches or is greater than </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the convertible security’s “conversion price.” The conversion price is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">defined as the predetermined price at which the convertible security </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could be exchanged for the associated stock. Certain types of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">convertible securities may decline in value or lose their value entirely in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the event the issuer’s financial condition becomes significantly impaired. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">As the market price of the underlying common stock declines, the price </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the convertible security tends to be influenced more by the yield of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the convertible security. Thus, it may not decline in price to the same </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent as the underlying common stock. In the event of a liquidation of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the issuing company, holders of convertible securities may be paid </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">before the company’s common stockholders but after holders of any </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">senior debt obligations of the company. Consequently, the issuer’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">convertible securities generally entail less risk than its common stock </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">but more risk than its other debt obligations. Convertible securities are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">often rated below investment grade or not rated.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Contingent Convertible Securities Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">CoCos have no stated maturity, have fully discretionary coupons and are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">typically issued in the form of subordinated debt instruments. CoCos </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally either convert into equity or have their principal written down </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(including potentially to zero) upon the occurrence of certain triggering </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">events (“triggers”) linked to regulatory capital thresholds or regulatory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">actions relating to the issuer’s continued viability. As a result, an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment by the Fund in CoCos is subject to the risk that coupon (</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; font-style: normal; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-style:italic;display:inline;">i.e.</span></span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest) payments may be cancelled by the issuer or a regulatory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">authority in order to help the issuer absorb losses and the risk of total </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">loss. If such an event occurs, an investor may not have any rights to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repayment of the principal amount of the securities. Additionally, an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investor may not be able to collect interest payments or dividends on </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such securities. An investment by the Fund in CoCos is also subject to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the risk that, in the event of the liquidation, dissolution or winding-up of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">an issuer prior to a trigger event, the Fund’s rights and claims will </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generally rank junior to the claims of holders of the issuer’s other debt </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations and CoCos may also be treated as junior to an issuer’s other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations and securities. In addition, if CoCos held by the Fund are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">converted into the issuer’s underlying equity securities following a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trigger event, the Fund’s holding may be further subordinated due to </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the conversion from a debt</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">-</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">-</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">equity instrument. Further, the value of an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment in CoCos is unpredictable and will be influenced by many </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">factors and risks, including interest rate risk, credit risk, market risk and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity risk. An investment by the Fund in CoCos may result in losses to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Valuation Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain securities in which the Fund i<span style="display:inline;">nves</span>ts may be less liquid and more </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficult to value than other types of securities. Investments for which </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market quotations are not readily available are valued at fair value as </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">determined in good faith pursuant to Rule 2a-5 under the 1940 Act. Fair </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value pricing may require subjective determinations about the value of a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security or other asset. As a result, there can be no assurance that fair </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value pricing will result in adjustments to the prices of securities or other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets or that fair value pricing will reflect actual market value, and it is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">possible that the fair value determined for a security or other asset will </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be materially different from quoted or published prices, from the prices </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">used by others for the same security or other asset and/or from the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value that actually could be or is realized upon the sale of that security </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or other asset.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Leverage Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s use of leverage (as described under “Use of Leverage” in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">body of this prospectus) creates the opportunity for increased Common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Share net income, but also creates special risks for Common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shareholders (including an increased risk of loss). To the extent used, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">there is no assurance that the Fund’s leveraging strategies will be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">successful. Leverage is a speculative technique that may expose the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund to greater risk and increased costs. The Fund’s assets attributable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to leverage, if any, will be invested in accordance with the Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment objective and policies as described in this prospectus. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Interest expense payable by the Fund with respect to derivatives and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other forms of leverage, and dividends payable with respect to preferred </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shares outstanding, if any, will generally be based on shorter-term </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest rates that would be periodically reset. So long as the Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portfolio investments provide a higher rate of return (net of applicable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund expenses) than the interest expenses and other costs to the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of such leverage, the investment of the proceeds thereof will generate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more income than will be needed to pay the costs of the leverage. If so, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and all other things being equal, the excess may be used to pay higher </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dividends to Common Shareholders than if the Fund were not so </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leveraged. If, however, shorter-term interest rates rise relative to the rate </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of return on the Fund’s portfolio, the interest and other costs to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund of leverage could exceed the rate of return on the debt obligations </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other investments held by the Fund, thereby reducing return to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shareholders. When the Fund reduces or discontinues its use </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of leverage (“deleveraging”), </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">it may be required to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sell portfolio </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities at inopportune times to repay leverage obligations, which </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could result in realized losses and a decrease in the Fund's </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">NAV</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Deleveraging involves complex operational processes, including the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">coordination of asset sales, repayment of debt, and potential </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restructuring of the Fund's capital and may involve significant costs, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including transaction costs associated with the sale of portfolio </span></span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities, prepayment penalties on borrowed funds, and, if applicable, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fees related to the redemption of preferred shares. Leveraging </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions pursued by the Fund may increase its duration and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sensitivity to interest rate changes and other market risks. The Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">continue to use leverage even if available financing rates are higher </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than anticipated returns, including, for example, in cases where </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deleveraging, including any expenses related thereto, might be viewed </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as detrimental to the Fund’s portfolio. In addition, fees and expenses of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any form of leverage used by the Fund will be borne entirely by the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shareholders (and not by preferred shareholders, if any) and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will reduce the investment return of the Common Shares. Therefore, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">there can be no assurance that the Fund’s use of leverage will result in a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">higher yield on the Common Shares, and it may result in losses. In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, any preferred shares issued by the Fund are expected to pay </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cumulative dividends, which may tend to increase leverage risk. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Leverage creates several major types of risks for Common Shareholders, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including:</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div><div style="clear:both;margin-top:6pt;position:relative;width:100%"><div style="float:left;line-height:12.0pt;margin-left:10pt;text-align:left;width:5.56pt"><div style="color: rgb(30, 130, 151); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">■</div></div><div style="float:left;line-height:12.0pt;margin-left:6.44pt;text-align:left;width:233.00pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the likelihood of greater volatility of NAV of Common Shares, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the investment return to Common Shareholders, than a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">comparable portfolio without leverage;</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="clear: both; position: relative; max-height: 0px;"> </div></div><div><div style="clear:both;position:relative;width:100%"><div style="float:left;line-height:12.0pt;margin-left:10pt;text-align:left;width:5.56pt"><div style="color: rgb(30, 130, 151); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">■</div></div><div style="float:left;line-height:12.0pt;margin-left:6.44pt;text-align:left;width:233.00pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the possibility either that Common Share dividends will fall if the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest and other costs of leverage rise, or that dividends paid on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares will fluctuate because such costs vary over time; </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="clear: both; position: relative; max-height: 0px;"> </div></div><div><div style="clear:both;position:relative;width:100%"><div style="float:left;line-height:12.0pt;margin-left:10pt;text-align:left;width:5.56pt"><div style="color: rgb(30, 130, 151); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">■</div></div><div style="float:left;line-height:12.0pt;margin-left:6.44pt;text-align:left;width:233.00pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the effects of leverage in a declining market or a rising interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rate environment, as leverage is likely to cause a greater decline in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the NAV of the Common Shares than if the Fund were not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leveraged.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="clear: both; position: relative; max-height: 0px;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, the counterparties to the Fund’s leveraging transactions and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any preferred shareholders of the Fund will have complete priority of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment over the Fund’s Common Shareholders.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Reverse repurchase agreements involve the risks that the interest </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income earned on the investment of the proceeds will be less than the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest expense and Fund expenses associated with the repurchase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agreement, that the market value of the securities sold by the Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decline below the price at which the Fund is obligated to repurchase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such securities and that the securities may not be returned to the Fund. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There is no assurance that reverse repurchase agreements can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">successfully employed. Dollar roll/buyback transactions involve the risk </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that the market value of the securities the Fund is required to purchase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may decline below the agreed upon repurchase price of those securities. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Successful use of dollar rolls/buybacks may depend upon the Investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Manager’s ability to correctly predict interest rates and prepayments. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There is no assurance that dollar rolls/buybacks can be successfully </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">employed. In connection with reverse repurchase agreements and dollar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rolls/buybacks, the Fund will also be subject to counterparty risk with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">respect to the purchaser of the securities. If the broker/dealer to whom </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund sells securities becomes insolvent, the Fund’s right to purchase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or repurchase securities may be restricted.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may engage in total return swaps, reverse repurchases, loans </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of portfolio securities, short sales and when-issued, delayed delivery and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">forward commitment transactions, credit default swaps, basis swaps </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other swap agreements<div style="display:inline;">, purc</div>hases or sales of futures and forward </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contracts (including foreign currency exchange contracts), call and put </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">options or other derivatives. The Fund’s use of such transactions gives </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rise to associated leverage risks described above, and may adversely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the Fund’s income, distributions and total returns to Common </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shareholders. To the extent that any offsetting positions do not behave </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in relation to one another as expected, the Fund may perform as if it is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leveraged through use of these derivative strategies.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Any total return swaps, reverse repurchases, loans of portfolio securities, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">short sales and when-issued, delayed delivery and forward commitment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions, credit default swaps, basis swaps and other swap </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agreements, purchases or sales of futures and forward contracts </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(including foreign currency exchange contracts), call and put options or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other derivatives by the Fund or counterparties to the Fund’s other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leveraging transactions, if any, would have seniority over the Fund’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Because the fees received by the Investment Manager may increase </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">depending on the types of leverage utilized by the Fund, the Investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Manager has a financial incentive for the Fund to use certain forms of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leverage, which may create a conflict of interest between the Investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Manager, on the one hand, and the Common Shareholders, on the other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">hand. </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent that any Subsidiary of the Fund directly incurs leverage in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the form of debt or preferred shares, the amount of such leverage used </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by the Fund and such Subsidiaries will be consolidated and treated as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">senior securities for purposes of complying with the 1940 Act’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limitations on leverage by the Fund.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Focused Investment Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent that the Fund focuses its investments in a particular sector, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">it may be susceptible to loss due to adverse developments affecting that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sector, including (but not limited to): governmental regulation; inflation; </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rising interest rates; cost increases in raw materials, fuel and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operating expenses; technological innovations that may render existing </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">products and equipment obsolete; competition from new entrants; high </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">research and development costs; increased costs associated with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">compliance with environmental or other governmental regulations; and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other economic, business or political developments specific to that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sector. Furthermore, the Fund may invest a substantial portion of its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assets in companies in related sectors that may share common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">characteristics, are often subject to similar business risks and regulatory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">burdens, and whose securities may react similarly to the types of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developments described above, which will subject the Fund to greater </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk. The Fund also will be subject to focused investment risk to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent that it invests a substantial portion of its assets in a particular </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuer, market, asset class, country or geographic region.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Equity Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Equity securities represent an ownership interest, or the right to acquire </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">an ownership interest, in an issuer. Equity securities also include, among </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other things, common stocks, preferred securities, convertible stocks and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">warrants. The values of equity securities, such as common stocks and </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">preferred securities, may decline due to general market conditions that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are not specifically related to a particular company, such as real or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perceived adverse economic conditions, changes in the general outlook </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for corporate earnings, changes in inflation, interest or currency rates, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial system instability or adverse investor sentiment generally. They </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may also decline due to factors that affect a particular industry or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">industries, such as regulatory changes, labor shortages or increased </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">production costs and competitive conditions within an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">industry.Conversely, a change in financial condition or other event </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affecting a single issuer or industry may adversely impact securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets as a whole. Equity securities generally have greater price </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatility than most fixed income securities. These risks are generally </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">magnified in the case of equity investments in distressed companies.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Other Pooled Investment Vehicles Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subject to applicable limits under the 1940 Act, the Fund may invest in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other pooled investment vehicles, including investment companies, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">private funds or other pooled investment vehicles that would qualify as </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">“investment companies” under the 1940 Act but for an applicable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exemption or exclusion, including but not limited to Sections 3(c)(1) or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">3(c)(7) of the 1940 Act (“Private Funds”). When investing in an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment company, the Fund will generally bear its ratable share of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that investment company's expenses and would remain subject to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment of the Fund's investment management fees and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expenses with respect to assets so invested. Common Shareholders </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would therefore be subject to duplicative expenses to the extent the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund invests in other investment companies. In addition, other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment companies may utilize leverage, in which case an investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would subject the Fund to additional risks associated with leverage. Due </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to its own financial interest or other business considerations, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investment Manager may choose to invest a portion of the Fund’s assets </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in investment companies sponsored or managed by the Investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Manager or its related parties in lieu of investments by the Fund directly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in portfolio securities, or may choose to invest in such investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">companies over investment companies sponsored or managed by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">others. Participation in a cash sweep program where the Fund's </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">uninvested cash balance is used to purchase shares of affiliated or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unaffiliated money market funds or cash management pooled </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment vehicles at the end of each day subjects the Fund to the risks </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with the underlying money market funds or cash </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">management pooled investment vehicles, including liquidity risk. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Applicable law may limit the Fund’s ability to invest in other investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">companies.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent the Fund invests through one or more Private Funds, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund would be exposed to the risks associated with such Private Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments. The Fund’s investments in Private Funds would not be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to the protections afforded to shareholders under the 1940 Act. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">These protections include, among others, certain corporate governance </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">standards, such as the requirement of having a certain percentage of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the directors serving on a board as independent directors, statutory </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">protections against self-dealing by Private Fund managers, and leverage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limitations. By investing in Private Funds indirectly through the Fund, a </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shareholder would bear two layers of asset-based fees and expenses – </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at the Fund level and the Private Fund level – in addition to indirectly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bearing any performance fees charged by the Private Fund.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Derivatives Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may, but is not required to, utilize a variety of derivative </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments (both long and short positions) for investment or risk </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">management purposes. Additionally, the Fund may invest in futures and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other derivatives that provide equity exposures, including for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">equitization and hedging purposes, using derivatives that provide </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exposure that is not identical to the instruments or markets in which the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund seeks to invest 80% of its assets. Derivatives or other similar </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments (referred to collectively as “derivatives”) are financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contracts whose value depends on, or is derived from, the value of an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underlying asset, reference rate or index. For example, the Fund may use </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivative instruments for purposes of increasing liquidity, providing </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">efficient portfolio management, broadening investment opportunities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(including taking short or negative positions), implementing a tax or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cash management strategy, gaining exposure to a particular security or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">segment of the market, modifying the effective duration of the Fund's </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portfolio investments and/or enhancing total return. Investments in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives may take the form of buying and/or writing (selling) </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives, and/or the Fund may otherwise become an obligor under a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives transaction. These transactions may produce short-term </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital gains in the form of premiums or other returns for the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(which may support, constitute and/or increase the distributions paid by, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or the yield of, the Fund) but create the risk of losses that can </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significantly exceed such current income or other returns. For example, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the premium received for writing a call option may be dwarfed by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">losses the Fund may incur if the call option is exercised, and derivative </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions where the Fund is an obligor can produce an up-front </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">benefit, but the potential for leveraged losses. The distributions, or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distribution rates, paid by the Fund should not be viewed as the total </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">returns or overall performance of the Fund. These strategies may also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">produce adverse tax consequences (for example, the Fund’s income and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">gain-generating strategies may generate current income and gains, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including short-term capital gains, taxable as ordinary income) and limit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s opportunity to profit or otherwise benefit from certain gains. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may enter into opposing derivative transactions, or otherwise </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">take opposing positions. Such transactions can generate distributable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">gains (which, as noted elsewhere, may be taxed as ordinary income) and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">create the risk of losses and NAV declines.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may engage in investment strategies, including the use of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives, to, among other things, generate current, distributable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income, even if such strategies could potentially result in declines in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s net asset value. The Fund’s income and gain-generating </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategies, including certain derivatives strategies, may generate current </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income and gains, including short-term capital gains, taxable as </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ordinary income sufficient to support distributions, even in situations </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">when the Fund has experienced a decline in net assets due to, for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">example, adverse changes in the broad U.S. or non-U.S. securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets or the Fund’s portfolio of investments, or arising from its use of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives. Consequently, Fund shareholders may receive distributions </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to tax at ordinary income rates at a time when their investment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the Fund has declined in value, which may be economically similar to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a taxable return of capital.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The use of derivatives involves risks different from, and possibly greater </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than, the risks associated with investing directly in securities and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">traditional investments. Derivatives, which may increase market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exposure, are subject to a number of risks, including leverage risk, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity risk (which may be heightened for highly-customized </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives), interest rate risk, market risk, counterparty (including credit) </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk, operational risk (such as documentation issues, settlement issues </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and systems failures), legal risk (such as insufficient documentation, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insufficient capacity or authority of a counterparty, and issues with the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">legality or enforceability of a contract), management risk, risks arising </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from changes in applicable regulatory requirements, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">governmental risk, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions risk,</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> risks arising from margin requirements and risks arising </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from mispricing or valuation complexity (including the risk of improper </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">valuation), </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as well as the risks associated with the underlying asset, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reference rate or index</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. They also involve the risk that changes in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value of a derivative instrument may not correlate perfectly with the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underlying asset, rate or index. By investing in a derivative instrument, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund could lose more than the initial amount invested, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives may increase the volatility of the Fund, especially in unusual </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or extreme market conditions. In addition, the use of derivatives may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cause the Fund’s investment returns to be impacted by the performance </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of assets the Fund does not own, potentially resulting in the Fund’s total </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment exposure exceeding the value of its portfolio. Certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives have the potential for unlimited loss, regardless of the size of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the initial investment. The Fund may utilize asset segregation and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">posting of collateral for risk management or other purposes. The Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be required to hold additional cash or sell other investments in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">order to obtain cash to close out a position and changes in the value of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a derivative may also create margin delivery or settlement payment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obligations for the Fund. Also, suitable derivative transactions may not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be available in all circumstances and there can be no assurance that the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund will engage in these transactions to reduce exposure to other risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">when that would be beneficial or that, if used, such strategies will be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">successful. The Fund's use of derivatives may increase or accelerate the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">amount of taxes payable by Common Shareholders.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Non-centrally-cleared </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">over</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">-the-counter (“OTC”) derivatives are also </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to the risk that a counterparty to the transaction will not fulfill </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its contractual obligations to the other party, as many of the protections </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">afforded to centrally-cleared derivative transactions might not be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">available for non-centrally-cleared OTC derivatives. The primary credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk on derivatives that are exchange-traded or traded through a central </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">clearing counterparty resides with the Fund's clearing broker, or the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">clearinghouse.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Derivatives that are cleared by a central clearing organization can still </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be subject to different risks, including the creditworthiness of the central </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">clearing organization and its members.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, derivatives that are traded on an exchange are subject to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the risk that an exchange may limit the maximum daily price fluctuation </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of a derivative contract and restrict or suspend trading of a contract that </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">has reached a limit. Such limit governs only price movements of a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contract during a particular trading day and therefore does not limit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potential losses because the limit may work to prevent the liquidation of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unfavorable positions. A daily limit may be reached for several </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consecutive days with little or no trading.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Participation in the markets for derivative instruments involves </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment risks and transaction costs to which the Fund may not be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject absent the use of these strategies. The skills needed to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">successfully execute derivative strategies may be different from those </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">needed for other types of transactions. If the Fund incorrectly forecasts </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the value and/or creditworthiness of securities, currencies, interest rates, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparties or other economic factors involved in a derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transaction, the Fund might have been in a better position if the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">had not entered into such derivative transaction. In evaluating the risks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and contractual obligations associated with particular derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments or other similar investments, it is important to consider that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain derivative transactions, absent a default or termination event, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may only be modified or terminated by mutual consent of the Fund and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its counterparty.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">It may not be possible for the Fund to modify, terminate, or offset the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's obligations or the Fund's exposure to the risks associated with a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivative transaction prior to its scheduled termination or maturity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">date, which may create a possibility of increased volatility and/or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">decreased liquidity to the Fund.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Because the markets for certain derivative instruments (including </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets located in foreign countries) are relatively new and still </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developing, appropriate derivative transactions may not be available in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">all circumstances for risk management or other purposes. Upon the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expiration of a particular contract, the Fund may wish to retain the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s position in the derivative instrument by entering into a similar </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contract but may be unable to do so if the counterparty to the original </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contract is unwilling to enter into the new contract and no other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">appropriate counterparty can be found. When such markets are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unavailable, the Fund will be subject to increased liquidity and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment risk.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may enter into opposite sides of interest rate swap and other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives for the principal purpose of generating distributable gains on </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the one side (characterized as ordinary income for tax purposes) that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are not part of the Fund’s duration or yield curve management </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategies (“paired swap transactions”), and with a substantial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">possibility that the Fund will experience a corresponding capital loss </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and decline in NAV with respect to the opposite side transaction (to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">extent it does not have corresponding offsetting capital gains). </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Consequently, Common Shareholders may receive distributions and owe </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tax on amounts that are effectively a taxable return of the shareholder’s </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment in the Fund, at a time when their investment in the Fund has </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">declined in value, which tax may be at ordinary income rates. In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, the Fund’s use of derivatives may cause the Fund to realize </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">higher amounts of short-term capital gains (generally taxed at ordinary </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income tax rates), potentially subjecting shareholders of the Fund to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adverse tax consequences. The tax treatment of certain derivatives in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which the Fund invests may be unclear <div style="display:inline;">and </div>thus subject to </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recharacterization. Any recharacterization of payments made or received </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by the Fund pursuant to derivatives potentially could affect the amount, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">timing or character of Fund distributions. In addition, the tax treatment </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of such investment strategies may be changed by regulation or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">otherwise. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">When a derivative is used as a hedge against a position that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund holds, any loss generated by the derivative generally should be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">substantially offset by gains on the hedged investment, and vice versa.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">More generally, sales of the Fund’s portfolio holdings may result in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">short-term capital gains (which are generally taxed to shareholders at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ordinary income tax rates when distributed net of short-term capital </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">losses and net of long-term capital losses), potentially subjecting </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shareholders of the Fund to adverse tax consequences.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Although hedging can reduce or eliminate losses, it can also reduce or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">eliminate gains. Hedges are sometimes subject to imperfect matching </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">between the derivative and the underlying instrument, and there can be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">no assurance that the Fund's hedging transactions will be effective. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Derivatives used for hedging or risk management may not operate as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intended or may expose the Fund to additional risks. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivatives used for hedging may partially protect the Fund from the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks they were intended to hedge yet not fully mitigate the impact of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such risks. The regulation of the derivatives markets has increased over </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time, and additional future regulation of the derivatives markets may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">make derivatives more costly, may limit the availability or reduce the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity of derivatives, or may otherwise adversely affect the value or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance of derivatives. Any such adverse future developments could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impair the effectiveness or raise the costs of the Fund’s derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions, impede the employment of the Fund’s derivatives </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategies, or adversely affect the Fund’s performance and cause the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund to lose value.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Credit Default Swaps Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Credit default swap agreements may involve greater risks than if the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund had invested in the reference obligation directly since, in addition </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to general market risks, credit default swaps are subject to leverage risk, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">illiquidity risk, counterparty risk and credit risk. A buyer generally also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will lose its investment and recover nothing should no credit event occur </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and the swap is held to its termination date. If a credit event were to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">occur, the value of any deliverable obligation received by the seller (if </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any), coupled with the upfront or periodic payments previously received, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be less than the full notional value it pays to the buyer, resulting in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a loss of value to the seller. When the Fund acts as a seller of a credit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default swap, it is exposed to many of the same risks of leverage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">described herein. As the seller, the Fund would receive a stream of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments over the term of the swap agreement provided that no event </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of default has occurred with respect to the referenced debt obligation </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">upon which the swap is based. The Fund would effectively add leverage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to its portfolio because, if a default occurs, the stream of payments may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">stop and, in addition to its total net assets, the Fund would be subject to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment exposure on the notional amount of the swap.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Although the Fund may seek to realize gains by selling credit default </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">swaps that increase in value, to realize gains on selling credit default </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">swaps, an active secondary market for such instruments must exist or </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund must otherwise be able to close out these transactions at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">advantageous times. In addition to the risk of losses described above, if </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">no such secondary market exists or the Fund is otherwise unable to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">close out these transactions at advantageous times, selling credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default swaps may not be profitable for the Fund.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The market for credit default swaps has become more volatile as the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">creditworthiness of certain counterparties has been questioned and/or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">downgraded. The Fund will be subject to credit risk with respect to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparties to the credit default swap contract (whether a clearing </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">corporation or another third party). If a counterparty’s credit becomes </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significantly impaired, multiple requests for collateral posting in a short </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">period of time could increase the risk that the Fund may not receive </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adequate collateral. The Fund may exit its obligations under a credit </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default swap only by terminating the contract and paying applicable </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">breakage fees, or by entering into an offsetting credit default swap </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">position, which may cause the Fund to incur more losses.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> The Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">obtain no or limited recovery in a bankruptcy or other reorganizational </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceedings, and any recovery may be significantly delayed.</div></div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Structured Investments Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Holders of structured products, including structured notes, credit-linked </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">notes and other types of structured products, bear the risks of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">underlying investments, index or reference obligation and are subject to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparty risk. The Fund may have the right to receive payments only </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from the structured product, and generally does not have direct rights </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">against the issuer or the entity that sold the assets to be securitized. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">While certain structured products enable the investor to acquire </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interests in a pool of securities without the brokerage and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expenses associated with directly holding the same securities, investors </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in structured products generally pay their share of the structured </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">product’s administrative and other expenses. Although it is difficult to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">predict whether the prices of indexes and securities underlying </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">structured products will rise or fall, these prices (and, therefore, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">prices of structured products) are generally influenced by the same types </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of political and economic events that affect issuers of securities and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital markets generally. If the issuer of a structured product uses </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shorter term financing to purchase longer term securities, the issuer may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be forced to sell its securities at below market prices if it experiences </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficulty in obtaining such financing, which may adversely affect the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value of the structured products owned by the Fund. Structured </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">products generally entail risks associated with derivative instruments.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Counterparty Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund will be subject to credit risk with respect to the counterparties </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the derivative contracts and other instruments entered into by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund or held by special purpose or structured vehicles in which the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invests. For example, if a bank at which the Fund or issuer has an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">account fails, any cash or other assets in bank or custody accounts, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may be substantial in size, could be temporarily inaccessible or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">permanently lost by the Fund or issuer. In the event that the Fund enters </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">into a derivative transaction with a counterparty that subsequently </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">becomes insolvent or becomes the subject of a bankruptcy case, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivative transaction may be terminated in accordance with its terms </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and the Fund’s ability to realize its rights under the derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instrument and its ability to distribute the proceeds could be adversely </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affected. If a counterparty becomes bankrupt or otherwise fails to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perform its obligations under a derivative contract due to financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficulties, the Fund may experience significant delays in obtaining any </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">recovery (including recovery of any collateral it has provided to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparty) in a dissolution, assignment for the benefit of creditors, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidation, winding-up, bankruptcy</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> or other analogous proceeding. In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, in the event of the insolvency of a counterparty to a derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transaction, the derivative transaction would typically be terminated at </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its fair market value. If the Fund is owed this fair market value in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">termination of the derivative transaction and its claim is unsecured, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund will be treated as a general creditor of such counterparty</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and will </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not have any claim with respect to any underlying security or asset. The </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund may obtain only a limited recovery or may obtain no recovery in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such circumstances. Counterparty credit risk also includes the related </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk of having concentrated exposure to a single counterparty, which </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may increase potential losses if the counterparty were to become </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insolvent. While the Fund may seek to manage its counterparty risk by </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transacting with a number of counterparties, concerns about the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">solvency of, or a default by, one large market participant could lead to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant impairment of liquidity and other adverse consequences for </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other counterparties.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Confidential Information Access Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In managing the Fund (and other PIMCO clients), PIMCO may from time </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to time have the opportunity to receive material, non-public information </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(“Confidential Information”) about the issuers of certain investments, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including, without limitation, senior floating rate loans, other loans and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">related investments being considered for acquisition by the Fund or held </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the Fund’s portfolio. For example, an issuer of privately placed loans </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">considered by the Fund may offer to provide PIMCO with financial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information and related documentation regarding the issuer that is not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">publicly available. Pursuant to applicable policies and procedures, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO may (but is not required to) seek to avoid receipt of Confidential </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Information </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">about such issuers</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> so as to avoid possible restrictions on its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ability to purchase and sell investments on behalf of the Fund and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">clients to which such Confidential Information relates. In such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">circumstances, the Fund (and other PIMCO clients) may be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disadvantaged in comparison to other investors, including with respect </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the price the Fund pays or receives when it buys or sells an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment. Further, PIMCO’s and the Fund’s abilities to assess the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">desirability of proposed consents, waivers or amendments with respect </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to certain investments may be compromised if they are not privy to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">available Confidential Information. PIMCO may also determine to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">receive such Confidential Information in certain circumstances under its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">applicable policies and procedures. If PIMCO intentionally or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unintentionally comes into possession of Confidential Information, it </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may be unable, potentially for a substantial period of time, to purchase </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or sell investments to which such Confidential Information relates.</span></span></div></div> <div style="line-height:12.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Private Placements Risk</span></span></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">A private placement involves the sale of securities that have not been </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registered under the Securities Act, or relevant provisions of applicable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-U.S. law, to certain institutional and qualified individual purchasers, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such as the Fund. In addition to the general risks to which all securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are subject, securities received in a private placement generally are </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to strict restrictions on resale, and there may be no liquid </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">secondary market or ready purchaser for such securities. See “Principal </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Risks of the Fund—Liquidity Risk.” Therefore, the Fund may be unable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to dispose of such securities when it desires to do so, or at the most </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">favorable time or price. Private placements may also raise valuation </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks. See “Principal Risks of the Fund—Valuation Risk.” The Fund may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">also have to bear the expense of registering the securities for resale and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the risk of substantial delays in effecting the registration. Additionally, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the purchase price and subsequent valuation of private placements </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">typically reflect a discount, which may be significant, from the market </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">price of comparable securities for which a more liquid market exists.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Inflation/Deflation Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Inflation risk is the risk that the value of assets or income from the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s investments will be worth less in the future as inflation decreases </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the value of payments at future dates. As inflation increases, the real </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value of the Fund’s portfolio could decline. Inflation rates may change </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">frequently and significantly as a result of various factors, including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unexpected shifts in the domestic or global economy or changes in fiscal </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or monetary policies </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(or the expectation of such changes)</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. Deflation risk </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is the risk that prices throughout the economy decline over time. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Deflation may have an adverse effect on the creditworthiness of issuers </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and may make issuer default more likely, which may result in a decline </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in the value of the Fund’s portfolio and Common Shares.</span></span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Insurance-Linked and Other Instruments Risk</span></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in insurance-linked instruments and similar </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments (which may include, for example, exposure to reinsurance </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contracts (through sidecars or otherwise), event-linked bonds, such as </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">catastrophe and resilience bonds, and securities relating to life </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insurance policies, annuity contracts and premium finance loans). The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund could lose a portion or all of the principal it has invested in these </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">types of investments, and the right to additional interest and/or dividend </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments with respect to the investments, upon the occurrence of one </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or more trigger events, as defined within the terms of an investment. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Trigger events may include natural or other perils of a specific size or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">magnitude that occur in a designated geographic region during a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">specified time period, and/or that involve losses or other metrics that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exceed a specific amount. The Fund may also invest in insurance-linked </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments that are subject to “indemnity triggers.” An indemnity </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trigger is a mechanism where the payout to the investor is based on the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">actual losses incurred by the insurer and come into play when losses </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from a specified event exceed a designated level. Insurance-linked </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments subject to indemnity triggers are often regarded as being </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to potential moral hazard, since such insurance-linked </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments are triggered by actual losses of the ceding sponsor and the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ceding sponsor may have an incentive to take actions and/or risks that </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would have an adverse effect on the Fund. There is no way to accurately </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">predict whether a trigger event will occur and, accordingly, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insurance-linked instruments and similar investments carry significant </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk. In addition to the specified trigger events, these types of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments may expose the Fund to other risks, including but not </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limited to issuer (credit) default, adverse regulatory or jurisdictional </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interpretations and adverse tax consequences.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may also gain exposure to reinsurance contracts (through </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insurance-linked securities, sidecars or otherwise). This exposure may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">include “excess of loss” contracts, wherein liability arises only if and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">when losses exceed a specified amount, and proportional reinsurance, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">wherein a pro rata portion of the premiums and liabilities of the cedant </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">associated with a specified business or a portfolio of insurance contracts </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">are linked to the investment. Investments linked to reinsurance </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions may involve significant insurance brokerage fees, fronting </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fees and other transaction costs.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">A series of major triggering events could cause the failure of a reinsurer. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Similarly, to the extent the Fund invests in reinsurance-related securities </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">for which a triggering event occurs, losses associated with such event </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">will result in losses to the Fund and a series of major triggering events </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affecting a large portion of the reinsurance-related securities held by the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund may result in substantial losses to the Fund. In addition, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unexpected events such as natural disasters or terrorist attacks could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">lead to government intervention. Political, judicial and legal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">developments affecting the reinsurance industry could also create new </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and expanded theories of liability or regulatory or other requirements; </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such changes could have a material adverse effect on a Fund. In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, the litigation environment in catastrophe-exposed states or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regions could impact the frequency and severity of insurance claims, and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">litigation costs could decrease the value of a Fund’s investment in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">products linked to reinsurance contracts. In recent years, capital market </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participants have been increasingly active in the reinsurance market and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">markets for related risks. Increased competition could result in fewer </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">submissions, lower premium rates and less favorable policy terms and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain insurance-linked instruments and similar investments may have </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limited liquidity, or may be illiquid. The Fund has limited transparency </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">into the individual contracts underlying certain insurance-linked </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">instruments and similar investments, which may make the risk </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assessment of them more difficult. These types of investments may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">difficult to value.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The aforementioned instruments may include longevity and mortality </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments, including indirect investment in pools of insurance-related </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">longevity and mortality investments, including life insurance policies, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">annuity contracts and premium finance loans. Such investments are </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subject to “longevity risk” and/or “mortality risk.” Longevity risk is the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk that members of a reference population will live longer, on average, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than anticipated. Mortality risk is the risk that members of a reference </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">population will live shorter, on average, than anticipated. Changes in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">these rates can significantly affect the liabilities and cash needs of life </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">insurers, annuity providers and pension funds. The terms of a longevity </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">bond typically provide that the investor in the bond will receive less than </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the bond’s par amount at maturity if the actual average longevity (life </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">span) of a specified population of people observed over a specified </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">period of time (typically measured by a longevity index) is higher than a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">specified level. If longevity is higher than expected, the bond will return </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">less than its par amount at maturity. A mortality bond, in contrast to a </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">longevity bond, typically provides that the investor in the bond will </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">receive less than the bond’s par amount at maturity if the mortality rate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of a specified population of people observed over a specified period of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time (typically measured by a mortality index) is higher than a specified </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">level.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">During their term, both longevity bonds and mortality bonds typically </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pay a floating rate of interest to investors. Longevity and mortality </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments purchased by the Fund involve the risk of incorrectly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">predicting the actual level of longevity or mortality, as applicable, for the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reference population of people. With respect to mortality investments </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">held by the Fund, there is also the risk that an epidemic or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">catastrophic event could strike the reference population, resulting in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">mortality rates exceeding expectations. The Fund may also gain this type </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of exposure through event-linked derivative instruments, such as swaps, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that are contingent on or formulaically related to longevity or mortality </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Regulatory Changes Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Financial entities, such as investment companies and investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">advisers, are generally subject to extensive government regulation and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intervention. Government regulation and/or intervention may change </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the way the Fund is regulated, affect the expenses incurred directly by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund and the value of its investments, and limit and /or preclude the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s ability to achieve its investment objective. Government </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">regulation may change frequently and may have significant adverse </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consequences. The Fund and the Investment Manager have historically </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">been eligible for exemptions from certain regulations. However, there is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">no assurance that the Fund and the Investment Manager will continue </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to be eligible for such exemptions.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Moreover, government regulation may have unpredictable and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unintended effects. Legislative or regulatory actions to address </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">perceived liquidity or other issues in fixed income markets generally, or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in particular markets such as the municipal securities market, may alter </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or impair the Fund’s ability to pursue its investment objective or utilize </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain investment strategies and techniques.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">While there continues to be uncertainty about the full impact of these </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other regulatory changes, it is the case that the Fund will be subject </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to a more complex regulatory framework, and may incur additional </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">costs to comply with new requirements as well as to monitor for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">compliance in the future. Actions by governmental entities may also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impact certain instruments in which the Fund invests and reduce market </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidity and resiliency.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Recent policy initiatives undertaken by the U.S. government have the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">potential to impact international relations, trade agreements, and the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">overall regulatory environment in ways that could create uncertainty </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and instability in domestic and global markets, and could adversely </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affect the investment performance of the Fund. In particular, actions </span></span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taken by the U.S. government in respect of international trade relations </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could lead to trade wars, increased costs for imported goods, disruptions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in supply chains, reduced foreign investment, and instability in regions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">where the Fund invests.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Tax Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund has elected to be treated as a RIC under Subchapter M of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Code and intends each year to qualify and be eligible to be treated as </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such, so that it generally will not be subject to U.S. federal income tax </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on its net investment income or net short-term or long-term capital </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">gains that are timely distributed (or deemed distributed, as described </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">below) to shareholders. In order to qualify and be eligible for such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">treatment, the Fund must meet certain asset diversification tests, derive </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at least 90% of its gross income for such year from certain types of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">qualifying income, and distribute to its shareholders at least 90% of its </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">“investment company taxable income” as that term is defined in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Code (which includes, among other things, dividends, taxable interest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and the excess of any net short-term capital gains over net long-term </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">capital losses, as reduced by certain deductible expenses) and net </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tax-exempt income, for such year.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s investment strategy will potentially be limited by its intention </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to qualify for treatment as a RIC and can limit the Fund’s ability to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">qualify as such. The tax treatment of certain of the Fund’s investments </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under one or more of the qualification or distribution tests applicable to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">RICs is uncertain. An adverse determination or future guidance by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">IRS or a change in law might affect the Fund's ability to qualify or be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">eligible for treatment as a RIC. Income and gains from certain of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's activities may not constitute qualifying income to a RIC for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purposes of the 90% gross income test. If the Fund’s income or gain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from a particular investment or activity were determined to constitute </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">nonqualifying income, which in certain cases may be determined </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">retroactively, and the Fund's nonqualifying income from all sources </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">were to exceed 10% of its gross income in any taxable year, the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would fail to qualify as a RIC unless it were eligible to and did pay a tax </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at the Fund level. See “Taxation” in the Statement of Additional </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Information for additional details.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">If, in any year, the Fund were to fail to qualify for treatment as a RIC </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under the Code and were ineligible to or did not otherwise cure such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">failure, the Fund would be subject to tax on its taxable income at </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">corporate rates and, when such income is distributed, shareholders </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would be subject to further tax on such distributions to the extent of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's current or accumulated earnings and profits.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent the Fund invests through one or more subsidiaries, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund may be required to include in gross income for U.S. federal income </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tax purposes all of the subsidiary’s income, whether or not such income </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">is distributed by the subsidiary, and the Fund may generally have to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">treat such income as ordinary income, regardless of the character of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subsidiary’s underlying income or gains. If a net loss is realized by a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">subsidiary, such loss is not generally available to offset the income </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">earned by the Fund, and such loss cannot be carried forward to offset </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taxable income of the Fund or the subsidiary in future periods.</span></div></div> <div style="line-height:12.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Potential Conflicts of Interest Risk—Allocation of Investment </span></span><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Opportunities</span></span></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Investment Manager and its affiliates are involved worldwide with a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">broad spectrum of financial services and asset management activities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and may engage in the ordinary course of business in activities in which </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">their interests or the interests of their clients may conflict with those of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund. The Investment Manager may provide investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">management services to other funds and discretionary managed </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accounts that follow an investment program similar to that of the Fund. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subject to the requirements of the 1940 Act, the Investment Manager </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intends to engage in such activities and may receive compensation from </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">third parties for its services. The results of the Fund’s investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">activities may differ from those of the Fund’s affiliates, or another </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">account managed by the Investment Manager or its affiliates, and it is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">possible that the Fund could sustain losses during periods in which one </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or more of the Fund’s affiliates and/or other accounts managed by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investment Manager or its affiliates, including proprietary accounts, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">achieve profits on their trading.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Repurchase Agreements Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may enter into repurchase agreements, in which the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">purchases a security from a bank or broker-dealer, which agrees to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase the security at the Fund’s cost plus interest within a specified </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time. Entering into repurchase agreements allows the Fund to earn a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">return on cash in the Fund's portfolio that would otherwise remain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">un-invested. Repurchase agreements may involve risks in the event of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">default or insolvency of the counterparty, including possible delays or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions upon the Fund's ability to sell the underlying securities and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">additional expenses in seeking to enforce the Fund's rights and recover </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any losses. Although the Fund seeks to limit the credit risk under a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase agreement by carefully selecting counterparties and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accepting only high quality collateral, some credit risk remains. The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparty could default which may make it necessary for the Fund to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incur expenses to liquidate the collateral. The security subject to a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">repurchase agreement may be or become illiquid. These events could </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">also trigger adverse tax consequences for the Fund.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In December 2023, the U.S. Securities and Exchange Commission </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adopted rule amendments that are expected to result in the Fund being </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">required to clear all or substantially all of its repurchase agreements </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">collateralized by U.S. Treasury securities as of June 30, 2027 where a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">direct participant in any covered clearing agency is the counterparty. The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund may incur costs in connection with entering into new agreements </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">(or amending existing agreements) with counterparties who are direct </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participants of a covered clearing agency and potentially other market </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">participants and taking other actions to comply with the new </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">requirements. In addition, upon the compliance date, the costs and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">benefits of entering into repurchase agreements collateralized by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Treasury securities to the Fund may be impacted as compared to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such repurchase agreements prior to the compliance date.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div> <div style="line-height:12.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Distribution Rate Risk</span></span></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s distribution rate may be affected by numerous factors, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including but not limited to changes in realized and projected market </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">returns, fluctuations in market interest rates, Fund performance, and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other factors. There can be no assurance that a change in market </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions or other factors will not result in a change in the Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distribution rate or that the rate will be sustainable in the future. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Additionally, the distribution rate is not indicative of the Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">performance and may not correlate with the actual returns generated by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s investments.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">For instance, during periods of low or declining interest rates, the Fund's </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distributable income and dividend levels may decline for many reasons. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">For example, the Fund may have to deploy uninvested assets (whether </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds from matured, traded or called debt obligations or other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sources) in new, lower yielding instruments. Additionally, payments from </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain instruments that may be held by the Fund (such as variable and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">floating rate securities) may be negatively impacted by declining interest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rates, which may also lead to a decline in the Fund’s distributable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income and dividend levels. The distribution rate is not indicative of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund's performance and may not correlate with the actual returns </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generated by the Fund's investments.</span></span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Zero-Coupon Bonds, Step-Ups and Payment-In-Kind Securities </span></span><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The market prices of zero-coupon, step-ups and payment-in-kind </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities are generally more volatile than the prices of securities that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pay interest periodically and in cash, and are likely to respond to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">changes in interest rates to a greater degree than other types of debt </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities with similar maturities and credit quality. Because </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">zero-coupon securities bear no interest, their prices are especially </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">volatile and, because zero-coupon bondholders do not receive interest </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payments, the prices of zero-coupon securities generally fall more </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dramatically </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">when interest rates rise </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than those of bonds that pay </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interest on a current basis</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Zero coupon bonds, step-ups and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment-in-</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">kind securities allow an issuer to avoid or delay the need to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">generate cash to meet current interest payments and, as a result, may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">involve greater credit risk than bonds that pay interest currently or in </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cash</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. The market for zero-coupon and payment-in-kind securities may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">suffer decreased liquidity. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Payment-in-kind securities may present </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">challenging fair valuation considerations because the accruals require </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">judgments about the collectability of deferred payments and the value </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of any associated collateral. Further, even if the conditions for income </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">accrual under U.S.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> GAAP are satisfied, a borrower could default when </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">actual payment is due upon maturity.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> In addition, as these securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may not pay cash interest, the Fund’s investment exposure to these </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities and their risks, including credit risk, will increase during the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">time these securities are held in the Fund’s portfolio. Further, to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">maintain its qualification for treatment as a RIC and to avoid Fund-level </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. federal income and/or excise taxes, the Fund is required to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distribute to its shareholders any income it is deemed to have received </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with respect to</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> such investments, notwithstanding that cash has not </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">been received currently, and the value of paid-in-kind interest. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Consequently, the Fund may have to dispose of portfolio securities </span></span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">under disadvantageous circumstances to generate the cash, or may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have to leverage itself by borrowing the cash to satisfy this distribution </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">requirement. The required distributions, if any, would result in an </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase in the Fund’s exposure to these securities.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Risk Retention Investment Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may invest in risk retention tranches of CMBS or other eligible </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securitizations, if any (“risk retention tranches”), which are eligible </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">residual interests typically held by the sponsors of such securitizations </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">pursuant to the final rules implementing the credit risk retention </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">requirements of Section 941 of the Dodd-Frank Act (the “U.S. Risk </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Retention Rules”). In the case of CMBS transactions, for example, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Risk Retention Rules permit all or a portion of the retained credit </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risk associated with certain securitizations (i.e., retained risk) to be held </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">by an unaffiliated “third party purchaser,” such as the Fund, if, among </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other requirements, the third-party purchaser holds its retained interest, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unhedged, for at least five years following the closing of the CMBS </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transaction, after which it is entitled to transfer its interest in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securitization to another person that meets the requirements for a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">third-party purchaser. Even after the required holding period has </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expired, due to the generally illiquid nature of such investments, no </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">assurance can be given as to what, if any, exit strategies will ultimately </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be available for any given position.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In addition, there is limited guidance on the application of the final </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">U.S. Risk Retention Rules to specific securitization structures. There can </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be no assurance that the applicable federal agencies charged with the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">implementation of the final U.S. Risk Retention Rules (the Federal </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Deposit Insurance Corporation, the Comptroller of the Currency, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Federal Reserve Board, the SEC, the Department of Housing and Urban </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Development, and the Federal Housing Finance Agency) could not take </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">positions in the future that differ from the interpretation of such rules </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">taken or embodied in such securitizations, or that the final U.S. Risk </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Retention Rules will not change.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Furthermore, in situations where the Fund invests in risk retention </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">tranches of securitizations structured by third parties, the Fund may be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">required to execute one or more letters or other agreements, the exact </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">form and nature of which will vary (each, a “Risk Retention </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Agreement”) under which it will make certain undertakings designed to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ensure such securitization complies with the final U.S. Risk Retention </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Rules. Such Risk Retention Agreements may include a variety of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">representations, warranties, covenants and other indemnities, each of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which may run to various transaction parties. If the Fund breaches any </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">undertakings in any Risk Retention Agreement, it will be exposed to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">claims by the other parties thereto, including for any losses incurred as a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result of such breach , which could be significant and exceed the value </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the Fund's investments.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Subsidiary Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">To the extent the Fund invests through one or more of its Subsidiaries, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund would be exposed to the risks associated with such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Subsidiary’s investments. Such Subsidiaries would likely not be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registered as investment companies under the 1940 Act and therefore </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">would not be subject to all of the investor protections of the 1940 Act. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Changes in the laws of the United States and/or the jurisdiction in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which a Subsidiary is organized could result in the inability of the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and/or the Subsidiary to operate as intended and could adversely affect </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Portfolio Turnover Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Investment Manager manages the Fund without regard generally to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">restrictions on portfolio turnover. The use of futures contracts and other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">derivative instruments with relatively short maturities may tend to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exaggerate the portfolio turnover rate for the Fund. Trading in fixed </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">income securities does not generally involve the payment of brokerage </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">commissions, but does involve indirect transaction costs. The use of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">futures contracts and other derivative instruments may involve the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">payment of commissions to futures commission merchants or other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intermediaries. Higher portfolio turnover involves correspondingly </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">greater expenses to the Fund, including brokerage commissions or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dealer mark-ups and other transaction costs on the sale of securities </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and reinvestments in other securities</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, which directly reduce net returns </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to investors</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">. The higher the rate of portfolio turnover of the Fund, the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">higher these transaction costs borne by the Fund generally will be. Such </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sales may result in realization of taxable capital gains (including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">short-term capital gains, which are generally taxed to shareholders </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">holding shares in taxable accounts </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">at ordinary income tax rates when </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distributed net of short-term capital losses and net long-term capital </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">losses), and may adversely impact the Fund’s after-tax returns. The </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">realization of short-term capital gains may also cause adverse tax </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">consequences for the Fund’s shareholders. See “Tax Matters.”</span></span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Operational Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">An investment in the Fund, like any fund, can involve operational </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">technology </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks arising from factors such as processing errors, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">communication errors,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> human errors, inadequate or failed internal or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">external processes, failures in systems and technology, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cybersecurity </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incidents, the potential use of artificial intelligence and machine </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">learning,</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> changes in personnel and errors caused by third-party service </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">providers. The occurrence of any of these failures, errors or breaches </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could result in a loss of information, regulatory scrutiny, reputational </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">damage or other events, any of which could have a material adverse </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">effect on the Fund. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Operational and technology risks for the issuers </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could also result in material adverse consequences for such issuers and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may cause the Fund's investments in such issuers to lose value.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> While </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund seeks to minimize such events through controls and oversight, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">there may still be failures that could cause losses to the Fund.</span></span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Market Disruptions Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund is subject to investment and operational risks associated with </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial, economic and other global market developments and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disruptions, including those <span style="display:inline;">arising </span>from war, military conflicts, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geopolitical disputes, terrorism, social or political unrest, recessions, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">supply chain disruptions, tariffs and other restrictions on trade, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sanctions, market manipulation, government interventions, defaults and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shutdowns, political changes or diplomatic developments, public health </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">emergencies (such as the spread of infectious diseases, pandemics and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">epidemics), bank failures, natural/environmental disasters, climate </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">change and climate related events, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">responses to government actions or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">interventions (the threat or imposition of tariffs, trade restrictions, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency restrictions, or similar actions),</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> which can all negatively impact </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the securities markets, interest rates, auctions, secondary trading, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ratings, credit risk, inflation, deflation and other factors relating to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s investments or the Investment Manager’s operations and the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">value of an investment in the Fund, its distributions and its returns. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">These events can also impair the technology and other operational </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systems upon which the Fund’s service providers, including PIMCO as </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s investment adviser, rely, and could otherwise disrupt the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s service providers’ ability to fulfill their obligations to the Fund. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Furthermore, events involving limited liquidity, defaults, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-performance or other adverse developments that affect financial </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">institutions or the financial services industry generally, or concerns or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">rumors about any events of these kinds or other similar risks, have in the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">past and may in the future lead to market-wide liquidity problems.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Geopolitical Conflicts Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The occurrence of geopolitical conflicts, war or terrorist activities could </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">have adverse impacts on markets in various and unpredictable ways. For </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">example, the armed conflict among the United States, Israel, and Iran </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">has caused, and could continue to cause, significant market disruptions </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and volatility. The conflict has had a particular negative impact on oil </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and gas markets, which could have a broader adverse effect on many </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sectors of the global economy in the future. In addition, following </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Russia's large-scale invasion of Ukraine in February 2022, Russia, and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other countries, persons and entities that were viewed as having </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provided material aid to Russia's aggression against Ukraine, became </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the subject of economic sanctions and import and export controls </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">imposed by countries throughout the world, including the United States. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Such measures have had and may continue to have an adverse effect on </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Russian, Belarusian and other securities and economies. Additional </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">examples include, but are not limited to, heightened concerns of trade </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disputes, which could result in increased tariffs, trade restrictions or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other retaliatory countermeasures. The extent, duration and impact of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geopolitical conflicts and related market impacts are difficult to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">ascertain, but could be significant and could have significant adverse </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">effects on regional and global economies and the markets for certain </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">securities and commodities, such as oil, natural gas, steel and aluminum, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">as well as other sectors, and on the Fund’s investments.</span></span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Cyber Security Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">As the use of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">complex information technology and communication </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systems</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, including cloud-based technology, has become more prevalent </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and interconnected in the course of business, the Fund is potentially </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">more susceptible to operational and information security risks resulting </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from breaches in cyber security, including: processing and human errors, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">inadequate or failed internal or external processes, failures in system </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and technology, errors in algorithms used with respect to Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">operations and changes in personnel. A breach in cyber security refers to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">both intentional and unintentional cyber events from outside threat </span></span></div></div><div style="line-height:12.0pt;text-align:left"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">actors or internal resources that may, among other things, cause the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund to lose proprietary information, suffer data corruption and/or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">destruction, lose operational capacity, result in the unauthorized release </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or other misuse of confidential information, or otherwise disrupt normal </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">business operations. Geopolitical tensions can increase the scale and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">sophistication of deliberate cybersecurity attacks, particularly those from </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">nation-states or from entities with nation-state backing, who may desire </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to use cybersecurity attacks to cause damage or create leverage against </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">geopolitical rivals. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The increasing use of artificial intelligence, machine </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">learning, and automated algorithmic systems — both by the Fund and </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its service providers and by malicious actors — introduces additional </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">cybersecurity vulnerabilities, including the risk that AI systems may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exploited, manipulated, or produce unintended outputs that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">compromise the security or integrity of Fund operations or data.</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> Cyber </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security breaches may involve unauthorized access to the Fund’s digital </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">information systems (e.g., through “hacking” or malicious software </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">coding), and may come from multiple sources, including outside attacks </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such as denial-of-service attacks (i.e., efforts to make network services </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">unavailable to intended users) or cyber extortion, including exfiltration </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of data held for ransom and/or “ransomware” attacks that renders </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">systems inoperable until the ransom is paid, or insider actions (e.g., </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">intentionally or unintentionally harmful acts of PIMCO personnel). In </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">addition, cyber security breaches involving the Fund’s third party service </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">providers (including but not limited to advisers, sub-advisers, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">administrators, transfer agents, custodians, vendors, suppliers, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distributors and other third parties), trading counterparties or issuers in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which the Fund invests can also subject the Fund to many of the same </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks associated with direct cyber security breaches or extortion of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">company data. PIMCO’s use of cloud-based service providers could </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">heighten or change these risks. In addition, work-from-home </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arrangements by the Fund, the Investment Manager or their service </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">providers could increase all of the above risks, create additional data </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and information accessibility concerns, and make the Fund, the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Investment Manager or their service providers susceptible to operational </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">disruptions, any of which could adversely impact their operations.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Cyber security failures or breaches may result in financial losses to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund and its shareholders. For example, cyber security failures or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">breaches involving trading counterparties or issuers in which the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invests could adversely impact such counterparties or issuers and cause </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the Fund’s investment to lose value. These failures or breaches may also </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">result in disruptions to business operations, potentially resulting in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial losses; interference with the Fund’s ability to calculate its NAV, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">process shareholder transactions or otherwise transact business with </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shareholders; impediments to trading; violations of applicable privacy </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other laws; regulatory fines; penalties; third-party claims in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">litigation; reputational damage; reimbursement or other compensation </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">costs; additional compliance and cyber security risk management costs </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and other adverse consequences. In addition, substantial costs may be </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">incurred in order to prevent any cyber incidents in the future.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Like with operational risk in general, the Fund has established business </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">continuity plans and risk management systems designed to reduce the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks associated with cyber security. However, there are inherent </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">limitations in these plans and systems, including that certain risks may </div></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not have been identified, in large part because different or unknown </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">threats may emerge in the future. As such, there is no guarantee that </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">such efforts will succeed, e<div style="display:inline;">sp</div>ecially because the Fund does not directly </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">control the cyber security systems of issuers in which the Fund may </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invest, trading counterparties or third-party service providers to the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund. Such entities have experienced cyber attacks and other attempts </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to gain unauthorized access to systems from time to time, and there is </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">no guarantee that efforts to prevent or mitigate the effects of such </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">attacks or other attempts to gain unauthorized access will be successful. </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">There is also a risk that cyber security breaches may not be detected. The </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund and its shareholders may suffer losses as a result of a cyber </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">security breach related to the Fund, its service providers, trading </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">counterparties or the issuers in which the Fund invests.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Non-Diversification Risk</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund is “non-diversified,” which means that the Fund may invest a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">significant portion of its assets in the securities of a smaller number of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issuers than a diversified fund. Focusing investments in a small number </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of issuers increases risk. A fund that invests in a relatively smaller </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">number of issuers is more susceptible to risks associated with a single </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">economic, political or regulatory occurrence than a diversified fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">might be. Some of those issuers also may present substantial credit or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other risks. Similarly, the Fund may be subject to increased economic, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">business or political risk to the extent that it invests a substantial </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">portion of its assets in a particular currency, in a group of related </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">industries, in a particular issuer, in the bonds of similar projects or in a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">narrowly defined geographic area outside the U.S. Notwithstanding the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund’s status as a “non-diversified” investment company under the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">1940 Act, the Fund intends to qualify as a regulated investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">company accorded special tax treatment under the Code, which </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">imposes its own diversification requirements.</span></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Short Exposure Risk</span></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;"> </span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s short sales </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> short positions, if any, are subject to special </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">risks. A short sale involves the sale by the Fund of a security that it does </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">not own with the hope of purchasing the same security at a later date at </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">a lower price. The Fund may also enter into a short position through a </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">forward commitment or a short derivative position through a futures </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">contract or swap agreement. If the price of the security or derivative has </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increased during this time, then the Fund will incur a loss equal to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">increase in price from the time that the short sale was entered into plus </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any transaction costs (i.e., premiums and interest) paid to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">broker-dealer to borrow securities. Therefore, short sales involve the risk </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that losses may be exaggerated, potentially losing more money than the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">actual cost of the investment. By contrast, a loss on a long position </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">arises from decreases in the value of the security and is limited by the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">fact that a security’s value cannot decrease below zero. By investing the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">proceeds received from selling securities short, the Fund could be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">deemed to be employing a form of leverage, which creates special risks. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The use of leverage may increase the Fund’s exposure to long security </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">positions and make any change in the Fund’s NAV greater than it would </span></span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">be without the use of leverage. This could result in increased volatility of </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">returns. There is no guarantee that any leveraging strategy the Fund </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">employs will be successful during any period in which it is employed.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">In times of unusual or adverse market, economic, regulatory, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">environmental or political conditions, the Fund may not be able, fully or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">partially, to implement its short selling strategy. Periods of unusual or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adverse market, economic, environmental, regulatory or political </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions generally may exist for long periods of time. In response to </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">market events, the SEC and regulatory authorities in other jurisdictions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may adopt (and in certain cases, have adopted) bans on, and/or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">reporting requirements for, short sales of certain securities, including </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">short positions on such securities acquired through swaps. Restrictions </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on and/or reporting of short selling and short positions may negatively </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">impact and materially impair the Fund's ability to execute certain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions. Also, there is the risk that the third party to the short sale </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">or short position will not fulfill its contractual obligations, causing a loss </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the Fund.</div></div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Certain Affiliations</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Certain broker-dealers may be considered to be affiliated persons of the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund and/or the Investment Manager due to their possible affiliations </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with Allianz SE, the ultimate parent of the Investment Manager, or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">another Allianz entity. Allianz Asset Management of America LP merged </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with Allianz Asset Management of America LLC (“Allianz Asset </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Management”), with the latter being the surviving entity, effective </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">January 1, 2023. Following the merger, Allianz Asset Management is </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">PIMCO’s managing member and direct parent entity. Absent an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">exemption from the SEC or other regulatory relief, the Fund is generally </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">precluded from effecting certain principal transactions with affiliated </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">brokers, and its ability to purchase securities being underwritten by an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affiliated broker or a syndicate including an affiliated broker, or to utilize </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affiliated brokers for agency transactions, is subject to restrictions. This </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">could limit the Fund’s ability to engage in securities transactions and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">take advantage of market opportunities.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The 1940 Act imposes significant limits on co-investment with affiliates </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">of the Fund. The Fund has received exemptive relief from the SEC that, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">to the extent the Fund relies on such relief, permits it to (among other </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">things) co-invest alongside certain other persons in privately negotiated </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investments, including certain affiliates of the Investment Manager and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">certain public or private funds managed by the Investment Manager and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">its affiliates, subject to certain terms and conditions. The exemptive relief </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">from the SEC with respect to co-investments imposes a number of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">conditions on any co-investments made in reliance on such relief that </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">may limit or restrict the Fund’s ability to participate in an investment or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">require it to participate in an investment to a lesser extent, which could </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">negatively impact the Fund’s ability to execute its desired investment </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">strategy and its returns. Subject to applicable law, the Fund may also </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">invest alongside other PIMCO managed funds and accounts, including </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">private funds and affiliates of the Investment Manager, without relying </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">on the exemptive relief. Pursuant to co-investment exemptive relief, to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">the extent the Fund relies on such relief, the Fund will be able to invest </span></div></div><div style="line-height:12.0pt;text-align:left"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">in opportunities in which PIMCO and/or its affiliates has an investment, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and PIMCO and/or its affiliates will be able to invest in opportunities in </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">which a fund has made an investment.</div></div> <div style="line-height:12.0pt;margin-top:10pt;text-align:left"><div style="margin-top:10pt"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Anti-Takeover Provisions</span></span></div></div><div style="line-height:12.0pt;margin-top:4pt;text-align:left"><div style="margin-top:4pt"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund’s Amended and Restated Agreement and Declaration of Trust</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">includes provisions that could limit the ability of other entities or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">persons to acquire control of the Fund or to convert the Fund to </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">open-end status. See “Anti-Takeover and Other Provisions in the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Declaration of Trust and Bylaws.”</span></span></div></div> <div style="line-height:14.0pt;text-align:left"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 12pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="font-weight:bolder;display:inline;">Description of Capital Structure and Shares</span></span></div> <div style="line-height:12.0pt;margin-top:2pt;text-align:left"> <div style="margin-top:2pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The following is a brief description of the capital structure of the Fund. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">This description does not purport to be complete and is subject to and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">qualified in its entirety by reference to the Declaration and the Fund’s </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Bylaws, as amended and restated through the date hereof (the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">“Bylaws”). The Declaration and Bylaws are each exhibits to the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">registration statement of which this prospectus is a part.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund is an unincorporated voluntary association with transferable </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shares of beneficial interest (commonly referred to as a “Massachusetts </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">business trust”) established under the laws of The Commonwealth of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Massachusetts by the Declaration. The Declaration provides that the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Trustees of the Fund may authorize separate classes of shares of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">beneficial interest. Preferred shares may be issued in one or more series, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">with such par value and with such rights as determined by the Board, by </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">action of the Board without the approval of the Common Shareholders.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Declaration authorizes the issuance of an unlimited number of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares. The Common Shares will be issued with a par value of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">$0.00001 per share. The Fund currently has five separate classes of </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares: Institutional Class, Class A-1, Class A-2, Class A-3 and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Class A-4. An investment in any share class of the Fund represents an </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">investment in the same assets of the Fund. However, the ongoing fees </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and expenses for each share class may be different. The fees and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">expenses for the Fund are set forth in “Summary of Fund Expenses” </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">above. Certain share class details are set forth in “Plan of Distribution” </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">above.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shareholders will be entitled to the payment of dividends and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other distributions when, as and if declared by the Board.</span> All Common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shares have equal rights to the payment of dividends and the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distribution of assets upon liquidation. Common Shares will, when </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">issued, be fully paid and, subject to matters discussed in “Anti-Takeover </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and Other Provisions in the Declaration of Trust and Bylaws,” </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">non-assessable, and will have no pre-emptive or conversion rights or rights to cumulative voting. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Upon liquidation of the Fund, after paying or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adequately providing for the payment of all liabilities of the Fund and the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidation preference with respect to any outstanding preferred shares, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and upon receipt of such releases, indemnities and refunding </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agreements as they deem necessary for their protection, the Trustees may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distribute the remaining assets of the Fund among the Fund’s Common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shareholders.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund does not intend to hold annual meetings of shareholders. </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">If the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund does hold a meeting of shareholders, Common Shares of the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entitle their holders to one vote for each Common Share held; however, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">separate votes are taken by each class of Common Shares on matters </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affecting an individual class of Common Shares. Each fractional share </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shall be entitled to a proportionate fractional vote, except as otherwise </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provided by the Declaration, Bylaws, or required by applicable law.</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"></span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund will send unaudited reports at least semiannually and audited </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">financial statements annually to all of its Common Shareholders.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Common Shares are not, and are not expected to be, listed for </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">trading on any national securities exchange nor is there expected to be </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">any secondary trading market in the Common Shares.</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></div> </div> <div style="line-height:12.0pt;text-align:left"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The following table shows the amounts of Common Shares of the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that were authorized and outstanding as of September 30, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">2026</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">:</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 1pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></span></div> <div style="line-height:0.0pt;margin-top:6pt;text-align:left"> <div style="margin-top:6pt"> </div> </div> <div style="margin-top:0.0pt"> <table cellpadding="0" cellspacing="0" style="text-align:start; border-bottom:0.5pt solid #00687D;empty-cells:show;width:263pt"> <tr style="height:14.25pt"> <td style="background-color:#FFFFFF;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:106.48pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:6pt;text-align:Left;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">(1)</span></span></div> </div> </td> <td style="background-color:#FFFFFF;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:44.14pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">(2)</span></span></div> </div> </td> <td style="background-color:#FFFFFF;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:58.83pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">(3)</span></span></div> </div> </td> <td style="background-color:#FFFFFF;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:53.55pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">(4)</span></span></div> </div> </td> </tr> <tr style="height:39.5pt"> <td style="background-color:azure;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:106.48pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:6pt;text-align:Left;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Title of Class</span></span></div> </div> </td> <td style="background-color:azure;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:44.14pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Amount</span></span></div> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Authorized</span></span></div> </div> </td> <td style="background-color:azure;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:58.83pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Amount Held by</span></span></div> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">the Fund for its</span></span></div> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Account</span></span></div> </div> </td> <td style="background-color:azure;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:53.55pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Amount</span></span></div> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Outstanding</span></span></div> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Exclusive of</span></span></div> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Amount Shown</span></span></div> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Under (3)</span></span></div> </div> </td> </tr> <tr style="height:8.75pt"> <td style="background-color:#FFFFFF;padding-bottom:2pt;padding-top:1.75pt;vertical-align:Top;width:106.48pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:3pt;margin-right:6pt;text-align:Left;white-space:nowrap"><span style="display:inline;"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Institutional Class Common Shares</span></span></div> </div> </td> <td style="background-color:#FFFFFF;padding-bottom:2pt;padding-top:1.75pt;vertical-align:Top;width:44.14pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Unlimited</span></div> </div> </td> <td style="background-color:#FFFFFF;padding-bottom:2pt;padding-top:1.75pt;vertical-align:Top;width:58.83pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="display:inline;"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0</span></span></div> </div> </td> <td style="background-color:#FFFFFF;padding-bottom:2pt;padding-top:1.75pt;vertical-align:Top;width:53.55pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="display:inline;"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">7,033,497</span></span></div> </div> </td> </tr> </table> </div> <div style="line-height:12.0pt;margin-top:4pt;text-align:left"> <div style="margin-top:4pt"><div style="display:inline;"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">As noted under “Use of Leverage,” the Fund currently </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">utilizes</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 17pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leverage </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">principally through</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> reverse repurchase agreements</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;"> and may also obtain </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">leverage through credit default swaps</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">dollar rolls/</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">buybacks and</div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">borrowings, such as through bank loans or commercial paper and/or </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other credit facilities. The Fund may also enter into transactions other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">than those noted above that may give rise to a form of leverage </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">including, among others, futures and forward contracts (including foreign </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">currency exchange contracts), </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">total return swaps and other derivative </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">transactions, loans of portfolio securities, short sales and when-issued, </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">delayed delivery and forward commitment transactions.</div><div style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; line-height: 12pt; letter-spacing: 0px; top: 0px;display:inline;"> </div></div></div> </div> <div style="line-height:12.0pt;margin-top:4.0pt;text-align:left"> <div style="margin-top:4pt"><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The Fund may determine in the future to issue preferred shares or other </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">senior securities to add leverage to its portfolio. Any such preferred </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shares would have complete priority upon distribution of assets over the </div><div style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shares.</div></div> </div> <span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Common Shareholders will be entitled to the payment of dividends and </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">other distributions when, as and if declared by the Board.</span> <span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Upon liquidation of the Fund, after paying or </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">adequately providing for the payment of all liabilities of the Fund and the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">liquidation preference with respect to any outstanding preferred shares, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">and upon receipt of such releases, indemnities and refunding </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">agreements as they deem necessary for their protection, the Trustees may </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">distribute the remaining assets of the Fund among the Fund’s Common </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Shareholders.</span> <span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">If the </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">Fund does hold a meeting of shareholders, Common Shares of the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">entitle their holders to one vote for each Common Share held; however, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">separate votes are taken by each class of Common Shares on matters </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">affecting an individual class of Common Shares. Each fractional share </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">shall be entitled to a proportionate fractional vote, except as otherwise </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">provided by the Declaration, Bylaws, or required by applicable law.</span> <div style="line-height:12.0pt;text-align:left"><span style="display:inline;"><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">The following table shows the amounts of Common Shares of the Fund </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">that were authorized and outstanding as of September 30, </span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">2026</span><span style="color: rgb(51, 51, 51); font-family: &quot;Arial Narrow&quot;; font-size: 10pt; letter-spacing: 0px; top: 0px;display:inline;">:</span><span style="color: rgb(0, 0, 0); font-family: &quot;Arial Narrow&quot;; font-size: 1pt; letter-spacing: 0px; top: 0px;display:inline;"> </span></span></div> <div style="line-height:0.0pt;margin-top:6pt;text-align:left"> <div style="margin-top:6pt"> </div> </div> <div style="margin-top:0.0pt"> <table cellpadding="0" cellspacing="0" style="text-align:start; border-bottom:0.5pt solid #00687D;empty-cells:show;width:263pt"> <tr style="height:14.25pt"> <td style="background-color:#FFFFFF;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:106.48pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:6pt;text-align:Left;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">(1)</span></span></div> </div> </td> <td style="background-color:#FFFFFF;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:44.14pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">(2)</span></span></div> </div> </td> <td style="background-color:#FFFFFF;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:58.83pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">(3)</span></span></div> </div> </td> <td style="background-color:#FFFFFF;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:53.55pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">(4)</span></span></div> </div> </td> </tr> <tr style="height:39.5pt"> <td style="background-color:azure;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:106.48pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:3pt;margin-right:6pt;text-align:Left;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Title of Class</span></span></div> </div> </td> <td style="background-color:azure;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:44.14pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Amount</span></span></div> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Authorized</span></span></div> </div> </td> <td style="background-color:azure;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:58.83pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Amount Held by</span></span></div> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">the Fund for its</span></span></div> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Account</span></span></div> </div> </td> <td style="background-color:azure;border-bottom:0.5pt solid #00687D;padding-bottom:1.75pt;padding-top:1.75pt;vertical-align:Bottom;width:53.55pt"> <div style="line-height:8.0pt;text-align:left"> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Amount</span></span></div> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Outstanding</span></span></div> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Exclusive of</span></span></div> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Amount Shown</span></span></div> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="color: rgb(0, 104, 125); font-family: &quot;Arial Narrow&quot;; font-size: 7pt; letter-spacing: 0px; top: 0px;display:inline;"><span style="display:inline;font-weight:bolder;display:inline;">Under (3)</span></span></div> </div> </td> </tr> <tr style="height:8.75pt"> <td style="background-color:#FFFFFF;padding-bottom:2pt;padding-top:1.75pt;vertical-align:Top;width:106.48pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:3pt;margin-right:6pt;text-align:Left;white-space:nowrap"><span style="display:inline;"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Institutional Class Common Shares</span></span></div> </div> </td> <td style="background-color:#FFFFFF;padding-bottom:2pt;padding-top:1.75pt;vertical-align:Top;width:44.14pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">Unlimited</span></div> </div> </td> <td style="background-color:#FFFFFF;padding-bottom:2pt;padding-top:1.75pt;vertical-align:Top;width:58.83pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:6pt;margin-right:6pt;text-align:Center;white-space:nowrap"><span style="display:inline;"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">0</span></span></div> </div> </td> <td style="background-color:#FFFFFF;padding-bottom:2pt;padding-top:1.75pt;vertical-align:Top;width:53.55pt"> <div style="line-height:7.5pt;text-align:left"> <div style="margin-left:6pt;margin-right:3pt;text-align:Center;white-space:nowrap"><span style="display:inline;"><span style="color: rgb(63, 63, 63); font-family: &quot;Arial Narrow&quot;; font-size: 7.5pt; margin-left: 0pt; letter-spacing: 0px; top: 0px;display:inline;">7,033,497</span></span></div> </div> </td> </tr> </table> </div> Institutional Class Common Shares 0 7033497 Management Fees include fees payable to the Investment Manager for advisory services and for supervisory, administrative and other services. The Fund pays for the advisory, supervisory and administrative services it requires under what is essentially an all-in fee structure (the “unified management fee”). Pursuant to an investment management agreement, PIMCO is paid a Management Fee of 1.30% of the Fund’s average daily total managed assets. The Fund (and not PIMCO) is responsible for certain fees and expenses, which are reflected in the table above, that are not covered by the unified management fee under the investment management agreement. Please see “Management of the Fund – Investment Management Agreement” for an explanation of the unified management fee and definition of “total managed assets.” Reflects the Fund’s use of leverage in the form of reverse repurchase agreements averaged over the fiscal year ended June 30, 2026 which represented approximately 15.29% of the Fund’s average total managed assets, including assets attributable to such leverage, (or 18.05% of the Fund’s average net assets attributable to common shares), as of that date, at an estimated annual interest rate cost to the Fund of 3.74%, which is the weighted average interest rate cost during the fiscal year ended June 30, 2026. See “Use of Leverage-Effects of Leverage.” The actual amount of interest expense borne by the Fund will vary over time in accordance with the level of the Fund’s use of leverage and variations in market interest rates. Borrowing expense is required to be treated as an expense of the Fund for accounting purposes. Any associated income or gains (or losses) realized from leverage obtained through such instruments is not reflected in the Annual Expenses table above, but would be reflected in the Fund’s performance results. “Interest Payments on Borrowed Funds” is borne by the Fund separately from the management fees paid to PIMCO. Excluding such expense, Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement are estimated to be 1.61%, 2.11%, 2.11%, 2.36% and 2.36% for Institutional Class, Class A-1, Class A-2, Class A-3 and Class A-4 shares, respectively. “Other Expenses” are based on estimated amounts for the current fiscal year. PIMCO has contractually agreed, through November 3, 2027, to waive its management fee, or reimburse the Fund, to the extent that organizational expenses (including any initial offering expenses), pro rata share of expenses related to obtaining or maintaining a Legal Entity Identifier and pro rata Trustees’ fees exceed 0.07% of the Fund’s average daily net assets. The Expense Limitation Agreement will automatically renew for one-year terms unless PIMCO provides written notice to the Fund at least 30 days prior to the end of the current term, or unless the Fund terminates the agreement upon 90 days notice of the Fund's investment management agreement with PIMCO terminates. Under the Expense Limitation Agreement, if, in any month in which the investment management agreement is in effect, the estimated annualized Specified Expenses for that month are less than the Expense Limit, PIMCO is entitled to reimbursement by the Fund of any portion of the management fee waived or reduced as set forth above during the previous thirty-six months, provided that such amount paid to PIMCO will not (1) together with the annualized Specified Expenses exceed, for such month, the Expense Limit; (2) exceed the total Reimbursement Amount; or (3) include any amounts previously reimbursed to PIMCO. For the avoidance of doubt, any reimbursement of PIMCO’s management fee pursuant to the Expense Limitation Agreement plus any recoupment of Specified Expenses will not exceed the lesser of (i) the expense limit in effect at the time of waiver or reimbursement and (ii) the expense limit in effect at the time of recoupment. While neither the Fund nor the Distributor impose an initial sales charge, if you buy Institutional Class, Class A-1 or Class A-3 Common Shares through certain financial firms, they may directly charge you transaction or other fees in such amount as they may determine. Please consult your financial firm for additional information. The applicable initial sales charge reflected in the example for Class A-2 and Class A-4 Common Shares of the Fund is 2.00%. Although the Fund is permitted to charge a maximum initial sales charge of 3.00% for these share classes, the Fund has elected to currently charge a maximum initial sales charge of 2.00%. The example above should not be considered a representation of future expenses. Actual expenses may be higher or lower than those shown. The example assumes that the estimated Interest Payments on Borrowed Funds and Other Expenses set forth in the Annual Fund Operating Expenses table are accurate, that the Total Annual Fund Operating Expenses (as described above) remain the same for all time periods shown, and that all dividends and distributions are reinvested at NAV and takes into account the effect of the fee waiver and/or expense reimbursement (if any) during the full contractual term of such fee waiver and/or expense reimbursement. Actual expenses may be greater or less than those assumed. Moreover, the Fund’s actual rate of return may be greater or less than the hypothetical 5% annual return shown in the example. In addition to the fees and expenses described above, you may also be required to pay transaction or other fees on purchases of Institutional Class, Class A-1, Class A-2, Class A-3 or Class A-4 Common Shares of the Fund, which are not reflected in the example. Although the Fund is permitted to charge a maximum sales charge of 3.00%, the Fund has elected to currently charge a maximum sales charge of 2.00%. See “Plan of Distribution - Purchasing Shares - Reductions and Waivers of Initial Sales Charges and EWCs” in this prospectus for more information on sales charge waivers and discounts.