Relationship Disclosure Information

The disclosure provided in this document is meant to deliver to our clients all information that a reasonable investor would consider important regarding your relationship with Prime Quadrant Corp. (“Prime Quadrant”). We encourage you to read this document carefully to understand its contents. If you have any questions, please contact us by telephone (647-749-4118) or by e-mail (info@primequadrant.com).

Some of the information we are required to provide about our relationship with you may be contained in other documents we have provided to you or will provide to you from time to time. These additional documents are hereby incorporated by reference into this document.

If there is a significant change to the information contained in this document, it will be made available on www.primequadrant.com and notice of any change will be provided to you in a timely manner.

2. Who We Are

Prime Quadrant Corp., carrying on business as Prime Quadrant, is registered as a portfolio manager, exempt market dealer in the provinces of Ontario, Quebec, Manitoba, Alberta, and British Columbia. Prime Quadrant is also registered as an investment fund manager in the provinces of Ontario and Quebec. Prime Quadrant provides independent investment management services to individuals, institutions, and other organizations.

3. Our Products and Services

Prime Quadrant provides investment research and consulting services to high net worth families. Most of the consulting work that we do for clients is undertaken on a “non-discretionary” basis, meaning that our clients make their own investment decisions based on the research and consulting services that we provide to them. Although we believe it is important that investors maintain ultimate responsibility for their portfolios, sometimes we will enter an agreement to provide ‘discretionary” investment management services, where our clients grant us a mandate to make investment decisions for them based on a pre-agreed plan. The primary goal of this service is to provide our clients with lower cost access to particular investment opportunities (i.e., F-Class funds) or outcomes (i.e., liquidating securities at a lower cost). In practice, however, we expect to discuss any of the trading we direct within these mandates with our clients before execution.

Prime Quadrant also manages and selects securities for certain proprietary private pooled funds and may place certain of its discretionary and non-discretionary clients into these private proprietary pooled funds (see ‘conflicts of interest’ for further details).

Finally, where Prime Quadrant has sufficient capacity in an investment opportunity, we will offer the additional capacity to our transactional dealing clients.

4. Suitability Assessment

Where Prime Quadrant provides advisory or dealing services to you, Prime Quadrant has an obligation to take reasonable steps to ensure that, before it makes a recommendation to or accepts an instruction from you to buy or sell a security or takes any investment action, as applicable, the investment action is suitable for you. Prime Quadrant must put the client’s interest first when it takes an investment action for the client.

To meet this suitability obligation, we collect “know-your-client” (“KYC”) information from you at the time you open an account with us, such as: information about your personal circumstances, financial situation, investment goals and objectives, investment horizon, investment knowledge and experience, and make a determination regarding your risk profile, which includes your willingness to accept risk (risk tolerance) and ability to endure financial loss (risk capacity). In order to satisfy our obligation to assess suitability on an ongoing basis after you open your account, as applicable, we update your KYC information on a periodic basis.

To meet our suitability obligation, we must also “know” and understand each investment we place you in. Through our “know-your-product” (“KYP”) due diligence process, the firm analyzes every investment we place you in or recommend to you. Without limitation, as part of the firm’s KYP process, we generally consider such things as the reputation and track record of the investment product, the potential for profit and loss, the associated risk level and potential for conflicts of interest, the investment’s time horizon and complexity and the specific features of any investment, including costs and fees, liquidity, redemption rights and the frequency, completeness and accuracy of an issuer’s disclosure.

Once we have collected your KYC information and we have conducted our KYP process, we can then use all of that information to determine whether or not an investment is suitable for you. Should there be any changes to your KYC information during the year, it is your responsibility to let us know as quickly as possible. All personal, confidential information we receive from you will be treated in accordance with our Privacy Policy, a copy of which is contained at Appendix A to this document.

5. Fees and Operating Expenses

Prime Quadrant charges fees for the different services it offers. These fees are set out the agreement you signed with Prime Quadrant and, in particular, Schedule A to that agreement. Please see your agreements for more information.

Please note that all fees will be subject to an annual inflationary increase of 2.5% to help cover ongoing administrative cost increases to deliver our services, including personnel, compliance and legal overheads. Any further increases in fees will not be applied without consultation and your express written consent. All increases will be applied on the 1st day of each calendar year, provided that this is at least 6 months following the date of the execution of your original agreement. If the 1st day of the calendar year is less than 6 months following the date of the execution of your original agreement, then the increase will be applied at the beginning of the following calendar year.

Fees are expressed in annual rates. All fees are collected on a quarterly basis based on the market value of your portfolio as at the end of the relevant calendar quarter (adjusted for any material withdrawals and deposits during that relevant calendar quarter). No increase in the management fee shall be effective without prior written notification to you.

In addition to our management fee, you may also incur certain charges imposed by unaffiliated third parties. Such charges may include, but are not limited to, fees charged by independent managers, custodial fees, brokerage commissions, transaction fees.

6. Related and Connected Entities

The word “connected” is intended to involve a state of indebtedness to, or other relationship with, Prime Quadrant or those “related” to Prime Quadrant that, in connection with a distribution of securities, would be material to a purchaser of the securities; and (ii) the word “related” is intended to involve positions permitting, through ownership or otherwise, a controlling influence, and would include all companies under a common controlling influence. All of the Prime Quadrant Funds are related and connected issuers. Please see Appendix C for all related and connected entities of Prime Quadrant.

7. Custody of Your Assets

Prime Quadrant does not hold or have access to clients’ assets. Where Prime Quadrant acts with discretionary authority over its clients’ accounts, Prime Quadrant will use National Bank Independent Network (“NBIN”) and its affiliates to custody the assets in your account. If you have granted us discretionary authority to act as your portfolio manager of assets on your account with NBIN pursuant to an investment management agreement the following applies to you:

• Prime Quadrant Corp. ( the “Prime Quadrant”) and National Bank Independent Network (“NBIN”), a division of National Bank Financial (“NBF”) have entered into a Portfolio Manager Services Agreement (the “PM Services Agreement”) pursuant to which NBIN has agreed to provide certain services including: (i) establishing and servicing an account in your name (the “account”); and (ii) providing certain administrative services in connection with the account; and (iii) executing trades for your account. NBF holds your assets in the account as custodian. Under the PM Services Agreement, Prime Quadrant is responsible for providing NBIN with all instructions related to securities transactions to be executed for the account, ensuring such transactions are suitable for you and for complying with all applicable “know your client”, “know your product” and anti-money laundering obligations (the “Arrangement”).

• The Arrangement with NBIN is intended to enhance the protection of client assets since NBIN is a qualified custodian that is functionally independent from the Prime Quadrant. Although Prime Quadrant will monitor the services performed by NBIN and believes that they are an appropriate custodian, in the event of the bankruptcy or insolvency of NBIN, there is no certainty that you will not incur losses due to your assets being unavailable for a period of time, the ultimate receipt of less than full recovery of your assets, or both. You will only pay custody fees on assets held in an account at NBIN that are not directly invested in either one of the Prime Quadrant Funds or any other exempt investment as detailed by NBIN in the PM Services Agreement.

• With the exception of certain standing instructions, we may collect from you, we do not hold or have access to your assets. Any agreed upon management fees charged by us are payable directly from your account.

Client Reporting

NBIN will provide you with monthly reports in respect of your account. The reports will contain transaction information covering each transaction that was made in the account during the relevant period and a description of the assets held in the account, as required by applicable law. Both Prime Quadrant and NBIN are responsible for ensuring that the information in the statements you receive from NBIN is complete and accurate. Please contact us at the email address set out in this agreement. Prime Quadrant will provide you with an annual report on charges and other compensation and an annual investment performance report, as applicable. The assets in the account will be held by NBF at its office in Toronto.

NBIN may also be used as custodian for the Prime Quadrant Access LPs. Please refer to the offering document for any of the Access LPs for further information on the custodian.

8. Your Account Statements and Reports

Where specified as a service by Prime Quadrant in your agreements, every quarter Prime Quadrant will provide you with a statement that includes details about each transaction or activity that occurred in your account during the previous quarter and information about each security, including its cost, and the cash balance, if any, in your account at the end of the month. If you wish, Prime Quadrant will provide you with such statements on a monthly basis.

Prime Quadrant will provide you with an annual report on any charges that you paid to Prime Quadrant as well as any other compensation that Prime Quadrant received in connection with operating your account. Prime Quadrant will also provide you with a report, at least annually, on the investment performance of each of your Prime Quadrant accounts or, with your consent, all of your accounts on a consolidated basis. Prime Quadrant may not, and is not obligated, to provide such a report to any client who is a “permitted client” as defined in Canadian securities regulations and who is not an individual.

9. Risks Associated with Investing

All investments, apart from certain “guaranteed” investment products, are subject to fluctuations in value and risk of loss and, unlike bank accounts or guaranteed investment certificates, the value of stocks, bonds, money market securities and investment funds is not covered by the Canada Deposit Insurance Corporation or other government deposit insurer.

Before finalizing an investment policy statement for your Prime Quadrant-managed account(s), carefully consider your investment goals, your level of risk tolerance and the risks associated with the type of securities that Prime Quadrant might recommend to you or purchase for your account. The following are risks that might affect your investments.

  • Details of any security transaction that occurred during the period covered by the statement;
  • Details about each security held through Prime Quadrant at the end of the reporting period.

In addition, we will provide annual reports containing (i) the charges and compensation associated with your investments, and (ii) the investment performance of the securities in your account, which will include an annualized total percentage return for positions in your account.

For clients for whom we provide a transactional service only, Prime Quadrant will provide you with a written trade confirmation after each trade has been placed, containing information regarding the name, description and quantity of the security purchased or sold, the price per security paid or received by you, the total value of the transaction, if a debt security the security’s annual yield, the commission, sales charge or any other amount charged to you or received by Prime Quadrant, the settlement date of the transaction, and the name of the Prime Quadrant dealing representative.

Use of Investment Performance Benchmarks

An investment performance benchmark is a market or industry sector index against which you can measure the relative performance of your investment. Benchmarks should reflect a similar asset class, industry sector and/or risk level so they are comparable to the investment you are comparing the performance to. By comparing your investment to a benchmark that closely replicates the investment or investment’s strategy, you can see how your investment performed compared to the market or industry sector. It is important to note however that benchmarks do not include operating or transaction charges or any expenses related to the investment, all of which impact an investment’s performance.

While Prime Quadrant may use benchmarks for internal research purposes, we do not currently use benchmark comparisons as part of our reporting to our clients.

Internal Targeted Returns

While Prime Quadrant does not use external benchmarks, Prime Quadrant’s Investment Committee sets longer-term target returns for each primary asset class based on several factors including historical returns, expected market conditions and our expectations, along with those of other institutions whom we respect. While these target returns are adjusted from time to time, these changes should be infrequent. These internal targeted returns may show up in reporting we give to you.

Compensation Received by Prime Quadrant

Prime Quadrant may receive placement or trailer fees or other compensation from investment managers for investments made by its clients; however, to the extent that it is legally permissible, Prime Quadrant reduces the fees paid by our advisory clients by an amount equal to all placement or trailer fees or such other forms of compensation in order to forward all savings on to its advisory clients and avoid all conflicts of interest. For investments made on behalf of our transactional dealing clients, placement or trailer fees or other forms of compensation received from investment managers will usually be retained by Prime Quadrant.

Occasionally, Prime Quadrant may be directly involved in the structuring and execution of an investment in order to make it available for our clients. To recover our costs, we may receive a time-based fee paid by the investment structure directly (and therefore indirectly by any clients that choose to participate).

All such compensation is defined in advance of any client transaction and all compensation received in respect of our services to you will be set out in either a formal agreement or otherwise agreed in writing prior to the execution of our services. In addition, you will be provided with a statement indicating the amount and type of compensation, if any, Prime Quadrant has received in connection with investments made on your behalf.

Potential Conflicts of Interest

Prime Quadrant takes reasonable steps to identify existing material conflicts of interest [1], as well as material conflicts that might be expected to arise between itself and a client. Prime Quadrant will resolve these conflicts in our clients’ best interest.  Please see our separate conflicts of interest disclosure for further information. This disclosure can be found at www.primequadrant.com

Complaints and Dispute Resolution

Please direct any complaint you may have about Prime Quadrant’s services, in writing, with as much detail as possible, to our Chief Compliance Officer at compliance@primequadrant.com. In accordance with securities regulations, Prime Quadrant is a member of the Ombudsman for Banking Services and Investments (“OBSI”), a national, independent dispute resolution service. This service is available to you, at our expense, to mediate any dispute arising between us. If your complaint is not resolved by Prime Quadrant within 90 days, or if you are not satisfied with the resolution within 180 days of receiving our decision, you will have the option to request that OBSI act as mediator for the complaint, provided the amount claimed is $350,000 or less, and is related to a trading activity conducted by us within 6 years of you taking action. If you provide Prime Quadrant with a written complaint, additional information regarding OBSI’s process will be provided to you within 10 days of the compliant being made.

[1] A conflict of interest can generally be described as any circumstance where the interests of different parties, such as the interests of Prime Quadrant and of a client, are inconsistent or divergent.

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Copyright © 2021 Prime Quadrant Corp. All rights reserved. Privacy Policy.

The offering, sale, and/or distribution of the products or services described on this website are not intended for any U.S. Person. If you intend to obtain any product or service from Prime Quadrant that is described on this website, you must first inform Prime Quadrant whether you are a U.S. Person. This website and its contents do not constitute an offer or invitation to purchase or subscribe for any securities or a solicitation of any offer to sell any securities to U.S. Persons. “U.S. Persons” are generally defined as natural persons residing in the United States, or entities organized or incorporated under the laws of the United States. U.S. citizens living abroad may also be deemed “U.S. Persons”.

References herein to Prime Quadrant refer to Prime Quadrant Corp., which is registered as a Portfolio Manager and Exempt Market Dealer in Alberta, British Columbia, Manitoba, Ontario and Quebec, and as an Investment Fund Manager in Ontario and Quebec.

Contact Us
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Copyright © 2021 Prime Quadrant Corp. All rights reserved. Privacy Policy.

The offering, sale, and/or distribution of the products or services described on this website are not intended for any U.S. Person. If you intend to obtain any product or service from Prime Quadrant that is described on this website, you must first inform Prime Quadrant whether you are a U.S. Person. This website and its contents do not constitute an offer or invitation to purchase or subscribe for any securities or a solicitation of any offer to sell any securities to U.S. Persons. “U.S. Persons” are generally defined as natural persons residing in the United States, or entities organized or incorporated under the laws of the United States. U.S. citizens living abroad may also be deemed “U.S. Persons”.

References herein to Prime Quadrant refer to Prime Quadrant Corp., which is registered as a Portfolio Manager and Exempt Market Dealer in Alberta, British Columbia, Manitoba, Ontario and Quebec, and as an Investment Fund Manager in Ontario and Quebec.