Western Asset Management Company, LLC

Western Asset Management Company, LLC (“Western Asset U.S.”), Western Asset Management Company Limited (“Western Asset UK”), Western Asset Management Company Pte. Ltd. (“Western Asset Singapore”), and Western Asset Management Company Ltd. (“Western Asset Japan”), Western Asset Management Company Limitada (“Western Asset Brazil”), and Western Asset Management Company Pty Ltd (“Western Asset Australia”) (collectively, “Western Asset” or the “Firm”) operate as a group of coordinated sister companies located in various jurisdictions, with headquarters in Pasadena, California. Introduction to Franklin Templeton Western Asset has been in business for over 50 years. Each Western Asset entity is ultimately an indirect wholly owned subsidiary of Franklin Templeton, Inc. (“Franklin Templeton”), the holding company for various subsidiaries that form the global investment management organization known as Franklin Templeton (“Franklin Templeton”). With more than 75 years of active management experience, Franklin Templeton offers investment solutions to help clients achieve better outcomes. The company’s autonomous Specialist Investment Managers (“SIMs”), including Western Asset, provide clients with deep expertise and specialization across asset classes, investment styles, and geographies. Franklin Templeton markets its financial products and sub-advisory services under the name Franklin Templeton. Franklin Templeton constitutes the ultimate principal owner of Western Asset. Unless otherwise noted, references to Western Asset and the Firm in this brochure pertain to the four SECregistered legal entities. Organizational Structure Western Asset operates through various business units and departments. Western Asset’s Chief Executive Officer (“CEO”) oversees the Firm’s Investment Management Department and other business units and has joint oversight for the Risk Management department with Western Asset’s parent company, Franklin Templeton. The Firm’s Investment Management unit focuses on the management of client portfolios. It is led by the Firm’s Chief Investment Officer (“CIO”), Deputy CIOs, and Director of Portfolio Operations. The Investment Management Unit includes Investment Strategy, Portfolio Management, Research, Trading, and Portfolio Operations. The institutional sales and client service teams of Franklin Templeton and Western Asset have been unified under the leadership of Franklin Templeton. This merger combines Western Asset’s vast institutional experience and dedicated client service with enhanced access to Franklin Templeton's comprehensive investment platform, diverse product range, and abundant resources. Franklin Templeton also manages and supports the Firm's back-office and middle-office functions, including Finance and Accounting, Compliance, Legal, Human Resources, Information Technology, Enterprise Risk Management, Investment Operations, and Marketing. Our History Western Asset operates as a separate legal entity and an autonomous investment management company as part of the Franklin Templeton organization and provides discretionary investment management and advisory services to clients, as described in this brochure. Western Asset Management Company, LLC was founded in Los Angeles, California in October 1971 by United California Bank (which later became First Interstate) before relocating to Pasadena, California, where it is currently headquartered.

In December 2005, to further enhance Western Asset's capabilities and global presence, Legg Mason acquired a substantial part of Citigroup’s asset management business in exchange for its brokerage and capital markets business. As part of this transaction, the Firm gained new offices in Hong Kong, Melbourne, New York, São Paulo and Tokyo, as well as related staff and assets. In May 2018, Western Asset U.S. was converted from a California corporation to a California limited liability company. Western Asset’s former parent company, Legg Mason, Inc. (“Legg Mason”) was acquired by Franklin Templeton. in a transaction that closed on July 31, 2020. In the transaction, Franklin Templeton purchased 100% of the outstanding equity of Legg Mason and, as a result, indirectly acquired 100% of Legg Mason’s ownership interest in Western Asset. While Western Asset U.S. is generally responsible for managing U.S. fixed-income mandates, including the related portions of the Firm’s broader portfolios and servicing its U.S. relationships, it undertakes all types of investment-related activities, including investment management, and research and analysis with securities settlement and client service supported by Franklin Templeton. Western Asset’s office in New York is primarily responsible for the Firm’s liquidity and municipal products. Western Asset UK is generally responsible for managing global and non-U.S. dollar fixed-income mandates, including the related portions of the Firm’s broader portfolios, as well as servicing client relationships in Europe Middle East and Africa. Western Asset UK undertakes all types of investment related activities including investment management, and research analysis with securities settlement, and client service supported by Franklin Templeton. Western Asset Singapore is dedicated to managing Asian (excluding Japan) fixed income mandates and providing input and analysis for the Asian portions of Western Asset’s broader portfolios, as well as servicing these relationships. It undertakes all types of investment-related activities including investment management, and research and analysis with securities settlement, and client service supported by Franklin Templeton. Western Asset Japan is responsible for managing Japanese mandates, including the related portions of Western Asset’s broader portfolios. It also services Japanese clients investing in non-Japanese investments managed by other offices. It undertakes all types of investment-related activities including investment management, and research and analysis with securities settlement, and client service supported by Franklin Templeton. Western Asset Australia is responsible for managing Australian and New Zealand fixed-income mandates, including the related portions of Western Asset’s broader portfolios, and servicing the Firm’s Australian relationships. It undertakes all types of investment related activities including investment management, and research and analysis with securities settlement and client service supported by Franklin Templeton. Western Asset Brazil is responsible for managing Brazilian fixed-income mandates, including the related portions of Western Asset’s broader portfolios, and servicing the Firm’s Brazilian relationships. Unlike other offices, it also manages equity and balanced accounts. It undertakes all types of investment-related activities including investment management, and research and analysis with securities settlement, and client service supported by Franklin Templeton Supervised Affiliates of Western Asset As noted above, Western Asset is comprised of several supervised affiliates. Below are the dates these entities were established or came under Western Asset’s management:

Entity

Date

Western Asset U.S. Western Asset UK Western Asset Singapore Western Asset Japan Western Asset Australia Western Asset Brazil

1971 1986 2000 2005 2005 2005

As of September 30, 2025, Western Asset had approximately 221 employees in 7 cities across 6 countries. Western Asset provides investment advisory or sub-advisory services for a broad range of fixed income strategies. Western Asset’s services are offered generally based on the strategy the client has selected and dependent on a written agreement and negotiated account restrictions and guidelines. It does not manage equity portfolios except in limited circumstances, although certain types of instruments, which may be considered to have equity characteristics, such as preferred stock and convertible instruments, are commonly found in certain fixed income investment portfolios that we manage. Our affiliates may sub advise all or a part of any account through delegation in addition to the legal entity directly contracted with a client. For a list of our marketed investment strategies, please refer to Item 8. “Methods of Analysis, Investment Strategies and Risk of Loss.” Western Asset generally tailors its advisory services and products to meet the needs and requirements of our clients. When onboarding new clients, we review and develop/agree/negotiate detailed investment objectives and guidelines as part of the startup process. This ensures that each client's specific investment goals are clearly defined and aligned with our strategies from the very beginning. Moreover, we understand that investment requirements can evolve over time. Therefore, we make it a priority to revisit and adjust these objectives and guidelines with our clients, ensuring that their investment strategies remain relevant and effective in light of any changes in their circumstances or market conditions. TYPES OF ADVISORY SERVICES Institutional Separate Accounts Western Asset provides investment management services to U.S and non-U.S. institutional clients, including pension funds, funds, foundations, charitable institutions, banks and thrift institutions, trust accounts, corporations, insurance companies, and public entities, including municipalities, states and related agencies. The fees and services for each such arrangement are individually negotiated, depending on factors such as asset class, pre-existing relationship, portfolio complexity, client type and account size or other special circumstances. For more information, please refer to Item 5. “Fees and Compensation.” Wrap Fee Programs Western Asset U.S. also provides investment advisory services to retail separately managed account clients through managed account programs (“wrap fee programs”) sponsored by broker-dealers and other financial intermediaries (“sponsors” or “sponsored firms”) under various wrap fee programs that may not be affiliated with Western Asset. Wrap fee program clients should carefully review the terms of the relevant agreement with their sponsor to understand the terms, services, minimum account size and any additional fees that may be associated with their account and participation in the wrap fee program. In consideration for providing investment management services to wrap fee program accounts, Western Asset U.S. receives a portion of the wrap fee paid by wrap fee program participants to the sponsor.

Considering the relatively small size of these accounts when compared to those of institutional clients, Western Asset U.S. has developed products specifically for wrap fee program accounts and clients. Not all Western Asset’s strategies are available through wrap fee programs offered by our sponsors. Further, the manner in which Western Asset U.S. executes a strategy through a wrap fee program may differ from how the same strategy is executed for an institutional client, for example, because of the need to adhere to the restrictions imposed by the wrap fee account provider or due to the use of affiliated commingled vehicles rather than individual securities. Where Western Asset U.S. has discretion, Western Asset U.S. makes investment decisions that are consistent with the strategy selected by the client and sponsor. Where Western Asset U.S. does not have discretion, Western Asset U.S. provides information (e.g., model portfolios) to the sponsor to be used by the sponsor or other investment professional in implementing investment decisions. Private Funds Clients may access certain Western Asset strategies through private funds. To do so, clients must meet certain qualifications and be either qualified purchasers or accredited investors. These funds are primarily designed to provide Western Asset’s clients with opportunistic asset diversification in an effort to augment investment strategies in seeking a client’s overall objectives. The funds may also be utilized as an investment vehicle to launch a new strategy or product that may not initially create demand worthy of separate account minimums or where specific business, and legal arrangements make the use of a private fund necessary or advisable. As of September 30, 2025, Western Asset U.S. is the Managing Member and investment manager of approximately 35 private commingled investment funds. Assets Under Management (“AUM”) As of September 30, 2025, AUM totaled approximately $196 billion. This amount encompassed the four SEC-registered legal entities in the table below, excluding the assets for wrap fee programs. AUM is in U.S. Dollars (USD).

U.S. Dollar Amount

Entity

AUM in billions Western Asset U.S. Western Asset UK Western Asset Singapore Western Asset Tokyo Total

$171,086,000,000 $20,094,000,000 $2,802,000,000 $2,583,000,000 $196,565,000,000

As of September 30, 2025, the total assets under management in the table above for the separately managed accounts exclude the amounts from wrap fee programs where only Western Asset U.S. sub-advises. These programs total approximately $13,903,000,000. This sum is further divided into approximately $11,481,000,000 in discretionary assets and $2,422,000,000 in non-discretionary assets.

Advisory Fees Investment management fees are generally calculated under contractual arrangements with the advisers’

clients as a percentage of the market value of assets under management. Annual rates vary by investment objective and type of services provided. Fee arrangements for separate accounts vary by client, and are based on several different factors, including investment mandate, services performed, and account/relationship size. To the extent permitted under the Investment Advisers Act of 1940, as amended (the “Advisers Act”) and other applicable law, the advisers can negotiate and charge performance fees or special allocations in addition to asset-based fees in connection with accounts. In addition, fees and allocations can be fixed, fixed plus performance, or performance only. Please refer to Item 6. “PerformanceBased Fees and Side-by-Side Management” for additional information. Western Asset’s advisory fees are generally based on a percentage of asset under its management and generally, are not negotiable, but from time-to-time may be depending on facts and circumstances. In the event of account termination, fees paid in advance will be prorated to the date of termination specified in the notice of termination, and any unearned portion thereof will be refunded to the client. Although agreements are individually negotiated and may vary, either clients or Western Asset, generally have the right to terminate the advisory agreement by giving the other party thirty (30) days written notice. Western Asset will normally negotiate a performance-based fee on request subject to any regulatory limits on fees. In such an arrangement, compensation is typically based on account performance relative to a mutually agreed benchmark. Performance-based fees vary depending on the extent to which Western Asset is authorized to employ a full array of investment techniques. In certain cases, Western Asset may be paid a percentage of the account’s return (e.g., 20%), typically above a “hurdle” or base return. Please refer to Item 6. “Performance-Based Fees and Side-by-Side Management” for information concerning conflicts of interests related to Western Asset’s accounts that pay performance-based fees. Western Asset typically acts solely as portfolio manager for an account and not as custodian or another type of service provider. Clients will pay separate fees to third parties for those services. Western Asset U.S. maintains a family of privately offered commingled funds, primarily for those institutions seeking a strategic or opportunistic allocation to a certain investment sector or strategy. Those funds will pay custodian and administrative fees and other expenses to third-party custodians, administrators and service providers such as accountants and lawyers, reducing the return to investors. Western Asset is also an adviser or sub-adviser to registered mutual funds and closed-end funds, including those managed and/or administered by Franklin Templeton and its other affiliates. Those funds will pay management, administration and other fees to other service providers, such as Franklin Templeton or its other affiliates. Almost all fixed income instruments trade at a bid/ask spread and without an explicit brokerage charge. Accordingly, while there is not a formal trading expense, clients will bear the implicit trading costs reflected in these spreads. Please refer to Item 12. “Brokerage Practices” for more information. Western Asset typically bills clients for fees but at client direction and by agreement may deduct fees from assets (this election does not extend to clients of Western Asset UK due to local regulation). Western Asset believes its fees are similar to those charged by many other investment advisory firms for similar services; however, fixed-income management services may be available from other sources for lower fees. Neither Western Asset nor its supervised individuals accept compensation for the sale of securities or other investment products. Private Funds Each Private Fund’s private placement memorandum and/or other offering or governing document describes the applicable fees and expenses. Fees paid by Private Funds (and therefore indirectly by Private

Fund investors will, from time to time, differ from fees charged in respect of other accounts even where a similar investment mandate is followed. The fees disclosed in the offering and/or governing documents of a Private Fund will, from time to time, be waived or reduced for one or more particular investors in that Private Fund. Separate Accounts and Fee Schedules Western Asset’s standard fees for separate account clients are normally calculated as a percentage of the value of assets under management, and are typically calculated monthly or quarterly, or as otherwise agreed with each client. In some cases, fees will be negotiated. Some strategies may only be available in certain jurisdictions, may be subject to change, may fall outside of the stated ranges, and may be subject to local value-added tax or goods and services tax. based on a variety of factors including the account size, investment objectives, whether or not the separate account involves a multi-asset strategy mandate and the type and number of other accounts a client has with Western Asset. Additionally, some institutional clients are billed on fee schedules that are no longer offered. Those schedules are not otherwise available to new or other existing clients of Western Asset. All fees are stated in U.S. Dollars (USD) except as otherwise noted. Advisory fees for separate accounts are generally determined based upon the following schedules. However, fees for certain strategies or accounts fall outside of the stated ranges or are negotiated. Strategy Name

Standard Investment Advisory Fee

Australia Core

.20 of 1% on first A$100 million .125 of 1% on amounts over A$100 million

Minimum Account Size A$50 million

.22 of 1% on first A$100 million .1375 of 1% on amounts over A$100 million

Australia Enhanced Cash

.15 of 1% on first A$100 million .10 of 1% on amounts over A$100 million

A$100 million

.165 of 1% on first A$100 million .11 of 1% on amounts over A$100 million

Australia Credit

.25 of 1% on first A$100 million .15 of 1% on amounts over A$100 million

A$50 million

With Japanese Consumption Tax .275 of 1% on first A$100 million .165 of 1% on amounts over A$100 million

Asia Local Currency Debt

.40 of 1% on first $50 million .20 of 1% on amounts over $50 million .44 of 1% on first $50 million .22 of 1% on amounts over $50 million

$50 million

Asia USD Debt

.40 of 1% on first $50 million .20 of 1% on amounts over $50 million

$50 million

.44 of 1% on first $50 million .22 of 1% on amounts over $50 million

Commercial MBS

.30 of 1% on the first $50 million .20 of 1% on amounts over $50 million

$50 million

.33 of 1% on the first $50 million .22 of 1% on amounts over $50 million

Emerging Markets Corporate

.40 of 1% on first $100 million .30 of 1% on amounts over $100 million

$50 million or €50 million

.44 of 1% on first $100 million .33 of 1% on amounts over $100 million

Emerging Markets Diversified

.40 of 1% on first $100 million .30 of 1% on amounts over $100 million

$50 million or €50 million

.44 of 1% on first $100 million .33 of 1% on amounts over $100 million

Emerging Markets Local Currency .40 of 1% on the first $100 million Sovereign .30 of 1% on amounts over $100 million

$50 million or €50 million

.44 of 1% on first $100 million .33 of 1% on amounts over $100 million

Global Aggregate

.40 of 1% on first $100 million .20 of 1% on amounts over $100 million

$50 million

.44 of 1% on first $100 million .22 of 1% on amounts over $100 million

Global Credit-Corporate

.35 of 1% on first $100 million .175 of 1% on amounts over $100 million

$25 million

.385 of 1% on first $100 million .1925 of 1% on amounts over $100 million

Global High Yield

.40 of 1% on first $100 million .30 of 1% on amounts over $100 million .44 of 1% on first $100 million .33 of 1% on amounts over $100 million

$50 million or €50 million

Global Multi-Sector

.40 of 1% on first $100 million .20 of 1% on amounts over $100 million

$50 million or €50 million

.44 of 1% on first $100 million .22 of 1% on amounts over $100 million

Global Sovereign

.30 of 1% on first $100 million .15 of 1% on amounts over $100 million

$50 million

.33 of 1% on first $100 million .165 of 1% on amounts over $100 million

Global Term Premium

.30 of 1% on first ¥10 billion .15 of 1% on amounts over ¥10 billion

JP¥5 billion

.33 of 1% on first ¥10 billion .165 of 1% on amounts over ¥10 billion

Japan Fixed Income

.25% of 1% on the first ¥5B .15% of 1% on amounts over ¥5B

JP¥5 billion

.275 of 1% on first ¥5 billion .165 of 1% on amounts over ¥5 billion

Multi-Asset Credit

.60 of 1% on first $100 million .40 of 1% on amounts over $100 million

$50 million

.66 of 1% on first $100 million .44 of 1% on amounts over $100 million

New Zealand Core

.20 of 1% on first NZD100 million .125 of 1% on amounts over NZD100 million

NZD50 million

.22 of 1% on first NZD100 million .1375 of 1% on amounts over NZD100 million

Short-Duration High Income

.40 of 1% on first $100 million .30 of 1% on amounts over $100 million

$25 million

.44 of 1% on first $100 million .33 of 1% on amounts over $100 million

Structured Product

.75 of 1% on first $100 million .50 of 1% on amounts over $100 million .825 of 1% on first $100 million .55 of 1% on amounts over $100 million

$50 million

Structured Product Levered

1% on all amounts, plus 15% of the outperformance over the fund’s high-water mark on an annual basis

$100 million

1.1% on all amounts, plus 16.5% of the outperformance over the fund’s high-water mark on an annual basis

Total Return Unconstrained

.60 of 1% on first $100 million .40 of 1% on amounts over $100 million

$100 million

.66 of 1% on first $100 million .44 of 1% on amounts over $100 million

UK Credit

.30 of 1% on first £60 million .15 of 1% on amounts over £60 million

£60 million

.33 of 1% on first £60 million .165 of 1% on amounts over £60 million

US Agency MBS

.30 of 1% on first $100 million .15 of 1% on amounts over $100 million

$75 million

.33 of 1% on first $100 million .165 of 1% on amounts over $100 million

US Agency MBS Plus

.40 of 1% on first $100 million .20 of 1% on amounts over $100 million

$75 million

.44 of 1% on first $100 million .22 of 1% on amounts over $100 million

US Bank Loan

.45 of 1% on first $100 million .30 of 1% on amounts over $100 million

$50 million

.495 of 1% on first $100 million .33 of 1% on amounts over $100 million

US Core

.30 of 1% on first $100 million .20 of 1% on amounts over $100 million

$75 million

.33 of 1% on first $100 million .22 of 1% on amounts over $100 million

US Core Constrained

.20 of 1% on first $100 million .15 of 1% on next $400 million .10 of 1% on amounts over $500 million .22 of 1% on first $100 million .165 of 1% on next $400 million

$75 million

US Core Plus

.30 of 1% on first $100 million .20 of 1% on amounts over $100 million

$75 million

.33 of 1% on first $100 million .22 of 1% on amounts over $100 million

US Enhanced Liquidity

.12 of 1% on first $100 million .09 of 1% on next $200 million .07 of 1% on amounts over $300 million

$50 million

.132 of 1% on first $100 million .099 of 1% on next $200 million

US High Yield

.40 of 1% on first $100 million .30 of 1% on amounts over $100 million

$25 million

.44 of 1% on first $100 million .33 of 1% on amounts over $100 million

US High Quality High Yield

.40 of 1% on first $100 million .30 of 1% on amounts over $100 million

$25 million

.44 of 1% on first $100 million .33 of 1% on amounts over $100 million

US Intermediate

.25 of 1% on first $100 million .125 of 1% on amounts over $100 million

$50 million

.275 of 1% on first $100 million .1375 of 1% on amounts over $100 million

US Intermediate Plus

.25 of 1% on first $100 million .125 of 1% on amounts over $100 million

$50 million

.275 of 1% on first $100 million .1375 of 1% on amounts over $100 million

US Investment Grade Credit Plus .30 of 1% on first $100 million .15 of 1% on amounts over $100 million

$75 million

.33 of 1% on first $100 million .165 of 1% on amounts over $100 million

US Investment Grade Intermediate Credit Plus

.30 of 1% on first $100 million .15 of 1% on amounts over $100 million .33 of 1% on first $100 million .165 of 1% on amounts over $100 million

$75 million

US Liquidity

.12 of 1% on first $100 million .09 of 1% on next $200 million .07 of 1% on amounts over $300 million

$50 million

.132 of 1% on first $100 million .099 of 1% on next $200 million .077 of 1% on amounts over $300 million

US Long Credit Plus

.30 of 1% on first $100 million .20 of 1% on amounts over $100 million

$75 million

.33 of 1% on first $100 million .22 of 1% on amounts over $100 million

US Long Duration Plus

.35 of 1% on first $100 million .20 of 1% on amounts over $100 million

$75 million

.385 of 1% on first $100 million .22 of 1% on amounts over $100 million

US Municipal Intermediate

.25 of 1% on first $100 million .125 of 1% on amounts over $100 million

$50 million

.275 of 1% on first $100 million .1375 of 1% on amounts over $100 million

US Municipal Long

.25 of 1% on first $100 million .125 of 1% on amounts over $100 million

$50 million

.275 of 1% on first $100 million .1375 of 1% on amounts over $100 million

US Short Duration

.25 of 1% on first $100 million .125 of 1% on amounts over $100 million .275 of 1% on first $100 million .1375 of 1% on amounts over $100 million

$50 million

Investment Philosophy Since Western Asset’s founding, it has adhered to a long-term fundamental value investing approach, utilizing a variety of diversified strategies to achieve our goals. This has remained a constant throughout Western Asset’s history and is consistently applied across all the Firm’s investment strategies. Western Asset’s investment decision-making process and organizational structure are specifically designed to align with and support this enduring philosophy. By maintaining this steadfast commitment to our core principles, we continue to deliver value to our clients and uphold the high standards that have defined Western Asset throughout the years. Long-term, Fundamental Value. ▪

Markets often misprice securities. Prices can deviate from fundamental fair value, but over time they typically adjust to reflect inflation, credit quality fundamentals and liquidity concerns. Consistently investing in undervalued securities may deliver attractive investment returns.

▪

Western Asset has developed a systematic method to pinpoint and take advantage of markets and securities that are priced below what Western Asset believes to be their fundamental value. The Firm does this through its disciplined and rigorous research and analysis process. By comparing market prices to the fundamental fair values estimated by our dedicated macroeconomic and credit research teams around the globe, Western Asset can identify potential mispricing.

▪

Western Asset’s investment strategies revolve around emphasizing our highest convictions, which means that we focus on the areas where we see the most significant potential value opportunities. The greater the difference between the Firm’s view of fair value and markets’ pricing, the bigger the potential value opportunity. This discrepancy allows us to capitalize on what we believe are undervalued or mispriced assets, leading to potentially higher returns for our clients. Furthermore, Western Asset’s confidence in its view of the fundamentals plays a crucial role in shaping our strategies. The more confident we are in our analysis and understanding of the market, the more we emphasize those strategies in our portfolios. This approach ensures that our client’s investments are aligned with our thorough research and strongly held convictions.

Multiple Diversified Strategies. Western Asset is highly committed to seeking diversified sources of returns for our investors. Western Asset’s primary objective is to meet or even surpass the performance goals set by our investors, all the while staying within their individual tolerances for risk. To achieve this, Western Asset employs a range of diversified strategies that add value across various dimensions, including interest rate duration, yield curve, sector allocation, security selection, and country and currency strategies. Western Asset believes that by deploying multiple diversified strategies, we can benefit from different market environments. This approach ensures that no single strategy dominates our performance, which ultimately helps us to dampen volatility and provide more stable returns. Sustainable Investing Philosophy

Given its alignment with Western Asset’s long-term fundamental value philosophy, sustainable investing is an important element of the Firm’s investment process and is incorporated across the fixed-income strategies that the Firm manages. Sustainability considerations are integrated with the Firm’s general research process and led by its sector specialists, who analyze sustainability factors in conjunction with traditional metrics. Western Asset believes that financially material sustainability factors can affect the creditworthiness of fixed-income issuers’ securities and therefore can impact the performance of fixedincome investment portfolios. To address this, we have developed comprehensive sustainability frameworks tailored to various sectors such as sovereigns, corporates, securitized credit, and municipal fixed-income sectors. These frameworks are designed to identify material environmental, social, and governance risks and opportunities that could impact financial valuations. Our research analysts leverage these frameworks to evaluate financially material sustainability characteristics of issuers, which then informs our overall assessment of the risk and opportunity profiles for these issuers. INVESTMENT STRATEGIES Western Asset offers actively managed fixed income portfolios ranging from a broad global multi-sector perspective to regionally focused, as well as sector specific styles of investing. Such strategies emphasize rotation among different types of debt on a relative value basis, specific security selection, quantitative analysis of each security and the portfolio as a whole, as well as intensive credit analysis and review. Portfolios seeking income generally focus on one or more of the following securities: taxable and taxexempt money market instruments; tax-exempt and taxable municipal securities; global fixed- income securities; and taxable fixed-income debt securities of corporations, of the U.S. government and its sponsored agencies and instrumentalities, and non-government structured securities, such as residential mortgage-backed securities. In addition, certain products will focus on investments in particular countries and regions. Depending on the strategy, Western Asset may invest in a variety of securities and other investments. This includes the use of derivatives in certain strategies, which can be an effective tool for managing risk and enhancing returns. Such derivatives include, but are not limited to, futures; interest rate swaps, caps, collars and floors; index swaps, total return swaps, credit default swaps and non-U.S. currency swaps; forward currency contracts and non-deliverable forward currency contracts; options on futures, non-U.S. currencies and swaps; and/or other derivatives. The strategies may also invest a portion of their total assets in dollar roll transactions. Moreover, Western Asset employs a range of methods of analysis and investment techniques to ensure well-informed and strategic decision-making. Our expertise in navigating the complexities of the market allows us to offer robust and resilient investment solutions. While Western Asset maintains a consistent philosophy and approach across all our products, the specific analysis and strategies employed will differ based on the product. To provide a clearer picture, descriptions of Western Asset’s various investment strategies are included below. These descriptions are not intended to serve as applicable account guidelines. In most cases, Western Asset’s strategies are not designed to offer a complete investment program for a client. Except in limited instances – such as certain allocation or multiasset class strategies – clients are responsible for diversifying their assets appropriately to suit their individual needs and goals. Western Asset reserves the right to limit the availability of any strategy at any given time based on factors including asset class capacity, pre-existing relationships, minimum account sizes, fees and available

distribution channels. In addition, Western Asset develops other investment strategies from time to time and manages portfolios according to a client’s specific investment guidelines, and thus, strategies may vary by client account. Certain strategies are available only in certain channels or through investing in Funds offered through Franklin Templeton. It is crucial to understand that there can be no assurance that Western Asset will be successful in implementing any investment strategy. Investing in securities involves the risk of loss, and this is something our clients should be prepared to bear. For a more detailed overview, please see Appendix A which describes investment risks associated with Western Asset’s investment strategies. CLIENTS MAY BE INVESTED IN STRATEGIES THAT ARE NO LONGER AVAILABLE FOR INVESTMENT. BELOW IS A LIST OF ACTIVELY MARKETED STRATEGIES. Australia Core strategy employs an active, team-managed investment approach around a long-term, valueoriented investment philosophy. These portfolios use diversified strategies and all investment-grade sectors of the fixed-income market in seeking to add value while minimizing risk. The approach is to construct a diversified portfolio using all major Australian fixed-income sectors with a bias towards non-government securities. Australia Credit strategy employs an actively managed approach that is risk controlled and assimilates the Firm's top-down macro-economic views with credit analysts' fundamental and relative value views regarding industry and issuer opportunities in an effort to build and maintain a portfolio that seeks to generate strong risk-adjusted returns. These portfolios purchase fixed coupon investment grade rated securities across all sub-sectors and industries within the Australia credit asset class in seeking to add value while minimizing risk. Australia Enhanced Cash strategy employs an active, team-managed approach around a high-quality, value-oriented investment philosophy. These portfolios use diversified strategies and invest in all investment-grade sectors of the Australian fixed-income market in seeking to add value while adhering to strict risk controls. The approach is to construct a highly liquid, high-quality portfolio with an enhanced yield using all major investment-grade fixed interest sectors with a bias towards corporate, mortgagebacked and asset-backed securities. Asia Local Currency Debt (USD) strategy aims to maximize total return and add value through interestrate positioning (duration, curve and country), currency allocation and security selection, while managing risk relative to its benchmark. The strategy invests primarily in local-currency-denominated Asian government bonds with a controlled exposure to non-government issuers. Asia USD Debt strategy aims to maximize total return and add value through sector allocation, interestrate positioning (duration, curve and country), and security selection, while managing risk relative to its benchmark. The strategy invests primarily in Asian sovereign, quasi-sovereign, banks and corporate issues. Commercial MBS strategy aims to maximize total return on a risk adjusted basis. The strategy seeks to invest in a diversified portfolio of investment-grade commercial mortgage debt including Agency and NonAgency CMBS. The strategy actively rotates across commercial mortgage sub-sectors including rating, term profile, duration, property sector and geography. The strategy provides exposure to a high-quality portfolio of senior, secured commercial mortgage debt generating high current income with limited duration exposure while diversifying from traditional corporate credit sectors. Emerging Markets Corporate strategy aims to maximize total return and add value through interest-rate positioning (duration, curve and country), currency and subsector allocation, and security selection, while

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Western Asset provides investment advisory and sub-advisory services to primarily institutional clients, which include, from time to time, corporate and other business entities, corporate and government pension funds, , corporate defined contribution and profit-sharing plans, state and municipal entities, Taft-Hartley plans, charitable foundations and organizations, endowment funds, insurance companies, , sovereign wealth fund and foreign government and private institutions, family offices, non-U.S. government entities, U.S. and non-U.S. mutual funds, collateralized debt/loan obligations issuers, pooled investment vehicles, and collective investment trusts. Western Asset U.S. also provides investment advisory services to individuals, primarily through wrap fee

programs sponsored by its affiliate, Franklin Templeton Private Portfolio Group, or non-affiliated third parties.

Western Asset maintains fee schedules for different strategies, some of which may involve performance fees or other customized arrangements. In addition, Western Asset may agree to specific performance-based fees or other fee arrangements upon client request. Such performance-based fee accounts are managed alongside accounts that have a more traditional fee structure (e.g., accounts that pay solely asset-based fees), typically by the same portfolio manager or team. This arrangement inherently creates a conflict of interest as Western Asset has an incentive to favour performance-based fee accounts in order to increase its revenues. Moreover, in situations where Western Asset is paid a performance fee, it may have an economic incentive to make riskier investments and/or pursue riskier strategies than it otherwise would. There are other potential conflicts that arise from the management of accounts with conflicting investment strategies and accounts in which Western Asset has a proprietary interest. These conflicts could cause Western Asset to favour particular accounts with different strategies or allocate investments to accounts in which it has a significant ownership or financial interest (“proprietary accounts”). Western Asset seeks to mitigate this conflict through a variety of means. First, Western Asset discloses that these conflicts exist to ensure that clients and potential clients are aware of the risks posed by different fee schedules and Western Asset’s management of proprietary accounts. Once clients are aware of these potential conflicts, they can evaluate the implications of these conflicts and Western Asset’s approach to mitigate these conflicts. Second, Western Asset maintains policies and procedures that are designed to reduce the potential for favoritism. Specifically, Western Asset maintains compliance policies and procedures that it believes are reasonably designed to result in fair allocations of investment opportunities to clients over time, even though a specific trade allocation may have the effect of benefiting one or more accounts over other accounts when viewed in isolation. Western Asset frequently bunches (or aggregates) orders to minimize execution costs and optimize the implementation of investment strategies for clients. Investment allocations are done in a manner that Western Asset believes is fair and equitable, with the presumption that similarly situated clients should generally participate in similar investment opportunities and trades. The most common means of allocating investment opportunities is to allocate based on the proportionate size of each client’s account, making adjustments to accommodate individual client factors such as: unique investment goals and guidelines, available cash, liquidity requirements, odd lot positions, minimum allocations, existing portfolio holdings compared to the target weightings and regulatory restrictions. Allocations are developed based on commonality of investment strategies among clients rather than on the fee schedules for particular clients. Investment decisions are not permitted to be based upon an intent to allocate lucrative or immediately profitable trades to particular accounts in order to, for example, make up for past account performance deficiencies or to benefit the Firm through a higher fee structure associated with such accounts. At times, investments may be allocated by the relevant Portfolio Managers on a non-pro-rata basis as long as the allocation is fair and equitable to all client portfolios. For all trades created by the investment team, the intent or rationale must be documented in the trader notes in the trade ticket. All trades must be pre-allocated by creation of a trade ticket so that all trades have a recommended or target allocation either before or concurrent with the execution of that respective trade. If the trade ticket does not include a target allocation due to the nature of the trade, then the general allocation intent must be adequately described in the trader notes section of the trade ticket. Western Asset’s policy is to complete

the allocation of trades among participating client portfolios no later than the end of the day (trade date 3 PM PST for Western Asset U.S.) on which the transaction is completed, or “filled,” or in the case of a trade executed on an exchange, the close of that exchange. Further, with respect to futures and options-on-futures, the allocations will be made as soon as practicable after the entire transaction is executed (and in no case later than the end of the day). Western Asset also maintains a methodology with respect to partially filled orders on the primary and secondary markets, which includes treating similarly situated clients similarly, and in the event accounts that need to be removed or not treated pro rata, there is a process for review and approval so that all accounts are carefully considered and treated fairly. Third, Western Asset maintains a variety of oversight mechanisms to monitor for situations that might suggest further inquiry would be prudent or that raise potential concerns. All accounts are reviewed quarterly, pursuant to the Compliance Monitoring Program, to identify potential conflicts of interest, including by way of example, cases in which Western Asset has a proprietary interest or in which other incentives are mis-aligned (e.g. performance fees, alternative investment accounts, investment strategies, differing fee schedules). From an investment perspective, there are a variety of resources utilized to monitor performance and portfolio management measures such as dispersion and tracking error. Similarly situated accounts are grouped together in Western Asset’s systems and data is available to a wide audience beyond a particular portfolio manager. Please refer to Item 13. “Review of Accounts” for more information about how client accounts are reviewed. From a regulatory monitoring perspective, Western Asset maintains a compliance monitoring program that has a component dedicated to reviewing allocations through a variety of means. For example, accounts where Western Asset has a proprietary interest are identified and relevant trades subjected to additional review. Exception reports produced in the process of performance composite construction are reviewed to identify outliers. Western Asset participates in new issues. In the instance that Western Asset is purchasing new issues on behalf of its clients, similarly, situated clients should be treated similarly for purposes of participation in such newly issued assets consistent with the principles outlined in this policy. It is typical that the initially requested subscription amount is not fully allocated. In these instances, the following allocation methodology is generally applied but may deviate per instances above: •

All allocations are pro-rated then rounded by the minimum increment;

•

If an account is below half of the minimum piece on this basis, it is dropped from the allocation;

•

If an account is at or above half of the minimum piece on this basis, it is rounded up to the minimum piece; and

•

Any residual excess/deficit is pro-rated between the other accounts in the allocation.

Western Asset also maintains policies to identify and monitor the potential conflicts between “alternative investment” or “hedge fund” accounts and other accounts. “Alternative Investments” or “hedge funds” are commonly understood to mean investment vehicles that have no investment benchmarks and use long/short strategies and/or investment leverage. Western Asset also may work with separate account clients to manage portfolios that have similar characteristics to “alternative investments” or “hedge funds.” Western Asset maintains additional monitoring for such accounts to seek to ensure that its trade allocation decisions are consistent with its fiduciary duties and are fair and equitable over time. Alternative Investments Policy

In managing alternative investment and long-only accounts, Western Asset must ensure that all accounts are treated fairly in connection with the allocation of investment opportunities and related trading decisions. The Firm has established policies and procedures that govern investment decision making and the trade allocation process for alternative investment accounts. The policies and procedures are designed to meet the fiduciary duties owed to clients, to avoid conflicts of interest, and to meet applicable requirements under the Advisers Act. While alternative investment (“AI”) and long-only (“LO”) accounts share a common investment philosophy, they are subject to different investment objectives and may follow different investment strategies. There may also be circumstances where AI and LO accounts share the same strategy and are traded together. In general, AI accounts have greater investment flexibility than LO accounts. For example, unlike LO accounts: 1. AI accounts are seldom managed to a benchmark; 2. AI accounts focus on short-term investment horizons and may engage in more frequent and opportunistic trading to take advantage of market inefficiencies; 3. AI accounts may short securities and pursue market neutral, relative value strategies (i.e., strategies that use long and short positions in combination with one another) to seek sources of return that are not correlated with broad market fluctuations; and 4. AI accounts may leverage their portfolios using various financial instruments to increase the potential return of an investment. Because of these considerations, trading decisions for AI and LO accounts may not be identical even though the same portfolio manager may manage both AI and LO accounts. Whether a particular investment opportunity is allocated to only AI accounts or to AI and LO accounts will depend on the investment strategy being implemented and respective target weightings for the AI and LO accounts which may differ. There may be circumstances when an investment opportunity is appropriate for both AI and LO accounts and the investment team must allocate on grounds that are consistent with the Firm’s fiduciary duty to both. Monitoring procedures, through Western Asset’s Compliance Monitoring Program, have been established with the goal of ensuring that the Firm meets its fiduciary obligations to AI and LO Accounts, and that any deviation from the policies and procedures are identified and addressed in a timely manner. Proprietary Accounts Western Asset considers, for purposes of this policy, and in the absence of special circumstances as determined by the Legal & Compliance Department, “proprietary accounts” to be those accounts where 25% of net assets are owned by Western Asset employees, officers and/or affiliates. The Regulatory Affairs Group monitors the trading activity of proprietary accounts to ensure that the trading in a proprietary portfolio does not disadvantage clients of Western Asset or otherwise violate applicable law or policy. Model Delivery and Trade Rotation Western Asset communicates investment instructions in accordance with a process that is fair and equitable to model delivery client accounts in relation to other clients of Western Asset. Model delivery investment programs can raise trade communication conflicts issues if the client/sponsor firms, and not Western Asset, handles all or a portion of the trading for program accounts. To achieve fair and equitable treatment across client accounts, Western Asset considers not only the manner in which it allocates trades to accounts but also the sequence in which it delivers trade orders to the market for execution and any corresponding investment instructions to third parties that handle trading for model delivery accounts. The delivery of

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As previously mentioned, Western Asset is an indirect, wholly owned subsidiary of Franklin Templeton. For further details on the ownership structure, please refer to Form ADV Part 1, Schedules A and B. Related Broker-Dealers Western Asset is not a registered broker or dealer. Certain Western Asset employees are registered with the Financial Industry Regulatory Authority (“FINRA”) as registered representatives through their affiliation with, Franklin Distributors, LLC (“FD, LLC”). FD, LLC is a SEC-registered limited purpose broker-dealer, a member of FINRA, registered with the CFTC as an introducing broker, and is a member of the National Futures Association (“NFA”). FD, LLC serves as an underwriter and distributor for Franklin Templeton’s U.S. registered funds, and 529 college savings plans as well as affiliated open-end funds to which Western Asset serves as sub-adviser. These employees actively market funds managed by Western Asset, but these employees do not receive sales commissions from FD, LLC. Registration with or licensing by a regulator does not imply endorsement by the regulator nor does it imply a certain level of skill or training.

Western Asset’s global offices may also serve as the adviser or sub-adviser to several SEC-registered funds, some of which are advised by Franklin Templeton or other SEC-registered investment advisers. FD, LLC also serves as placement agent for certain private funds sponsored or managed by Western Asset. With client consent and in compliance with any relevant regulatory requirements, Western Asset may delegate the management of all or part of an account to one or more of the following affiliated legal entities: 1.

Western Asset U.S is registered with the SEC as an investment adviser and the CFTC as a commodity trading adviser and a commodity pool operator. Additionally, Western Asset U.S. is a member of the NFA. Various employees, including key management and investment personnel, are registered as principals and/or associated persons under U.S. commodities laws with the NFA. The derivatives utilized by Western Asset U.S. frequently include financial instruments classified by the CFTC as “commodity interests,” such as futures, options on futures, swaps and certain foreign exchange contracts. Depending on the specific strategy and services, Western Asset U.S. may operate under its commodity trading adviser registration or under an exemption or exclusion from the registration requirements.

2.

Western Asset UK is authorized and regulated by the United Kingdom’s Financial Conduct Authority and is registered as an investment adviser with the SEC as well as the Korea Financial Supervisory Commission.

3.

Western Asset Singapore holds a Capital Markets Services Licence (Reg. No. 200007692R) for fund management and is regulated by the Monetary Authority of Singapore and is registered as an investment adviser with the SEC.

4.

Western Asset Japan is a registered financial instruments dealer whose business is investment advisory or agency business, investment management, and Type II Financial Instruments Dealing business with the registration number KLFB (FID) No. 427, and a member of Japan Investment Advisers Association (membership number 011-01319) and Investment Trust Association, Japan, and is registered as an investment adviser with the SEC.

5.

Western Asset Brazil is authorized and regulated by Brazilian securities regulators (the Comissão de Valores Mobiliários).

6.

Western Asset Australia ABN 41 117 767 923 holds Australian Financial Services Licence 303160.

Affiliations and Conflicts of Interest Although Western Asset is committed to acting in the best interests of its clients, in some situations there may be conflicts between Western Asset’s interests and a client’s interests or there may be conflicts in the interests of multiple clients. Many of these conflicts of interest are inherent in operating an investment advisory business. For example, Western Asset may have an incentive to resolve a matter in favor of clients that are affiliates of Western Asset over clients that are not affiliates. Western Asset has adopted policies and procedures that it believes are reasonably designed to mitigate these conflicts of interest. Various investment adviser affiliates of Western Asset may provide advice to their clients with respect to investment strategies that are similar to or the same as their related adviser. Those advisory affiliates may purchase on behalf of their clients the same securities. As a result, the interests of one affiliate’s clients may conflict with the interests of clients of affiliated advisers. For example, if an investment adviser affiliate implements a portfolio management decision for its client ahead of, or contemporaneously with, a decision another affiliate makes for its client(s), the market impact of the decision made by one advisory affiliate could result in the other affiliate’s clients receiving less favorable trading results than they otherwise would.

One affiliate’s trade allocation and trade aggregation procedures do not typically apply to portfolio management decisions and trading executed by other Western Asset investment advisory affiliates. Western Asset provides investment advice to a large number of clients. In some circumstances, officers or employees of Western Asset may serve as members (or have similar responsibilities with respect to) of a board of directors of a pooled investment vehicle that pays fees to Western Asset (not to the officer or employee of Western Asset) which in some circumstances could be performance-based fees. As a result, it is possible that the Western Asset officers and employees who serve in such capacities may have potential conflicts of interest with the pooled vehicle. Each such officer or employee of Western Asset who serves in such a capacity carefully considers his or her obligations to the pooled vehicle and endeavors to resolve any such conflicts fairly. For further information, please refer to Item 11. “Code of Ethics, Participation or Interest in Client Transactions and Personal Trading,” as well as the Alternative Investments Policy under Item 6. “Performance-Based Fees and Side-by-Side Management” for additional information regarding conflicts of interest that arise as a result of Western Asset’s investment advisory activities.

Western Asset has adopted Franklin Templeton’s Code of Ethics which sets forth high ethical standards of business conduct that we require of our employees, including compliance with applicable federal securities laws. All Covered Employees (as defined below) are required to conduct themselves in a lawful, honest and ethical manner in their business practices and to maintain an environment that fosters fairness, respect and integrity. “Covered Employees” include Western Asset’s partners, officers, directors (or other persons occupying a similar status or performing similar functions), and employees. Additionally, Access Persons, a subset of Covered Employees, are required to provide certain periodic reports on their personal securities transactions and holdings. “Access Persons” are those persons who have access to non-public information regarding the securities transactions of Western Asset’s clients; are involved in making securities recommendations to clients; have access to securities recommendations that are non-public; or have access to non-public information regarding the portfolio holdings. The Code of Ethics includes policies and procedures for the review of quarterly securities transactions reports as well as initial and annual securities holdings reports that must be submitted by the firm’s Access Persons. Among other things, the Code of Ethics requires employees to obtain pre-approval of most personal securities transactions from the Compliance Department including the prior approval of any acquisition of securities in a limited offering (e.g., private placement) or an initial public offering. The Code of Ethics also provides for oversight, enforcement and recordkeeping. Management of personal accounts by a portfolio manager or other investment professionals will, from time to time, give rise to potential conflicts of interest. Western Asset has adopted Franklin Templeton’s Personal Investments and Insider Trading Policy, which it believes contains provisions reasonably designed to prevent a wide range of prohibited activities by portfolio managers and others with respect to their personal trading activities, as well as certain additional compliance procedures that are designed to address these and other types of conflicts. To avoid actual or potential conflicts of interest certain transactions and practices are prohibited by the Personal Investments and Insider Trading Policy. These include front-running, trading parallel to a client, trading against a client, using proprietary information for personal transactions, market timing, and short selling Franklin Templeton stock and the securities of Franklin Templeton funds. The Personal Investments and Insider Trading Policy requires prompt internal reporting of suspected and actual violations. In addition, violations are referred to the Director of Global Compliance and/or the Chief Compliance Officer as well as the relevant management personnel. Western Asset maintains a “restricted

list” of securities in which their respective personnel generally may not trade. The restricted list is updated as necessary and is intended to prevent the misuse of material, nonpublic information by their employees. In addition to continuous monitoring, Franklin Templeton’s Compliance Department will conduct forensic testing or auditing of reported personal securities transactions to ensure compliance with the Personal Investments and Insider Trading Policy. Franklin Templeton has implemented a substantial set of personal investing procedures designed to avoid violations. However, there is no guarantee that the Personal Investments and Insider Trading Policy or such additional compliance procedures will detect and/or address all situations where an actual or potential conflict arises. Discussion of Conflicts of Interest Associated with Portfolio Management of Multiple Accounts Western Asset U.S. acts as investment adviser to pooled vehicles and separately managed accounts that have similar investment objectives and pursue similar investment strategies. As a result, certain investments identified by Western Asset may be appropriate for multiple clients. Decisions to buy and sell investments for each client advised by Western Asset are made with a view toward achieving each client’s investment objectives; however, Western Asset may face conflicts of interest in allocating investment opportunities among accounts. For example, Western Asset might receive greater fees or compensation from some accounts than others, or some accounts may be larger and generate more fees than others. Moreover, a particular investment may be bought or sold for only one client or in different amounts and at different times for more than one but fewer than all clients, even though it could have been bought or sold for other clients at the same time. Also, a particular investment may be bought for one or more clients when one or more other clients are selling the investment. Investment decisions for clients are made by Western Asset in its best judgment, but in its sole discretion, taking into account such factors as Western Asset believes to be relevant. Such factors may include investment objectives, regulatory restrictions, respective risk profiles, availability and liquidity of the investment, current holdings, availability of cash for investment, the size of the investments generally and limitations and restrictions on a client’s account that are imposed by the client. In effecting transactions, it may not always be possible, or consistent with the investment objectives of Western Asset’s various clients, to take or liquidate the same investment positions at the same time or at the same prices. Western Asset generally is not under any obligation to share any investment, idea or strategy with all of its clients. Western Asset seeks to manage and/or mitigate the potential conflicts of interest described above by following procedures with respect to the allocation of investment opportunities among its clients, including the allocation of limited opportunities. Information regarding these procedures is provided under Item 6. “Performance-Based Fees and Side-by-Side Management.” Notwithstanding these procedures, if Western Asset implements a portfolio decision for one client ahead of, or contemporaneous with, another client, the market impact of the investment decision could result in one or more clients receiving more favorable trading results or reduced costs at the expense of one or more other clients. Conflicts may arise when clients invest in different parts of an issuer’s capital structure, including circumstances in which one or more clients own private securities or obligations of an issuer and other clients may own publicly traded securities of the same issuer. Western Asset may also, for example, direct a client to invest in a tranche of a structured finance vehicle, such as a collateralized loan or debt obligation, where we are also, at the same or different time, directing another client to make investments in a different tranche of the same vehicle, which tranche's interests may be adverse to other tranches. Western Asset may also cause a client to purchase from, or sell assets to, an entity, such as a structured finance vehicle, in which other clients may have an interest. These transactions could have an adverse effect on the clients that have interest in the structured finance vehicle. There may also be conflicts where, for

example, a client holds certain loans of an issuer, and that same issuer has issued other loans or instruments that are owned by other clients or by an entity, such as a structured finance vehicle, in which other clients have an interest. In this situation, Western Asset may take actions with respect to the assets held by one client that are potentially adverse to the other clients, for example, by foreclosing on loans or by putting an issuer into default. In negotiating the terms and conditions of any such investments, or any subsequent amendments or waivers, Western Asset may find that the interests of a client and the interests of one or more other clients could conflict. In these situations, decisions over proxy voting, corporate reorganization, how to exit an investment, or bankruptcy matters (including, for example, whether to trigger an event of default or the terms of any workout), may result in conflicts of interest. Similarly, if an issuer in which a client and one or more other clients directly or indirectly hold different classes of securities (or other assets, instruments or obligations issued by such issuer or underlying investments of such issuer) encounters financial problems, decisions over the terms of any workout will raise conflicts of interests (including, for example, conflicts over proposed waivers and amendments to debt covenants). For example, a debt holder may be better served by a liquidation of the issuer in which it may be paid in full, whereas an equity or junior bond holder might prefer a reorganization that holds the potential to create value for the equity holders. Although in some cases Western Asset may refrain from taking certain actions or making investments on behalf of clients because of conflicts (potentially disadvantaging the clients on whose behalf the actions are not taken or investments not made), in other cases Western Asset will not refrain from taking actions or making investments on behalf of some clients that have the potential to disadvantage other clients. Any of the foregoing conflicts of interest will be resolved on a case-by-case basis. Any such resolution will take into consideration the interests of the relevant clients, the circumstances giving rise to the conflict and applicable laws. Clients should be aware that conflicts will not necessarily be resolved in favor of their interests, and in fact may be resolved in favor of clients that pay Western Asset higher fees or performancebased fees or in which Western Asset or its affiliates have a significant proprietary interest. There can be no assurance that any actual or potential conflicts of interest will not result in a particular client receiving less favorable investment terms in certain investments than if such conflicts of interest did not exist. Western Asset also acts as the investment adviser to pooled investment vehicles that Western Asset recommends to clients or, pursuant to the discretionary authority granted to Western Asset by a client, in which Western Asset causes a client to invest. This gives rise to conflicts of interest because Western Asset is paid an asset-based fee by certain of the pooled investment vehicles and, as a result, has an incentive to cause clients to invest in these pooled investment vehicles and thereby increase the pooled investment vehicle’s assets and Western Asset’s fee or to support the launch of new investment products. Western Asset will generally credit the amount of any advisory and shareholder service fees paid to Western Asset by the pooled investment vehicle in respect of such account’s investment in the pooled investment vehicle against the fee payable by the account to Western Asset pursuant to its investment advisory agreement. This credit will not necessarily eliminate the conflict, and Western Asset may continue to have a financial incentive to favor causing clients to invest in Western Asset-affiliated pooled investment vehicles. In addition, Western Asset acts as the investment adviser to pooled investment vehicles that pay performancebased fees. The procedures Western Asset follows to manage the conflicts of interest that arise as a result of the side-by-side management of accounts paying performance-based fees and asset-based fees is included under Item 6. “Performance-Based Fees and Side–by-Side Management.” Western Asset, for its own account or the account of a client, could take a position through a derivative instrument that is linked to a client (or an affiliate thereof) or to an issuer of a security held by a client. It is possible that the structure or characteristics of such derivatives could adversely affect one or more clients. For example, the derivative

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Broker-Dealer Selection and Best Execution Almost all fixed income instruments trade at a bid/ask spread and without an explicit brokerage charge. Accordingly, while there is not a formal trading expense or commission, clients will bear the implicit trading costs reflected in these spreads. Western Asset maintains a variety of policies and practices to address its approach for trading on behalf of clients. These policies are designed to ensure that Western Asset is being thoughtful when executing transactions on behalf of clients and honoring its fiduciary obligation to seek best execution. Western Asset seeks to obtain best execution of its clients’ trades through monitoring and effectively controlling the quality of trade decisions. The circumstantial and judgmental aspects involved in obtaining best execution with respect to a particular trade are not always quantifiable. Therefore, it is not feasible to define a single measurement basis for best execution on a trade-by-trade basis. Instead, Western Asset focuses on establishing processes, disclosures, and documentation, which together form a systematic, repeatable, and demonstrable approach to seeking best execution. In addition, when selecting a broker, individuals making trades on behalf of clients are obliged to consider the full range and quality of a broker's services, including such factors as execution capability, commission rate (including markups or markdowns), price, financial responsibility and responsiveness. Western Asset is not obligated to obtain for any particular transaction the best price or lowest commission but rather should determine whether the transaction represents the best execution for the account based on all relative factors. In selecting brokers for execution, Western Asset seeks to ensure that brokers are selected on the merits and not because of other reasons. Western Asset maintains an approved broker list which is designed to limit trading only to those broker-dealers Western Asset believes who demonstrate strength in the asset classes in which they operate, have knowledgeable sales coverage, provide quality research, and show a

willingness to commit capital and maintain financial stability. Western Asset may only select broker-dealers on this list to execute securities transactions for client accounts. Exceptions to this policy are permitted once approval from senior investment management and compliance personnel have been obtained. Additional scrutiny and monitoring is conducted for those brokers with whom trades involving direct counterparty risk (i.e., risk beyond settlement risk) may be executed. Use of Affiliated Broker-Dealer Western Asset does not trade with any affiliated broker-dealer and does not engage in principal trading. As described in Item 6. “Performance-Based Fees and Side-by-Side Management,” Western Asset maintains policies to address the risks associated with trading for accounts in which it has a significant ownership or financial interest. Western Asset also does not make trading decisions on behalf of registered investment companies on the basis of the involvement of a broker in the distribution and sales activities for those funds. In fact, in most cases, Western Asset’s role is limited to acting as investment adviser and its staff has no knowledge of the distribution arrangements for sub-advised third-party open-end funds. While Western Asset maintains some referral arrangements from time to time, Western Asset does not direct trade activity on the basis of whether it maintains referral arrangements with any broker-dealer. Research and Other Soft Dollar Benefits Western Asset’s philosophy is not to make use of arrangements where brokerage business is allocated in exchange for benefits of proprietary or third-party services (i.e., soft dollars or soft commissions). However, in the event that circumstances arise that suggest that entering into a soft dollar arrangement for the purchase of research services is prudent and in the best interests of Western Asset’s clients, Western Asset may do so. If Western Asset enters into a soft dollar arrangement, its policy is to only pay for services that directly assist in the investment decision-making process and benefit the best interest of Western Asset clients. In maintaining this standard, all arrangements and services must benefit all clients who would participate in soft dollar trades. Further, all proposed arrangements and/or services must be submitted to the Broker Review and Trade Oversight Committee for approval prior to their implementation. Such approved soft dollar arrangements could involve Western Asset causing a client to pay, or being deemed to have paid, commission rates (including markups or markdowns) that are higher than those Western Asset could have otherwise obtained in order to obtain research or brokerage services. To the extent that client brokerage commissions (or markups or markdowns) are used to obtain research or other services, Western Asset would receive a benefit because it may, in that case, not need to produce or pay for the research, products or services received. Western Asset may receive research or other services (both solicited and unsolicited) from brokers in the ordinary course of trading on behalf of clients. These items are not received pursuant to arrangements or agreements to exchange brokerage activity for services or benefits and are not considered to be obtained using “soft dollars.” Western Asset is not obliged to direct brokerage in order to receive such information. However, as a result, Western Asset may have an incentive to select or recommend a broker-dealer based on its interest in receiving the research or other products or services that the broker-dealer provides to Western Asset in the ordinary course of trading for client accounts, rather than its clients’ interest in receiving the most favorable execution. Western Asset UK is subject to the European Union (Withdrawal) Act 2018 (“EUWA”) and the Markets in Financial Instruments (Amendment) (EU Exit) Regulations 2018 (together, “UK MiFID II”). As a UK MiFID II firm, it has elected to pay for broker research directly in compliance with UK MiFID II requirements. Further considerations are discussed in Appendix A. Investment Risks.

Directed Brokerage Western Asset does not maintain directed brokerage arrangements on its own initiative and generally recommends against them in light of the unique features of the fixed-income market and the potential impact on Western Asset’s trading decisions. However, clients may request that Western Asset direct the client’s brokerage to a particular broker-dealer. A directed brokerage arrangement involves a client directive obligating Western Asset to utilize a particular broker or brokers without regard to best execution. Directed brokerage arrangements reflect client preferences, goals or instructions and are not subject to Western Asset's obligation to seek best execution. Western Asset’s ability to obtain best execution for the client may be hindered by the directed brokerage relationship and the client may forego any benefit from savings on execution costs that Western Asset could obtain for its other clients through negotiating for volume discounts with broker-dealers. Accounts with directed brokerage instructions may be excluded from block trades and their directed orders will generally be executed following completion of any non-directed trades. Cross Trades As discussed previously, Western Asset may engage in internal cross trades, in compliance with SEC and DOL rules, and where permitted by client investment guidelines and Western Asset’s policies and procedures. Pursuant to the SEC and industry guidance in regard to the provisions of Rule 2a-5 under the Investment Company Act of 1940 concerning the permissibility of cross trades under Rule 17a-7, no fixedincome securities, with the exception of certain municipal fixed-income securities (i.e., Variable Rate Demand Notes), shall be permitted in a cross trade between the funds or between a fund and another affiliated person. In the ordinary course of its business, Western Asset primarily executes cross trades between affiliated U.S. mutual funds that have particular liquidity mandates. Identifying proprietary accounts is also applicable for cross trades that might involve such accounts and other client accounts. Western Asset does not engage in agency cross transactions (i.e., transactions in which Western Asset earns a fee other than its advisory fee). Internal cross trades are subject to Rule 17a-7 under the Investment Company Act of 1940 for U.S. mutual funds. No internal cross trades are permitted unless specifically approved by the Legal & Compliance Department in advance. Likewise, no pre-arranged trades (i.e., promises to repurchase a security from a broker after a sale to the same broker) are permitted unless specifically evaluated and approved by the Legal & Compliance Department for cross trade considerations. Western Asset does not permit internal cross trades involving one or more retirement accounts (e.g., accounts subject to ERISA). In other cases, Western Asset will ensure that any internal cross transactions are in the best interests of and appropriate for both clients, the transactions are consistent with Western Asset’s obligations to seek best execution, and an independent or objective pricing mechanism is used. To the extent a broker is intentionally utilized to facilitate a cross trade with or without compensation, Western Asset will honor the same process and requirements. To address the risk of inadvertent or unapproved pre-arranged cross trades, Western Asset utilizes an automated control in its trading systems that blocks the posting of purchases of certain CUSIPs made from a broker on the same or next trading day following a sale of the same CUSIP to that broker. The block may be lifted upon review by the Legal & Compliance Department, or the trade may be treated as a cross-trade depending on the facts and circumstances. The automated block does not apply to CUSIPs executed through electronic platforms and does not apply to instruments and asset classes that Western Asset has deemed to be more liquid and at a lower risk of an inadvertent or disguised cross trade. The instruments subject to the block may be adjusted from time to time depending on that assessment. If a trade encounters a block, the response of the trader, the availability of electronic platforms, the nature

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Under certain circumstances, Western Asset may pay an individual, consulting firm, or other similar company (the “solicitor”) for referring or soliciting current and prospective clients. Rule 206(4)-1 under the Advisers Act imposes the following restrictions, among others, on the payment of cash referral fees: • No fee may be paid to a person who has been the subject of certain disqualifying events, including certain convictions. • There must be a written contract between Western Asset and the referring party before any client can be solicited. • A record of the written contract, including the fee arrangement, must be maintained. Western Asset must make a bona fide effort to ascertain whether the referring party has complied with the written contract and have a reasonable basis for believing that the referring party has so complied. To the extent that Western Asset maintains referral arrangements, compensation is generally based on a percentage of assets or revenues for a period of time. Western Asset’s parent company, our affiliates, or employees may introduce prospective clients to Western Asset without being subject to a referral arrangement. Typically, these introductions are not subject to referral arrangements or compensation for the payment of referral fees. While Western Asset employees

may receive compensation as part of their regular duties, it is important to note that carrying out job functions is not considered acting under a referral agreement. Hence no disclosure statement or written referral agreement is required in such cases. Nevertheless, it is essential for a Western Asset employee to disclose their affiliation with the Firm when communicating with a prospect or potential client. If an affiliated party makes an introduction, our preference is for them to disclose their affiliation, although there is no referral agreement or other enforcement mechanism to ensure this disclosure. However, if an affiliated party makes introductions and receives cash compensation from Western Asset for referrals, this arrangement must be documented in writing. In such instances, the affiliated party must also disclose their affiliation with Western Asset to prospective clients. Typically, Western Asset does not receive economic benefits from someone who is not a client for providing investment advice or other advisory services to its clients, although it is possible that from time to time retirement and/or pension plan sponsors may pay all or a portion of Western Asset's management fees in connection with advice provided by Western Asset to a retirement or pension plan instead of having such fees deducted directly from the assets of the applicable plan. Dual Employment by Affiliates From time-to-time employees of Western Asset, including portfolio management employees, may also be employed by, or appointed as an officer or authorized person of, entities affiliated with Western Asset, for certain designated purposes and subject to certain conditions designed to ensure compliance with applicable regulatory requirements. In such cases, the affiliated entity takes the responsibility for the supervision of the activities of any such appointed employee with respect to the services they provide on behalf of the affiliated entity.

In 2023, following the launch of an internal investigation, Western Asset received notification of parallel SEC and DOJ investigations into trade allocations in select Western-managed accounts involving treasury derivatives during 2019 to 2023. The CFTC later commenced a parallel investigation into the matter. All trade allocations at issue were made by Western Asset’s then co-Chief Investment Officer (“co-CIO”), who retired on July 30, 2025 and is no longer with the firm. The CFTC closed its investigation on June 30, 2025. On June 3, 2026, the DOJ notified Western Asset that it was no longer a subject of the DOJ investigation and that the DOJ would take no further action. On June 5, 2026, pursuant to a settlement, the SEC issued an order resolving its investigation of Western Asset. Under the terms of that order, the SEC found, among other things, that Western Asset failed to implement policies and procedures reasonably designed to detect and prevent violations of the Investment Advisers Act of 1940 and Western Asset, without admitting the SEC’s findings, agreed to pay a civil penalty of $100 million to be paid into a Fair Fund for the benefit of investors. These outcomes end the governmental investigations of Western Asset. As to the former co-CIO, the DOJ and SEC announced charges against him on November 25, 2024. On June 12, 2026, all criminal charges against the former co-CIO alleging a purported “cherry-picking” scheme were dismissed. The former co-CIO and the DOJ reached a plea agreement on one charge of obstruction of a pending proceeding, which was not part of the core allegations in the original indictment. Allegations of favoritism among investment strategies were dismissed. The SEC case against the former co-CIO remains pending as of the date of this report.

Overseeing each assigned account is a core investment matter for us. On a daily basis, members of every account-assigned portfolio management team are responsible for this oversight, under the overall supervision of the account’s portfolio manager. As part of this process, Western Asset’s RMQS generates standard reports at various intervals, focusing on portfolio’s structure, risk relative to benchmarks, and updates to each of the portfolio’s structure. Both the investment and risk management teams, including portfolio managers, review these reports to help insure client accounts are structured properly according to Western Asset's expectations. Regular reviews are conducted for groups of similarly managed accounts within the same product. These thorough examinations involve the portfolio managers responsible for the portfolios, several portfolio analysts, and local senior investment officers. The portfolio analysts provide detailed reports listing common portfolio and risk characteristics and individual portfolio performance metrics. These insights help align all accounts within the group with the current strategy, other accounts in the group, and each client’s objectives and policies and specific investment guidelines. Written reports of portfolio breakdown, transactions and performance are typically provided to clients no less frequently than quarterly. Additional trade reports may be available upon request.

Western Asset does not intend to maintain physical custody of client assets, and Western Asset UK is not registered to hold client assets with the Financial Conduct Authority. However, under the provisions of Rule 206(4)-2 under the Advisers Act, Western Asset’s authority as it relates to custody is generally limited in the ordinary course to customary trading and settlement of securities and investment transactions. Western Asset may be deemed to have custody of a client’s assets because it either: i) has the ability to deduct the client’s fees directly from a custodian account (pursuant to client authorization) or ii) Western Asset or its affiliates act as adviser and Managing Member for a client that is a pooled investment vehicle. Clients select qualified custodians and enter into custody agreements with custodians without Western Asset’s involvement. Physical custody of each client’s assets is maintained with a qualified custodian in an account either in the client’s name or, in the case of a private fund, the name of the legal entity. Even in the case of Western Asset’s sponsored pooled private funds, an unaffiliated qualified custodian maintains custody of the funds’ assets. Western Asset clients should receive quarterly or monthly account statements directly from their custodians which should be carefully reviewed. In addition to account statements delivered by these custodians, Western Asset may provide such clients with separate reports or account statements containing information about the Accounts. Clients should compare these carefully to the account statements received from the custodian and report any discrepancies to their Adviser and custodian immediately.

Western Asset accepts discretionary authority to manage securities accounts on behalf of its clients and generally all the accounts. Additionally, Western Asset offers investment advisory services through

managed accounts sponsored by program sponsors. While most of these advisory services are discretionary some are provided on a non-discretionary basis or within model-based programs. As part of the client onboarding process, Western Asset reviews and negotiates an Investment Management Agreement with the client which generally includes a set of investment guidelines that govern how the account is managed. These guidelines are reviewed and discussed with the client at the outset. Western Asset generally will not commence account management without an executed Investment Management Agreement and investment guidelines. Clients often seek to limit their accounts to specific types of permitted instruments and may impose requirements regarding issuer and sector diversification, asset class allocations, ratings classifications, currency denominations and other similar characteristics, depending on the nature of the account. Western Asset endeavors to adhere to reasonable directions, investment guidelines and the client requests provided that these do not compromise the account’s ability to meet its objective and Western Asset’s ability to implement the limitations within its compliance systems. LIMITATIONS ON DISCRETION Western Asset may, in its sole discretion, accept one or more categories of investment restrictions requested in writing by clients. In the case of investment restrictions based on social, environmental or other criteria, unless otherwise agreed to with a client, Western Asset’s compliance with such restrictions will be based on good faith efforts and can be satisfied by using either a third-party service to screen issuers against such restrictions, or a combination of other market data services (such as Bloomberg and FactSet) and internal research. The investment guidelines applicable to a client’s portfolio are typically based on the account being fully funded. During funding or transition phases, or where there are unusual market conditions, Western Asset’s inability to comply with restrictions related to holding limitations, sector allocations and similar restrictions shall not, unless otherwise agreed with a client, be considered a breach of the investment management agreement between Western Asset and its client. Moreover, investment restrictions are looked to at the time of investment unless otherwise agreed with the client in writing, and variances to the investment guidelines such as market movements (including exchange rates), the exercise of subscription rights, late settlement as a result of custodial action or inaction, a material increase or reduction in assets due to contributions or withdrawals by the client, or a change in the nature of an investment are generally not considered to be a breach of the investment management agreement unless specifically agreed to in writing. PARTICIPATION IN LEGAL PROCEEDINGS Class Action Suit Filings Unless specifically agreed otherwise, Western Asset will not take action or render advice involving a legal action on behalf of a client with respect to securities or other investments held in the client’s account, which become the subject of legal notices or proceedings, including securities class actions and bankruptcies.

As a fixed income only manager, the occasion to vote proxies is very rare, for instance, when fixed income securities are converted into equity by their terms or in connection with a bankruptcy or corporate workout. In addition to SEC requirements governing advisers, our proxy voting policies reflect the long-standing fiduciary standards and responsibilities for ERISA accounts. Unless a manager of ERISA assets has been

expressly precluded from voting proxies, the DOL has determined that the responsibility for these votes lies with the investment manager. Proxy Voting Policies and Procedures Western Asset's proxy voting procedures are designed and implemented in a way that is reasonably expected to ensure that proxy matters are handled in the best interest of our clients. While the guidelines included in the procedures are intended to provide a benchmark for voting standards, each vote is ultimately cast on a case-by-case basis, taking into consideration Western Asset's contractual obligations to our clients and all other relevant facts and circumstances at the time of the vote (such that these guidelines may be overridden to the extent Western Asset deems appropriate). In exercising its voting authority, Western Asset will not consult or enter into agreements with officers, directors or employees of Franklin Templeton (Franklin Templeton includes Franklin Templeton, Inc. and organizations operating as Franklin Templeton) or any of its affiliates (other than Western Asset affiliated companies) regarding the voting of any securities owned by its clients. Proxy voting delegation may be revoked by a client at any time. A summary of the voting procedures is included below. A full copy of the policy and procedures is available upon request. You may also request information detailing how proxies were voted with respect to securities held in your portfolio(s) by contacting your Client Service Executive at (626) 844-9400 or send a written request to: Western Asset Management Company, 385 East Colorado Blvd., Pasadena, CA 91101, Attention: Proxy Group. Proxy Voting Procedures Summary Once proxy materials are received by Corporate Actions, they are forwarded to the Portfolio Compliance Group for coordination and the following actions: a.

Proxies are reviewed to determine accounts impacted.

b.

Impacted accounts are checked to confirm Western Asset voting authority.

c. Where appropriate, the Regulatory Affairs Group reviews the issues presented to determine any material conflicts of interest. Please see the Conflicts of Interest section below for further information on determining material conflicts of interest. d. If a material conflict of interest exists, (i) to the extent reasonably practicable and permitted by applicable law, the client is promptly notified, the conflict is disclosed and Western Asset obtains the client's proxy voting instructions, and (ii) to the extent that it is not reasonably practicable or permitted by applicable law to notify the client and obtain such instructions (e.g., the client is a mutual fund or other commingled vehicle or is an ERISA plan client), Western Asset seeks voting instructions from an independent third-party. e. The Portfolio Compliance Group provides proxy material to the appropriate research analyst or portfolio manager to obtain their recommended vote Research analysts and portfolio managers determine votes on a case-by-case basis taking into account the voting guidelines contained in these procedures. For avoidance of doubt, depending on the best interest of each individual client, Western Asset may vote the same proxy differently for different clients. The analyst’s or portfolio manager’s basis for their decision is documented and maintained by the Portfolio Compliance Group. f. Portfolio Compliance Group votes the proxy pursuant to the instructions received in (d) or (e) and return the voted proxy as indicated in the proxy materials.

Conflicts of Interest All proxies that potentially present conflicts of interest are reviewed by the Legal Group for a materiality assessment. Issues to be reviewed include, but are not limited to: a. Whether Western Asset (or, to the extent required to be considered by applicable law, its affiliates) manages assets for the company or an employee group of the company or otherwise has an interest in the company; b. Whether Western Asset or an officer or director of Western Asset or the applicable portfolio manager or analyst responsible for recommending the proxy vote (together, “Voting Persons”) is a close relative of or has a personal or business relationship with an executive, director or person who is a candidate for director of the company or is a participant in a proxy contest; and c. Whether there is any other business or personal relationship where a Voting Person has a personal interest in the outcome of the matter before shareholders. Retirement Accounts For accounts subject to ERISA, as well as other retirement accounts, Western Asset is presumed to have the responsibility to vote proxies for the client. The DOL has issued a bulletin that states that investment managers have the responsibility to vote proxies on behalf of Retirement Accounts unless the authority to vote proxies has been specifically reserved to another named fiduciary. Furthermore, unless Western Asset is expressly precluded from voting the proxies, the DOL has determined that the responsibility remains with the investment manager. To comply with the DOL’s position, Western Asset will be presumed to have the obligation to vote proxies for its retirement accounts unless Western Asset has obtained a specific written instruction indicating that: (a) the power to vote proxies has been specifically reserved to a named fiduciary of the client, and (b) Western Asset is precluded from voting proxies on behalf of the client. If Western Asset does not receive such instruction, Western Asset will be responsible for voting proxies in the best interests of plan participants and beneficiaries unless the retirement account client and in accordance with any proxy voting guidelines provided by the client.

Western Asset is not aware of any financial condition that is reasonably likely to impair its ability to meet its contractual commitments to clients.

APPENDIX A. Investment Risks All investment strategies carry some degree of investment, market, loss of principal, regulatory and political activity risk. The risks differ for each client based on the strategy held in the client’s account(s). Clients should be aware that this brochure does not list all of the potential risks associated with an investment strategy. The strategies described above also are subject to the risks listed below. Management Risks The investment results of any account are dependent upon Western Asset’s management of the account. The investment strategies, techniques and risk analyses employed, while designed to enhance returns, may not produce the desired results. Assessment of the market, interest rates or other trends could be incorrect and may not anticipate actual market movements or the impact of economic conditions generally. As a result, portfolio construction may be suboptimal, and the account may lose money and/or underperform the account benchmark. There can be no assurance that all of Western Asset’s key personnel will continue to be associated with Western Asset for any length of time. The loss of their services could have an adverse impact on a strategy’s ability to achieve its investment objective. Western Asset may rely on quantitative models (both proprietary and those developed by third parties) (“Models”) and information and data (“Data”) supplied by third parties. When Models or Data used prove to be incorrect or incomplete, any investment decisions made in reliance on the Models and Data may not produce the desired results and an account may realize losses. For example, Western Asset may, in reliance on faulty Models or Data, buy certain investments at prices that are too high, sell certain investments at prices that are too low or miss favorable investment opportunities altogether. In addition, any hedging based on faulty Models or Data may prove to be unsuccessful. Some of the Models that may be used may be predictive in nature. Because these predictive Models are typically constructed based on historical data supplied by third parties, the success of these Models is dependent largely on the accuracy and reliability of the supplied historical data. In addition, Models that are predictive in nature may, for example, incorrectly forecast future behavior, leading to potential losses on a cash flow and/or mark-to-market basis. Use of these Models in unforeseen or certain low-probability scenarios (often involving a market disruption of some kind) also may result in losses for the account. The investment strategies based on Models and Data may underperform other investment strategies and may not perform as intended in volatile markets. Interest Rate Risks The market value of an account’s investments will change in response to changes in interest rates. During periods of declining interest rates, the values of fixed income securities generally rise. Conversely, during periods of rising interest rates, the values of such securities generally decline. The magnitude of these fluctuations is generally greater for securities with longer maturities. Notwithstanding the foregoing, because of the resetting of interest rates, adjustable rate securities are less likely than nonadjustable rate securities of comparable quality and maturity to increase significantly in value when market interest rates fall or to decrease significantly in value when interest rates rise (in each case, depending, however, on the characteristics of the reset terms, including the index chosen, frequency of reset and reset caps or floors, among other factors). Additionally, short-term and long-term interest rates, and interest rates in different countries, do not necessarily move in the same direction or by the same amount.

As a result of principal prepayment features, the values of asset-backed securities generally fall when interest rates rise, but their potential for capital appreciation in periods of falling interest rates is limited because of the prepayment feature. To the extent an account invests in interest only securities or fixed income securities paying no interest, such as zero coupon and principal only securities, the account will be exposed to additional interest rate risk. In addition, interest rate sensitivity is generally more pronounced and less predictable in instruments with uncertain payment or prepayment schedules. Inflationary price movement may cause the fixed income securities markets to experience heightened levels of interest rate volatility and liquidity risk. The U.S. government and the U.S. Federal Reserve, as well as certain foreign governments and central banks, have from time to time taken steps to support financial markets. The U.S. government and the U.S. Federal Reserve may, conversely, reduce market support activities, including by taking action intended to increase certain interest rates. This and other government intervention may not work as intended, particularly if the efforts are perceived by investors as being unlikely to achieve the desired results. Changes in government activities in this regard, such as changes in interest rate policy, can negatively affect financial markets generally, increase market volatility and reduce the value and liquidity of securities in which a fund invests. Credit Risks An account is also subject to credit risk (i.e., the risk that an issuer of securities will be unable to pay principal and/or interest when due, or that the value of a security will suffer because investors believe the issuer is less able to pay). Financial strength and solvency of an issuer are the primary factors influencing credit risk. In addition, subordination, lack or inadequacy of collateral or credit enhancement for a debt instrument affects its credit risk. In some cases, the credit risk for a debt instrument may be broadly gauged by credit ratings. Changes by recognized rating services in their ratings of securities and changes in the ability of an issuer to make scheduled payments may also affect the value of these investments. However, ratings are only the opinions of the agencies issuing them and are not guarantees as to the quality of the rated securities. Additionally, Western Asset often relies on its own independent analysis of the credit quality and risks associated with individual securities considered for an account, rather than relying on ratings agencies or third-party research. Therefore, Western Asset’s capabilities in analyzing credit quality and associated risks will be particularly important, and there can be no assurance that it will be successful in this regard. Government securities are subject to varying degrees of credit risk depending upon how the securities are supported. Not all government securities are backed by the full faith and credit of a national government. In addition, investments in emerging country sovereign or quasi-sovereign debt are subject to the risk that one may lack recourse against the issuer in the event of default. Investments in quasi-sovereign debt also are subject to the risk that the issuer will default independently of its sovereign. Market Risks Conditions in a broad or specialized market, a sector thereof or an individual industry may adversely affect security prices, thereby reducing the value of investments held in a client account. Such conditions may include general financial market conditions or changing market perceptions. Legal, political, regulatory, or tax changes, or changes in government intervention in the financial markets also may cause fluctuations in markets and securities prices. Even in the absence of a credit downgrade or default, the prices of fixed

income securities held by an account may decline significantly due to a reduction in market demand. Market demand for fixed income securities is amplified by liquidity risks. Changes in market conditions will not typically have the same impact on all types of investments. Due to increasing interdependence among global economies and markets, social, political or economic conditions and events (including, but not limited to, armed conflicts, natural/environmental disasters, public health crises, social unrest, labor strikes and government shutdowns and defaults) in one country, market or region might adversely affect markets, issuers and/or foreign exchange rates in other countries, including the United States. The investments held by an account could be negatively affected by the economic conditions and events of a country, market or region even if the account does not invest in such country, market or region. Historically, instability in the financial markets has led governments across the globe to take actions designed to support those markets. There can be no guarantee that any economic stimulus bills (within the United States or other countries) or other government actions intended to support markets will have their intended effect. Moreover, governments or their agencies may acquire distressed assets from financial institutions, acquire ownership interests in various institutions, or impose conditions on issuers receiving financial assistance (including by restricting or limiting their ability to pay dividends), all of which may affect an account’s investments in ways that are not foreseen. The commencement, continuation or withdrawal of supportive government policies, such as economic stimulus programs or supportive monetary policy, could significantly affect the financial markets and an account. Political institutions may not be able to effectively respond to political and economic conditions and events, and these political institutions may erode over time. For example, one or more countries that have adopted the euro may abandon that currency and/or withdraw from the Economic and Monetary Union of the European Union. Any partial or complete dissolution of the Economic and Monetary Union of the European Union, or any increased uncertainty as to its status, could have significant adverse effects on currency and financial markets, and on the liquidity and values of an account’s investments. Additionally, raising the U.S. government debt ceiling has become increasingly politicized. Any failure to increase the total amount that the U.S. government is authorized to borrow could lead to a default on U.S. government obligations. A default by the U.S. government would be highly disruptive to the U.S. and global securities markets and could significantly reduce the value of a fund’s investments. Securities and financial markets may be susceptible to market manipulation or other fraudulent trade practices, which could disrupt the orderly functioning of these markets or adversely affect the values of investments traded in these markets, including investments held by an account. Loans, Loan Participations and Loan Assignments Risks Bank loans may not be readily marketable and may be subject to restrictions on resale. There can be no assurance that future levels of supply and demand in loan trading will provide an adequate degree of liquidity or that the market will not experience periods of significant illiquidity in the future. Investments in loans through direct assignment of a lender’s interests may involve additional risks to an account. For example, if a secured loan is foreclosed, the account could become part owner of any collateral associated with that loan, and would bear the costs and liabilities and risks associated with owning and disposing of the collateral. Participation interests in a portion of a debt obligation typically result in a contractual relationship only

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