INVESCO SMALL CAP QUALITY Business Summary

Invesco S&P SmallCap Quality ETF (XSHQ) operates as a factor-based exchange-traded fund that generates revenue through a management fee, structured as a 0.29% annual expense ratio charged on its total assets under management. The fund's primary business segment is the US Small-Cap Blend equity market, specifically utilizing a "smart beta" strategy to track the S&P SmallCap 600 Quality Index. This methodology selects 120 constituent stocks based on high quality scores derived from three fundamental pillars: return on equity, accruals ratio, and financial leverage ratio. Within the competitive landscape, XSHQ competes directly with broad-market small-cap funds such as the iShares Core S&P Small-Cap ETF (IJR), the iShares Russell 2000 ETF (IWM), and the Vanguard S&P Small-Cap 600 ETF (VIOO). XSHQ distinguishes itself by offering a concentrated, quality-screened alternative to these market-cap-weighted peers, aiming to mitigate exposure to financially distressed firms while capturing the premium associated with high-quality small-cap equities. The fund is managed by Invesco Ltd., led by President and CEO Andrew R. Schlossberg, who assumed the role in June 2023 after serving as Head of the Americas and has been with the firm since 2001. The executive leadership team includes L. Allison Dukes as Senior Managing Director and Chief Financial Officer, and Shannon Johnston as Senior Managing Director and Chief Information and Operations Officer, overseeing the firm's global technology and digital infrastructure. Investment strategy is directed by Co-Heads of Investments Stephanie C. Butcher and Tony L. Wong, who bring over five decades of combined experience in portfolio management and investment leadership. The board is chaired by G. Richard Wagoner, Jr., the former Chairman and CEO of General Motors, providing high-level corporate governance. As of February 2026, Invesco remains a premier global asset manager with approximately $2.2 trillion in assets, supported by a diverse board of non-executive directors including Sarah E. Beshar and Thomas M. Finke.