AdvisorShares Investments, LLC (the “Advisor”) acts as investment advisor to the AdvisorShares Psychedelics ETF (the “Fund”), a series of AdvisorShares Trust. The Fund, an exchange-traded fund regulated under the Investment Company Act of 1940, 15 U.S.C. §§ 80a-1–80a-64 (the “1940 Act”), is subject to the oversight of the Board of Trustees of the Trust (the “Board”) and has retained Seyfarth Shaw LLP for purposes of rendering opinions for the benefit of the Fund and its beneficial owners, or beneficiaries.

The Advisor has asked us whether: (i) the Fund’s investment in securities issued by Psychedelics Companies (a term which we define below); and (ii) the Fund’s execution of over-the-counter (“OTC”) total return swaps (“TRS’s”), which have economic characteristics similar to such securities, would violate the laws of the United States and whether the Fund and its beneficial owners would incur liability arising out of any such violation.

Based upon our analysis and for purposes of this letter, the applicable federal laws are the Controlled Substances Act, 21 U.S.C. § 801, et seq. (the “CSA”), the Money Laundering Control Act, 18 U.S.C. §1956, et seq. (the “MCA”) and the Securities Exchange Act of 1934, 15 U.S.C. §78a et seq. (“1934 Act”) (as amended by the Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. 111-203, H.R. 4173,124 Stat. 1376 (2010)(“Dodd-Frank”¹)(for purposes of this letter and collectively with the regulations promulgated thereunder, the “Applicable Federal Law”).

¹ When we refer in this letter to “Dodd-Frank,” we are referring to the Dodd-Frank Wall Street Reform and Consumer Protection Act generally and in particular, The Wall Street Transparency and Accountability Act, which is Title VII of Dodd-Frank, and which generally became effective, subject to rulemaking, on July 16, 2010, Public Law 111-203, 124 Stat. 1376. Title VII of Dodd-Frank amended the 1934 Act and the Commodity Exchange Act, ch. 545, 49 Stat. 1491, enacted on June 15, 1936, as amended (“CEA”), by defining “swap,” 7 U.S.C. 1a(47)(E)(i)), and “Security-Based Swap,” as such term is defined in Section 3(a)(68) of the 1934 Act.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 2

As described more fully below, our opinion is that the Fund and its beneficial owners will not violate the CSA and MCA (i) for the Fund’s purchase of securities or (ii) for the execution of TRS’s referencing any such security issued by companies, so long as those companies issuing securities referenced in (i) or (ii) have those securities listed on regulated exchanges and participate in the psychedelics industry in full compliance with local and state law, and/or the law of a non-U.S. country (so long as local and state law permit the business activity of a company operating lawfully under non-U.S. law), which expressly² permits such participation (collectively, “Psychedelics Companies”).³ This is our opinion and it is subject to the assumptions, qualifications and other statements in this letter.

² A Psychedelics Company is a company whose business in the psychedelics industry, that is, the commercialization of psychedelics, is expressly permitted, without exception, by local and state law, and/or the law of a non-U.S. country (so long as local and state law permit the business activity of a company operating lawfully under non-U.S. law) as we state in this footnote and in the footnote which follows. We assume for purposes of this letter that a Psychedelics Company is also a company whose securities are listed on a regulated exchange and by way of illustration, Psychedelics Companies are in the business of psychedelic medicine and these companies include life sciences companies having significant business activities in, or significant exposure to, the psychedelics industry, including producers or distributors of psychedelic medicines, biotechnology companies engaged in research and development of psychedelic medicines, and Psychedelics Companies provide psychotherapy treatments and mental health services using psychedelics. In contrast, companies, whether formally incorporated or not, that develop, market or sell “designer” psychedelics (i.e., manufacturers of psychedelic drugs circumventing existing law and regulation and controls by creating analogs or synthetically modified drugs to sidestep established law) or other drugs such as LSD or MDMA are, for our purposes, not Psychedelic Companies, and companies whose practices are merely subject to “low law enforcement priorities” (see, e.g., Sean McAllister, Esq., “Myths and Realities About the Decriminalization of Psychedelics in the U.S.” Mar. 18, 2020, available at https://chacruna.net/myths-and-realities-about-the-decriminalization-of-psychedelics-in-the-us/ accessed on June 11, 2021) are also not, for purposes of this letter, Psychedelic Companies, nor are individuals or groups of people, or corporate entities which either do not observe corporate formalities or are not legally conducting business, or corporate entities whose corporate status has been revoked. See also, Psychedelics.com, “Are There Legal Psychedelic Drugs?” available at https://psychedelics.com/psychedelic-facts/are-there-legal-psychedelic-drugs/ accessed on June 11, 2021. See also footnote 3.

³ As stated in footnote 2, a Psychedelics Company is a company whose commercial and other operations are specifically permitted by express statutory and regulatory provisions of local and state law, and/or the law of a non-U.S. country (so long as local and state law permit the business activity of a company operating lawfully under non-U.S. law; and companies whose securities are listed on regulated exchanges) for lawfully manufacturing, selling and distributing controlled substances. Psychedelic Companies specifically include, for example, licensed psilocybin product manufacturers in full compliance with Oregon law (including the Oregon Uniform Controlled Substances Act) including Oregon Health Authority (“OHA”) regulations provided that the companies have been properly issued an annual license for premises where the psilocybin products are produced. These licensed companies in Oregon are approved by the OHA, which promulgates rules and prescribes the nature and number of psilocybin products permitted on premises sanctioned for use under state law codifying Measure 109, which is summarized in the pages that follow. Accordingly, Psychedelic Companies may also include, in addition to manufacturing companies, companies which have been issued licenses for the administration of psilocybin in accordance with Oregon statutory law and rules promulgated and guidance issued by the OHA and the Oregon Psilocybin Advisory Board (“OPAB”). Psychedelic Companies may also include companies sponsoring service centers as well as facilitators and manufacturers of psilocybin and other companies whose commercial operations are in full compliance with state law, OHA and OPAB rules and those companies which satisfy obligations arising out of the Oregon Psilocybin Control and Regulation Fund. See also footnote 2.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 3

We are also of the opinion that, assuming full compliance with local and state and/or non-U.S. law⁴ by a TRS Company (which is, as described in detail below, a Psychedelics Company whose security is referenced in a TRS) referenced in a cash-settled TRS: (i) the TRS Documentation (as defined below) should create legal, valid and binding obligations under New York law with respect to the Fund and its TRS counterparties; (ii) the TRS under the TRS Documentation should not be rendered unenforceable due to a violation of the CSA; (iii) the Fund should not have ownership, pursuant to Rule 13d-3 promulgated under the 1934 Act, with respect to the TRS Company; and (iv) the Fund and its beneficial owners should incur no regulatory exposure or regulatory liability because we are of the opinion that, with respect to the TRS’s, the TRS’s (based on assumptions in this letter) each have as a Reference Asset (as defined below) a single security of a Psychedelics Company (resulting in each TRS being deemed to be a security-based swap regulated by the Securities and Exchange Commission (“SEC”) under its rules and the 1934 Act, as amended by Dodd-Frank), and accordingly, we are of the opinion that such Reference Asset, by itself, would not likely render the TRS unenforceable under the 1934 Act and the SEC rules promulgated thereunder and would not expose the beneficial owners of the Fund to regulatory exposure or regulatory liability; and (v) in the event that the federal government declares at some future time by means of written guidance, the enactment of law or promulgation of a regulation that the TRS violates the CSA, the Fund and each of its TRS counterparties can terminate the TRS on a no-fault basis and use mid-market values calculated pursuant Section 6(e) of the ISDA Master Agreement in the TRS Documentation.⁵ These opinions are being provided for inclusion with the Fund’s Registration Statement filed on Form N-1A (the “Registration Statement”). Our opinions are subject to the assumptions, qualifications and limitations set forth herein as of the date of this opinion letter.

Our opinions are expressed herein solely with respect to Applicable Federal Law and are based on these laws as in effect on the date hereof and not the law of any other jurisdiction. Our opinions in all respects are subject to and may be limited by future legislation, regulations, guidance, formal and informal interpretations and/or case law. The opinions expressed herein represent our reasonable professional judgment as to the matters of law addressed herein, based upon the facts presented or assumed, and are not a guarantee that a court or regulator will reach any particular result.

⁵ For the reasons stated in this letter and although we reference the law of the state of Oregon, the focus of this letter is Applicable Federal law, not state or local law, and additionally, we do not have any actual knowledge of any specific investment in any company in particular and we have no actual knowledge of any federal investigation of any Psychedelics Company or TRS Company and accordingly, we make certain assumptions stated in this letter including that the Fund will directly invest in companies whose securities are listed on regulated exchanges.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 4

In connection with this opinion letter, we have examined and relied upon the originals, or copies certified or otherwise identified to our satisfaction, of such records, documents, certificates, agreements and other instruments which in our judgment are necessary or appropriate to enable us to render the opinions expressed below. As to certain factual matters, we have relied upon a certificate of an officer of the Advisor and have not sought to independently verify such matters. The Advisor has supplied us with a list of companies in which the Fund may invest as of the date of this letter and we have not confirmed full compliance with applicable local, state or other law by such companies. We base our opinions in this letter on Psychedelic Companies’ securities being purchased by the Fund and the Fund’s execution and settlement of TRS’s referencing the security of a Psychedelics Company, as well as on other assumptions, qualifications and statements in this letter. Our opinions also assume that the Fund will invest in securities and that the Fund will execute TRS’s in full compliance with the Fund’s publicly disclosed investment guidelines and other applicable law.

This opinion letter is limited to the matters stated herein, and no opinion is implied or may be inferred beyond the matters expressly stated. This opinion letter is given as of the date hereof, and we expressly disclaim any obligation to update or supplement our opinions contained herein to reflect any facts or circumstances that may hereafter come to our attention or any changes in laws or regulations or reported decisions that may hereafter occur or be published. Unless otherwise stated, when we use the term “invest” (or derivations thereof, e.g., “investment”) in this letter, we mean the purchase of a security issued by a Psychedelics Company and the execution and settlement of a “security-based swap,” as such term is defined in Section 3(a)(68) of the 1934 Act, referencing a single security issued by a Psychedelics Company. We express no opinion as to the law (other than Applicable Federal Law) of any other jurisdiction that may be applicable or relevant to the subject matter hereof. We are not rendering any opinion as to compliance with any federal, state, local or non-U.S. law, rule or regulation relating to securities, or to the sale or issuance thereof, or derivatives.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 5

We understand that the Fund is an actively managed investment vehicle which, for purposes of this letter we assume will achieve its investment objectives principally through the investment in exchange-listed securities, including common and preferred stock, of mid-, small and micro-capitalized Psychedelics Companies and in TRS’s with Psychedelics Companies’ equity referenced in such TRS’s (hereinafter “Reference Assets,” as described later in this letter in greater detail). The Fund will not invest by the purchase of securities directly in (or hold ownership in any companies that engage in) psychedelics-related businesses unless permitted by national and/or local laws of the relevant jurisdiction, including U.S. federal and state laws. As presently stated in the Fund’s Registration Statement or as otherwise represented to us by the Advisor, the principal investment strategy of the Fund is as follows:

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 6

In rendering the opinions in this letter, we base our opinions on our understanding of --and our assumptions herein are based on-- the investment strategy disclosed in the registration statement and made known to us by the Advisor. The Advisor has further represented to us that the following principles, that are reflected in the Fund’s Registration Statement’s Statement of Additional Information, will be adhered to in selecting investments for the Fund:

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 7

In summary, we understand and assume that the investment strategy of the Fund primarily entails investment in exchange-listed equity securities, including the common and preferred stock of U.S. and foreign mid, small and micro-capitalized Psychedelics Companies, as well as in the execution of TRS’s (as we describe in the pages that follow) with an eye toward getting economic exposure to Psychedelics Companies, so long as those companies are engaging in the permitted development, manufacture/service and sale of psychedelic drugs as permitted on a local, state or other level, including psilocybin, including but not limited to psychedelic medicine.⁶

On November 4, 2020, the electorate in Oregon voted to approve Measure 109.⁷ This measure gives non-criminal access to psilocybin in certain prescribed instances such as, for example, where non-criminal possession of substances is permitted by the measure, such as in the case of psilocybin, possession of up to 11.99 grams⁸, and the measure permits services involving mushroom products used for mental health treatment in supervised setting. In this way, Oregon became the first state to remove criminal statutory penalties from, in certain narrowly prescribed circumstances, psilocybin⁹and other jurisdictions continue to move in this direction.¹⁰The District of Columbia electorate similarly voted to approve psychedelic substances with the passage of Initiative 81.¹¹On June 1, 2021 a bill which cleared three Senate committees passed 21-16 on the floor of the California Senate legalizes possession of psychedelics in California.¹²

⁶ Psilocybin is a naturally-occurring psychedelic prodrug compound produced by more than 200 species of fungi.

⁷ See the Psilocybin Services Act, “Oregon Measure 109, Psilocybin Mushroom Services Program Initiative (2020), available at https://ballotpedia.org/Oregon_Measure_109,_Psilocybin_Mushroom_Services_Program_Initiative_(2020) accessed on June 11, 2021; see also Measure 110 (2020) Background Brief, Oregon Legislative Policy and Research Office, available at https://www.oregonlegislature.gov/lpro/Publications/Background-Brief-Measure-110-(2020).pdf accessed on June 11, 2021 (reducing to civil penalties certain drug crimes previously prosecuted as felonies).

⁸ Patrick Lynch, M.A., “What Does It mean that Oregon Decriminalized All Drugs?” WayofLeaf.com (Jan. 7, 2021) available at What Oregon Decriminalizing Drugs Means [Demystifying Laws] (wayofleaf.com), accessed on June 11, 2021.

⁹ See Oregon Secretary of State election results for November 4, 2020, available at https://results.oregonvotes.gov/resultsSW.aspx?type=SMEA&map=CTY accessed on June 11, 2021; see also Will Feuer, “Oregon Becomes First State to Legalize Magic Mushrooms as More States Ease Drug Laws in ‘Psychedelic Renaissance,’” CNBC.com (Nov. 4, 2020); see also Natalie O’Neill, “Oregon Becomes First State to Legalize Magic Mushrooms, Decriminalize Street Drugs,” NYPost.com (November 4, 2020), available at https://nypost.com/2020/11/04/oregon-becomes-1st-state-to-legalize-magic-mushrooms/ accessed on June 11, 2021.

¹⁰ “41 states have their own version of the federal Right to Try Act.” Serena Wu, “Legality of Psychedelics in the U.S.,” Pscyhable, available at https://psychable.com/law/legality-of-psychedelics-in-the-us/ accessed on June 11, 2021. “President Trump signed the Right to Try Act in May 2018. It permits terminally ill patients to have access to experimental therapies that have finished Phase I testing but are not FDA approved. The federal legislation came only after the vast majority of states had already signed their own versions of the Right to Try legislation into law.” Lynn Marie Moraski, MD, Esq., “Psychedelics: Are They Legal in the USA?” WayofLeaf.com (Feb. 24, 2021), available at Are Psychedelics Legal in the USA? [Fully Explained] (wayofleaf.com) accessed on June 11, 2021.

¹¹ Will Feuer, “Oregon Becomes First State to Legalize Magic Mushrooms as More States Ease Drug Laws in ‘Psychedelic Renaissance,’” CNBC.com (Nov. 4, 2020).

¹² Kyle Jaeger, “California Senate Approves Bill to Legalize Possession of Psychedelics Like Psilocybin and LSD,” MarijuanaMoment.com (June 1, 2021), available at https://www.marijuanamoment.net/california-senate-approves-bill-to-legalize-possession-of-psychedelics-like-psilocybin-and-lsd/ accessed on June 11, 2021.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 8

After over five decades of prohibition, the electorate in the United States has in limited instances become more accepting of psychedelics in certain controlled circumstances. There are over 70 clinical studies involving psychedelics in the U.S. and as stated in the preceding paragraph, Oregon and other jurisdictions referenced in this letter on the pages that follow have legalized therapeutic and controlled use of psilocybin.¹³ Psychedelics such as MDMA and psilocybin are also used legally in FDA-approved clinical research to treat patients with depression, post-traumatic stress disorder or PTSD, or other mental health conditions¹⁴ and for purposes of this letter, companies providing psychedelics for these sanctioned purposes are also referred to as Psychedelics Companies.

Many local jurisdictions around the United States have passed decriminalization bills. Generally, decriminalization means that arrest, investigation and prosecution for the possession of certain psychedelics becomes low priority for enforcement. However, approved decriminalization initiatives do not render psychedelics legal and accordingly a Psychedelics Company is not one whose commercial activities are a “low priority” for local, state and federal law enforcement.¹⁵ We do however recognize that decriminalization is an important step forward on the path to legalize psychedelics. The following jurisdictions have decriminalized certain activities (e.g., possession of a small amount) with respect to psilocybin and other psychedelics:

¹³ Serena Wu, “Legality of Psychedelics in the U.S.,” Pscyhable, available at https://psychable.com/law/legality-of-psychedelics-in-the-us/ accessed on June 11, 2021.

¹⁴ Id. “People who do not qualify for the clinical trials could get access through an expanded access program. For terminally ill patients, they could work with their doctors to petition the FDA for compassionate use of investigational drugs, such as MDMA and psilocybin. Alternatively, patients with immediately life-threatening diseases or conditions could petition the drug developer for access to investigational drugs under the Right to Try Act. There are unique challenges to these processes. Some individuals use certain psychedelics, such as ayahuasca, as a sacrament to exercise their religious faith and practice. These visionary churches rely on the Religious Freedom Restoration Act to protect their sincere religious exercises involving certain psychedelics. However, this type of use is not without risks and exposure to potential prosecution.” Id.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 9

The Fund will directly invest in companies that list their securities on exchanges that require compliance with all laws, rules and regulations applicable to their business, including U.S. federal laws. The current exchanges identified by the Fund that meet these requirements are the New York Stock Exchange (“NYSE”), Nasdaq Stock Market (“Nasdaq”), TSX Exchange, (“TSX”) and TSX Venture Exchange (“TSX Venture”).

The NYSE and NASDAQ are national securities exchanges that are registered with the SEC under Section 6 of the Securities Exchange Act of 1934. Before a company’s securities can trade on a U.S. exchange, the company must register that class of securities with the SEC under Section 12(b) of the Exchange Act.

We assume for purposes of this letter and the legal opinions in it that the Fund will not invest directly in or hold ownership in any companies that engage in psychedelics-related business unless permitted by national and local laws of the relevant jurisdiction, including U.S. federal and state laws.

We next proceed with our legal analysis and the opinions which we render in this letter, first in Parts I, II and III, insofar as the Fund’s purchase of securities is concerned, and finally in Part IV, insofar as the Fund’s execution and settlement of a TRS is concerned.

¹⁶ Serena Wu, “Legality of Psychedelics in the U.S.,” Pscyhable, available at https://psychable.com/law/legality-of-psychedelics-in-the-us/ accessed on June 11, 2021. Note that with respect to Washington D.C., Oakland, and North Hampton, each of these jurisdictions has decriminalized possession of all psychedelics, including ayahausca, ibogaine, MDMA and others. See also Esther Honig, “In Close Vote, Denver Becomes 1st U.S. City to Decriminalize Psychedelic Mushrooms,” NPR.org (May 9, 2019), available at https://www.npr.org/sections/health-shots/2019/05/09/721660053/in-close-vote-denver-becomes-first-u-s-city-to-decriminalize-psychedelic-mushrooms accessed on June 11, 2021 (“Officials with the DEA office in Denver said they will continue prosecuting cases of psilocybin possession and trafficking. Under federal law, it remains a Schedule 1 drug that’s considered to have ‘no accepted medical use and a high potential for abuse.’”); Kyle Jaeger, “Third Massachusetts City Approves Psychedelics Decriminalization Measure,” Marijuana Moment (April 2, 2021) available at https://www.marijuanamoment.net/third-massachusetts-city-approves-psychedelics-decriminalization-measure/ accessed on June 11, 2021; Elizabeth Weise and Marco della Cava, “Oakland in California Decriminalizes Magic Mushrooms and Peyote,” USAToday.com (June 5, 2019)(“The vote [in Oakland] makes Oakland the second U.S. city to decriminalize the natural hallucinogens after Denver decriminalized them on May 8 [2019]”), available at https://www.usatoday.com/story/news/2019/06/05/oakland-california-legalizes-magic-mushrooms-and-peyote/1347888001/ accessed on June 11, 2021; Kelly McCarthy, “Santa Cruz Decriminalizes Psychedelic Mushrooms,” ABCNews.com, available at https://abcnews.go.com/US/santa-cruz-decriminalizes-psychedelic-mushrooms/story?id=68611065 accessed on June 11, 2021.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 10

Beyond the limits of investing in companies described above, we analyzed the potential criminal exposure to the Fund and its shareholders solely under Applicable Federal Law in connection with the Fund’s proposed investment in Psychedelics Companies.¹⁷ The legal landscape in psychedelics industries is rapidly changing, and enforcement priorities for prosecutors, investigators, and regulators are difficult (if not impossible) to predict, may be influenced by political considerations (and thus a moving target), and may lack consistent application, all of which are beyond the scope of this opinion.

Subject to the considerations set forth in the preceding paragraph, based on our review of the case law and other authorities, we note the following:

¹⁷ For purposes of this opinion, we do not assess potential regulatory issues with the SEC, the Financial Industry Regulatory Authority (“FINRA”), the Financial Crimes Enforcement Network (“FinCen”), or foreign authorities.

¹⁸ See, e.g., Superseding Indictment, U.S. v. Hoang, Case No. 3:17-cr-70, 2017 WL 9855203 (S.D. Iowa); Press Release, U.S. Dep’t of Justice, California Realtor Sentenced to Prison for Filing a False Tax Return - Did Not Report Over $1 million In Income From Marijuana Distribution Business (Nov. 2, 2018), available at https://www.justice.gov/opa/pr/california-realtor-sentenced-prison-filing-false-tax-return; Press Release, U.S. Dep’t of Justice, Washington, D.C. Post Office Manager and Two Letter Carriers Found Guilty of Bribery and Conspiracy to Distribute Marijuana (Jul. 24, 2017), available at https://www.justice.gov/opa/pr/washington-dc-post-office-manager-and-two-letter-carriers-found-guilty-bribery-and-conspiracy.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 11

Our opinion focuses on Applicable Federal Law, and based on the current status of state laws regarding psychedelics, it is our view that Applicable Federal Law is more stringent. Therefore, it is our opinion that, if the Fund complies with Applicable Federal Law, the Fund will meet state law standards because the Fund will not be investing in companies engaged in the manufacturing, distribution or possession of psychedelics in the U.S. other than Psychedelics Companies.

¹⁹ This statement does not mean that no action may be brought in the future or that no confidential investigation is proceeding in the status quo; it simply means that we have not found evidence of the same through publicly available resources that we reviewed as noted above. We are aware of the indictment of a member of, and the involvement in DOJ investigations of NutraHQ LLC, a Nevada limited liability company (whose corporate status has been revoked), as well as a subpoena being served on Capsule Connection LLC, in DOJ investigations and proceedings and accordingly, for purposes of this letter, none of NutraHQ LLC, Spice Jungle, LLC, Freund Container or Capsule Connection LLC is a “Psychedelics Company” (because from publicly available information concerning DOJ action we gather that none of those entities was operating in compliance with local, state or federal law), which we define and describe on page 2 and in footnotes 2-4. Seyfarth Shaw LLP has conducted research to locate the investigations and proceedings by the DOJ and we have in our due diligence identified and reviewed the matters involving NutraHQ LLC, Spice Jungle, LLC, Freund Container or Capsule Connection LLC, and as we have discussed in this letter, we consider none of the proceeding companies to be a “Psychedelics Company.”

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 12

Congress gives federal agencies significant authority in executing federal laws, including the DEA, the law enforcement arm of the federal government primarily responsible for enforcing the CSA.²⁰ Further, federal prosecutors have wide latitude in determining when, who, how and even whether to prosecute for alleged violations of federal criminal law.²¹ In our legal system, “the decision whether or not to prosecute, and what charge to file or bring before a grand jury, generally rests entirely in [the prosecutor’s] discretion.”²² “This broad discretion ... is particularly ill-suited to judicial review.”²³ That discretion extends to, for example, the decision to prosecute a matter, the selection of charges, whether to enter into a plea agreement, and participation in sentencing.²⁴

With respect to business organizations, such as the Fund, the United States Justice Manual provides the following guidelines to prosecutors to promote the reasoned exercise of discretion:²⁵

²⁴ See United States Justice Manual at § 9-27.110, available at https://www.justice.gov/jm/jm-9-27000-principles-federal-prosecution#9-27.110.

²⁵ United States Justice Manual at §§ 9-28.300, 9-28.400, 9-28.500, 9-28.600, 9-28.700, 9-28.800, 9-28.900, 9-28.1000, 9-28.1100, 9-28.1200, and 9-28.1300, available at https://www.justice.gov/jm/jm-9-28000-principles-federal-prosecution-business-organizations.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 13

We are not aware of the DOJ’s position on the enforcement of federal law (solely pertaining to psychedelics). We know that in the context of cannabis and that during the Obama administration, Deputy Attorney General David Ogden and Deputy Attorney General James Cole released several memoranda that addressed federal enforcement priorities regarding the CSA. These memoranda were intended to adapt the federal government’s position on marijuana as states legalized the drug for medical purposes.

Most notably, in 2013, Deputy Attorney General Cole released a memorandum²⁶ (the “Cole Memo”) that reiterated the DOJ’s commitment to enforcing the CSA, but that directed law enforcement and prosecutors only to focus on conduct that implicated the following, and again, the Cole Memo was issued in the context of cannabis, which we believe is instructive insofar as psychedelics are concerned:

²⁶ Memorandum from James Cole, U.S. Deputy Attorney General, on Guidance Regarding Marijuana Enforcement (Aug. 29, 2013) available at https://www.justice.gov/iso/opa/resources/3052013829132756857467.pdf.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 14

The Cole Memo further conditioned this guidance on the existence of a state regulatory scheme that provides “robust controls and procedures [which are] effective in practice,” in which case “enforcement of state law by state and local law enforcement and regulatory bodies should remain the primary means of addressing marijuana-related activity.” Taken together, the Cole Memo and other related memoranda provided that the federal government would give some leeway to states’ control over medical marijuana use and production for medical purposes. Importantly, though, the Cole Memo did not have the force of law, but only reflected a policy subject to change at any time.

In January 2018, Attorney General Jeff Sessions issued a new memorandum (the “Sessions Memo”) repealing the policy statements in the Cole Memo: “Given the Department’s well-established general principles, previous nationwide guidance specific to marijuana enforcement is unnecessary and is rescinded, effective immediately.”²⁷ The Sessions Memo reinforces the prosecutorial discretion to pursue penalties for marijuana cultivation, distribution, and possession under Applicable Federal Law for financial transactions.²⁸

²⁷ Memorandum from Jeffrey Sessions, U.S. Attorney General, on Marijuana Enforcement, (Jan. 4, 2018) available at https://www.justice.gov/opa/press-release/file/1022196/download.

²⁸ During confirmation hearings before the Senate Judiciary Committee for appointment as Attorney General, in February, 2021, new Attorney General Merrick Garland responded to questioning by Senator Cory Booker as follows: “It does not seem to me a useful use of limited resources that we have, to be pursuing prosecutions in states that have legalized and that are regulating the use of marijuana, either medically or otherwise. I don’t think that’s a useful use.” See https://mjbizdaily.com/attorney-general-nominee-merrick-garland-signals-friendlier-marijuana-stance/. In subsequent written responses to the Senate Judiciary Committee, Attorney General Garland stated that he did not think it worth the department’s time to pursue prosecutions “of those who are complying with the laws in states that have legalized and are effectively regulating marijuana.” See https://www.rollcall.com/2021/03/01/senate-judiciary-sends-garland-nomination-to-the-floor/. Separate and apart from these pronouncements, Congress has withheld funding to the DOJ (pursuant to the Rohrabacher-Blumenauer Amendment to federal spending bills) to prosecute state-compliant business in the medical marijuana space since 2014.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 15

The Sessions Memo provides that the federal government may pursue action against violations of federal law related to marijuana. To the extent that they have done so, it appears that federal prosecutors have focused on growers and producers within the states, rather than investors.²⁹

We have found nothing in the publicly available resources noted above that suggests that any Psychedelics Company is or would be in violation of the CSA and/or MCA.³⁰ This opinion is only based upon and limited to that publicly available information available from the SEC and other regulators listed in this letter.

Based on the foregoing and the Fund’s representation that it will only invest in certain exchange traded securities compliant with U.S. federal law, we believe the Fund would not violate the CSA or be subject to DOJ psychedelics enforcement so long as the companies are Psychedelics Companies.

Under Section 841(a) of the CSA, it is unlawful for a person to knowingly or intentionally “manufacture, distribute, or dispense, or possess with intent to manufacture, distribute, or dispense, a controlled substance . . . .”³¹The statute defines “manufacture” as the production, preparation, propagation, compounding, or processing of a drug or other substance, either directly or indirectly or by extraction, and includes any packaging or repackaging of such substance, except as complying with applicable state law.³² In addition, Section 846 of the CSA prohibits conspiring to commit substantive offenses under the Act, and provides that any individual who attempts or conspires to commit a violation of the CSA will be subject to the same penalties as the underlying offense.³³

Based solely on the plain language of the Fund’s Registration Statement (including the Statement of Additional Information) and the proposed investments, including our analysis of their businesses as derived from the publicly available resources noted above, and based on the assumptions herein, none of the businesses of Psychedelics Companies, would be non-compliant with applicable local law and their operations would as of today violate Applicable Federal Law. This opinion is only based upon and limited to that publicly available information available from the SEC and other regulators listed in this letter.

²⁹ See, e.g., Superseding Indictment, U.S. v. Hoang, Case No. 3:17-cr-70, 2017 WL 9855203 (S.D. Iowa) (criminal charges filed against growers, not investors, related to marijuana production and/or distribution within the states).

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 16

Based on the foregoing, it is our opinion that the Fund would not have direct liability under Section 841(a) or Section 846 of the CSA because it will not be investing in any business other than in the business of a Psychedelics Company so long as, as we assume, such company does not undertake a commercial or other activity which expressly violates the terms of the CSA.

In addition to complying with the CSA, the Fund must also comply with federal money laundering laws. Section 1956 of the MCA provides that (i) “[w]hoever, knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity, conducts or attempts to conduct such a financial transaction which in fact involves the proceeds of specified unlawful activity… with the intent to promote the carrying on of specified unlawful activity…³⁴” or (ii) “[w]hoever transports, transmits, or transfers, or attempts to transport, transmit, or transfer a monetary instrument or funds from a place in the United States to or through a place outside the United States or to a place in the United States from or through a place outside the United States…with the intent to promote the carrying on of specified unlawful activity…”³⁵ is in violation of federal law.

Based on the foregoing, in our opinion the Fund’s investment activity would not constitute an offense under Section 1961(1) (i.e., obtaining proceeds from an unlawful activities) because the Fund represents that it will invest in Psychedelics Companies, which are exchange-listed companies and require compliance with U.S. federal laws in addition to the laws of their respective jurisdictions.

As we previously stated in this letter, it is our understanding that an integral part of the investment strategy of the Fund is its execution and settlement of total return swaps (as we have previously defined, “TRS’s”), a straightforward form of over-the-counter or OTC derivative.

The opinions relating to OTC derivatives apply only to the TRS’s executed by the Fund which we analyze in this letter; we have been asked to opine with respect to the enforceability of the TRS’s to be executed and settled by the Fund. For purposes of our analysis and with respect to the opinions relating to the TRS’s, we assume that the Fund will be executing one or more TRS’s with one or more counterparties and that each TRS will reference either a single Psychedelics Company (each such company, is also referred to in this letter as a “TRS Company”) and that all TRS’s which are the subject of this letter will be financially, or cash settled (and at no time will the Fund have any direct, indirect, actual or beneficial ownership of any TRS Company).

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 17

It is our understanding and a fundamental assumption of this letter that the Fund will not (a) invest directly in any Psychedelics Company that grows, produces, distributes, or sells plant products or drugs in a country, state, province, locality or other political subdivision where this activity is illegal under applicable law; or (b) execute any TRS (or any other OTC derivative or exchange traded derivative) which references (i) any Psychedelics Company that grows, produces, distributes, or sells plant products or drugs derived in a country, state, province, locality or other political subdivision where this activity is illegal under applicable law; or (ii) any index which includes as a component any Psychedelics Company that grows, produces, distributes, or sells plant products or drugs in a country, state, province, locality or other political subdivision where this activity is illegal under applicable law.

In this context, we have considered the enforceability of the legal documentation governing the TRS’s under principles of contract law as well as the CSA and the 1934 Act (as amended by Dodd-Frank) and regulations promulgated thereunder by the SEC.

TRS payments are received by the counterparty to the Fund under the TRS. The TRS payments do not result in ownership of stock in a Psychedelics Company because the TRS’s are to be cash settled. In addition, the Fund’s payments are not used for the purchase or cultivation of plants, or manufacture of drugs, or marijuana or other controlled substances or related supplies and do not facilitate distribution or contribute to the growth of a Psychedelics Company or other company, or in the purchase of plants, cannabis, drugs or related supplies and do not facilitate any illegal activity in any way.

Instead, all TRS payments are directed by the TRS documentation to be made to a party to the TRS as part of what we view as a lawful bargain: the Fund pays a TRS counterparty a fee (like a premium in an insurance contract) for the TRS, and incurs the risk that the share value of each Psychedelics Company (that is, the Reference Asset(s) in the reference portfolio) in the TRS depreciates (because if such share value does depreciate, then the Fund is obligated under TRS terms to pay the counterparty a value representing that depreciation), in exchange for a cash payment by the TRS counterparty to the Fund representing the appreciation and total return of each referenced stock or fund interest. The payments by the Fund in the case of the TRS do not result in the purchase of any Psychedelics Company’s or other company’s stock.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 18

We are aware of no guidance, regulation, or formal or informal prohibition by the DOJ or any federal regulator (including derivatives regulators in the United States (e.g., the SEC and CFTC)) with respect to a derivative based on a Psychedelics Company or investment vehicle investing in a Psychedelics Company.

We are also aware of no reported decision by a court or other tribunal as to whether a derivative referencing a Psychedelics Company (whether operating with or outside of a state license, permission or mandate) is legal --or illegal. We were able to locate no rule (proposed or final), no solicitation for market input for a prospective rule, no guidance or other regulatory pronouncement directly relating to what we understand to be a Psychedelics Company on which a TRS will be based.

The TRS is not a transaction or an activity which is expressly prohibited by the CSA (and we assume for purposes of this letter that the Psychedelics Company referenced in the TRS is not undertaking criminal or other activities which would trigger federal action such as funneling proceeds from the sale of plants or drugs to criminal enterprises, distributing contraband to gangs or cartels or other activities which are expressly prohibited by the CSA).³⁶

In the absence of on-point regulatory or other guidance, we have considered other commercial and contractual arrangements which we believe would be entered into by Psychedelics Companies, or even companies in the cannabis industry, such as insurance policies. The insurance contract has for decades been compared to a derivative and vice-versa.³⁷

We are aware of state insurance commissioners approving the issuance of insurance policies undertaking risks relating to lawful state cannabis businesses, which, as we have previously written, is something of a precedent for business in psychedelics.

For instance, the California Cannabis Control Board submitted proposed regulations to the California Office of Administrative Law in December 2018 establishing minimum general liability coverage for cannabis distributors.³⁸ Former California Insurance Commissioner Dave Jones lobbied California's admitted insurers to begin serving the cannabis industry³⁹ and was ultimately successful in persuading admitted insurance carriers (i.e., carriers authorized to do business in California by the Secretary of State) to provide a cannabis insurance product,⁴⁰ including Golden Bear Insurance Company,⁴¹ North River Insurance Company, United States Fire Insurance Company, White Pine Insurance Company,⁴² Continental Heritage Insurance Company⁴³ and California Mutual Insurance Company.⁴⁴

³⁹ https://www.natlawreview.com/article/california-s-insurance-commissioner-encourages-admitted-carriers-to-insure-cannabis

⁴⁰ https://www.horstcounsel.com/single-post/2017/10/02/Admitted-Carriers-Offer-Some-Benefits-Some-Dangers-for-Cannabis-Industry

⁴¹ http://www.insurance.ca.gov/0400-news/0100-press-releases/archives/release119-17.cfm; https://www.goldenbear.com/news/how-to-cover-the-cannabis-sector-from-a-broker-whos-deep-in-the-weeds/

⁴² http://www.insurance.ca.gov/0400-news/0100-press-releases/2018/release088-18.cfm

⁴³ http://www.insurance.ca.gov/0400-news/0100-press-releases/2018/release055-18.cfm

⁴⁴ http://www.insurance.ca.gov/0400-news/0100-press-releases/2018/release046-18.cfm

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 19

For the sake of completeness we note that a federal court in Hawaii⁴⁵ held that an insured individual growing cannabis for personal use in compliance with state law could not recover under her homeowner’s policy because the federal public policy against cannabis trumps the express terms of an insurance policy; however, a federal court in Colorado refused to follow that court in Hawaii, and refused to absolve a property insurance carrier of its coverage obligation when the property insurance policy was written for a state-legal cannabis business, because the policy was written specifically to provide coverage for the insured's state-legal marijuana business.⁴⁶

For purposes of evaluating the TRS’s in the context of the CSA, we considered the federal judiciary’s upholding of contracts⁴⁷ including those evidencing payment obligations albeit in the insurance context. The upholding of contracts in the insurance context is helpful guidance for evaluating the enforceability of the TRS’s. As with the purchase of securities, for the reasons and based on the law which we cite, the Fund’s proposed execution of a TRS should not trigger action by the DOJ or federal prosecutors under the CSA and so for our conclusions concerning the TRS, we incorporate by reference all legal and factual analyses as well as representations made to us and assumptions made in the parts of this letter preceding this Part IV (regarding the Fund’s purchases of securities), as we reach the conclusion that under the CSA, the DOJ and federal prosecutors should not pursue any action with respect to the TRS’s (referencing Psychedelics Companies) to be executed by the Fund.

⁴⁵ Tracy v. USAA Cas. Ins. Co., No. 11-00487 LEK-KSC, 2012 WL 928186, at *13 (D. Haw. Mar. 16, 2012).

⁴⁶ Green Earth Wellness Ctr., LLC v. Atain Specialty Ins. Co., 163 F. Supp. 3d 821, 833-34 (D. Colo. 2016)(“Green Earth Wellness Center”).

⁴⁷ We note that when we refer in this paragraph to “the federal judiciary,” we refer primarily to the federal district court in Green Earth Wellness Center, and federal courts’ decisions subsequent to Green Earth Wellness Center (see, e.g., Greenwood v. Green Leaf Lab LLC, 2017 U.S.Dist. LEXIS 125143 (2017); In re Way to Grow, Inc., 597 B.R. 111, 2018 Bankr. LEXIS 4142 (2018); see also In re Malul, 614 B.R. 699, 2020 Bankr. LEXIS , 68 Bankr. Ct. Dec. (LRP) 147)(2020)(“At oral argument, Malul attacked the relevance of Green Earth Wellness on two grounds. First, Malul argued Green Earth Wellness is inapplicable because it was evaluating the legality of state insurance laws, not necessarily federal drug laws. Second, Malul argued the insurance policy in Green Earth Wellness is a different situation to a declaratory judgment or breach of fiduciary duty claim, because there is an underlying equity interest at stake in the latter. The Court agrees [that] the facts of Green Earth Wellness are distinguishable in these respects, but it is not clear whether, or how, those factual differentiators mediate a different result. Rather, the operative decision point in Green Earth Wellness was Judge Krieger's careful distinction between ordering the insurer to pay for damages to specific items (i.e., marijuana plants) and merely ordering compliance with the contract, which could be accomplished without reference to the existence of any marijuana asset.”)). We also note that at least one federal court has declined to invalidate an insurance contract (where an insurer underwrites a cannabis company (not a psychedelics company), in compliance with state law) on the grounds that the contract contravenes public policy; the federal district court in Green Earth Wellness Center refused to invalidate the insurance contact at issue in that case on public policy grounds “in light of several additional years evidencing a continued erosion of any clear and consistent federal public policy in this area” and on that basis the federal district court “declines [insurer] Atain’s indirect invitation to declare the [insurance] Policy void on public policy grounds.” See Green Earth Wellness Center, 163 F.Supp.3d at 834-35. We finally note that it appears that federal prosecutors have focused on growers and producers within the states, rather than investors, see also Superseding Indictment, U.S. v. Hoang, Case No. 3:17-cr-70, 2017 WL 9855203 (S.D. Iowa) (criminal charges filed against growers, not investors, related to marijuana production and/or distribution within the states).

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 20

In connection with this letter, its analysis and resulting TRS-related conclusions and opinions, we have examined the following (collectively, the “TRS Documentation”), each of which is governed by New York law pursuant to the election of the parties to the TRS Documentation:

⁴⁸ In the analysis and with respect to the conclusions and opinions relating to TRS documentation, when we refer to legal documentation, we refer to the legal documentation that the Fund executes.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 21

In rendering legal opinions in Part IV of this letter, we make and rely on certain assumptions concerning the TRS Documentation, including that such representations are accurate and the following assumptions. We assume that each of the terms and conditions of the TRS Documentation, as presented to us, are presently and would remain in final form without material variation or modification. We further assume that each party referenced in the TRS Documentation has legal capacity, authority and has fulfilled all legal prerequisites with respect to the execution, delivery and full and timely performance of obligations set forth or contemplated by the TRS Documentation. We assume for the purpose of this letter that Fund and its counterparty will fully and timely perform all applicable obligations and undertakings under the TRS Documentation and we further assume that each party to the TRS Documentation is in full compliance with all applicable state and federal law, including but not limited to Applicable Federal Law and therefore we limit this opinion letter and the analysis within it only to the first two full paragraphs on page two of this letter.

We further assume for purposes of our analysis, conclusions and opinions that each party to the TRS Documentation: (i) represents and warrants to the other, with respect to each TRS evidenced by the TRS Documentation that each such party is not entering into the TRS to avoid, prevent or to circumvent or do anything that is contrary to any Applicable Federal Law including statutory law, regulations or case law relating to the vesting of beneficial ownership and those applicable to shareholder disclosure; (ii) does not intend to engage, and in fact does not in any way engage in any fraudulent, deceptive or manipulative act or practice; and (iii) is in full compliance with the Exchange Act, and CEA, each as amended by Dodd-Frank,⁴⁹ and the 1940 Act, with respect to the legal issues which are outside of the scope of this letter (e.g., reporting obligations, diversification and custody rules) and each fully executes and delivers the TRS Documentation.

⁴⁹ We recognize that the Fund under the 1934 Act may be obligated to report its TRS’s to a security-based swap data repository and to comply with portfolio reconciliation or other obligations which are not directly related to the focus of this opinion letter, and so for purposes of this letter we assume that the Fund and its TRS counterparties are in compliance with those requirements. We also recognize that the Fund and/or the TRS counterparty to the Fund may be obligated to comply with other law which is not central to, referenced in and is therefore outside of the scope of this letter, including the Internal Revenue Code, Regulation T of the Federal Reserve Board, and the rules and regulations, and there are also 1940 Act custody, diversification, leverage and other requirements with respect to which the Fund must comply. The Fund and its performance are governed primarily by the 1940 Act, with respect to which the SEC promulgates regulations effectuating the 1940 Act, including most recently, Rule 18f-4, which generally became effective on February 19, 2021. We gather that the SEC is permitting 1940 Act investment vehicles (including the Fund) to come into compliance with new Rule 18f-4 during an eighteen-month transition period, commencing on February 19, 2021 and ending on August 19, 2022 (at which point compliance with Rule 18f-4 is required in all respects), and today we assume for purposes of issuing this letter that the Fund is today, and will in the future continue to be, in compliance with existing SEC rules, as applicable to the Fund as of the date hereof.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 22

We also note that in the event that the TRS is at some later date declared illegal under the CSA, the Fund’s (and indirectly its beneficial owners’) losses would be determined by “break provisions” that enable the parties to the TRS to close-out an existing TRS and to the extent possible, restore the parties economically to a position immediately before a federal department or other federal authority declared the TRS illegal under the CSA (or other law). Within the TRS Documentation is a provision that stipulates that a termination event will occur if it becomes unlawful under any applicable law for a party to make or to receive payments with respect to a transaction, or to perform any material provision of the ISDA Master Agreement (which governs the TRS and any other “Transaction” under the terms of the ISDA Master Agreement); this “Illegality” provision is anticipatory in nature and has (after currency crises in and around 1998) become integrated into the 2002 form of ISDA Master Agreement on which the TRS is based, so that this provision contemplates that a termination of the TRS would occur if, at some later date after (TRS) execution, it would be unlawful to make or receive a payment in the future.

Therefore, important to our legal analysis of the enforceability of the TRS Documentation (and the manner in which losses and gains are calculated on termination by the Fund or their counterparties) is this “Illegality” feature of the ISDA Master Agreement and Schedule contemplating a government decree making a payment of a derivative illegal, such as was the case on August 17, 1998, when the Russian government (in dealing with a widespread economic and currency crisis of its own)⁵⁰ imposed a moratorium on payments called for in many OTC currency derivatives referencing the Ruble.

We consider the August 17, 1998 Russian decree to be, in fact, something of a precedent for helping us evaluate potential monetary liability of the Fund and its beneficial owners under the CSA; in that circumstance, with the “Illegality” feature of the ISDA Master Agreement (published in 2002 and included in the TRS Documentation),⁵¹ the Fund: should incur no regulatory exposure or regulatory liability solely because a court of competent jurisdiction in the future holds that the TRS violates the CSA or the 1934 Act; and the TRS could be terminated on a no-fault basis with the Fund and its TRS counterparties using mid-market values calculated pursuant Section 6(e) of the ISDA Master Agreement (this may result in the Fund sustaining monetary loss or gain on the TRS, but we believe there would in that instance not be resulting regulatory exposure for the termination in the absence of a federal prohibition on the TRS at the point of execution of that OTC derivative).⁵²

⁵⁰ On August 17, 1998, in the face of a rapidly deteriorating economic situation, the Russian government defaulted on its Ruble-denominated securities, the Russian Central Bank stopped its support of the Ruble and a temporary moratorium was imposed on certain hard currency payments. Russia imposed a 90-day moratorium on various hard currency transactions connected with the movement of capital. These actions resulted in an immediate and severe devaluation of the ruble and a sharp increase in the rate of inflation; a dramatic decline in the prices of Russian debt and equity securities; and an inability of Russian issuers to raise funds in the international capital markets and the OTC derivatives market was likewise affected. See Statement of the Government of the Russian Federation and the Central Bank of the Russian Federation (August 17, 1998), https://web.archive.org/web/20150131090423/http://www.cbr.ru/eng/press/JOINT.htm, accessed on June 30, 2020.

⁵¹ See Section 6(e) of the ISDA Master Agreement (as opposed to the earlier 1992 version of the ISDA Master Agreement).

⁵² Under the effective terms of the TRS Documentation, if the TRS, after it is executed but before the end of the term or maturity for the transaction if the U.S. government (or even a state) declares the TRS to be illegal, then, at the end of a waiting period, the Fund and each TRS counterparty can terminate the TRS on a no-fault basis and use mid-market values calculated pursuant Section 6(e)(ii)(3) of the ISDA Master Agreement.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 23

In the absence of any government prohibition of the TRS structure and the TRS Companies referenced within it, the TRS Documentation should create legal, valid and binding obligations under New York law with respect to the Fund and its TRS counterparties.

Because of the dynamic, bespoke nature of the TRS and the regulatory implications from its design and management, it is important for purposes of the analysis leading to the rendering of opinions to first describe with greater particularity the manner in which the regulator (i.e., the SEC or the Commodity Futures Trading Commission, or the “CFTC,” and each of its respective regulatory regimes) for the TRS is identified under Dodd-Frank (and pursuant to its amendment of the CEA and 1934 Act); this depends on the Reference Assets (reference portfolio of the Fund) of the TRS.

The upshot is that if the reference portfolio consists of a single security (such as the equity of a Psychedelics Company), a single loan or a narrow-based group or index of securities, then under current U.S. law, the regulator of the TRS is the SEC and the federal law which applies to the TRS is the 1934 Act (not the CEA, the Commodity Exchange Act), as amended by Dodd-Frank and SEC rules (as opposed to the CEA and CFTC rules), with respect to the TRS, promulgated thereunder.

On the other hand, if the reference portfolio consists of more than one security, more than one loan, a broad-based index or basket of securities (or any combination thereof), then under current U.S. law, the regulator of the TRS is the CFTC; so if the CFTC regulates TRS’s executed by the Fund, then the Fund would be subject to both the SEC and its rules insofar as the Fund and its operation are concerned and the CFTC insofar as the TRS is concerned. In that case, the CFTC and the CEA (not the 1934 Act), as amended by Dodd-Frank, and CFTC rules and guidance is the statutory basis and regulatory regime governing the TRS. Given this complexity and for our purposes, in this letter, we assume that the only TRS that is to be executed is one that references either a single Psychedelics Company; so for all purposes, the TRS (and TRS’s) which are the subject of the opinions in this letter would be regulated by the SEC. The following discussion brings this and the paragraph immediately above this paragraph into sharper focus.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 24

Total return swaps in the U.S. have been regulated by a still relatively new and comprehensive body of law, including a federal statute and implementing rules -- for about a decade.

In 2010, Congress passed and President Obama signed into law Dodd-Frank, which established for the first time in America a comprehensive framework for regulating OTC (privately negotiated) derivatives, OTC derivative markets and utilities -- and the financial products executed within and by them, including those products with the basic structure of the TRS.

Before 2010, one of the primary culprits in the Great Recession of 2008 was the near complete confusion and improper identification with respect to the regulator with authority to regulate an OTC derivative⁵³ and this is no longer the case, so today the TRS is subject to a clearly-defined and predicable regulatory regime, which we discuss next, but the federal regulator and its regulatory regime is determined by the design and management of the TRS, as described on this page and the pages that follow.

Under Dodd-Frank, regulatory authority is divided between the SEC and the CFTC or the Commodity Futures Trading Commission; Dodd-Frank mandated that the CFTC and SEC issue definitions for purposes of guiding market participants such as the Fund, so that it is more clear (as compared to the years prior to 2010) which regulator has jurisdiction over an OTC derivative.⁵⁴

After Dodd-Frank and with the benefit of clarifying regulations from both the CFTC and SEC, federal law assigns the SEC the authority to regulate “security-based swaps,” which are broadly defined as OTC derivatives, including swaps, based on (1) a single security or (2) a loan or (3) a narrow-based group or index of securities or (4) events relating to a single issuer or issuers of securities in a narrow-based group or index.

⁵³ See generally, Gordon F. Peery, The Post-Reform Guide to Derivatives and Futures (Wiley 2012), at 30 (hereinafter “Guide to Derivatives”).

⁵⁴ The regulators’ rules were proposed, refined and published in “Further Definition of ‘Swap,’ ‘Security-Based Swap,’ and ‘Security-Based Swap Agreement’; Mixed Swaps; Security-Based Swap Agreement Recordkeeping,” 77 Fed. Reg. 48208 (August 13, 2012)(“Swap Definitions”). Mixed swaps are swaps that after Dodd-Frank and the aforementioned regulations are within the jurisdiction of both the SEC and CFTC and these typically include a security and a commodity such as a swap based on a currency (i.e., a commodity) and an equity (i.e., a security); the breadth and reach of the mixed swap definition is intended to be narrow and to close gaps in the OTC derivatives regulations post Dodd-Frank.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 25

Total return swaps on a single security, loan or narrow-based security index are security-based swaps regulated by the SEC, its rules, the 1934 Act and Dodd-Frank.

Total return swaps based on more than one security, more than one loan, or on a broad-based security index are “swaps” regulated by the CFTC, its rules, the CEA and Dodd Frank.

The SEC and the CFTC also in rare cases, not relevant here, share jurisdiction over “mixed swaps,” and the regulations of the SEC for security-based swaps, and the CFTC for swaps, are completely different, separate and apart from each other.

This means that derivative execution, documentation, settlement, reporting and recordkeeping requirements for security-based swaps (regulated by the SEC) and swaps (regulated by the CFTC) are completely different.

The easiest way to understand whether a derivative is regulated by the SEC or CFTC is to focus on the subject, or “reference” or “reference obligation” (in the case of the TRS, the Reference Assets and reference portfolio) of the derivative, which is the asset, event or other thing from which the financial product derives its value. If the subject of the derivative is a commodity (e.g., gold), or a basket of securities (or broad based index) then that derivative is a swap regulated by the CFTC.

If the derivative is a loan or a single security or a narrow-based index, then that derivative is likely⁵⁵ a security-based swap regulated by the SEC.

For our purposes, the TRS is regulated by the SEC if the subject of the TRS is the security (equity or debt (or loan)) of a single company or a narrow-based security index; otherwise, the TRS is a “swap” regulated by the CFTC.

A narrow-based security index, generally, with exceptions,⁵⁶ is an index of securities that meets one of the following four requirements (1) it has nine or fewer components; (2) one component comprises more than 30 percent of the index weighting; (3) the five highest weighted components comprise more than 60 percent of the index weighting, or (4) the lowest weighted components comprising in the aggregate 25 percent of the index’s weighting have an aggregate dollar value of average daily volume over a six-month period of less than $50 million ($30 million if there are at least 15 component securities).

⁵⁵ An option on a single equity is technically (again with limited exceptions) a “security” also regulated by the SEC. A security-based swap is also a “security” regulated by the SEC.

⁵⁶ The legal definition of narrow-based security interest, in the context of a swap, in Section 1a(25) of the CEA or Commodity Exchange Act, 7 USC 1a(25), contains several exceptions.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 26

OTC derivatives which are not security-based swaps generally fall into the category of a “swap,” a regulatory term which is meant to include all other (non-security-based swap) derivatives executed OTC, including an option, or a swap, on a basket of securities. A “swap,” as defined by the CFTC, entails “the exchange of one asset or liability for a similar asset or liability for the purpose of lengthening or shortening maturities, or otherwise shifting risks. This may entail selling one securities issue and buying another in foreign currency; it may entail buying a currency on the spot market and simultaneously selling it forward. Swaps also may involve exchanging income flows; for example, exchanging the fixed rate coupon stream of a bond for a variable rate payment stream, or vice versa, while not swapping the principal component of the bond. Swaps are generally traded over-the-counter.”⁵⁷

Section 721(a) of Dodd-Frank added Section 1a(47) to the Commodity Exchange Act (7 U.S.C. § 1a(47)) to bring total return swaps under the regulatory jurisdiction of the CFTC if those swaps reference a broadly-based index or a basket of companies (as opposed to, in this case, a single TRS Company consisting of a Psychedelics Company in compliance with state law). Whereas the TRS Documentation is governed by state law (i.e., the laws of the State of New York), the TRS itself is an OTC derivative now subject to federal law.⁵⁸

The TRS’s now before us are dynamically managed, which is to say that a portfolio manager “constructs” the derivative before execution and then has the right --and indeed it is contemplated that such right will be executed frequently, which is to say on a daily basis -- to change the Psychedelics Company on which the TRS is based (in the case of the TRS’s to be executed by Fund; the TRS’s to be executed by Fund are not considered dynamically or actively managed). From a regulatory standpoint, dynamic management of a TRS does not change the classification or regulator of the TRS; the Swap Definitions provide that the classification of an OTC derivative under Title VII of Dodd Frank is determined prior to its execution and then the product will retain its initial characterization throughout its life with the same regulator retaining jurisdiction from execution to expiry (and even if a narrow-based index becomes a broad-based index referenced in the same TRS, or vice versa, the regulator and derivative characterization as a swap or security-based swap remains the same over the life of the derivative).

⁵⁷ See CFTC Glossary, available at https://www.cftc.gov/LearnAndProtect/EducationCenter/CFTCGlossary/glossary_s.html and accessed on March 19, 2021.

⁵⁸ “Title VII [of Dodd Frank] defines ‘security-based swap’ as a swap that is based on a narrow-based security index, a single security or a loan [or] the occurrence, nonoccurrence or the extent of the occurrence of an event relating to a single issuer of a security or the issuers of securities in a narrow-based security index. An option on a security is not a security-based swap unless the security is restricted under the 1934 Act.” Guide to Derivatives at 141. The focus of this letter, as expressed in summary form on page 2, is a set of opinions as to the enforceability of the TRS and other financial products executed, purchased and owned, whether beneficially or not, by the Fund and not compliance with all aspects of Applicable Federal Law and such compliance is outside of the scope of this letter.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 27

After the passage of Dodd-Frank in 2010, and implementing regulations under that act, a TRS based on a broad-based index of TRS Companies and a TRS referencing two or more TRS Companies likewise would be an OTC derivative (a “swap”) regulated by the CFTC pursuant to its regulations. The SEC regulates most equity options as well as, for purposes of this letter, the TRS’s, each of which is based on a “single name,” or one TRS Company (or a single, narrow-based security index). Dodd-Frank also added Section 3(a)(68) to the Exchange Act, which defines “security-based swap”; accordingly, for a TRS based on the equity of a single TRS Company, the U.S. regulator is the SEC. For the reasons stated above and just as we believe that the DOJ and federal prosecutors should not pursue any action with respect to the TRS, we see no SEC guidance today that points to a conclusion that a TRS would be rendered invalid by the SEC (or the CFTC).

We summarized at the outset of this Part IV the cash-settlement, non-ownership aspects of the TRS. The Fund obtains nothing other than cash as a settlement at TRS maturity, and is obligated to do nothing, other than to make and to receive cash payments. In the absence of the right to vote, the absence of intent to prevent vesting or absence of intent to evade ownership obligations or ability or desire to dispose shares of the underlying psychedelics-related security, we do not believe that the TRS’s at issue here confer ownership interest in any underlying Psychedelics Company. Additionally, we do not believe that the Fund would have a reporting obligation from a purely cash-settled TRS (and we believe that Fund is not attempting to avoid obligations of ownership by executing TRS’s, and we further believe, and issue opinions based on that belief, that the Fund is not attempting to avoid obligations of ownership by executing TRS’s which are by their nature designed to synthetically replicate ownership of Psychedelics Companies or Psychedelics Companies).⁵⁹ As the case law and regulatory guidance is not settled with respect to total return swaps generally, we reference the following authorities that lead us to the conclusions and to the opinions found at the conclusion of this Part IV:

⁵⁹ See CSX Corp. v. The Children’s Investment Fund Management, 562 F.Supp.2d 511 (S.D.N.Y 2008), aff’d, 292 F. App’x 133 (2d Cir. 2008) (Second Circuit Court of Appeals unable to reach agreement on whether party executing TRS is a beneficial owner), 654 F.3d 276 (2d Cir. 2011)(“This case comes to us raising issues concerning a contractual arrangement known as a ‘cash-settled total return equity swap agreement’ although our disposition at this stage of the appeal touches only tangentially on such issues”.)(deciding only issues pertaining to a “group” violation of Section 13(d)(3)(“CSX”)); see also 2 Edward F. Greene et al., U.S. Regulation of the International Securities and Derivatives Markets § 14.02[2][a] (9th Ed 2008); Arnold S. Jacobs, The Williams Act - Tender Offers and Stock Accumulations § 2.12 (2009); James P. Smith & Corinne Levy, ‘CSX’: Second Circuit Upholds Denial of Injunctive Relief, N.Y.L.J., Sept. 26, 2008, at 4. We view the legal and other authorities as helpful in our analysis and the facts in CSX to be distinguishable because whereas the total return swap in CSX resulted in an effort to elect candidates to the board of directors of CSX, the TRS now before us is cash-settled with no exercise of any right other than the right to receive a cash payment.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 28

The TRS’s to be executed by the Fund are, as noted above, security-based swaps regulated by the SEC and as the TRS’s are cash-settled with no TRS term calling for TRS Company ownership by the Fund, the Fund should not have ownership or reporting obligations under the 1934 Act. As we have also noted, the underlying securities on which the TRS’s to be executed by the Fund will be based are companies with business activities conducted within the bounds of applicable local and state law, but not necessarily the CSA.

⁶²Letter from Brian V. Breheny, Deputy Director, Division of Corporation Finance, SEC, to Judge Lewis A. Kaplan, United States District Judge, Southern District of New York (June 4, 2008), available at http://www.givsondunn.com/publications/Documents/CSX-BrianBrehenyLtrtoJudgeKaplan.pdf).

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 29

Based on the relevant facts pertaining to the TRS’s as described in this Part IV of our letter, and subject to the TRS-specific qualifications, exceptions and limitations discussed below and the scope of this letter, we conclude, having due regard for legal considerations set forth herein, that, for purposes of the 1934 Act (as amended by Dodd-Frank) OR the CEA (also as amended by Dodd-Frank) and the CSA and with respect to only the TRS and assuming full compliance with state law by the Psychedelics Company referenced in the TRS (for the reasons stated in this letter, we do not focus on state law and as we state in this letter, we are aware of no federal investigation of any such Psychedelics Company):

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 30

The foregoing opinions are rendered at a “should” level of confidence, which involves a greater degree of certainty than a “more likely than not” opinion. However, the foregoing opinions and this letter are not stated and rendered with unqualified guarantees with airtight certainty for two reasons:

In light of the unavoidable realities and facts, including those referenced in (a) and (b) and (x) through (z) on the previous page, and, although this opinion represents our considered legal judgment, this has no binding effect and, therefore, there can be no assurance that the SEC, CFTC or other U.S. or state regulator, department or agency will not be able to successfully challenge the TRS’s on grounds of enforceability or any of the conclusions reached by us in this letter. We do not express any opinion with respect to the law of any jurisdiction outside of the United States, conflict of law principles or law, the rules of any derivatives exchange or clearinghouse, the internal policies of any party to the TRS or custodian or bank which may be involved in the performance of the TRS. The opinions concerning the TRS’s are delivered subject to this understanding and we are under no obligation to monitor the law or body of regulation to update this letter. Our opinion is subject to and is limited by the effects of bankruptcy, insolvency, reorganization, receivership, moratorium and similar laws including but not limited to state fraudulent transfer and conveyance laws, judicially developed doctrines in this area, general principles of equity including doctrines requiring consideration of the impracticability or impossibility or frustration of purpose relieving performance at the time of attempted enforcement as well as other rights, remedies and waivers contained in the TRS Documentation and any ancillary documents, schedules, instruments, side letters or other materials referenced therein.

Our opinions with respect to the TRS are limited to the facts, matters and law expressly set forth herein and no opinion may be inferred or implied beyond what is expressly stated in this letter. Our TRS-related opinions are for the benefit of the Fund and its beneficial owners and may not be relied upon by any other person or entity without the express written consent of Seyfarth Shaw LLP.

Legal Opinion prepared for AdvisorShares Investments, LLC

AdvisorShares Psychedelics ETF

September 10, 2021

Page 31

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement of the Fund, including any amendments and supplements thereto. In giving such consent, we do not hereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act, or the rules and regulations of the SEC thereunder.