Statement of Policies, Related Registrants and Related Mutual Funds

Statement of policies
The securities legislation of certain jurisdictions in Canada requires securities dealers and advisors, when they trade in or advise with respect to their own securities or securities of certain other issuers to which they, or certain other parties related to them, are related or connected, to do so only in accordance with particular disclosure or other rules. In certain provinces, these rules require dealers and advisors, prior to trading with or advising their clients, to inform them of the relevant relationships and connections with the issuer of the securities. For the particulars of these rules and their rights, clients should refer to the applicable provisions of the securities legislation or consult a legal advisor.

Definitions

An issuer of securities is “related” to NBF if, through the ownership of, or direction or control over voting securities, NBF exercises a controlling influence over that issuer, that issuer exercises a controlling influence over NBF or the same third party exercises a controlling influence over each of NBF and that issuer. In some jurisdictions, some connected issuers may be considered related issuers.

Related Issuers to NBF
National Bank Financial Inc. and National Bank Financial Ltd. are wholly owned subsidiaries of National Bank. National Bank is a reporting issuer under applicable securities law and is a related issuer to NBF.

Connected Issuers to NBF
The entities are considered connected issuers to NBF as at the date of this Account Booklet:

National Bank Mutual Funds (including the Omega Funds): National Bank Securities Inc., a wholly owned subsidiary of National Bank, is the manager of all National Bank Mutual Funds, including the Omega Funds. Natcan Investment Management Inc. is the advisor of most of National Bank Mutual Funds. National Bank has an indirect controlling interest in Natcan Investment Management Inc.

Emissary and Diplomat Portfolios: NBF Emissary Turnkey Solution LP, a wholly owned subsidiary of National Bank Financial Inc., itself a wholly owned subsidiary of National Bank, is the manager and trustee of the Emissary and Diplomat Portfolios.

Altamira Funds: National Bank Securities Inc., a wholly owned subsidiary of National Bank, is the manager and acts as principal for all Altamira Funds.

Natcan Investment Management Inc. is the advisor of most of the Altamira Funds. National Bank has an indirect controlling interest in Natcan Investment Management Inc.

The Natcan QSSP II Investment Fund Inc.: Natcan Investment Management Inc. is the manager of The Natcan QSSP II Investment Fund Inc. All Class B Shares which are voting shares are held by Natcan Investment Management Inc. National Bank Financial Inc. is the principal distributor of The Natcan QSSP II Investment Fund Inc.

Meritage Portfolios: National Bank Securities Inc., a wholly owned subsidiary of National Bank, is the manager of the Meritage Portfolios. National Bank Trust Inc., a subsidiary of National Bank, is the advisor of the Meritage Portfolios.

NBC Asset Trust: This trust is an open-ended trust whose voting units are held by National Bank. Consequently, NBC Asset Trust is deemed to be a connected issuer.

NBC Capital Trust: This trust is an open-ended trust whose voting units are held by National Bank. Consequently, NBC Capital Trust is deemed to be a connected issuer.

In carrying on business as a full service securities dealer, NBF may from time to time engage in the following activities in respect of National Bank or other related issuers to NBF, and in the course of a distribution, of securities of National Bank and other connected issuers to NBF:

• act as an underwriter or selling group member in connection with the distribution of such securities;
• sell such securities to or on behalf of clients of NBF;
• purchase such securities from or on behalf of clients of NBF;
• with the written consent of the client, exercise discretionary authority to buy or sell such securities;
• act as an advisor in respect of such securities;
• make recommendations in respect of such securities; and
• offer for sale securities, goods and services which include securities, goods or services issued or provided by National Bank or cooperate with National Bank in the joint offering for sale or the sale of securities, and goods or services.

It is the policy of NBF to comply fully with all applicable securities legislation and to make all required disclosure in acting as advisor, dealer or underwriter in respect of securities of National Bank and other related or connected issuers of NBF including:

• before advising in respect of the purchase or sale of securities of a related issuer, or in the course of a distribution, in respect of securities of a connected issuer, informing the client either orally or in writing of the relationship or connection between the registrant and the issuer of the securities;
• before exercising discretionary authority in respect of the securities of a related issuer or of a connected issuer, and, in the provinces of Alberta, Ontario and Newfoundland, once each twelve months thereafter, providing the client with its current Statement of Policies, and, if necessary, obtain specific and informed written consent of the client to the exercise of the discretionary authority; and
• where NBF purchases securities from or sells securities to a subsidiary or affiliate, the dealing will be done on the basis that the transaction price for a given security together with the brokerage commission applicable to such trade, is as good or better than that offered by an unaffiliated third party broker in an arms-length transaction.

Alberta Clients

NBF has a relationship with the persons or companies listed in this statement. NBF or its directors, officers or other employees may, from time to time, recommend that you trade in, or provide to you advice about, a security issued by those listed persons or companies. If you wish further information concerning the relationship between NBF and those listed persons or companies, please contact us.

RELATED REGISTRANTS

Securities legislation requires a securities dealer or advisor to advise clients if it has a principal shareholder, officer, partner or director that is also a principal shareholder, officer, partner or director of another registrant under such legislation and to describe the policies and procedures adopted to minimize the potential for conflicts resulting from these relationships. As used in this document, “principal shareholder” means a person or company that is the direct or indirect registered or beneficial owner of more than 10% of any class or series of voting securities of the person or company.

National Bank or NBF, a wholly owned subsidiary of National Bank, is the principal shareholder of the following registrants:

  · CABN Investments Inc.;

  · Innocap Investment Management Inc.;

  · Natcan Investment Management Inc.;

  · Natcan Trust Company;

  · National Bank Direct Brokerage Inc.;

  · National Bank of Canada Financial Inc.;

  · National Bank Securities Inc.;

  · National Bank Trust Inc.;

  · NBC Alternative Investments Inc.;

  · NBCN Inc.;

  · NBF Securities (USA) Corp.;

  · NBF International S.A.;

  · PI Financial Corp.;

  · Wellington West Capital Inc.;

  · Wellington West Capital Markets Inc.;

  · Wellington West Financial Services Inc.; and

  · Wellington West Total Wealth Management Inc.

NBF obtains from or provides to the above related registrants management, administrative, referral and/or other services in connection with its ongoing business activities or the ongoing business activities of these other companies or transactions completed by it or these other companies. These relationships are subject to certain legislative and industry regulatory requirements which impose restrictions on dealing between related registrants intended to minimize the potential for conflict of interest resulting from these relationships. NBF has also adopted internal policies and procedures which supplement these requirements, including its policies on confidentiality of information.

Related Mutual Funds

National Instrument 81-105 on Mutual Fund Sales Practices require that NBF makes certain disclosures to account holders concerning related mutual funds and obtain their consent to trade in such funds.

NBF is affiliated with the following members of the organization of several families of mutual funds, which are entities within the National Bank of Canada group:

  · National Bank Mutual Funds (including the Omega Funds);

  · Emissary and Diplomat Portfolios;

  · Altamira Mutual Funds;

  · The Natcan QSSP II Investment Fund.; and

  · Meritage Portfolios.

For more information regarding each mutual fund, please refer to the section “Connected Issuers to NBF”.