DAVIS-REA POOLED FUNDS Offering Class A, Class B, Class F and Class O units of:

DAVIS-REA BALANCED FUND* DAVIS-REA EQUITY FUND * DAVIS-REA FIXED INCOME FUND * DAVIS-REA PARTNERS FUND DAVIS-REA ENHANCED INCOME FUND

This offering memorandum has been prepared by Davis-Rea Ltd., as manager of the Davis-Rea Pooled Funds, and is being furnished solely for use by prospective investors in such funds. This offering memorandum is not and under no circumstances is to be construed as a prospectus relating to a public offering of the securities described herein. No securities commission or similar regulatory authority has in any way passed upon the merits of the securities offered hereby nor has it reviewed this offering memorandum and any representation to the contrary is an offence.

October 30`h, 2013

* These Funds are being offered under this offering memorandum in all of the provinces and territories except for Ontario.

SUMMARY The following is a summary only and is qualified by the more detailed information contained in this offering memorandum. Investors should consult their own advisors before investing in a fund.

Davis-Rea Pooled Funds

Five funds are offered herein, the Davis-Rea Balanced Fund (the Balanced Fund), the Davis-Rea Equity Fund (the Equity Fund), the Davis-Rea Fixed Income Fund (the Fixed Income Fund), the Davis-Rea Partners Fund (the Partners Fund) and the Davis-Rea Enhanced Income Fund (the Enhanced Income Fund). Each fund is an open-end unit trust governed under the laws of Ontario by a trust agreement. Davis-Rea Ltd. is the manager and CIBC Mellon Trust Company is the trustee of each fund.

Investment Objective

Balanced Fund*

The Balanced Fund seeks to preserve capital and to minimize market fluctuations while generating superior long-term returns by primarily investing in a combination of equity and fixed income investments. At the discretion of the Manager, the Balanced Fund may also hold cash and/or short-term money market instruments, and may from time to time invest in units of one or more of the other funds.

Equity Fund*

The Equity Fund seeks to preserve and enhance capital by primarily investing in Canadian, U.S. and international equity securities for longterm gain. At the discretion of the Manager, the Equity Fund may also hold cash and/or short-term money market instruments, and convertible debentures, and may from time to time invest in units of one or more of the other funds.

Fixed Income Fund*

The Fixed Income Fund seeks to preserve capital while providing income and some capital gains by primarily investing in bonds and fixed income securities with a strong credit rating. At the discretion of the Manager, the Fixed Income Fund may also hold cash and/or short-term money market instruments, preferred shares and conve rtible debentures, and may from time to time invest in units of one or more of the other funds.

Partners Fund

The Partners Fund seeks to achieve long-term capital appreciation by primarily investing in Canadian, U.S. dollar and internationally denominated equity securities for long-term gain. At the discretion of the Manager, the Partners Fund may also hold cash, short-term money market instruments and/or fixed income securities, and may from time to time invest in units of one or more of the other funds. The activities of the Partners Fund may also include sho rt selling derivative products and the use leverage from time to time, as determined by the Manager.

Enhanced Income Fund

The Enhanced Income Fund seeks to provide income and capital appreciation by primarily investing in a diversity of Canadian, U.S. and international fixed income securities for short-term and long-term gain. At the discretion of the Manager, the Enhanced Income Fund may also hold cash, short-term money market instruments and/or equity securities and may from time to time invest in units of one or more of the other funds.

* These Funds are being offered under this offering memorandum in all of the provinces and territories except for Ontario.

The activities of the Enhanced Income Fund may also include short selling, derivative products and the use leverage, as determined by the Manager. Risk Factors

Investing in units of a class of a fund is subject to various risk factors including fluctuations in the equity markets, foreign currencies and interest rates, and the use of options, sho rt selling and derivatives. Investors should realize that there is no guarantee that an investment in a fund will earn a positive return in the sho rt or long-term.

Manager

Davis-Rea Ltd., as the manager and promoter of each fund, (the Manager) is responsible for the day-to-day business of each fund, including investment management services.

Trustee

CIBC Mellon Trust Company, as the tr ustee of each fund, (the Trustee) is responsible for ce rtain day-to-day adminis tr ative activities for each fund.

Custodian

CIBC Mellon Trust Company is the custodian for each fund.

Fund Administrator

The Manager has appointed CIBC Mellon Global Securities Services Company as the administrator for each fund to assist with the adminis tr ation of each fund.

Classes / Units

Each fund offers an unlimited number of class A units, class B units, class F units and class O units to qualified investors. Each class of units of a fund represents an undivided interest in the net assets of that class of units of the fund. Additional classes of units of a fund can be created at the discretion of the Manager with such terms and conditions as it determines. Each class of units of a fund is entitled to participate in distributions made by the fund and in its net assets if the fund is terminated. Each unit of a class of a fund is also entitled to one vote at any meetings of unitholders of the fund. No unit certificates will be issued to investors.

The Offering

A qualified investor can, at the Manager's discretion, buy class A units, class B units, class F units or class O units of: - the Balanced Fund, the Equity Fund and the Fixed Income Fund on the close of business on each business day of the week; or - the Partners Fund and the Enhanced Income Fund on the last business day of each month; on or before 4:00 p.m. (Toronto time) on such day or on such other dates as the Manager may agree to from time to time, including December 31'` of each year, (each a Valuation Date) in Canadian dollars at the net asset value (NAV) of that class of units of the fund on the applicable Valuation Date of the fund in any province or territory of Canada (each an Offering Jurisdiction) pursuant to applicable prospectus exemptions. Class A units of a fund are typically intended for accredited investors or investors investing at least $150,000 in units of a class of a fund, or $500,000 in the case of the Enhanced Income Fund and who purchase their units from Davis-Rea Ltd. Class B units of a fund are typically intended for accredited investors or investors investing at least $150,000 in units of a class of a fund, or -2-

$500,000 in the case of the Enhanced Income Fund and who purchase their units from a third party dealer. Class F units of a fund are typically intended for accredited investors or investors investing at least $150,000 in units of a class of a fund, or $500,000 in the case of the Enhanced Income Fund and who purchase their units from a third party dealer and who participate in a fee based program with such dealer. Class O units of a fund pay a management fee directly to the Manager pursuant to a class O management agreement for that fund. Class N units of a fund can only be purchased by another fund. Buying class A, class B or class F units of a fund may be subject to a front end sales charge. The Manager reserves the right to accept or reject an investor's subscription for units of a class of a fund, and may change minimum investment amounts, distribution policies and when units of a fund can be purchased from time to time. Any monies received with a subscription order that the Manager rejects will be promptly returned to the investor without interest. Management Fee

For providing services to a fund, the Manager receives a management fee (the Management Fee) from the class A, class B and class F units of each fund. The Management Fee charged to such classes of units, as set out below, are only borne by the holders of such units.

Fee Schedule

Fund

Class A

Class B

Class F

Balanced Fund Equity Fund Fixed Income Fund Partners Fund Enhanced Income Fund

1.75% 1.75% 1.75% 2.00% 1.25%

2.00% 2.00% 2.00% 2.25% 1.50%

1.50% 1.50% 1.50% 1.75% 1.00%

Each holder of class O units of a fund pays a Management Fee directly to the Manager pursuant to a class O management agreement for that fund. No management fee is charged when one fund invests in class N units of another fund. The Manager will pay a portion of its Management Fee in respect of class B units of a fund to dealers who distribute units of that fund. Performance Fee for Enhanced Income Fund

In addition to the Management Fee, a performance fee (the Performance Fee) is calculated and accrued on each Valuation Date of the Enhanced Income Fund and is payable to the Manager on the last Valuation Date of each year (each, a Performance Valuation Date) in respect of each class of units of the Enhanced Income Fund, which is equal to ten percent (10%) of the amount by which the Adjusted Net Asset Value (as defined below) of that class of units of the Enhanced Income Fund on a Performance Valuation Date exceeds that High Water Mark (as defined below) of that class of units of the Enhanced Income Fund on that Performance Valuation Date. -3-

If any units of any class of the Enhanced Income Fund are to be redeemed prior to the last Valuation Date of a year, the Manager will determine if any Performance Fee is owing on such units on the basis outlined above immediately before such units are redeemed. If a Performance Fee is owing on such units, it will be accrued and paid to the Manager as soon as possible. Adjusted Net Asset Value of a class of units of the Enhanced Income Fund on any Valuation Date means the NAV of that class of units of the Enhanced Income Fund on such date, excluding any subscriptions or redemptions for units of that class on such date and before any Performance Fee is calculated, but including any distributions that have been paid to the unitholders of such units. In the case of Class O units of the Enhanced Income Fund, the NAV of the Class O units of the Enhanced Income Fund will also be reduced by any management fees that are directly paid to the Manager outside of the Enhanced Income Fund. High Water Mark for a class of units of the Enhanced Income Fund initially means the NAV of each unit of that class of the Enhanced Income Fund when such unit is issued less any redemptions, plus five percent (5%). When a Performance Fee for a class of units of the Enhanced Income Fund is accrued, the High Water Mark for that class of units of the Enhanced Income Fund will be reset as being equal to that NAV of that class of units of the Enhanced Income Fund on such date and will include the NAV of each unit of that class of the Enhanced Income Fund when such unit is subsequently issued less any redemptions that subsequently occur, plus five percent (5%).

If a Performance Fee is charged to a class of units of the Enhanced Income Fund, the NAV of that class of units will be reduced accordingly and the Performance Fee will be indirectly bo rne by the unitholders of that class of units. Trustee Fee

Each fund pays the Trustee a trustee fee and such other fees as are negotiated between the Trustee and the Manager from time to time.

Operating Expenses

Each fund is responsible for the payment of all of its operating expenses, including the costs of establishing that fund, legal and audit fees, bookkeeping charges, accounting, transfer agency services, custodial charges, preparing this offering memorandum and any marketing and/or sales materials about that fund, and all services required in connection with the provision of information to unitholders of that fund. Such fees and expenses are allocated, to the extent applicable, amongst each fund's classes of units in a manner that the Manager determines is fair and reasonable in the circumstances.

Distributions

Distributions may be made by a fund of all or any part of its net income and net realized gains or as a return of capital usually on a quarterly basis. Each fund will ensure that all of its net income and net realized capital gains, as computed for tax purposes, is distributed to its unitholders on or before December 31 ° of each year. The Manager currently intends to automatically reinvest such distributions of a fund in additional units of the same class of the fund on behalf of each unitholder, although a unitholder -4-

may elect to receive their distributions in cash. Minimum Investment

The minimum investment in the Balanced Fund, the Equity Fund, the Fixed Income Fund and the Partners Fund is $5,000 for an investor that is an accredited investor and $150,000 for an investor that is not. The minimum investment in the Enhanced Income Fund is $500,000. The Manager has the discretion to change these amounts from time to time, as permitted by applicable law.

Sales Charge

An investor does not have to pay any sales commission if they buy their units of a fund from the Manager. If units of a fund are purchased through another dealer, such dealer may charge the investor a sales commission of up to 5% of the amount that the investor invests in the fund. The sales charge is negotiable between the investor and the dealer.

Additional Investments

A unitholder of a fund can buy additional units of a class of the fund in amounts generally not less than $1,000, subject to compliance with applicable securities laws.

Net Asset Value

The NAV of a fund on a Valuation Date of the fund is equal to the fair market value of the assets of the fund on such date less its liabilities on such date. The NAV of a class of units of a fund on a Valuation Date of the fund is equal to the proportionate fair value of the assets of the fund assigned to that class of units of the fund on such date, less the liabilities attributable to that class of units of the fund on such date. The NAV per unit of a class of units of a fund on a Valuation Date of the fund is equal to the NAV of that class of units of the fund on such date divided by the number of units of that class of the fund outstanding on such date.

Redemption of Units

Units of a class of a fund may be redeemed at their NAV per units of that class of the fund on any Valuation Date of the fund, provided the Manager is advised of such request in writing at least 30 business days in advance of such Valuation Date. A request to redeem units of a class of a fund after such time will be processed at the NAV of that class of the fund on the next Valuation Date of the fund unless the Manager is prepared to waive such notice requirement. The Manager is also entitled to suspend or restrict redemption rights in ce rtain situations.

Short-Term Trading Deduction

The Manager may charge a unitholder that redeems units of a class of the Partners Fund or the Enhanced Income Fund, which they purchased within the previous 180 days, a short-term trading deduction equal to 2% of the value of the units of that class being redeemed. This deduction will be paid to the respective fund. The Manager may also charge a unitholder that redeems units of a class of the Balanced Fund, the Equity Fund or the Fixed Income Fund, which they purchased within the previous 90 days, a short-term trading deduction equal to 2% of the value of the units of that class being redeemed. This deduction will also be paid to the respective fund.

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Canadian Income Tax Considerations

Each fund is required to include in computing its income in respect of each calendar year the full amount of any gains realized on income account, dividends received by it, accrued interest and the taxable portion of net realized capital gains. Each fund may deduct in computing its income for tax purposes amounts of income (including any taxable capital gains) paid or payable to unitholders in the year. Net income and net realized taxable capital gains of a fund paid or payable in a year to unitholders are required to be included in computing the income of the unitholder for that year. Prospective investors should consult with their own tax advisers with respect to the income tax consequences to them of a proposed investment in a fund as it relates to their particular circumstances. Provided that a fund is a registered investment under the Income Tax Act (Canada) (the Tax Act) or a mutual fund trust within the meaning the Tax Act, units of such fund will be qualified investments for trusts governed by registered retirement savings plans, registered retirement income funds, deferred profit sharing plans, registered education savings plans, registered disability savings plans and tax-free savings accounts. Each fund (other than the Enhanced Income Fund) is a registered investment and the Enhanced Income Fund is in the process of applying to become a registered investment.

Statutory and Contractual Rights

Investors may be entitled to the benefit of certain statutory or contractual rights of action.

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TABLE OF CONTENTS

SUMMARY DAVIS-REA POOLED FUNDS INVESTMENT OBJECTIVE AND STRATEGIES Investment Objectives Balanced Fund Equity Fund Fixed Income Fund Partners Fund Enhanced Income Fund General Investment Restrictions RISK FACTORS MANAGEMENT OF THE FUNDS The Manager Personnel of the Manager The Trustee The Fund Administrator POTENTIAL CONFLICTS OF INTEREST FEES AND EXPENSES Management Fee Perform ance Fee Trustee Fee Operating Expenses INVESTING IN THE FUNDS Purchase of Units Minimum Investment Sales Charge Additional Investments SWITCHING BETWEEN FUNDS RECLASSIFICATION OF UNITS OF A FUND DEALER COMPENSATION Sales Charge Other Dealer Suppo rt DISTRIBUTIONS PORTFOLIO VALUATION AND NET ASSET VALUE UNITS OF THE FUNDS REDEMPTION OF UNITS Redemptions Payment in Specie Short-Term Trading Deduction Suspension and Restriction of Redemptions CANADIAN FEDERAL INCOME TAX CONSIDERATIONS Taxation of the Funds Taxation of Unitholders Deferred Income Pl ans and Qualified Investments

1 9 9 9 10 10 10 10 11 11 11 11 14 14 14 16 16 17 17 17 18 18 18 19 20 20 20 21 21 21 22 22 22 22 23 23 24 24 25 25 25 25 26 27 28

Non-Residents of C an ada AMENDMENT OF TRUST AGREEMENTS TERMINATION OF A FUND RECORDKEEPER CUSTODIAN AUDITOR LEGAL COUNSEL MATERIAL CONTRACTS RIGHTS OF ACTION FOR DAMAGES OR RESCISSION CERTIFICATE

29 29 29 29 30 30 30 30 30 43

DAVIS-REA POOLED FUNDS

Five funds are offered herein, the Davis-Rea Balanced Fund (the Balanced Fund), the Davis-Rea Equity Fund (the Equity Fund), the Davis-Rea Fixed Income Fund (the Fixed Income Fund), the Davis-Rea Partners Fund (the Partners Fund) and the Enhanced Income Fund (the Enhanced Income Fund). The Balanced Fund, the Equity Fund and the Fixed Income Fund are each an open-end unit trust governed under the laws of Ontario by an amended and restated trust agreement dated as of the 12` h day of September, 2013 between Davis-Rea Ltd., as the manager of each such fund, and CIBC Mellon Trust Company, as the trustee of each such fund (the Public Fund Trust Agreement). The Partners Fund and the Enhanced Income Fund are each an open-end unit trust governed under the laws of Ontario by an amended and restated trust agreement dated the 12 t1' day of September, 2013 between Davis-Rea Ltd., as the manager of each such fund, and CIBC Mellon Trust Company, as the trustee of each such fund (the Pooled Fund Trust Agreement, and together with the Public Fund Trust Agreement, the Trust Agreements). Davis-Rea Ltd. is the manager and promoter of the funds (the Manager). CIBC Mellon Trust Company is th e trustee of the funds (the Trustee) and is also the custodian of the funds (the Custodian). CIBC Mellon Global Securities Se rv ices Company is the administrator of each fund (the Fund Administrator). The head office of the Manager is 79 Wellington Street West, Suite 3535, P.O. Box 239, Toronto, Ontario, M5K 1J3. Copies of the Trust Agreements and the other material contracts of th e funds may be viewed at the offi ce of the Manager during business hours. Qualified investors can buy either class A units, class B units, class F units or class O units of a fund in Canadian dollars. Class A units are intended for accredited investors or investors investing at least $150,000 in the case of the Balanced Fund, th e Equity Fund, the Fixed Income Fund and the Partners Fund, and at least $500,000 in the case of the Enhanced Income Fund and who purchase their units from Davis-Rea Ltd. Class B units are intended for accredited investors or investors investing at least $150,000 in the case of th e Balanced Fund, the Equity Fund, the Fixed Income Fund and th e Partners Fund, and at least $500,000 in the case of the Enhanced Income Fund and who purchase their units from a third party dealer. Class F units are intended for accredited investors or investors investing at least $150,000 in th e case of the Balanced Fund, the Equity Fund, the Fixed Income Fund and the Partners Fund, and at least $500,000 in the case of the Enhanced Income Fund and who purchase their units from a third party dealer and who participate in a fee based program with such dealer. Class O units are intended for investors who pay a Management Fee directly to th e Manager pursuant to a class O management agreement for that fund. There is no maximum amount that may be invested in a fund, and the Manager may decide to offer additional classes of units of a fund in the future. INVESTMENT OBJECTIVE AND STRATEGIES Investment Objectives

Each fund seeks to provide investors with an opportunity to achieve ce rt ain investment objectives that are appropriate for their investment goals.

9

Balanced Fund* The investment objective of the Balanced Fund is to preserve capital and to minimize market fluctuations while generating superior long-term returns by primarily investing in a combination of equity and fixed income investments. The Manager may shift the weighting of the Balanced Fund's assets from time to time based on its assessment of the markets. The equity securities and fixed income investments held by the Balanced Fund may include foreign securities. Usually, the Manager will not invest the Balanced Fund in such investments unless they have a rating of B or higher. The duration of any fixed income investment held by the Balanced Fund will also vary depending on the Manager's assessment of the direction of interest rates. At the discretion of the Manager, the Balanced Fund may also hold cash and/or short-term money market instruments, and may from time to time invest in units of one or more of the other funds. The Balanced Fund may also invest in preferred shares and convertible debentures. Equity Fund* The investment objective of the Equity Fund is to preserve and enhance capital by primarily investing in Canadian, U.S. and inte rnational equity securities for long-term gain. Securities for the Equity Fund will be selected by the Manager based on its assessment of the markets and potential investment opportunities. The Manager intends to focus the Equity Fund on various sectors of the economy from time to time, and will typically only invest in large to medium capitalized companies with a market capitalization of not less than $250 million. Any exceptions to this market capitalization will be limited 10% of the value of the Equity Fund. Derivatives may also be used by the Manager from time to time to hedge against losses from movements in the stock markets or to realize additional gains. At the discretion of the Manager, the Equity Fund may also hold cash and/or short-term money market instruments, and conve rtible debentures, and may from time to time invest in units of one or more of the other funds. Fixed Income Fund* The investment objective of the Fixed Income Fund is to preserve capital while providing income and some capital gains by primarily investing in bonds and fixed income securities with a strong credit rating. The fixed income investments held by the Fixed Income Fund may include government securities and bonds issued by foreign governments and issuers. Usually, the Manager will not invest the Fixed Income Fund in such investments unless they have a rating of B or higher. The duration of any fixed income investment held by the Fixed Income Fund will also vary depending on the Manager's assessment of the direction of interest rates. It is not expected that any single issuer will represent more than 20% of the Fixed Income Fund's investment portfolio. At the discretion of the Manager, the Fixed Income Fund may also hold cash and/or short-term money market instruments, preferred shares and conve rtible debentures, and may from time to time invest in units of one or more of the other funds. Partners Fund The investment objective of the Partners Fund is to provide capital appreciation by primarily investing in Canadian, U.S. and international equity securities for short-term and long-term gain. Securities for the Partners Fund will be selected by the Manager based on its assessment of the markets and potential investment opportunities. The Manager intends to focus the Partners Fund on various sectors of the economy from time to time, and will typically invest in small and medium capitalized companies, as well as larger capitalization companies. Derivatives and currency hedges may also be used by the Manager from time to time to hedge against losses from movements in the stock markets or to realize additional * These Funds are being offered under this offering memorandum in all of the provinces and territories except for Ontario. -10-

gains. At the discretion of the Manager, the Partners Fund may also hold cash, short-term money market instruments, fixed income securities, including bonds, warrants, forwards, futures contracts and distressed debt securities, and may from time to time invest in units of one or more of the other funds. The Partners Fund may also engage in sho rt selling and use leverage from time to ti me, as determined by the M an ager. Enhanced Income Fund

The investment objective of the Enhanced Income Fund is to provide income and capital appreciation by primarily investing in a diversity of Canadian, U.S. and international fixed income securities for sho rtterm and long-term gain. Securities for the Enhanced Income Fund will be selected by the M an ager based on its assessment of the markets and potential investment opportunities. The Manager intends to focus the Enhanced Income Fund on various sectors of the economy, and might invest in small and medium capitalized companies, as well as larger capitalization companies. Derivatives and currency hedges may also be used by the Manager from time to time to hedge against losses from movements in fixed income and equity markets or to realize additional gains. Government bonds may be sold sho rt to reduce interest rate risk. At the discretion of the Manager, the Enhanced Income Fund may also hold cash, short-term money market instruments, fixed income securities (including government bonds, investment-grade corporate bonds, high-yield bonds, credit-linked notes, credit default swaps, asset swaps, asset-backed securities, mortgage-backed securities, collateralized debt, government agencies, conve rt ible debentures and bank loans), equities (including common shares, preferred shares, income trusts and royal ty trusts), warrants, forwards, futures contracts and distressed debt securities, and may from time to time invest in units of one or more of the other funds. The Enhanced Income Fund may use derivative instruments to achieve its investment objective. The Enhanced Income Fund may also engage in sho rt selling and use leverage, as determined by the Manager. General

Each fund may also make such other investments and carry on such activities as the Manager considers consistent with that fund's investment objectives, including entering into securities lending arrangements. Investment Restrictions

Each fund will only hold investments that may be held by a "mutual fund trust" under the Income Tax Act (Canada) ( th e Tax Act). As each fund, is or in the case of the Enhanced Income Fund will be, a registered investment under the Tax Act for trusts governed by registered retirement savings plans, registered retirement income funds, deferred profit sharing plans, registered education savings plans, registered disability savings plans and tax-free savings accounts (each a Registered Plan), each fund will refrain from any investment which would make it liable for a material amount of penal ty tax under the Tax Act for investments that may not be held by a Registered Plan. RISK FACTORS

An investment in a fund can involve significant risks and is not intended as a complete investment program. There is a risk that an investment in a fund may be lost entirely or in pa rt . Investors should consider, among others, th e following risk factors before investing, which is not intended to be a complete list of th e risk factors that may arise as a result of investing in a fund. Investors should also read this offering memorandum and consult with their advisors before deciding to invest in a fund. Risk of Obtaining Investment Objectives While the Manager believes that each fund's investment policies will be successful over the long-term, there can be no guarantee against losses resulting from an investment in units of a class of a fund and

there can be no assurance that a fund's investment approach will be successful or that its investment objective will be attained. Any investment may decline in value and a fund may realize substantial losses, rather than gains, from some or all of its investments. Lack of Operating History With the exception of the Balanced Fund, which was established in 2003, the Equity Fund, the Fixed Income Fund and the Partners Fund are relatively new have a limited operating history. The Enhanced Income Fund is new and does not have an operating history. In addition, the past performance of the Balanced Fund may not be indicative of its future performance. General Economic Conditions The success of a fund's activities may be affected by general economic and market conditions, such as interest rates, availability of credit, inflation rates, economic uncertainty, changes in laws and national and international political developments. These factors may affect the value and liquidity of a fund's investments. Unexpected volatility or illiquidity may also impair a fund's profitability or result in losses. Interest Rate Fluctuations The value of a fund's investments in bonds, debentures, notes and other fixed-income debt instruments will vary with interest rates. When interest rates rise, the value of securities with a fixed rate of interest will decline. Conversely, when interest rates fall, the value of such securities will increase. Company Risk and Stock Market Risk If there is negative news about a company in which a fund invests, its shares may lose value, causing the value of the investment to change. For example, the value of an investment in a particular company may change if that company's shares fall with the rest of the stock market. If a fund has a long position in these securities, such loss in the securities will decrease the value of the fund. Conversely, positive news about a company or a general rise in the value of the equity markets may cause the value of the company's stock to increase and may increase the value of a fund. Liquidity Constraints A fund's investments may be subject to liquidity constraints because of insufficient depth or volume on the trading markets the fund's securities trade on. The trading or restricted or illiquid securities may also result in higher brokerage costs, and may sell at a lower price than other similar securities. Foreign Investment Risks A fund's investment in foreign securities may be affected by economic conditions in that foreign count ry , the stock markets in such countries may not be as stable and financial data and information may be less reliable than it would be in No rt h America. Political instability and social unrest may also affect a fund's investment in foreign securities. Investments in a foreign investment in a foreign currency may also affect a fund's NAV depending on how the value of such foreign currency changes as compared to changes in the Canadian dollar. Net Asset Value The value of a fund's investments may fluctuate as a result of various factors, including general economic conditions and fluctuations in the securities markets. A fund's investment strategies may not be successful and there can be no guarantee that an investment in the fund may not decline in value. - 12 -

Multi-Class Risk Each fund has issued more than one class of units and in the future may issue additional classes of units. Notwithstanding the fact that a fund may issue more than one class of units, the fund may be treated as one entity. As a result, all of the assets of a fund may be available to meet all of th e liabilities of each class of units of the fund. As a result, the investment performance, expenses or liabilities of one class of units of a fund may affect the value of another class of units of the fund. However, this is only expected to be an issue if a fund becomes insolvent or is unable to meet all of its liabilities. Short Sales The Manager may, if it believes a security to be over-valued, take a sho rt sale position without maintaining or having a right to obtain an equivalent quantity of the security in a fund's investment po rt folio. Sho rt sales may expose a fund to losses if the value of th e security increases. A fund might also have to borrow securities to enter into a sho rt sale which may expose th e fund to additional fees. Reliance on Key Personnel The success of each fund is dependent on the successful implementation of its investment objectives and strategies by the Manager. The death, disability or withdrawal of a senior employee of the Manager could adversely affect each fund. Restriction or Suspension of Redemption Rights The Manager may from time to time restrict redemptions of units of a fund if normal trading is suspended on any stock exchanges on which securities are listed and traded which represent 50% or more of the value of the assets of the fund, or in ce rt ain other instances. Unitholder Liability Although th e intention is that only the assets of a fund are available to pay its liabilities, because of uncertainties in the law there is a risk that a unitholder of a fund could be held personally liable for the obligations of the fund. However, each fund will be operated in a manner to minimize this risk, and the Manager does not believe that this is a factor that unitholders need to be concerned about. Conflicts of Interest A fund may be subject to various conflicts from time to time, partially because the Manager has other clients and may have different obligations to such clients, including as a result of its different regis tr ations. The Manager will endeavour to treat all of its clients fairly in accordance with any applicable legal requirements, and to allocate investment opportunities amongst its clients in an equitable and appropriate manner. When retaining se rv ice providers on behalf of a fund, including dealers, th e Manager will ensure that all transactions undertaken on behalf of the fund are done on a best execution basis. Effect of Redemptions and Termination A significant redemption of units of a fund may have a significant adverse affect on a fund's performance In addition, a fund could be terminated at any time. Either event may create adverse tax and/or economic consequences for the unitholders of the applicable fund, depending on the timing of such redemption or termination.

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.

MANAGEMENT OF THE FUNDS The Manager

The Manager is responsible for the day-to-day administration of each fund, including investment management se rvices. The Manager provides or will cause to be provided, among other things, administrative, accounting, valuation, unitholder records and other administrative se rvices for each fund. The head office of the Manager is 79 Wellington Street West, Suite 3535, P.O. Box 239, Toronto, Ontario, M5K 1J3. The services of the Manager are not exclusive to the funds, and nothing prevents the Manager from providing similar serv ices to other investment funds and other clients (whether their investment objectives and policies are similar to those of the funds) or from engaging in other activities. In the course of providing serv ices to the funds, the Manager will attempt to avoid potential conflicts of interest that may arise, including with respect to its registration as a portfolio manager and exempt market dealer. In acting on behalf of the funds, the Manager shall always exercise the care, diligence and skill that a professional investment manager would exercise in the circumstances then prevailing. In accordance, with the Trust Agreements, the Manager is entitled to be indemnified by the funds, unless the indemnification is arising as a result of the Manager's gross negligence, wilful misconduct or failure to meet its aforementioned standard of care. Personnel of the Manager

As at the date hereof, the name and municipality of residence of each officer of the Manager is as follows: Name and Municipality of Residence Title

John O'Connell, CFA Toronto, Ontario

Chairman, Chief Executive Officer and Po rtfolio Manager

Zachary Curry, MBA Toronto, Ontario

Chief Operating Officer, Chief Financial Officer and Portfolio Manager

Douglas Davis, MBA Toronto, Ontario

Vice Chairman and Po rtfolio Manager

Mark Wisniewski, BComm Toronto, Ontario

Executive Vice President and Po rtfolio Manager

John Johnston, PhD Toronto, Ontario

Executive Vice President and Chief Strategist

Ana Maria Galarza Toronto, Ontario

Treasurer

John O'Connell

John O'Connell is the Chairman and Chief Executive Officer of the Manager. John has 25 years of investment experience. His past role was as a founder of the Harbour Group of RBC Dominion Securities where advised on assets exceeding $2.8 billion. John provides the strategic direction of the Manager and is Chairman of its Investment Committee. - 14 -

He is a Fellow of the Canadian Securities Institute and is a Chartered Financial Analyst. He is frequently quoted in national newspapers and is a frequent contributor to local and national television. Zachary Curry Zachary Cur ry is a Portfolio Manager and the Chief Operating Officer of the Manager. As a Portfolio Manager, Zach is responsible for determining asset allocation strategies for current and prospective clients, as well as selecting and implementing appropriate investments to fulfill discretionary client mandates. As Chief Operating Officer, Zach manages the day-to-day affairs of the Manager, including compliance, information technology and po rt folio management trading systems. Zach is also a member of the Manager's investment committee. Prior to joining the Manager, Zach spent four (4) years in the research and investment banking departments of two well-known Canadian boutique investment firms. Zach has a Bachelor of A rt s degree (Financial & Economic Studies) and a Master of Business Administration degree, both from the University of Western Ontario. Douglas Davis Douglas Davis is the Vice Chairman of the Manager and has had a 46 year career in financial se rv ices. Early in his career he was in commercial banking, securities analysis and sales, venture capital management and investment banking. He has spent the last 31 years of his career with the Manager and its predecessor companies. His skills include securities analysis and po rt folio management and he is a key member of the Manager's investment committee. Doug studied Economics at Princeton University and holds an MBA from the University of Western Ontario. Mark Wisniewski Mark Wisniewski is an Executive Vice President and Portfolio Manager, specializing in Fixed Income. Mark has 30 years of investment experience. He joined the Manager from Gluskin Sheff and Associates where he was a VP & Po rt folio Manager responsible for over $4 billion in fixed income credit strategies. Prior to this he was a Vice Chair at TD Securities responsible for Global Fixed Income. His extensive experience in the management, trading and analysis of debt securities has given him significant insight into the investment process. Throughout his career, Mark has traded the full spectrum of fixed income, heading liability trading, sales, origination and research for TD Securities, Goldman Sachs and BMO Nesbitt Burns. Mr. Wisniewski received a Bachelor of Commerce degree from Universi ty of Toronto in 1983. John Johnston John Johnston is Chief Strategist at the Manager, where he provides research and advice exclusively tailored to the needs of the firm's clients. John is pa rt of a nimble and disciplined Investment Committee whose number one goal is to provide unbiased and objective investment advice.

John has over 20 years of experience in the financial sector. His extensive background in analyzing developments in global financial markets has earned him widespread respect. Prior to joining Davis Rea Ltd., John spent 18 years at RBC, serving as Chief Strategist of The Harbour Group, Chief Economist and Managing Director at RBC Capital Markets, and Deputy Chief Economist of Royal Bank of Canada. John obtained his Ph.D at the Universi ty of Toronto, after obtaining his MA from the Universi ty of Waterloo and his BA from York Universi ty. He has lectured at the Universi ty of Toronto and the University of Waterloo. He is very active professionally, serving on an advisory committee at Ryerson University, as President of the Toronto Association for Business and Economics, on the Board of Directors of the Canadian Socie ty of Technical Analysts, and as a Council member for the Royal Canadian Institute for the Advancement of Science. Ana Maria Galarza Ana Maria Galarza is the Treasurer of the Manager. Ana Maria's responsibilities include presenting and updating operational budgets, as well as preparing the financial statements for the Board of Directors. Ana Maria prepares accounts for audit purposes and acts as the liaison with the firm's auditors. She is also responsible for cash management, cash flow projections and financial record keeping. Ana Maria ensures that all financial regulatory filings are up to date, and she is a valuable member of the firm's Operations Committee. Prior to joining the Manager, Ana Maria spent two (2) years as a Senior Tax Preparer at a private bookkeeping and accounting company. Ana Maria has a Certificate of Business Adminis tration — Accounting Diploma from Sheridan College; has completed the Canadian Securities Course and is a student in the CGA Program of Professional Studies. The Trustee CIBC Mellon Trust Company is the trustee of each fund and is responsible for certain day-to-day activities for each fund. The principal office of the Trustee is located at 320 Bay Street, Toronto, Ontario, M5H 4A6.

In performing its duties on behalf of each fund, the Trustee shall exercise the care, diligence and skill that a person of ordinary prudence would exercise in dealing with the property of another person. Pursuant to the Trust Agreements, the Trustee may resign on 90 days' prior written notice or may be removed by the Manager on 90 days' prior written notice, or such shorter period of time as the pa rties may agree to. The Trust Agreements also provide that the Trustee has a right of indemnification in carrying out its duties for each fund, the indemnification is arising as a result of the Trustee's gross negligence, wilful misconduct or dishonesty. The Fund Administrator CIBC Mellon Global Securities Services Company is the administrator of each fund pursuant to an amended fund administration se rvices agreement made as of the 31 5` day of May 2011 between the Manager and the Fund Administrator (the Fund Administration Services Agreement). Pursuant to the Fund Administration Agreement, the Manager has appointed the Fund Administrator to provide ce rtain

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administrative serv ices to each fund, including fund valuation, unitholder recordkeeping and tax preparation. POTENTIAL CONFLICTS OF INTEREST

The Manager may provide investment management se rvices to other accounts and funds that may or may not have investment programs similar to the funds. The se rvices of the Manager to the funds are not exclusive, and nothing prevents the Manager from providing similar se rv ices to other investment funds and other clients (whether their investment objectives and policies are similar to those of a fund) or from engaging in other activities. Participation in specific investment opportunities may be appropriate, at times, for a fund and one or more other clients of the Manager. In such cases, pa rticipation in such opportunities will be allocated on an equitable basis. Although other clients, including a fund, may pursue similar investment objectives, the portfolio of a fund and such other clients may differ as a result of subscriptions and redemptions being made at different times and in different amounts. The Manager may also give advice and recommend securities to other clients which may differ from advice given to, or securities recommended, or bought, for a fund. The Manager may also engage in investment activities for its own account and for family members and friends. Such activities may involve the purchase and sale of securities that are the same as, but in different concen trations or at different times than, those purchased or sold by a fund. In the course of providing se rvices to the funds, the Manager will attempt to avoid potential conflicts of interest, by discharging its duties as manager and po rtfolio advisor of the funds, in accordance with its aforementioned standard of care. In addition, the Manager shall not undertake any trading activities on behalf of a fund, unless such trades are transacted at prices which generally reflect current market rates. FEES AND EXPENSES Management Fee

For providing se rvices to a fund, the Manager receives a management fee (the Management Fee) from each class of units of the fund. The Management Fee charged to a class of units of a fund, as set out below, is only borne by the holders of units of that class of the fund. Fund

Class A Units

Class B Units

Balanced Fund Equity Fund Fixed Income Fund Partners Fund Enhanced Income Fund

1.75% 1.75% 1.75% 2.00% 1.25%

2.00% 2.00% 2.00% 2.25% 1.50%

Class F Units

1.50% 1.50% 1.50% 1.75% 1.00%

Each holder of class O units of a fund pays a Management Fee directly to the Manager pursuant to a class O management agreement for that fund. No management fees are paid to the Manager when a fund buys class N units of another fund. The Manager will pay a portion of its Management Fee in respect of class B units of a fund to dealers who distribute units of that fund. See "Dealer Compensation Trailer Fees" -

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Performance Fee

In addition to the Management Fee, a performance fee (the Performance Fee) is calculated and accrued on each Valuation Date (as defined below) of the Enhanced Income Fund and is payable to the Manager on the last Valuation Date of each year (each, a Performance Valuation Date) in respect of each class of units of the Enhanced Income Fund which is equal to ten percent (10%) of the amount by which the Adjusted Net Asset Value (as defined below) of that class of units of the Enhanced Income Fund on a Performance Valuation Date exceeds that High Water Mark (as defined below) of that class of units of the Enhanced Income Fund on that Performance Valuation Date. If any units of any class of the Enhanced Income Fund are to be redeemed prior to the last Valuation Date of a year, the Manager will determine if any Performance Fee is owing on such units on the basis outlined above immediately before such units are redeemed. If a Performance Fee is owing on such units, it will be accrued and paid to the Manager as soon as possible. Adjusted Net Asset Value of a class of units of the Enhanced Income Fund on any Valuation Date means the NAV of that class of units of the Enhanced Income Fund on such date, excluding any subscriptions or redemptions for units of that class on such date and before any Performance Fee is calculated, but including any distributions that have been paid to the unitholders of such units. In th e case of Class O units of the Enhanced Income Fund, the NAV of the Class O units of the Enhanced Income Fund will also be reduced by any management fees that are directly paid to the Manager outside of th e Enhanced Income Fund. High Water Mark for a class of units of the Enhanced Income Fund initially means the NAV of each unit of that class of th e Enhanced Income Fund when such unit is issued less any redemptions, plus five percent (5%). When a Performance Fee for a class of units of the Enhanced Income Fund is accrued, the High Water Mark for that class of units of the Enhanced Income Fund will be reset as being equal to that NAV of that class of units of the Enhanced Income Fund on such date and will include the NAV of each unit of that class of the Enhanced Income Fund when such unit is subsequently issued less any redemptions that subsequently occur, plus five percent (5%).

If a Performance Fee is charged to a class of units of the Enhanced Income Fund, the NAV of that class of units will be reduced accordingly and the Performance Fee will be indirectly bo rn e by the unitholders of that class of units. Trustee Fee

Each fund pays the Trustee a trustee fee and such other fees as are negotiated between the Trustee and th e Manager from time to time. Operating Expenses

Each fund is responsible for the payment of all of its operating expenses, including the costs of establishing that fund, legal and audit fees, bookkeeping charges, accounting, transfer agency se rv ices, custodial charges, preparing this offering memorandum and any marketing and/or sales materials about that fund, and all se rv ices required in connection with the provision of information to unitholders of that fund. Such fees and expenses are allocated, to the extent applicable, amongst each fund's classes of units in a manner that the Manager determines is fair and reasonable in th e circumstances. In addition, a fund is generally required to pay taxes exigible under Pa rt IX of the Excise Tax Act (Canada) and the regulations made thereunder (GST/HST) on any Management Fees and most of th e

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other fees and expenses that it has to pay; including the Performance Fee in the case of the Enhanced Income Fund. Each class of units of a fund will bear, as a separate class of units of the fund, any expenses that can be specifically attributed to that class of units of the fund. Common expenses, such as audit and custody fees, and expenses and fees that are charged to the funds as a group will be allocated among all classes of units of the funds in a manner that the Manager determines is fair and reasonable in the circumstances. INVESTING IN THE FUNDS

Each class of units of each fund is offered on a continuous basis in each province and territory of Canada (each an Offering Jurisdiction). A qualified investor in an Offering Jurisdiction can, at the Manager's discretion, buy class A units, class B units, class F units or class O units of: the Balanced Fund, the Equity Fund and the Fixed Income Fund on the close of business on each business day of the week; or the Partners Fund and the Enhanced Income Fund on the last business day of each month; on or before 4:00 p.m. (Toronto time) on such day or on such other dates as the Manager may agree to, including December 31 5` of each year, (each a Valuation Date) in Canadian dollars at the net asset value (NAV) of that class of units of the fund on the applicable Valuation Date of the fund pursuant to applicable prospectus exemptions. Class A units are typically intended for accredited investors or investors investing at least $150,000 in the case of the Balanced Fund, the Equity Fund, the Fixed Income Fund and the Partners Fund, and at least $500,000 in the case of the Enhanced Income Fund and who purchase their units from Davis-Rea Ltd. Class B units are typically intended for accredited investors or investors investing at least $150,000 in the case of the Balanced Fund, the Equity Fund, the Fixed Income Fund and the Partners Fund, and at least $500,000 in the case of the Enhanced Income Fund and who purchase their units from a third party dealer. Class F units are typically intended for accredited investors or investors investing at least $150,000 in the case of the Balanced Fund, the Equity Fund, the Fixed Income Fund and the Partners Fund, and at least $500,000 in the case of the Enhanced Income Fund and who purchase their units from a third party dealer and who participate in a fee based program with such dealer. Class O units of a fund are intended for investors who pay a Management Fee directly to the Manager pursuant to a class O management agreement for that fund. Class N units of a fund, which are non-voting, can only be purchased by another fund. Buying class A, class B or class F units of a fund may be subject to a front end sales charge. The Manager may discontinue the offering of units of any class of any fund at any time. Units of a class of a fund may be redeemed at a unitholder's request based on the NAV per unit of the applicable class of the fund less any applicable charges, subject to ce rt ain rights of the Manager to suspend or restrict redemption rights.

Purchase of Units

Investors can purchase units of a class of a fund through the Manager or through representatives of their dealer in any Offering Jurisdiction. Investors who wish to subscribe for units of a class of a fund must complete, execute and deliver a subscription agreement to the Manager or a representative of their dealer, together with payment in an amount equal to the purchase price of such units and, if applicable, the amount of any commission payable to their dealer. Investors who wish to subscribe for units of a class of a fund must represent to the fund that they are not, and will not become, a "designated beneficiary" as such term is defined in the Tax Act. In general, a designated beneficiary is a unitholder of a fund that is (i) a non-resident of Canada, (ii) a non-resident-owned investment corporation, (iii) a unitholder exempt from tax under Pa rt I of the Tax Act where the unitholder's units of a class of a fund were acquired other than from the fund, or (iv) a trust or partnership with an investor who is a "designated beneficiary", subject to ce rt ain exceptions. An investor is advised to consult with his or her legal and tax advisors to determine if he or she is a designated beneficiary. The purchase price of a class of units of a fund is an amount equal to the NAV per unit of that class of the fund on the Valuation Date of the fund on which such units are purchased. Subscriptions received and accepted on or prior to 4:00 p.m. (Toronto time) for units of a class of a fund on a Valuation Date of the fund will be issued at the NAV per unit for that class of the fund on that Valuation Date. Subscriptions received and accepted after 4:00 p.m. (Toronto time) for units of a class of a fund on a Valuation Date of the fund or on a day that is not a Valuation Date, will be issued at the NAV per unit for that class of the fund on the next Valuation Date of the fund. The Manager may permit an investor to subscribe for units of a fund on a day which is not otherwise a Valuation Date of the fund in certain situations. Upon completing a subscription agreement for units of a fund, an investor will have waived any right to withdraw their subscription, subject to compliance with applicable securities laws. The Manager reserves the right to accept or reject orders for units of a class of a fund within two (2) business days of the next Valuation Date of the fund after receiving the subscription agreement, provided that any decision to reject an order will be made promptly and any monies received with a rejected order will be refunded immediately, without interest, deduction or penalty, after such determination has been made by the Manager. Minimum Investment

The minimum investment in the Balanced Fund, the Equity Fund, the Fixed Income Fund and the Partners Fund is $5,000 for an investor that is an accredited investor and $150,000 for an investor that is not. The minimum investment in the Enhanced Income Fund is $500,000. The Manager has the discretion to change these amounts from time to time, as permitted by applicable law. Sales Charge

An investor does not have to pay any sales commission if they buy their units of a fund from the Manager. If units of a fund are purchased through another dealer, such dealer may charge the investor a sales commission of up to 5% of the amount that the investor invests in the fund. The sales charge is negotiable between the investor and the dealer. -20-

Units of a class of a fund purchased on a reinvestment of distributions are not subject to a sales charge. Additional Investments

Investors who are accredited Investors may, in the sole discretion of the Manager, make additional investments in units of a class of a fund at any time where each additional investment in units of a class of the fund is at least $1,000. Additional investments in units of a class of a fund by investors who are not accredited investors are permitted pursuant to exemptions in the securities legislation of the Offering Jurisdictions provided th e investor holds units of that class of the fund at the time of such subsequent purchase with an aggregate acquisition cost or a current market value equal to or greater than $150,000. Each additional investment in units of a class of the fund must be at least $5,000. The Manager reserves the right to change the minimum amount for additional investments in units of a class of a fund at any time and from time to time. Additional investments must be subscriptions to th e same fund that was initially purchased. SWITCHING BETWEEN FUNDS

Investors may switch units of a class of a fund offered under this offering memorandum for another class of units of a fund offered herein or for another investment fund that is created and/or managed by th e Manager and offered by means of another offering memorandum. A switch involves the redemption of units of a class of one fund and the purchase of units of another investment fund. Accordingly, as with any other sale of units of a class of a fund, this could result in a gain or a loss for th e investor. If the investor does not own any units of the class of the investment fund being switched to, the Minimum Investment Amount must be met. Consequently, in such a situation, the amount to be transferred must be sufficient to meet th e Minimum Investment Amount after the deduction of any applicable fees and/or charges, including any short-term trading deduction. To effect a switch, an investor should contact their representative of the dealer that they use. The representative of their dealer is required to forward a switch request, a new subscription agreement and a letter of direction signed by the investor, where applicable, to the Manager on or before 4:00 p.m. (Toronto time) on the Valuation Date of th e applicable fund if the switch is to occur on that day. If th e switch request is received after 4:00 p.m. (Toronto time) or on a day that is not a Valuation Date of the applicable fund, it will, if accepted by the Manager, be processed on the next Valuation Date of that fund. The Manager reserves the right to accept or reject switch orders within two (2) business days of the next Valuation Date of the applicable fund after receiving the switch request, provided that any decision to reject a switch order is made promptly. A switch request will be cancelled immediately, without interest, deduction or penalty if the Manager determines that it will not or cannot process th e switch request. A dealer may charge a unitholder a fee when the unitholder switches from one class of units of a fund to another class of units of the same fund or another investment fund. RECLASSIFICATION OF UNITS OF A FUND

In ce rt ain circumstances, an investor may be entitled to reclassify units of a class of a fund into units of another class of the same fund. This type of reclassification will not trigger a gain or a loss because,

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based on the Canada Revenue Agency's (CRA) administrative practice, such a reclassification is not considered a disposition for tax purposes. DEALER COMPENSATION

Units of each class of a fund may be distributed by dealers in the Offering Jurisdictions. The Manager provides the following compensation programs to dealers whose clients purchase units of a class of a fund to assist them in their distribution effo rt s. Sales Charge When an investor buys units of a class of a fund through their dealer, a sales charge of up to 5% of the subscription amount may be deducted from the purchase order and paid by the investor to the dealer. The remaining amount is then invested in units of the class of the applicable fund. The sales charge is negotiated between the investor and the representative of their dealer. Trailer Fees

For class B units, the Manager will pay out of its Management Fee, to a dealer that has bought class B units of a fund, 0.50% per annum of the average NAV of such class B units to the dealer (a "Trailer Fee"). The Trailer Fee pays for the ongoing advice and se rv ice which an investor is entitled to receive from his, her or its dealer so long as the investor continues to hold class B units of that fund. Other Dealer Support

The Manager may pay for marketing materials which the Manager gives to dealers to help suppo rt their sales efforts and to help educate investors. These materials include repo rt s and commentaries on securities, the markets, the funds and the se rv ices the Manager offers investors. Subject to regulatory requirements, the Manager may share the cost of local advertising or other marketing or sales related expenses or provide various training suppo rt programs to assist dealers in servicing their clients, and in their effo rt s to sell units of the funds. These programs may include, but are not limited to, training materials and audio/visual materials for seminar programs operated by the dealers. The Manager may also arrange seminars for sales representatives to inform them about new developments relating to the funds, the Manager's products and se rv ices and investment fund industry matters. The Manager may invite dealers to send their sales representatives to such seminars, but the Manager does not decide who a ttends. The sales representatives must pay their own travel, accommodation and personal expenses to a ttend the Manager's seminars. The Manager may also provide sales representatives with promotional items of nominal value and may engage in business promotion activities with sales representatives. DISTRIBUTIONS

Distributions may be made of all or any pa rt of the net income and net realized capital gains of a fund or as a return of capital, on a quarterly basis on the last Valuation Date of the fund of each calendar qua rt er, or at such other times as determined by the Manager. Any net income and net realized capital gains of a fund, as computed for tax purposes, for a taxation year not previously distributed will be distributed on or before December 31 in each year to the unitholders of record of the fund on such date so that the fund will not be liable for any Canadian federal income tax under Pa rt I of the Tax Act (after taking into account any capital gains refund to which the fund may be entitled to in the circumstance where the fund qualifies - 22 -

as a mutual fund trust throughout a particular taxation year). Distributions may also include non-taxable distributions out of capital. All distributions by a fund to unitholders of a class of the fund will be reinvested automatically in additional units of the same class of the fund at the NAV per unit of the applicable class of the fund on the day the distribution is payable, unless the unitholder asks for a cash distribution. Distributions made on units of a class of a fund will reflect the expenses attributable to that class of the fund. As a result, the amount of distributions per unit of one class of a fund may be different from the amount of distributions per unit of another class of the same fund. In addition, where the expenses attributable to a particular class of units of a fund exceed that class' proportionate share of the fund's net income, including taxable capital gains, the amount of such excess (excess class expenses) will be applied to the other classes of the fund by the Manager in such reasonable manner as the Manager may determine in its sole discretion. The Manager may use the excess class expenses of a fund for a particular class of units of the fund to reduce the distributions of net income (including taxable capital gains) made by the fund to unitholders of other classes of the fund. However, excess class expenses for a particular class of units of a fund will not reduce the NAV of any other class of units of the fund. Each fund will provide to its unitholders, no later than March 31st in each year with respect to the calendar year then last ended, all tax reporting forms in respect of distributions for that calendar year. PORTFOLIO VALUATION AND NET ASSET VALUE The NAV of each fund is determined by the Fund Administrator as of the close of regular trading on the Toronto Stock Exchange (the TSX), normally 4:00 p.m. (Toronto time) on each Valuation Date of that fund in accordance with the valuation principles set out in the Trust Agreements. The NAV of each fund will be reported in Canadian dollars. The NAV of a fund may not be calculated (i) during any period when normal trading is suspended on any stock exchange on which securities or permitted derivatives are listed which, in the aggregate, represent more than 50% by value or underlying market exposure of the total assets of a class of units of the fund; or (ii) during any period when the Manager determines that such a suspension would be in the best interests of the unitholders of a class of units of the fund. The NAV of a fund on a Valuation Date of the fund is equal to the fair market value of the assets of the fund on such date less its liabilities on such date. The NAV of a class of units of a fund on a Valuation Date of the fund is equal to the proportionate fair value of the assets of the fund assigned to that class of units of the fund on such date, less the liabilities attributable to that class of units of the fund on such date. The NAV per unit of a class of units of a fund on a Valuation Date of the fund is equal to the NAV of that class of units of the fund on such date divided by the number of units of that class of the fund outstanding on such date. Each allocation of liabilities, expenses, costs, charges and reserves by the Manager, or a party designated or appointed by the Manager, shall be conclusive and binding upon all unitholders of the class for all purposes. UNITS OF THE FUNDS An investment in a fund is represented by units of a class of the fund, each of which represents an undivided interest in the net assets of the fund attributable to that class of units of the fund. Each fund has a multi-class structure and currently offers class A units, class B units, class F units and class O units.

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An unlimited number of classes of units of each fund may be created at the discretion of the Manager having such terms and conditions as the Manager may determine. The units of any other class of a fund that the Manager may decide to offer may be sold through separate distribution channels and may have different features than the funds offered hereunder. The proportionate interest of each unitholder in a class of units of a fund is expressed by the number of units of that class of the fund or fractions thereof held by such unitholder. An unlimited number of units of all classes of each fund may currently be issued. No certificates will be issued for any units of a class of a fund that are issued. Outstanding units of a class of a fund may be subdivided or consolidated. Fractions of units of a class of a fund may be issued. The rights of unitholders of a class of units of a fund are contained in the Trust Agreements. Each class of units of a fund is entitled to participate equally in distributions made by the fund to its unitholders of that class and, on termination of the fund, to participate equally in the net assets of the fund attributable to that class remaining after all liabilities attributable to that class of units of the fund have been paid. Units of a class of a fund are only issued as fully paid and non-assessable. The holder of a whole unit of a class of a fund have the right to one vote at any meeting of unitholders of that class of the fund. Fractional units of a class of a fund car ry the same rights and are subject to the same conditions as whole units of that class of the fund (other than with respect to voting rights) in the propo rt ion that they bear to a whole unit of that class of the fund. REDEMPTION OF UNITS Redemptions

A unitholder of a class of units of a fund is entitled to redeem any units of that class of the fund held by the unitholder on any Valuation Date of the fund at the NAV per unit of that class of the fund. Redemption orders specifying the name of a fund, the class of units of th e fund, and the number or dollar amount of the units of that class of the fund to be redeemed must be in writing and the unitholder's signature must be guaranteed by their dealer, or a Canadian chartered bank, trust company or member of a stock exchange in Canada or otherwise guaranteed to the satisfaction of the Manager. Redemption orders may be made to a dealer or in writing directly to th e Manager. The amount payable to a unitholder by a fund for each unit of a class of the fund redeemed (the Redemption Amount) will be equal to the NAV per unit of the applicable class of the fund on the date the redemption is processed less any applicable fees and taxes. If a redemption order for a fund is received by the Manager on or prior to 4:00 p.m. (Toronto Time) on the day that is 30 business days before the Valuation Date of the fund, on which the units of the applicable class of the fund are to be redeemed, then the order will be processed and th e units of the applicable class of the fund will be redeemed on that date based on the NAV per unit of the applicable class of the fund on that date. Orders received after that time will be processed on the next Valuation Date of the fund. The Redemption Amount will usually be sent to the applicable unitholder within three (3) business days following the Valuation Date of the applicable fund on which the redemption order was received in good order. If units of a class of a fund were purchased by cheque and then redeemed within seven (7) business days of the purchase, the fund may hold the redemption proceeds until the purchase cheque has cleared, which may take up to 10 business days for cheques drawn on a Canadian chartered bank and up to 45 business days for all other cheques. Any Redemption Amount (net of amounts required to be withheld) to be paid to a unitholder of a fund will be paid by cheque or electronic payment to the order of the unitholder requesting the redemption and mailed by standard mail to such unitholder at his recorded address or by automatic funds transfer to an - 24 -

account maintained by the unitholder with a Canadian bank or trust company. No interest will be paid to the unitholder on account of any delay in forwarding the Redemption Amount to the unitholder. Any redemption order of a unitholder that has been deferred because of a suspension of redemptions of a fund will be completed by the Manager on the first Valuation Date of the fund following the termination of the suspension unless earlier withdrawn by the unitholder. Payment in Specie The Manager may at its discretion make payment for units of a class of a fund that are redeemed by delivery of liquid investments to the redeeming unitholder. The liquid investments so delivered shall be valued based on the value assigned to them for the purposes of determining the NAV of th e class of units of the fund being redeemed at such time. Short Term Trading Deduction -

The Manager may charge a unitholder that redeems units of a class of the Partners Fund or the Enhanced Income Fund, which they purchased within the previous 180 days, a short-term trading deduction equal to 2% of the value of the units of that class being redeemed. This deduction will be paid to the respective fund. The Manager may also charge a unitholder that redeems units of a class of the Balanced Fund, the Equity Fund or the Fixed Income Fund, which they purchased within th e previous 90 days, a short-term trading deduction equal to 2% of the value of th e units of that class being redeemed. This deduction will also be paid to the respective fund. Suspension and Restriction of Redemptions The Manager may from time to time restrict redemptions of units of a fund if normal trading is suspended on any stock exchanges on which securities are listed and traded which represent 50% or more of the value of the assets of the fund, or in ce rt ain other instances. CANADIAN FEDERAL INCOME TAX CONSIDERATIONS In the opinion of Fasken Martineau DuMoulin LLP, counsel to the funds and the Manager the following is, as of the date hereof, a summary of the principal Canadian federal income tax consequences of an investment in units of a fund. Unless otherwise indicated, the summary only applies to an investment made by an individual (other than a trust) who is resident in Canada and who holds units of the fund as capital property. The tax consequences to a unitholder of a fund of acquiring, owning and disposing of units of the fund will depend on many factors including the unitholder's jurisdiction of residence and the manner and frequency in which units of the fund are acquired and disposed of by the unitholder. This description is based upon the current provisions of the Tax Act, the specific proposals to amend the Tax Act (the Tax Proposals) announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof and counsel's understanding of the current publicly available administrative and assessing policies of the CRA published in writing. If any of the Tax Proposals are not adopted as contemplated, the tax consequences to a fund and the unitholders of the fund may not be as described below in all cases. This description is not exhaustive of all possible Canadian federal income tax consequences and, except for the Tax Proposals, does not take into account or anticipate any changes in law, whether by legislative, governmental or judicial action, nor does it take into account provincial or foreign tax considerations which may differ significantly from those discussed herein. There is no assurance that the Tax Proposals will be enacted in the form proposed, if at all. - 25 -

This description is of a general nature only and is not intended to be, nor should it be construed to be, legal or tax advice to any prospective purchaser and no representation with respect to the income tax consequences to any purchaser is made. Prospective purchasers should consult their own tax advisors for advice with respect to the income tax consequences to them of a proposed investment in a fund as it relates to their particular circumstances. It is assumed that no fund will have any material investment in interests in non-resident trusts deemed to be resident in Canada under the proposals to amend the Tax Act. Taxation of the Funds

Currently, none of the funds is a "mutual fund trust" within the meaning of the Tax Act. However, each fund is, or in the case of the Enhanced Income Fund has applied to become, a registered investment under the Tax Act. It is assumed that at no time will "financial institutions" (as defined in section 142.2 of the Tax Act) hold more than 50% of the fair market value of all the units in any fund. If financial institutions held more than 50% of the fair market value of all the units of a fund that is not a mutual fund trust, such fund will be subject to the "mark-to-market" rules on its "mark-to-market property". A fund will generally not be liable for tax under Pa rt I of the Tax Act in respect of its net income or net realized capital gains in each taxation year, determined in Canadian dollars in accordance with the Tax Act, to the extent such net income and net realized capital gains are paid or payable in the year to unitholders of the fund. For taxation years throughout which a fund is not a mutual fund tr ust under the Tax Act, the fund may in ce rt ain circumstances be subject to alternative minimum tax even though its net income and net realized capital gains are paid or payable to its unitholders. In accordance with the adminis tr ative practice of the CRA, each fund treats gains and losses on sho rt sales as being on income account, unless the sho rt sale is a hedge against identical securities of the fund that are capital property. Gains and losses on ce rt ain derivatives are also treated by the funds as being on income account. For a taxation year throughout which a fund is not a mutual fund trust under the Tax Act, the amount of distributions of net realized capital gains to unitholders made by the fund in the taxation year and, therefore, the amount required to be included in the income of unitholders of the fund, may exceed the amount of distributions of net realized capital gains that otherwise would be required to be made by the fund if it qualified as a mutual fund trust. For taxation years throughout which a fund is not a mutual fund tr ust under the Tax Act, the fund would be liable to a special tax under Pa rt XII.2 of the Tax Act if its unitholders include "designated beneficiaries" and it has "designated income". If a fund has a "designated beneficiary" (which includes a non-resident of Canada, certain trusts and ce rt ain tax-exempt persons) and has "designated income" (which includes capital gains from the dispositions of "taxable Canadian property" and income from a business carried on in Canada), the fund will be liable to pay Pa rt XII.2 tax on such designated income. Such tax will be effectively borne by the "designated beneficiaries" and all tax-exempt unitholders while taxable unitholders of the fund who are resident in Canada should generally achieve the same after-tax return as if the fund were not subject to Pa rt XII.2 tax. If a fund is a registered investment but not a mutual fund trust under the Tax Act, it will be liable to pay a penalty tax under the Tax Act if, at the end of any month, the fund holds any investments that are not qualified investments for Registered Plans. The tax for a month is equal to 1% of the fair market value of the non-qualified investments at the time it was acquired by the fund.

-26-

Losses incurred by a fund cannot be allocated to unitholders of the fund, but may be deducted by the fund in future years in accordance with the Tax Act. A distribution by a fund of its property upon a redemption of units of a fund in specie will be treated as a disposition by the fund of the property so distributed for proceeds of disposition equal to its fair market value. Assuming that such property is held as capital property, the fund will realize a capital gain (or a capital loss) to the extent that the proceeds from the disposition exceed (or are less than) the adjusted cost base of the relevant property and any reasonable costs of disposition. Taxation of Unitholders

A unitholder of a fund will be required to include in income for a taxation year in Canadian dollars the net income and the portion of the net realized capital gains of the fund paid or payable to the unitholder of the fund in such taxation year, whether received in cash or reinvested in additional units of the fund. The NAV per unit of a fund will reflect any income and gains of the fund that have accrued or been realized but not made payable at the time units of the fund are acquired. Consequently, purchasers of units of a fund may become taxable on their share of income and gains of the fund that accrued or were realized before the units of the fund were acquired. Foreign income, taxable dividends from taxable Canadian corporations and taxable capital gains of a fund (in each case, designated as such by the fund) will retain their identity in the hands of unitholders of the fund for income tax purposes. Where foreign income of a fund has been so designated, generally unitholders of the fund will be deemed to have paid, for foreign tax credit purposes, their proportionate share of the foreign taxes paid by the fund on such income. To the extent that amounts received from a fund by a unitholder are designated as taxable dividends from taxable Canadian corporations, the gross-up and dividend tax credit rules will apply, including the enhanced dividend tax credit in respect of "eligible dividends". All distributions by a fund to a unitholder (otherwise than as proceeds of disposition of all or part of the unitholder's units of the fund) will reduce the adjusted cost base of the unitholder's units of the fund except to the extent that the distribution is included in the unitholder's income or is the non-taxable po rt ion of a capital gain of the fund (designated as such by the fund). A unitholder of a fund will realize a capital gain to the extent that reductions in the adjusted cost base of the unitholder's units of the fund would result in a negative amount. Pursuant to the Trust Agreements, a fund may allocate and designate any income or capital gains realized by the fund as a result of any disposition of property of the fund undertaken to permit or facilitate the redemption of units of the fund to a unitholder whose units are being redeemed. In addition, each fund has the authority to distribute, allocate and designate any income or capital gains of that fund to a unitholder who has redeemed units of that fund during a year in an amount equal to the unitholder's share, at the time of redemption, of that fund's income and capital gains for the year or such other amount that is determined by that fund to be reasonable. Any such allocations will reduce the redeeming unitholder's proceeds of disposition. Pursuant to the Trust Agreements, the Manager may at its discretion make payment for units that are redeemed by delivery of portfolio securities to the redeeming unitholder of a fund. If units of a fund are redeemed in such manner, the proceeds of disposition to the unitholder of such units will be equal to the fair market value of the securities so distributed less any income or capital gain realized by the fund in connection with the redemption of those units. Where income or capital gain realized by a fund in connection with the distribution of securities on the redemption of units of the fund has been designated by the fund to a redeeming unitholder, the unitholder will be required to include in income the income or -27-

taxable portion of the capital gain so designated. The cost of any property distributed by a fund to a unitholder upon redemption of units of the fund will be equal to the fair market value of those securities at the time of the distribution. Upon the disposition of a unit of a fund, including on a redemption or switch, a capital gain (or capital loss) will be realized by the unitholder of the fund to the extent that the proceeds of disposition of the unit of the fund exceed (or are exceeded by) the aggregate of the adjusted cost base of the unit of the fund and any costs of disposition. Proceeds of disposition will not include an amount payable by a fund that is otherwise required to be included in the unitholder's income. One-half of a capital gain (a taxable capital gain) will be included in computing a unitholder's income and one-half of a capital loss (an allowable capital loss) may be deducted from taxable capital gains to the extent permitted by the Tax Act. For the purpose of determining the adjusted cost base to a unitholder of units of a fund, when a unit of the fund is acquired, whether on the reinvestment of distributions or otherwise, the cost of the newly-acquired unit will be averaged with the adjusted cost b as e of all units of the fund owned by the unitholder before that time. The cost to a unitholder of units of a fund received on the reinvestment of a distribution will be equal to the amount reinvested. Generally, a reclassification of units from one class to another of the same fund is not considered to be a disposition for tax purposes and, accordingly, a unitholder will not realize a gain or loss on such reclassification. In general terms net income of a fund paid or payable to a unitholder that is designated as taxable dividends from taxable Canadian corporations or as net taxable capital gains, and capital gains realized by a unitholder on the disposition of units of a fund, may increase such unitholder's liability for alternative minimum tax under the Tax Act. Amounts paid in respect of fees and expenses directly by a unitholder in respect of units of a fund held directly (i.e. not in a registered plan) will be deductible for income tax purposes to the extent that such amounts are reasonable and represent amounts paid for advice provided to the unitholder in respect of the purchase and sale of units or se rv ices in respect of the adminis tr ation or management of the units. The portion of the amounts paid directly by a unitholder that represents fees for se rv ices provided by the manager to the fund, rather than directly to the unitholder, will generally not be deductible for income tax purposes. Unitholders should consult their own tax advisors with respect to the deductibility of such amounts paid to the manager, a dealer or an advisor in their own particular circumstances. Fees paid in respect of units of a fund held in a registered plan are not deductible for income tax purposes. Deferred Income Plans and Qualified Investments

As each fund is, or in the case of the Enhanced Income Fund has applied to become a registered investment under the Tax Act, units of each fund are or will be qualified investments for Registered Plans. If the units of a fund are "prohibited investments" under the Tax Act, a unitholder who is a holder of a TFSA, or an annuitant of a RRSP or a RRIF that holds such units, will be subject to a penalty tax as set out in the Income Tax Act. A "prohibited investment" includes a unit of a trust which does not deal at arm's length with the holder or with a person or partnership in which the holder has a significant interest, or in which the holder has a significant interest. A significant interest, in general terms, means the ownership of 10% or more of the value of the fund's outstanding units by the holder, either alone or together with persons and partnerships with whom the holder does not deal at arm's length. Unitholders are advised to consult their own tax advisors in this regard. -28-

Non-Residents of Canada

In general, non-residents of Canada should not be subject to Canadian tax under the Tax Act on capital gains realized from the disposition of units of a fund. In addition, a non-resident of Canada who disposes of units of a fund should not be required to comply with the clearance certificate provisions of section 116 of the Tax Act or file a Canadian income tax return solely as a result of the disposition of units of a fund. However, a non-resident of Canada will be subject to Canadian tax on a disposition of units of a fund if at any time in the 60-month period prior to the disposition more than 50% of the fair market value of the units of the fund were derived directly or indirectly from real property situated in Canada, Canadian resource properties and/or options or interest in respect of the foregoing. Distributions of income (including the taxable po rt ion of capital gains) from a fund that is paid or credited to a non-resident of Canada will be subject to Canadian withholding tax at a rate of 25%. If a fund becomes a mutual fund trust under the Tax Act then distributions of income (excluding the entire amount of capital gains) from such fund that is paid or credited to a non-resident of Canada will be subject to Canadian withholding tax at a rate of 25%. In either case, the rate of withholding may be reduced under an applicable income tax treaty. AMENDMENT OF TRUST AGREEMENTS

Any provision of the Pooled Fund Trust Agreement, which governs the Partners Fund and Enhanced Fund, may be amended, deleted, expanded or varied at any time if the amendment is not materially adverse to unitholders of such funds in the opinion to counsel to the Trustee, or in the opinion of counsel to the Trustee, is necessary or desirable to comply with applicable laws and notice of the amendment is given to unitholders of such funds forthwith. Any other provision of the Pooled Fund Trust Agreement may be amended, deleted, expanded or varied at any time, provided unitholders of the such funds are given at least 30 days prior written notice of the change, and provided the Trustee must consent to any changes that affect its rights, powers and duties. Subject to the requirements of National Instrument 81-102 Mutual Funds, which requires that ce rt ain matters be submitted to the unitholders of the Balanced Fund, the Equity Fund and the Fixed Income Fund for approval (e.g., an increase in any fee that is charged to such funds by the Manager, any change to the fundamental investment objective of such funds or any decrease in the frequency of the calculation of the NAV per unit of such funds), the provisions of the Public Fund Trust Agreement may be amended or changed in a manner that is similar to how the provisions of the Pooled Fund Trust Agreement may be amended or changed. TERMINATION OF A FUND

A fund may be terminated in ce rt ain situations as stipulated in the Trust Agreements. If a fund is terminated, the Manager will make arrangements in consultation with the Trustee to distribute the assets of the fund in cash in accordance with the Trust Agreements. RECORDKEEPER

The Fund Administrator is the recordkeeper of each fund. The unit registers for each fund are kept by the Fund Administrator at its principal office in Toronto.

CUSTODIAN

CIBC Mellon Trust Company is the custodian of each fund pursuant to an amended custodial se rvices agreement made as of the 31 5` day of May 2011 between the Manager, the Custodian and ce rtain related parties of the Custodian (the Custodial Services Agreement). AUDITOR

The auditor of the funds is Collins Barrow, Chartered Accountants. Collins Barrow's head office is located at 11 King Street West, Suite 700, Toronto, Ontario, M5H 4C7. LEGAL COUNSEL

Legal counsel to the funds is Fasken Martineau DuMoulin LLP, located at 333 Bay Street, Suite 2400, Bay Adelaide Centre, Box 20, Toronto, Ontario, M5H 2T6. MATERIAL CONTRACTS

The material contracts pertaining to the funds are the Trust Agreements, the Custodial Se rvices Agreement and the Fund Administration Se rv ices Agreement. A copy of each of these documents may be inspected at the office of the Manager during normal business hours. To the extent there is any inconsistency or conflict between the Trust Agreements and this offering memorandum, the provisions of the Trust Agreements shall prevail. RIGHTS OF ACTION FOR DAMAGES OR RESCISSION

Securities legislation in ce rtain provinces and territories of Canada provides purchasers of units of a class of a fund with, in addition to any other right they may have at law, rights of rescission or damages, or both, where this offering memorandum, any amendment thereto and, in some cases, advertising, and sales literature used in connection with the offering of units of that class of the fund, contains a misrepresentation. For the purposes of this section, misrepresentation means: (a)

an untrue statement of a fact that significantly affects, or would reasonably be expected to have a significant effect, on the market price or the value of units of that class of the fund (a material fact); or

(b)

an omission to state a material fact that is required to be stated or that is necessary to make a statement not misleading in the light of the circumstances in which it was made.

These rights must be exercised by purchasers of units of a class of a fund within the prescribed time limits under applicable securities legislation. Purchasers should refer to the applicable provisions of the securities legislation of their province or territory for the full particulars of these rights or consult with their legal advisor. The rights of action for rescission or damages provided such securities legislation are in addition to and do not derogate from any other right that purchasers of units of a fund may have at law. Alberta

A purchaser of units of a class of a fund who is resident in Albe rta and to whom this offering memorandum was delivered may rescind the contract to purchase such units by sending written notice to -30-

the fund not later than midnight on the second day, exclusive of Saturdays and holidays, after the purchaser signs the agreement to purchase the units. If this offering memorandum contains a misrepresentation when a purchaser resident in Alberta buys units of a class of a fund, securities legislation in Alberta provides that every such purchaser has, without regard to whether the purchaser relied on the misrepresentation, a right of action for damages against the and and every person or company who signed this offering memorandum, but may elect (while still the owner of any of the units of that class of the fund such purchaser purchased) to exercise a right of rescission against the fund, in which case the purchaser shall have no right of action for damages, provided that: (a)

neither the fund not anyone signing this offering memorandum will be liable if the fund or such person or company proves that the purchaser purchased the units of that class of the fund with knowledge of the misrepresentation;

(b)

in an action for damages, neither the fund not anyone signing this offering memorandum will be liable for all or any po rt ion of such damages if the fund or such person or company proves that they do not represent the depreciation in value of the units of that class of the fund as a result of the misrepresentation relied on; and

(c)

in no case will the amount recoverable under this right of action exceed the price at which the units of that class of the fund were sold to the purchaser.

No person or company, other than a fund, is liable: (a)

if the person or company proves that this offering memorandum was sent to the purchaser without the person's or company's knowledge or consent, and that, on becoming aware of its being sent, the person or company promptly gave reasonable notice to the fund that it was sent without th e knowledge and consent of the person or company;

(b)

if the person or company proves that the person or company, on becoming aware of the misrepresentation, withdrew the person's or company's consent to this offering memorandum and gave reasonable notice to the fund of the withdrawal and the reason for it; or

(c)

with respect to any pa rt of this offering memorandum not purporting to be made on the authority of an expe rt and not purporting to be a copy of, or an extract from, a repo rt , opinion or statement of an expe rt , unless the person or company (i) did not conduct an investigation sufficient to provide reasonable grounds for a belief that there had been no misrepresentation, or (ii) believed there had been a misrepresentation.

In Albe rt a, no action may be commenced to enforce such right of action described above unless the right is exercised: (a)

in the case of action for rescission, no later than 180 days from the date the purchaser purchased the units of that class of the fund; or

(b)

in th e case of any action, other than an action for rescission, not later than the earlier of: (i) 180 days from the day that the purchaser first had knowledge of the facts giving rise to the cause of action, or (ii) three (3) years from th e day the purchaser purchased the units of that class of the fund.

Saskatchewan

If this offering memorandum or any amendment thereto or any advertising or sales literature used in connection therewith contains a misrepresentation, every purchaser of units of a class of a fund resident in Saskatchewan has, without regard to whether the purchaser relied on the representation, a right of action, in addition to any other rights they may have at law, for damages against: (a)

the fund;

(b)

the promoters of the fund;

(c)

every person or company that signed this offering memorandum or any amendments thereto (if there was a misrepresentation in this offering memorandum); and

(d)

every person or company that sells units of that class of the fund on behalf of the fund under this offering memorandum or amendment thereto or in respect of which the advertising or sales literature was disseminated, as the case may be.

Alternatively, where the purchaser purchased the units of a class of a fund from the fund, the purchaser may elect to exercise a right of rescission against the fund, and, when the purchaser so elects, the purchaser shall have no right of action for damages against the fund. No person or company, other than a fund, is liable: (a)

if the person or company proves that this offering memorandum, or any advertising, or sales literature was sent or delivered, or disseminated, as the case may be, to the purchaser without the person's or company's knowledge or consent, and that, on becoming aware that it was sent and delivered or disseminated, the person or company promptly gave reasonable general notice that it was so sent and delivered or disseminated;

(b)

if the person or company proves that after the filing of this offering memorandum, or after the dissemination of the advertising or sales literature, and before the purchase of units of a class of the fund by the purchaser, on becoming aware of any misrepresentation, the person or company withdrew the person's or company's consent to this offering memorandum, or to the advertising or sales literature and gave reasonable general notice of the withdrawal and the reason for it; or

(c)

with respect to any pa rt of this offering memorandum, or any advertising or sales literature not purporting to be made on the authority of an expe rt and not purporting to be a copy of, or an extract from, a repo rt , opinion or statement of an expe rt , unless the person or company (i) failed to conduct a reasonable investigation sufficient to provide reasonable grounds for a belief that there had been no misrepresentation, or (ii) believed there had been a misrepresentation.

In addition, where an individual makes a verbal statement to a prospective purchaser that contains a misrepresentation relating to the units of a class of a fund and the verbal statement is made either before or contemporaneously with the purchase of the units of that class of the fund, the purchaser has a right of action for damages against the individual who made the verbal statement. No such individual will be liable if: (a)

that individual can establish that he or she cannot reasonably be expected to have known that his or her statement contained a misrepresentation; or

-32-

(b)

prior to the purchase of the securities by the purchaser, that individual notified the purchaser that the individual's statement contained a misrepresentation.

No fund nor any other person or company will be liable, whether for misrepresentations in the offering memorandum, advertising or sales literature or in a verbal statement: (a)

if the fund or such promoter, person or company proves that the purchaser purchased the units of a class of the fund with knowledge of the misrepresentation;

(b)

in an action for damages, for all or any po rtion of the damages that the fund or such person or company proves do not represent the depreciation in value of the units of that class of the fund as a result of the misrepresentation relied on.

In no case will the amount recoverable by a purchaser for a misrepresentation in this offering memorandum, advertising and sales literature, or a verbal misrepresentation exceed the price at which units of a class of a fund were sold to the purchaser. In Saskatchewan, no action may be commenced to enforce a right of action for rescission or damages more than: (a)

in the case of an action for rescission, 180 days after the date the purchaser purchased the units of a class of the fund; and

(b)

in the c ase of any action, other than an action for rescission, the earlier of (i) one (1) year after the purchaser first had knowledge of the facts giving rise to the cause of action or (ii) six (6) years after the date the purchaser purchased the units of that class of the fund.

Manitoba

If this offering memorandum contains a misrepresentation, a purchaser who purchases units of a class of a fund offered by this offering memorandum is deemed to have relied on the representation if it was a misrepresentation at the time of purchase and has (a) a right of action for damages against (i) the fund and (ii) every person or company who signed the offering memorandum; and (b) a right of rescission against the fund. If the purchaser chooses to exercise a right of rescission against the fund, the purchaser has no right of action for damages. No person or company is liable if the person or company proves that the purchaser had knowledge of the misrepresentation. No person or company, other than a fund, is liable if (a)

if the person or company proves that the offering memorandum was sent to the purchaser without the person's or company's knowledge or consent, and that, after becoming aware that it was sent, the person or company promptly gave reasonable notice to the fund that it was sent without the person's or company's knowledge and consent;

(b)

if the person or company proves that, after becoming aware of the misrepresentation, the person or company withdrew the person's or company's consent to the offering memorandum and gave reasonable notice to the issuer of the withdrawal and the reason for it;

(c)

if, with respect to any pa rt of this offering memorandum purporting to be made on the authority of an expert or to be a copy of, or an extract from, an expert's repo rt, opinion or statement, the - 33 -

person or company proves that the person or company did not have any reasonable grounds to believe and did not believe that (i) there had been a misrepresentation, or (ii) the relevant pa rt of this offering memorandum (A) did not fairly represent the expert's repo rt , opinion or statement, or (B) was not a fair copy of, or an extract fr om, the expert's repo rt , opinion or statement; or

(d)

with respect to any pa rt of the offering memorandum not purporting to be made on an expert's authority and not purporting to be a copy of, or an extract from, an expert's repo rt , opinion or statement, unless the person or company (i) did not conduct an investigation sufficient to provide reasonable grounds for a belief that there had been no misrepresentation, or (ii) believed there had been a misrepresentation.

The amount recoverable under the right of action for damages may not exceed the price at which the units of a class of a fund were offered under the offering memorandum. In an action for damages, the defendant is not liable for all or any pa rt of the damages that the defendant proves do not represent the depreciation in value of the units of a class of a fund as a result of the misrepresentation. No action may be commenced to enforce the foregoing rights more than (a)

180 days after the day on which the purchaser acquired the units of a class of a fund, in the case of an action for rescission; or

(b)

the earlier of (i) 180 days after the day that the purchaser first had knowledge of the facts giving rise to the cause of action, or (ii) two years after the day of the purchase of the units of that class of the fund, in any other case.

Ontario

Section 130.1 of the Securities Act (Ontario) provides that every purchaser of units of a class of a fund pursuant to this offering memorandum shall have a statutory right of action for damages or rescission against the fund and any selling security holder of the fund in the event that this offering memorandum contains a misrepresentation. A purchaser who purchases units of a class of a fund offered by this offering memorandum during the period of distribution has, without regard to whether the purchaser relied upon the misrepresentation, a right of action for damages or, alternatively, while still the owner of units of the applicable class of the fund, for rescission against the fund provided that: (a)

if the purchaser exercises its right of rescission, it shall cease to have a right of action for damages as against the fund;

(b)

the fund will not be liable if it proves that the purchaser purchased the units of that class of the fund with knowledge of the misrepresentation;

(c)

the fund will not be liable for all or any po rt ion of damages that it proves do not represent the depreciation in value of the units of that class of the fund as a result of the misrepresentation relied upon; and

(d)

in no case shall the amount recoverable exceed the price at which the units of that class of the fund were offered.

Section 138 of the Securities Act (Ontario) provides that no action shall be commenced to enforce these rights more than: - 34 -

(a)

in the case of an action for rescission, 180 days after the date of the transaction that gave rise to the cause of action; or

(b)

in the case of an action for damages, the earlier of: (i)

180 days after the date that the purchaser first had knowledge of the facts giving rise to the cause of action; or

(ii)

three years after the date of the transaction that gave rise to the cause of action.

This offering memorandum is being delivered in connection with a distribution made in Ontario in reliance on, among other exemptions, the exemption from the prospectus requirements contained under section 2.3 of National Instrument 45-106 Prospectus and Registration Exemptions (the accredited investor exemption). The rights referred to above do not apply if this offering memorandum is delivered to a prospective purchaser in Ontario in connection with a distribution made in Ontario in reliance on the accredited investor exemption if the prospective purchaser is: (a)

a Canadian financial institution or a Schedule III bank (each as defined in OSC Rule 45-501

Ontario Prospectus and Registration Exemptions); Business Development Bank of

(b)

the Business Development Bank of Canada incorporated under the Canada Act (Canada); or

(c)

a subsidiary of any person referred to in paragraphs (a) and (b), if the person owns all of the voting securities of the subsidiary, except the voting securities required by law to be owned by directors of that subsidiary.

Newfoundland and Labrador In the event that this offering memorandum and any amendment thereto contains a misrepresentation, an investor to whom this offering memorandum was delivered and who purchases units of a class of a fund offered under it will be considered to have relied on the misrepresentation, if it was a misrepresentation on the date of investment, and will have, subject as hereinafter provided, a right of action for rescission or damages against the fund and every each person or company who signed the offering memorandum, provided that: (a)

neither the fund nor anyone signing this offering memorandum will be liable if the fund or such person or company proves that the purchaser purchased units of the applicable class of the fund with knowledge of the misrepresentation;

(b)

in an action for damages, neither the fund nor anyone signing this offering memorandum will be liable for all or any po rtion of the damages that it proves do not represent the depreciation in value of units of the applicable class of the fund as a result of the misrepresentation relied upon;

(c)

in no case shall the amount recoverable under the right of action described herein exceed the price at which units of the applicable class of the fund were offered; and

(d)

the rights of action for rescission or damages are in addition to any other right or remedy available at law to the purchaser.

No person or company, except a fund, shall be liable: (a)

where the person or company proves that this offering memorandum was sent to the purchaser without the person's or company's knowledge or consent, and that, on becoming aware of its being sent, the person or company promptly gave reasonable notice to the fund that it was sent without the person's or company's knowledge and consent;

(b)

if the person or company proves that, on becoming aware of the misrepresentation, the person or company withdrew the person's or company's consent to this offering memorandum and gave reasonable notice to the fund of the withdrawal and the reason for it; or

(c)

with respect to any pa rt of this offering memorandum not purporting to be made on the authority of an expe rt and not purporting to be a copy of, or an extract from, a repo rt , opinion or statement of an expe rt , unless such person or company (i) did not conduct an investigation sufficient to provide reasonable grounds for a belief that there had been no misrepresentation, or (ii) believed there had been a misrepresentation.

No action shall be commenced to enforce a contractual right of action unless the purchaser gives notice to a fund of the purchaser's intention to exercise such right not more than 90 days subsequent to the date on which the purchaser paid for units of the applicable class of the fund, and an action is commenced to enforce such right: (a)

in the case of an action for rescission, 180 days after the date the purchaser purchased the units of a class of a fund; and

(b)

in the case of any action, other than an action for rescission, the earlier of (i) 180 days after the purchaser first had knowledge of the facts giving rise to the cause of action or (ii) three (3) years after the date the purchaser purchased the units of that class of the fund.

New Brunswick If this offering memorandum or any information relating to the offering provided to the purchaser of the securities thereto or any advertising or sales literature used in connection therewith contains a misrepresentation, every purchaser of units of a class of a fund resident in New Brunswick purchasing units of the fund pursuant to this offering memorandum shall be deemed to have relied on the representation, if it was a misrepresentation at the time of purchase, and will have a right of action, in addition to any other rights they may have at law, for damages against the fund. Alternatively, where the purchaser purchased the units of a class of a fund from the fund, the purchaser may elect to exercise a right of rescission against the fund, in which case the purchaser shall have no right of action for damages against the fund. In addition, if advertising or sales literature is relied upon by a purchaser in connection with a purchase of units of a class of a fund, the purchaser shall also have a right of action for damages or rescission against every promoter or director of the fund at the time the advertising or sales literature was disseminated. In addition, where an individual makes a verbal statement to a prospective purchaser that contains a misrepresentation relating to the units of a class of a fund and the verbal statement is made either before or contemporaneously with the purchase of the units of that class of the fund, the purchaser shall be deemed to have relied upon the misrepresentation if it was a misrepresentation at the time of purchase, and has a right of action for damages against the individual who made the verbal statement. No such individual will be liable if:

-36-

(a)

that individual can establish that he or she cannot reasonably be expected to have known that his or her statement contained a misrepresentation; or

(b)

no individual is liable if, prior to the purchase of the securities by the purchaser, that individual notified the purchaser that the individual's statement contained a misrepresentation.

No fund nor any other person referred to above will be liable, whether for misrepresentations in the offering memorandum, any advertising or sales literature or in a verbal statement: (a)

if the fund or such other person proves that the purchaser purchased the units of a class of th e fund with knowledge of the misrepresentation;

(b)

in an action for damages, for all or any po rt ion of the damages that the fund or such promoter, person or company proves do not represent the depreciation in value of the units of that class of the fund as a result of the misrepresentation relied on.

No person, other than a fund, is liable for misrepresentations in any advertising or sales literature if the person proves: (a)

that the advertising or sales literature was disseminated without the person's knowledge or consent and that, on becoming aware of its dissemination, the person gave reasonable general notice that it was so disseminated,

(b)

that, after the dissemination of the advertising or sales literature and before the purchase of the securities by the purchaser, on becoming aware of any misrepresentation in the advertising or sales literature the person withdrew the person's consent to it and gave reasonable general notice of the withdrawal and the reason for the withdrawal, or

(c)

that, with respect to a false statement purporting to be a statement made by an official person or contained in what purports to be a copy of, or an extract from, a public official document, it was a correct and fair representation of the statement or copy of, or extract from, the document, and the person had reasonable grounds to believe and did believe that the statement was true.

No person, other than a fund, is liable with respect to any pa rt of the advertising or sales literature not purporting to be made on the authority of an expe rt and not purporting to be a copy of or, an extract fr om, a repo rt , opinion or statement of an expe rt unless the person: (a)

failed to conduct such reasonable investigation as to provide reasonable grounds for a belief that there had been no misrepresentation, or

(b)

believed there had been a misrepresentation.

Any person who at the time the advertising or sales literature was disseminated, sells units of a class of a fund on behalf of the fund with respect to which the advertising or sales literature was disseminated is not liable if that person can establish that the person cannot reasonably be expected to have had knowledge that the advertising or sales literature was disseminated or contained a misrepresentation. In no case will the amount recoverable by a purchaser exceed the price at which units of a class of a fund were sold to the purchaser. In New Brunswick, no action may be commenced to enforce such right of action more than:

-37-

(a)

in the case of an action for rescission, 180 days after the date the purchaser purchased the units of a class of a fund; or

(b)

in the case of any action, other than an action for rescission, the earlier of (i) one (1) year after the purchaser first had knowledge of the facts giving rise to the cause of action or (ii) six (6) years after the date the purchaser purchased the units of that class of the fund.

Nova Scotia If this offering memorandum or any amendment thereto or any advertising or sales literature (as defined in the Securities Act (Nova Scotia)) used in connection therewith contains a misrepresentation, every purchaser resident in Nova Scotia of units of a class of a fund in reliance on an exemption under the Securities Act (Nova Scotia), the regulations thereunder or a decision of the Nova Scotia Securities Commission pursuant to this offering memorandum shall be deemed to have relied on the representation, if it was a misrepresentation at the time of purchase, and has a right of action, in addition to any other rights they may have at law, for damages against (i) the fund, and (ii) every person who signed this offering memorandum, but may elect (while still the owner of any of the units of that class of the fund that such purchaser purchased) to exercise a right of rescission against the fund, in which case such purchaser shall have no right of action for damages, provided that: (a)

neither the fund nor anyone signing this offering memorandum will be liable if the fund or such person or company proves that the purchaser purchased units of the applicable class of the fund with knowledge of the misrepresentation;

(b)

in an action for damages, neither the fund nor anyone signing this offering memorandum will be liable for all or any po rtion of the damages that it proves do not represent the depreciation in value of units of the applicable class of the fund as a result of the misrepresentation relied upon;

(c)

in no case shall the amount recoverable under the right of action described herein exceed the price at which units of the applicable class of the fund were sold to the purchaser.

No person or company, other than a fund, is liable: (a)

if the person or company proves that this offering memorandum was sent or delivered to the purchaser without the person's or company's knowledge or consent, and that, on becoming aware of its delivery, the person or company promptly gave reasonable general notice that it was delivered without the person's or company's knowledge and consent;

(b)

if the person or company proves that after delivery of this offering memorandum, and before the purchase of the units of a class of the fund by the purchaser, on becoming aware of any misrepresentation, the person or company withdrew the person's or company's consent to this offering memorandum and gave reasonable general notice of the withdrawal and the reason for it; or

(c)

with respect to any part of this offering memorandum not purporting to be made on the authority of an expe rt and not purporting to be a copy of, or an extract from, a repo rt, opinion or statement of an expert, unless the person or company (i) failed to conduct a reasonable investigation to provide reasonable grounds for a belief that there had been no misrepresentation, or (ii) believed there had been a misrepresentation.

No action shall be commenced to enforce these rights more than 120 days after the date on which payment was made for units of a class of a fund.

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Prince Edward Island

If this offering memorandum contains a misrepresentation when a purchaser resident in Prince Edward Island buys units of a class of a fund during the period of distribution, has, without regard to whether the purchaser relied on the misrepresentation, a right of action for damages against (i) the fund, and (ii) every person or company who signed this offering memorandum, but may elect (while still the owner of any units of that class of the fund that it purchased) to exercise a right of rescission against the fund, in which case the purchaser shall have no right of action for damages, provided that: (a)

neither the fund nor any other person or company will be liable if the fund or such person or company proves that the purchaser purchased the units of a class of the fund with knowledge of the misrepresentation;

(b)

in an action for damages, neither the fund nor any other person or company will be liable for all or any portion of such damages if the fund or such person or company proves that they do not represent the depreciation in value of the units of that class of the fund as a result of the misrepresentation relied on; and

(c)

the amount recoverable under this right of action must not exceed the price at which units of that class of the fund purchased by the purchaser were offered.

In an action for damages, no person or company, other than a fund, is liable: (a)

if the person or company proves that this offering memorandum was sent to the purchaser without the person's or company's knowledge or consent, and that, on becoming aware that it was sent, the person or company had promptly given reasonable notice to the fund that it was sent without the person's or company's knowledge and consent;

(b)

if the person or company proves that on becoming aware of the misrepresentation, the person or company had withdrawn the person's or company's consent to this offering memorandum and had given reasonable notice to the fund of the withdrawal and the reason for it; or

(c)

with respect to any pa rt of this offering memorandum not purporting to be made on the authority of an expe rt and not purporting to be a copy of, or an extract from, a repo rt , opinion or statement of an expe rt , unless the person or company (i) failed to conduct a reasonable investigation to provide reasonable grounds for a belief that there had been no misrepresentation, or (ii) believed there had been a misrepresentation.

In Prince Edward Island, no action may be commenced to enforce such right of action described above more than: (a)

in the case of action for rescission, 180 days from the date the purchaser purchased units of a class of a fund; or

(b)

in the case of any action, other than an action for rescission: (i) 180 days from the day that the purchaser first had knowledge of the facts giving rise to the cause of action, or (ii) three (3) years from the day the purchaser purchased units of that class of the fund, whichever period expires first.

Northwest Territories

If this offering memorandum contains a misrepresentation, a purchaser resident in the Northwest Territories who buys units of a class of a fund during the period of distribution, has, without regard to whether the purchaser relied on the misrepresentation, a right of action for damages against (i) the fund, and (ii) every person or company who signed this offering memorandum, but may elect (while still the owner of any units of that class of the fund that they purchased) to exercise a right of rescission against the fund, in which case the purchaser shall have no right of action for damages, provided that: (a)

neither the fund nor any other person will be liable if the fund or such person proves that the purchaser purchased units of that class of the fund with knowledge of the misrepresentation;

(b)

in an action for damages, neither the fund nor any other person will be liable for all or any po rtion of such damages if the fund or such person proves that they do not represent the depreciation in value of the units of that class of the fund as a result of the misrepresentation relied on; and

(c)

the amount recoverable under this right of action must not exceed the price at which units of that class of the fund purchased by the purchaser were offered.

In an action for damages, no person, other than a fund, is liable: (a)

if the person proves that this offering memorandum was sent to the purchaser without the person's or company's knowledge or consent, and that, on becoming aware of its being sent, the person had promptly given reasonable notice to the fund that it was sent without the person's knowledge and consent;

(b)

if the person proves that, on becoming aware of the misrepresentation, the person had withdrawn the person's consent to this offering memorandum and had given reasonable notice to the fund of the withdrawal and the reason for it; or

(c)

with respect to any pa rt of this offering memorandum not purporting to be made on the authority of an expert and not purporting to be a copy of, or an extract from, a repo rt, opinion or statement of an expert, unless the person (i) failed to conduct a reasonable investigation to provide reasonable grounds for a belief that there had been no misrepresentation, or (ii) believed there had been a misrepresentation.

In Northwest Territories, no action may be commenced to enforce such right of action described above more than: (a)

in the case of action for rescission, no later than 180 days from the date the purchaser purchased the units of a class of a fund; or

(b)

in the case of any action, other than an action for rescission: (i) 180 days from the day that the purchaser first had knowledge of the facts giving rise to the cause of action, or (ii) three (3) years from the day the purchaser purchased units of that class of the fund, whichever period expires first.

Nunavut Territory

If this offering memorandum contains a misrepresentation, a purchaser resident in the Nunavut Territory who buys units of a class of a fund during the period of distribution, has, without regard to whether the purchaser relied on the misrepresentation, a right of action for damages against (i) the fund, and (ii) every - 40 -

person or company who signed this offering memorandum, but may elect (while still the owner of any of units of that class of the fund that they purchased) to exercise a right of rescission against the fund, in which case the purchaser shall have no right of action for damages, provided that: (a)

neither the fund nor any other person will be liable if the fund or such person proves that the purchaser purchased units of a class of the fund with knowledge of the misrepresentation;

(b)

in an action for damages, neither the fund nor any other person will be liable for all or any po rtion of such damages if the fund or such person proves that they do not represent the depreciation in value of units of that class of the fund as a result of the misrepresentation relied on; and

(c)

the amount recoverable under this right of action must not exceed the price at which units of that class of the fund purchased by the purchaser were offered.

In an action for damages, no person, other than a fund, is liable: (a)

if the person proves that this offering memorandum was sent to the purchaser without the person's or company's knowledge or consent, and that, on becoming aware of its being sent, the person had promptly given reasonable notice to the fund that it was sent without the person's knowledge and consent;

(b)

if the person proves that, on becoming aware of the misrepresentation, the person had withdrawn the person's consent to this offering memorandum and had given reasonable notice to the fund of the withdrawal and the reason for it; or

(c)

with respect to any pa rt of this offering memorandum not purporting to be made on the authority of an expert and not purporting to be a copy of, or an extract from, a repo rt, opinion or statement of an expert, unless the person (i) failed to conduct a reasonable investigation to provide reasonable grounds for a belief that there had been no misrepresentation, or (ii) believed there had been a misrepresentation.

In the Nunavut Territory, no action may be commenced to enforce such right of action described above more than: (a)

in the case of action for rescission, 180 days from the date the purchaser purchased units of a class of a fund; or

(b)

in the case of any action, other than an action for rescission: (i) 180 days from the day that the purchaser first had knowledge of the facts giving rise to the cause of action, or (ii) three (3) years from the day the purchaser purchased units of that class of the find, whichever period expi res first.

Yukon Territory

If this offering memorandum contains a misrepresentation when a purchaser resident in the Yukon Territory who buys units of a class of a fund during the period of distribution, has, without regard to whether the purchaser relied on the misrepresentation, a right of action for damages against (i) the fund, and (ii) every person or company who signed this offering memorandum, but may elect (while still the owner of any of units of that class of the fund that they purchased) to exercise a right of rescission against the fund, in which case the purchaser shall have no right of action for damages, provided that::

(a)

neither the fund nor any other person will be liable if the fund or such person proves that the purchaser purchased units of that class of the fund with knowledge of the misrepresentation;

(b)

in an action for damages, neither the fund nor any other person will be liable for all or any po rtion of such damages if the fund or such person proves that they do not represent the depreciation in value of units of that class of the fund as a result of the misrepresentation relied on; and

(c)

the amount recoverable under this right of action must not exceed the price at which units of that class of the fund purchased by the purchaser were offered.

In an action for damages, no person, other than a fund, is liable: (a)

if the person proves that this offering memorandum was sent to the purchaser without the person's or company's knowledge or consent, and that, on becoming aware of its being sent, the person had promptly given reasonable notice to the fund that it was sent without the person's knowledge and consent;

(b)

if the person proves that, on becoming aware of the misrepresentation, the person had withdrawn the person's consent to this offering memorandum and had given reasonable notice to the fund of the withdrawal and the reason for it; or

(c)

with respect to any pa rt of this offering memorandum not purporting to be made on the authority of an expert and not purporting to be a copy of, or an extract from, a repo rt, opinion or statement of an expert, unless the person (i) failed to conduct an investigation to provide reasonable grounds for a belief that there had been no misrepresentation, or (ii) believed there had been a misrepresentation.

In the Yukon Territory, no action may be commenced to enforce such right of action described above more than: (a)

in the case of action for rescission, 180 days from the date the purchaser purchased units of a class of a fund; or

(b)

in the case of any action, other than an action for rescission: (i) 180 days from the day that the purchaser first had knowledge of the facts giving rise to the cause of action, or (ii) three (3) years from the day the purchaser purchased units of that class of the fund, whichever period expires first.

CERTIFICATE For Alberta Purchasers Only Buying Units of a Class of a Fund with a Minimum Value of $150,000 This Offering Memorandum contains no untrue statement of material facts and does not omit to state a material fact that is required to be stated or that is necessary to make a statement not misleading in the light of the circumstances in which it was made. October 30th, 2013 DAVIS-REA LTD., as manager and promoter of each Fund

John O'Connell Chief Executive Officer By: Zachary Chief • • rating

DAVIS-REA POOLED FUNDS

DAVIS-REA BALANCED FUND DAVIS-REA EQUITY FUND DAVIS-REA FIXED INCOME FUND DAVIS-REA PARTNERS FUND DAVIS-REA ENHANCED INCOME FUND

Davis-Rea Ltd. 79 Wellington Street West, Suite 3535 P.O. Box 239, Toronto, Ontario, M5K 1J3 Telephone: 416-324-2200 Fax: 416 -324-2201 Toll Free: 1- 877- 391-9929

www.davisrea.com