Securities legislation in Canada requires Beutel, Goodman & Company Ltd. (“Beutel Goodman”) to make certain disclosures regarding conflicts of interest. This statement is to inform you of the nature and extent of conflicts of interest that might be expected to arise between Beutel Goodman and its clients.

It is important for you to be informed about how we identify and respond to conflicts of interest in order to minimize their impact.

Material Conflicts of Interests

A “conflict of interest” occurs whenever the personal interests of Beutel Goodman, or an individual acting on its behalf, may potentially conflict with those of a client, or in a situation where Beutel Goodman, or an individual acting on its behalf, has an obligation to more than one party whose interests are different. A conflict of interest can also exist where monetary or non-monetary benefits are made available to Beutel Goodman, or an individual acting on its behalf, as incentives.

Conflicts of interest may be large enough to be material (in which case they are addressed as described in this document) or small enough to be immaterial (in which case no further action is taken to address them). In determining the materiality of a conflict of interest, Beutel Goodman will consider whether the conflict may be reasonably expected to affect the decisions of its client in a particular situation or the recommendations and/or decisions Beutel Goodman makes on behalf of its client.

Beutel Goodman addresses material conflicts of interest in the best interest of our clients. This is done by placing the interests of clients first, ahead of the personal interest of Beutel Goodman and any other competing considerations. As such, Beutel Goodman takes reasonable steps to identify, address and avoid any existing material conflicts of interest or foreseeable material conflicts of interest that we would reasonably expect to arise (i.e., between us and a client and between each individual acting on our behalf and a client). Beutel Goodman determines the level of risk for each material conflict. The Firm avoids situations that would result in a serious conflict of interest that would be too high a risk for clients or market integrity and will ensure that it will act in the client’s best interest. In other circumstances involving a conflict of interest, Beutel Goodman takes the appropriate steps to control the conflict of interest. Similarly, if a particular conflict is capable of being addressed by using controls, but the specific controls being used by us are not sufficiently mitigating the effect of the conflict, we will avoid that conflict until we have implemented controls sufficient to address the conflict in the best interest of the client.

Individuals acting on behalf of Beutel Goodman also are required to identify potential conflicts of interest and bring them to the attention of Beutel Goodman, and will also disclose any relevant information that may arise in a potential conflict of interest to Beutel Goodman. If the individual is uncertain as to whether a potential conflict of interest exists or could arise, the matter should be directed to the Chief Compliance Officer or General Counsel for discussion. Any individual who identifies a potential conflict of interest will await approval from Beutel Goodman’s Chief Compliance Officer prior to acting on behalf of the client, in order to ensure that any actions taken on the client’s behalf are in their best interest.

Beutel Goodman, whose office is located in Toronto, Ontario, is a portfolio manager in the business of providing discretionary investment advisory services to its clients across Canada, and is also an investment fund manager, managing the assets of a group of proprietary pooled investment funds (“BG Pooled Funds”). In addition, Beutel Goodman as a mutual fund dealer, in Ontario, and as an investment fund manager, in Ontario and Quebec, manages the Beutel Goodman Managed Funds, a group of prospectus-qualified mutual funds (“BG Managed Funds”). The BG Pooled Funds and BG Managed Funds are collectively referred to as the “BG Funds”.

Each of the BG Managed Funds has an Independent Review Committee (“IRC”). The IRC reviews and advises on the BG Managed Funds’ conflict of interest matters. Beutel Goodman has policies and procedures to identify and control actual or potential conflicts of interest matters related to these funds.

Beutel Goodman takes proactive measures to anticipate reasonably foreseeable conflicts of interest, assesses the materiality of such conflicts to distinguish between those conflicts that are material and those that are not and has developed adequate procedures to identify existing conflicts. The situations in which Beutel Goodman could be in a conflict of interest, and the way in which Beutel Goodman intends to respond to such conflicts, are described below.

Proprietary Products - Beutel Goodman only offers BG Funds to its clients. When recommending BG Funds to a client, Beutel Goodman seeks to ensure those BG Funds are suitable for that client. Beutel Goodman conducts periodic reviews of a sample of mutual funds offered by others and compares the features and performance of the BG Funds to those other mutual funds.

Related Registrants – Affiliated Managers Group, Inc. (Massachusetts, USA) (“AMG”), through its indirect ownership in AMG Canada Corp. (Toronto, Ontario) and First Asset Capital Management III Inc. (Toronto, Ontario), a Canadian based financial services holding company, holds a minority 49% position in Beutel Goodman.

AMG is also the principal shareholder of certain dealers and advisers (“AMG Affiliates”). As a result of the AMG ownership interests, these AMG Affiliates are viewed as ‘related registrants’ to Beutel Goodman, registered with securities regulatory authorities in Canadian jurisdictions or in the United States. Except as described in this document, Beutel Goodman does not have any business dealings with AMG Affiliates and does not conduct any joint operations with them. These AMG Affiliates do not formulate advice for the firm’s clients and do not, in the firm’s view, present any potential conflict of interest with the firm’s clients. Listed below are the AMG Affiliates:

1. Foyston, Gordon & Payne Inc.
2. Montrusco Bolton Investments Inc.
3. River Road Asset Management, LLC
4. AQR Capital Management, LLC

The potential for conflict of interest is further minimized by the fact that, although AMG holds an ownership interest in each of them, the AMG Affiliates operate as discrete businesses with separate management and separate, individually constituted, boards of directors or equivalent. If Beutel Goodman determines that it is appropriate to engage an AMG Affiliate for a client, or to have the client invest in financial products offered by an AMG Affiliate, Beutel Goodman will notify the client of the relationship in advance and where applicable, obtain the client’s prior written consent. If the engagement or investment is for the BG Managed Funds, Beutel Goodman will obtain the approval of the IRC before such engagement or investment.

Representatives of AMG and AMG Affiliates may from time to time act as directors of Beutel Goodman and may also be directors of AMG Affiliates. All AMG Affiliates have adopted policies and procedures that minimize the potential for conflicts of interest resulting from relationships of directors and the AMG Affiliates.

It is Beutel Goodman’s policy to ensure that the engagement of AMG Affiliates on behalf of Beutel Goodman’s clients would only be done when it has been determined that such AMG Affiliate is an appropriate selection in the circumstances.

Investments in Related or Connected Issuers – As manager of investment funds, Beutel Goodman is connected to its own proprietary investment funds, the BG Funds. It is also related or connected to certain issuers who, in turn, are related or connected to AMG by virtue of AMG’s ownership interest in, or relationship with, these issuers (“AMG Issuers”). A related issuer means a person or company that influences or is influenced by, another person or company through ownership, or direction and control over, voting securities. A person or company is connected to another person or company if, due to its relationships with such person or company, a prospective purchaser of securities of the person or company might question the other person or company’s independence from the first person or company.

Beutel Goodman (including the BG Funds) does not invest assets of its clients in AMG or AMG Issuers. If Beutel Goodman does intend to invest in these connected or related issuers for its clients, before trading, or advising their clients, it will inform them of the relevant relationships and connections with the issuer of the securities and where applicable, obtain the client’s prior written consent. Furthermore, if the investment is proposed for one or more of the BG Managed Funds, Beutel Goodman will obtain the written approval of the IRC prior to making the investment. Listed below is the list of the AMG Issuers:

1. Affiliated Managers Group, Inc.
2. AQR group of mutual funds
3. Foyston, Gordon & Payne group of pooled funds
4. Harding Loevner group of mutual funds
5. AMG Funds group of mutual funds
6. Montrusco Bolton Focus (Canadian) Global Fund Ltd.
7. Montrusco Bolton group of pooled funds
8. Third Avenue group of mutual funds
9. Tweedy, Browne group of mutual funds

Services of Related Parties – Beutel Goodman is party to a client servicing and marketing agreement with one or more subsidiaries of AMG under which the AMG subsidiaries may market certain of Beutel Goodman’s investment strategies to wholesale clients and provide client services to Beutel Goodman’s clients in various foreign jurisdictions. Beutel Goodman pays the AMG subsidiaries a fee for these services.

Referral Arrangements – Beutel Goodman has in place referral arrangements whereby the referrer refers clients to Beutel Goodman for a fee. Details of the referral arrangement, including the fee paid by Beutel Goodman to the referrer and the nature of any existing or reasonably foreseeable conflicts of interests that may arise from such referral are disclosed to the clients being referred.

Conflicts of Interest Relating to Beutel Goodman Personnel/Personal Trading – Beutel Goodman’s personnel may find themselves in situations where their personal interests are in conflict with those of a client.

Beutel Goodman’s Code of Ethics and related policies and procedures establish basic principles for employee conduct which, among other things, prohibit an employee from:

• Using confidential information acquired in connection with his or her duties
• Accepting gifts, entertainment and compensation that would influence decisions to be taken in the course of performing his or her duties
• Engaging in activities that could interfere or conflict with his or her duties.

Beutel Goodman does not allow any of its personnel to engage in activities outside the scope of their duties, including serving as a director of a company or other entity, without first ensuring that such activities do not compromise the interests of Beutel Goodman’s clients.

When Beutel Goodman staff invest in the same securities as Beutel Goodman, including its funds, there is a perceived or potential conflict of interest that the staff person may benefit from opportunities at the expense of Beutel Goodman’s clients or its funds. Beutel Goodman has a Code of Ethics that sets out standards for business conduct so as to prevent conflicts of interest and has established personal trading policies and procedures to monitor personal trades of employees, officers and directors who have access to information about client portfolios and the BG Funds. Every BG employee is considered an Access Person and must obtain prior written approval for trades in securities in personal accounts and accounts over which they have a beneficial interest or control. Blackout periods are applied. Personal trading records are reviewed against brokerage statements and trading approvals on a quarterly basis.

Best Execution and Soft Dollars – When placing orders for and on behalf of clients’ accounts, Beutel Goodman will select those brokers and dealers from whom they reasonably can expect to obtain the best execution (after considering all transaction costs and research or other benefits). Beutel Goodman may receive soft dollars in connection with trades in securities on behalf of clients and BG Funds. Soft dollars create a perceived or potential conflict of interest to the extent that Beutel Goodman may use soft dollars for services that benefit Beutel Goodman but not necessarily all or any of their clients or BG Funds. Beutel Goodman complies with Canadian and U.S. regulatory requirements for soft dollar practices. Copies of the best execution and soft dollar policies of Beutel Goodman are available on request.

Fair Allocation Among Clients – Beutel Goodman is appointed to act as an advisor to many clients. It may aggregate orders for a number of client accounts for the purchase of a particular security. Unfair allocation of trades by Beutel Goodman is a potential conflict of interest. To avoid any potential conflicts of interest, Beutel Goodman has adopted trading policies designed to ensure fair allocation of securities among clients. A copy of Beutel Goodman’s fair allocation policy is provided to new clients before opening an account and thereafter when a significant change to the policy is made. A copy is available on request.

Fees and Valuation – Beutel Goodman charges its clients fees for its advisory services based on a percentage of the market value of the client’s account. Management fees for the BG Managed Funds are set out in the prospectus of the relevant fund. These fees include a management fee and an administrative fee. Beutel Goodman must obtain the recommendation of the IRC for any increase in these management fees as well as the prior approval of securityholders for any such increase.

Beutel Goodman is responsible for the valuation of its clients’ assets and for determining the market value of the client’s account. Valuation is a potential conflict of interest because Beutel Goodman’s interest in valuing a security to show good performance for obtaining a good ranking and attracting more investment may conflict with the firm’s fiduciary responsibility to its clients to provide accurate performance calculations for investment-making purposes. Beutel Goodman has appointed a third party service provider to obtain the prices of securities in clients’ accounts and in the BG Funds and the net asset value of the BG Managed Funds. Beutel Goodman has valuation policies and procedures designed to mitigate any potential conflicts of interest.

Expense Allocation Among Funds and in a Fund – All operating expenses of the BG Funds are allocated in an equitable manner. The management fees are charged based on the rates set out in the offering documents for the BG Managed Funds or in your investment management agreement with BG. Operating expenses are allocated generally based on assets of each of the BG Funds. Beutel Goodman has established procedures to fairly allocate expenses across the BG Funds.

Pricing Errors – Beutel Goodman may have a potential conflict of interest when determining when and how to deal with a pricing error or other type of unitholder account error, due to the time, processing cost and reimbursement of investors involved. Beutel Goodman uses a third party service provider to calculate net asset values of the BG Managed Funds. Beutel Goodman has policies that establish consistent standards for the correction of discrepancies in the calculation of net asset value across the BG Managed Funds and in accordance with industry guidelines.

Proxy Voting – Beutel Goodman generally has discretion in voting the portfolio securities purchased for clients. A perceived conflict of interest arises because of the opportunity for the firm to vote securities or to agree to certain corporate actions in its own interest. To minimize this potential conflict, Beutel Goodman has contracted with an independent third party to provide proxy voting recommendation and voting record services. Clients may request a copy of the third party’s policies and procedures. Beutel Goodman does not invest in securities of issuers in order to exercise control over, or participate in, the management of issuers. An individual proxy voting report is sent to all institutional clients as part of the client quarterly report. A record of the proxy voting for the BG Managed Funds is available at beutelgoodman.com.

Other Conflicts of Interest – From time to time, other conflicts of interest may arise. Beutel Goodman will continue to take appropriate measures to identify and respond to such situations fairly and reasonably and in the best interests of its clients.

This document is kept current and is posted on our external website at www.beutelgoodman.com or you may contact us for the most recent version.