BMO Global Dividend

September 2015

Sri Iyer, Managing Director, Systematic Strategies

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Stability, Vision, Results

Trust and stewardship

Long-term investors

Client focused

At Guardian Capital, we value our

clients’ trust and view

stewardship of their assets as

our primary responsibility.

We invest with the confidence that

comes from a highly disciplined

investment process and a

constant awareness of risk and

fiduciary responsibility.

Our strength is our culture,

enabling our stability and a long-

term focus.

•Servicing Investors Since 1962

Guardian Capital Profile

• 129 Institutional clients

•$23.2 Billion*

Clients

•Equity Strategies

•Fixed Income Strategies

•Income Strategies

•Direct** / Indirect Real Estate

Strategies

•28 Investment Professionals

•38 Management and Administrative Associates

Team

* Guardian Capital LP as at June 30th, 2015

** Through Guardian Capital Real Estate Inc.

2 Sources: MSCI World - Morgan Stanley

Top-Down Architecture: What it

means to you

Region, country, size and style has diminished as alpha sources

Industry groups and sectors now at the forefront of alpha generation

Bottom-up stock selection is key

0%

5%

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15%

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35%

40%

Jan-95 Jan-97 Jan-99 Jan-01 Jan-03 Jan-05 Jan-07 Jan-09 Jan-11 Jan-13 Jan-15

Month

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Industry Group Sector Style Size Country Region

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Dividends: The Largest Contributor to

Total Return

Long-term trend

Dividends have been the largest contributor to total returns and ERP over the long-term

This secular trend is expected to continue

Dividend as an asset class calls for a routine quality assessment of cash flow sustainability of a company

MSCI Total Return Indices are calculated With

Gross Dividends:

Gross total return indices reinvest as much as

possible of a company’s dividend distributions. The

reinvested amount is equal to the total dividend

amount distributed to persons residing in the country

of the dividend-paying company. Gross total return

indices do not, however, include any tax credits.

MSCI World, Figures provided are in USD

Date Range: 31/12/1969 – 09/03/2015

66%

MSCI Country Indexes: MSCI Canada, MSCI UK, MSCI US, MSCI Japan, MSCI Germany MSCI Australia

Date Range: 31/12/1969 - 09/03/2015, Base Currency

4

Comparing Fundamentals Globally: Relative

Common factors across 10 global sectors

Applied to over 3000 stocks

Rates of Change of Fundamentals (Delta)

By using a set of common factors, we focus on sectors regardless of geography.

Each of 10 sectors has its own model, allowing Guardian to buy best-in-class stocks within each sector.

By comparing rates-of-change in company fundamentals we are able to see through the differences in accounting standards globally.

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GPS: Empirical evidence

Top Quintile Dividend Growers (red) out performed

Top quintile Earnings growers (green)

• investors reward a growing and stable payout

of earnings

• strategies ( Orange and Blue) that combine

top quartile dividend and earnings growth

significantly out perform single factor

approaches

Performance of dividend payers within Broad U.S Market Index

Companies with high payout ratios

almost uniformly underperform

• avoiding payout tails is important for

sustainability of dividends

Cumulative performance Factor Rank IC

Earnings

growth

coupled with

Dividends

performs

best

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Our main thesis – stock prices revert around a Beta

captured by:

consistent cash flow

reduced estimation error

and a risk adjusted forward looking discount rate

Equity Duration

• Intrinsic Value

• Cash flow Value

• Terminal Value

• Market to Model Ratio

• Cash flow weight

Intrinsic: Cash Flow

Comparing Fundamentals Globally: Intrinsic

Unlike bonds, the cash flows that equity investors anticipate

receiving must be estimated and thus are less certain.

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rowth Dividend growth is a significant factor for long term returns and depends on consistent earnings growth

ayout Quality over Quantity through balance sheet management

ustainability A Globally competitive revenue stream and margin efficiency to sustain strong ROE and dividends

Yield carry and stock selection as alpha drivers

Emphasis on dividend growth and sustainability through a combination of relative and intrinsic valuations across different Global factor buckets

Avoid yield for yield sake by looking at a stocks cash flow visibility and estimation risk of terminal value

Early Stage Rapidly Increasing Growth

Steady Growth

Mature Growth GPS

Traditional

Investable Universe: All stocks in MSCI ACWI and REITs

that pay dividends regardless of where they are on the

evolutionary chart

Philosophy: How to capture the jump from

bonds to stocks

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High Yield

Dividend

Payers Dividend

Growers Dividend

Achievers

Low Yield

High Growth

Three Primary Dividend Classes

1. Dividend Payers

⁻ High yield, stable cash flow, modest dividend growth ⁻ Cash flow allocated primarily to dividends and balance for

debt re-placement and capex

2. Dividend Growers

⁻ Low to Median yield, good cash flow growth, solid dividend growth ⁻ Cash flow allocated evenly to dividends and re-investment for

further growth, uses buybacks also.

3. Dividend Achievers

⁻ Lower yields, steady cash flow growth, residual policy for dividends ⁻ Cash flow allocated primarily to re-investment for growth and meet

payout targets, uses buybacks significantly

Low Growth

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Portfolio Review – BMO Global

Dividend As at August 31st, 2015

*Benchmark: 100% MSCI World

GICS SECTOR Weight Dividend Yield

Portfolio Benchmark* Portfolio Benchmark*

Financials 16.33% 20.82% 3.76% 3.10%

Consumer Staples 14.63% 9.92% 3.53% 2.78%

Health Care 13.63% 13.64% 2.86% 1.89%

Industrials 13.10% 10.72% 2.91% 2.60%

Consumer Discretionary 10.27% 13.16% 2.63% 1.83%

Telecomm Service 9.64% 3.38% 4.44% 4.20%

Information Technology 7.54% 13.31% 2.73% 1.65%

Energy 5.50% 6.82% 5.71% 4.09%

Materials 4.53% 4.67% 3.33% 2.99%

Utilities 4.77% 3.16% 5.22% 4.43%

Overall 3.52% 2.62%

Source: Thomson Eikon

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Portfolio Review – BMO Global Dividend As at August 31st, 2015

Energy Weight Yield Portfolio 5.5% 5.7% Benchmark 6.8% 4.1%

Financials Weight Yield Portfolio 16.3% 3.8% Benchmark 20.8% 3.1%

Healthcare Weight Yield Portfolio 13.6% 2.9% Benchmark 13.6% 1.9%

Industrials Weight Yield Portfolio 13.1% 2.9% Benchmark 10.7% 2.6%

Consumer Discr. Weight Yield Portfolio 10.3% 2.6% Benchmark 13.2% 1.8%

Williams Companies Total Royal Dutch Shell Pembina Pipeline Corp Kinder Morgan Keyera Corp Eni Spa Conocophillips Chevron Corp BP

Westpac Banking Corp Wells Fargo & Co Swedbank Sumitomo Mitsui Financial Group Spirit Realty Capital Skandinaviska Enskilda Banken Royal Bank Of Canada Prudential Munich RE Mitsubishi UFJ Financial Group Legal & General Group Plc JPMorgan Chase & Co Goldman Sachs Daiwa Securities Biomed Realty Trust AXA ANZ Banking Group Ltd

Teva Pharmaceutical Sonic Healthcare Ltd Pfizer Novartis Merck & Co Inc Medtronic Johnson & Johnson Glaxosmithkline Gilead Sciences Inc Bayer Astrazeneca Amgen Abbvie

Waste Management Sydney Airport Holdings Ltd Republic Services Inc Raytheon Co Lockheed Martin Corp Illinois Tool Works General Dynamics Corp Ferrovial FANUC Corp CSX Corp BAE Systems

Walt Disney Co VF Corp Starbucks Corp Six Flags Entertainment Corp Prosiebensat 1 Media Newell Rubbermaid McDonald's Corp Macys Genuine Parts Co Fuji Heavy Industries Ltd Daimler Ag

Util it ies Weight Yield Portfolio 4.8% 5.2% Benchmark 3.2% 4.4%

Telecom Weight Yield Portfolio 9.6% 4.4% Benchmark 3.4% 4.2%

Materials Weight Yield Portfolio 4.5% 3.3% Benchmark 4.7% 3.0%

Information Tech Weight Yield Portfolio 7.5% 2.7% Benchmark 13.3% 1.7%

Consumer Staples Weight Yield Portfolio 14.6% 3.5% Benchmark 9.9% 2.8%

SSE National Grid Duke Energy Corp Ameren Corp

Verizon Communications Telstra Corporation Swisscom Proximus Deutsche Telekom AT&T

Lyondellbasell Industries Dow Chemical BASF SE Air Products And Chemicals

Texas Instruments STMicroelectronics Seagate Technology Microsoft Corp Intel Corp DH Corp ADP Apple Inc

Unilever Reynolds American Procter & Gamble Co Philip Morris International Nestle Kimberly-Clark Corp Imperial Tobacco Group Dr Pepper Snapple Group British American Tobacco Plc Anheuser-Busch InBev Altria Group

Source: Thomson Eikon

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Quality Redefined: European Focus

Source: UBS and GCLP based upon Local Shares Composite

As of July 21st, 2015

Name RIC Dividend

Yield

Equity

Duration Bond issuer

Bond

Maturity

Credit rating

(Moody's /

S&P)

Bond Yield

to Maturity

Bond

Duration

Nestle NESN.VX 3.0 30.55 NESTLE FINANCE INTL LTD 7/19/2019 Aa2 /N/A 0.44 3.9

Royal Dutch Shell RDSa.AS 6.7 18.80 SHELL INTERNATIONAL FIN 03/24/2021 Aa1 / AA 0.87 5.4

TOTAL TOTF.PA 5.5 15.26 TOTAL CAPITAL CANADA

LTD 09/07/2020 Aa1 / AA 0.72 4.8

BASF SE BASFn.DE 3.4 18.24 BASF SE 01/22/2019 A1 / A+ 0.32 3.2

GlaxoSmithKline GSK.L 5.9 17.79 GLAXOSMITHKLINE CAPITAL 12/13/2017 A2 / A+ 0.29 2.2

Unilever NV Unc.AS 2.8 14.46 UNILEVER NV 05/08/2020 A1 / A+ 0.67 4.8

EDF EDF.PA 5.9 9.75 ELECTRICITE DE FRANCE SA 01/18/2022 Aa3 / A+ 1.12 5.8

Eni ENI.MI 7.1 10.63 ENI SPA 11/22/2021 A3 / A /* 1.11 5.8

Daimler DAIGN.DE 2.9 22.43 DAIMLER AG 06/25/2021 A3 / A 0.88 5.6

Bayer BAYGn.DE 1.7 25.84 BAYER AG 01/25/2021 A3 / A 0.77 5.0

National Grid NG.L 5.1 27.07 NATIONAL GRID PLC 10/03/2020 Baa1 / BBB+ 0.84 4.2

Deutsche

Telekom DTEGn.DE .30 24.39 DEUTSCHE TELEKOM INT FIN 07/13/2022 Baa1 / BBB+ 1.25 6.2

BAE SYSTEMS BAES.L 4.4 13.31 BAE SYSTEMS PLC 11/10/2021 Baa2 / BBB+ 3.38 5.3

Imperial Tobacco IMT.L 4.0 13.83 IMPERIAL TOBACCO

FINANCE 02/26/2021 Baa3 / BBB 1.48 5.0

4.4 18.74 1.01 4.8

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Portfolio Composition

Source: Thomson Eikon

13

Buybacks – BMO Global Dividend

Company Buyback Yield

LYONDELLBASELL INDUSTRIES NV 11.08

ILLINOIS TOOL WORKS INCORPORATED 8.92

INTEL CORPORATION 5.97

APPLE INC. 5.84

ABBVIE INC 5.52

MCDONALD'S CORPORATION 4.59

GILEAD SCIENCES, INC. 4.56

GOLDMAN SACHS GROUP INC 4.41

PFIZER INC. 4.15

SIX FLAGS ENTERTAINMENT CORPORATION 4.08

% of portfolio with positive buyback yield: 48%

Source: Thomson QAD

12-Months Ending June 30, 2015

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Dividend Growers – BMO Global Dividend

% of portfolio that raised dividends: 60%

Source: Thomson QAD

12-Months Ending June 30, 2015

Company Current DPS Previous DPS % Change

AVAGO TECHNOLOGIES LIMITED 2.114 1.42 48.79

WILLIAMS COMPANIES INC 2.38 1.768 34.65

LYONDELLBASELL INDUSTRIES NV 2.577 1.915 34.56

AMGEN INC. 2.98 2.3 29.57

SEAGATE TECHNOLOGY 2.16 1.72 25.58

STARBUCKS CORPORATION 0.64 0.52 23.08

VF CORP 1.28 1.05 21.9

ROYAL DUTCH SHELL PLC 1.661 1.363 21.8

ABBVIE INC 2.02 1.66 21.69

LEGAL & GENERAL GROUP PLC 0.118 0.098 20.41

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Global Dividend Composite Performance

Annual Rates of Return (%) $CAD

Annualized Rates of Return (%) $CAD

for Periods Ending August 31st, 2015

* Inception Date: January 1, 2007

Past Performance may not be indicative of future performance.

Returns are gross of fees

2014 2013 2012 2011 2010 2009 2008 2007

Guardian Global Dividend 16.16 23.52 7.05 5.75 9.50 16.30 -18.08 -4.20

MSCI World 14.46 35.42 13.61 -5.26 7.07 15.06 -28.36 -8.47

MSCI ACWI 13.61 31.28 13.31 -3.41 6.21 11.09 -26.52 -6.43

1 Month 3 Months YTD 1 Year 3 Year 5 Year 7 Year Since

Inception*

Guardian Global Dividend -4.73 -0.70 9.46 16.64 17.32 14.69 10.16 6.86

MSCI World -5.36 -1.51 11.20 16.75 22.34 16.00 8.48 4.89

MSCI ACWI -5.60 -2.68 10.80 14.13 20.63 14.47 7.89 4.59

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Quality: Hedge against equity volatility

Source: BofA Merrill Lynch US Equity & US Quant Strategy, CBOE, S&P

Correlation of BofAML Quality Indices 12-month returns to 12-month changes in VIX

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A Fundamental Mispricing of Risk

Source: BofA Merrill Lynch US Equity & US Quant Strategy. As of 6/30/15)

Price Beta vs. Earnings risk for S&P 500 Sectors

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Demographics

Source: UN

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Sri Iyer, MBA

Managing Director - Head of Systematic Strategies

Sri joined Guardian Capital in 2001 to help lead the development and implementation of our proprietary systematic equity

portfolio management strategy. Prior to joining Guardian, Sri was with Global Value Investors in Princeton, New Jersey

responsible for a variety of portfolio management and financial engineering roles. Sri graduated with a Bachelor of

Commerce from the University of Bombay in 1989, earned his Chartered Cost and Works Accountant (India) designation

in 1990 and his MBA (Applied Finance) from Rutgers Graduate School of Management in 1994.

Systematic Strategies Team

Adam Cilio, MMF, CFA, FRM

Senior Portfolio Engineer - Systematic Strategies

Adam joined Guardian Capital LP in 2008 as a portfolio engineer with responsibility for research and modeling in our

systematic strategies team. Prior to joining Guardian Capital, he was a Market Risk Analyst with TD Securities. Adam

graduated with a Bachelor of Applied Science (Industrial Engineering) from the University of Toronto in 2004 and he

obtained his Masters of Mathematical Finance from the University of Toronto in 2005 and is a CFA Charterholder. He

obtained his Financial Risk Manager designation from Global Associations of Risk Professionals in 2012.

Fiona Wilson, MBA, CFA

Portfolio Manager - Systematic Strategies

Fiona Wilson joined Guardian Capital LP in 2011 as a Portfolio Manager in our systematic strategies team. Fiona began her

career as an options trader at CIBC and progressed to become Head of Currency Options Marketing, South East Asia for

Societe Generale with postings in Tokyo, Singapore and London. Her experiences included structuring classical and exotic

option trading and hedging strategies for central banks, corporate and institutional clients throughout Asia. She subsequently

took on the role of Portfolio Manager, Global Derivative Instruments with Ontario Municipal Employees Retirement System

(OMERS). Fiona graduated with a Bachelor of Arts from the University of Western Ontario and obtained her Honours

Bachelor of Commerce and MBA from the University of Windsor. Fiona is also a CFA Charterholder.

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Systematic Strategies Team

Harpreet Singh, MBA, CFA

Director of Research and Portfolio Management - Systematic Strategies

Harpreet joined Guardian Capital LP in 2012 as Director of Research and Portfolio Management with responsibility for

research and portfolio management in our systematic strategies team. Harpreet Singh is a proven senior investment

professional in portfolio management and construction, risk analysis and quantitative modeling. Previously, he was the Head

of US Equities at Manulife Asset Management in Toronto, where he successfully guided fundamental as well as quantitative

analysts and portfolio managers in a disciplined portfolio construction process established by him. Before that, Harpreet was a

Quantitative Associate at Standish, Ayer & Wood, Inc., a leading asset management firm in Boston. Harpreet earned a

B.Tech. in Chemical Engineering from The Indian Institute of Technology in New Delhi in 1989 and his MBA in Finance in

1992 from Bentley Graduate School of Business in Massachusetts. Harpreet is a CFA Charterholder.

Elgin Chau, B.Sc

Quantitative Analyst – Systematic Strategies

Elgin joined Guardian Capital LP in 2014 as a Quantitative Analyst with responsibility for assisting in research and modeling

in our systematic strategies team. Prior to joining Guardian, Elgin was a Business Intelligence consultant with Hitachi Corp.

as well as a programmer analyst with Capital one. As a Software Engineer, Elgin’s work experience has centered around

using innovative computer and financial technology to provide financial information. Elgin has a Bachelor’s Degree in

Computer Science from the University of Toronto (2008). He is pursuing his CFA designation.

Peter Michaels, M.Eng, CFA

Portfolio Engineer - Systematic Strategies

Peter joined Guardian Capital LP in 2012 as a senior Quantitative Analyst with responsibility for research and modeling in

our systematic strategies team. Peter has worked with some of the largest institutions in Canada that include Scotia

Capital, Symcor and Honeywell Aerospace. As a Software Engineer, Peter’s work experience has centered around using

innovative computer and financial technology to provide financial information to portfolio managers and financial institutions.

Peter has a Masters Degree in Computer Engineering from the University of Toronto (2008).

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This presentation may include information and commentary concerning financial markets that was developed at a particular point in time.

This information and commentary are subject to change at any time, without notice, and without update. This commentary may also include

forward looking statements concerning anticipated results, circumstances, and expectations regarding future events. Forward-looking

statements require assumptions to be made and are, therefore, subject to inherent risks and uncertainties. There is significant risk that

predictions and other forward looking statements will not prove to be accurate. Investing involves risk. Equity markets are volatile and will

increase and decrease in response to economic, political, regulatory and other developments. The risks and potential rewards are usually

greater for small companies and companies located in emerging markets. Bond markets and fixed-income securities are sensitive to

interest rate movements. Inflation, credit and default risks are also associated with fixed income securities. Diversification may not protect

against market risk and loss of principal may result.

Performance for Guardian Capital LP (Institutional Division) Composites has been calculated on a trade basis, time weighted, valued

monthly, with geometric linking of period returns. Performance is calculated gross of investment fees and net of transactions costs. Index

or benchmark performance is shown for comparison purposes. Index returns do not reflect fees, transaction costs or expenses. Please

consult the applicable Composite disclosure page for further details on performance and performance calculation.

The information provided in this presentation should not be considered a recommendation to purchase or sell any particular security.

There can be no assurance that the portfolio will continue to hold the same position in companies referenced here, and the portfolio may

change any position at any time. The securities discussed do not represent an account’s entire portfolio and in the aggregate may

represent only a small percentage of an account’s portfolio holdings. It should not be assumed that any of the securities discussed were or

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investment performance of the securities discussed.

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Disclosure