Prospectus. November 2, 2012

Transcription

1 No securities regulatory authority has expressed an opinion about these securities and it is an offence to claim otherwise. Prospectus November 2, 2012 SCHOLARSHIP PLANS qualified to be registered as Registered Education Savings Plans subject of a continuous offering in an unlimited number, by: The UNIVERSITAS plan Trust The REFLEX plan Trust The INDIVIDUAL plan Trust Through: Universitas Management Inc. (Exclusive distributor)

2 This prospectus covers the distribution of education savings plans (the plans ) issued respectively by the UNIVERSITAS plan Trust, the REFLEX plan Trust and the INDIVIDUAL plan Trust (collectively, the Trusts ), for which the Universitas Foundation of Canada (the Foundation ) is the promoter. These securities are only available through subscription in the provinces and territories where the securities commission with jurisdiction issued an official receipt of visa approval and may only be offered by persons duly registered pursuant to securities legislation. Universitas Management Inc. ( Universitas Management ) acts as Trust Manager ( Manager ) and, by way of its representatives, as exclusive Distributor of the plans ( Distributor ). Since the Distributor is the Trust Manager, the Trusts are deemed to be its connected issuers within the meaning of Regulation respecting Underwriting Conflicts. See the Trust Manager and Distributor section. Each plan is recognized in a scholarship agreement or educational assistance payment agreement between the Foundation, acting on behalf of the Trust issuing the plan, and the physical person who purchases it (the subscriber ). A plan enables the subscriber to save while encouraging the post-secondary education of a person he designates (the beneficiary ) to obtain scholarships or educational assistance payments ( EAP ) from the Trust that issued the plan. The contributions and government incentives received by the Manager in favour of the registered education savings plan ( RESP ) pertaining to the plans of this Trust, as well as the investment income earned on these contributions and incentives and paid to this same Trust, are invested and managed in compliance with the investment policies adopted by the Foundation. The investment policies of the Foundation aim to preserve the capital invested by the subscribers and achieve a profitable return on the latter over the long term. See the Investment Objectives, Strategies and Restrictions section. They ensure reimbursement, at maturity, of contributions and membership fees payable pursuant to the provisions of the scholarship agreement or educational assistance payment agreement. To implement these policies and manage the investment portfolio constituted as a result, the Manager retained the services of Addenda Capital Inc., Fiera Capital Corporation, AlphaFixe Capital Inc., Jarislowsky Fraser Limited and Montrusco Bolton Investments Inc. These portfolio managers are registered under the securities legislation. See the Trust Organization and Management Conditions Portfolio Managers section. The provisions of a Trust plan are established in consideration of the provisions applicable to the plan in question, pursuant to the current securities legislation and tax laws. These laws and their official interpretation may be amended, restated or repealed, in which case the plan s provisions may vary accordingly. Subscription to a plan incurs fees, including membership fees. See the Summary of the Prospectus Fees and Other Deductions section. A minimum contribution amount is also required depending on the beneficiary s age and the plan chosen. See the UNIVERSITAS and REFLEX Plans Minimum Contributions and INDIVIDUAL Plan sections. Education savings, our specialty since 1964

3 To obtain the registration of an Education Savings Plan ( ESP ) established by a plan promoted by the Foundation, section of the Income Tax Act (Canada) requires the social insurance number (SIN) of the designated beneficiary as well as that of the subscriber. Obtaining this information is a prerequisite for the coming into force of the scholarship agreement or educational assistance payment agreement, as well as for eligibility for the government incentives. You can make contributions on behalf of a beneficiary whose SIN has not yet been provided. However, these contributions will be paid into a non-interest-bearing suspense account pending our receipt of the missing SIN. When the missing SIN is not provided within a 12-month delay, all contributions made to the suspense account are reimbursed since there is a total cancellation of the agreement, less the amount of membership fees already paid. As with any type of investment, subscribing to a plan involves certain risks. See the Risk Factors sections. Some of the statements presented in this prospectus or incorporated by reference, including those which are prospective by their very nature, which depend on or refer to uncertain future events or conditions, or which use terms such as expect, intend, predict, foresee, project or other similar terms are prospective statements within the meaning given to this expression by the securities legislation. Such statements include information concerning possible or expected future results from the management of the subscriber contributions, the management of the government incentives paid on their behalf, or assessments and forecasts made by the Trusts external actuary. These statements are not historical facts. Rather, they reflect the Manager s expectations, estimates and projections regarding future events. By their very nature, these statements require that the Manager make assumptions whose future veracity is subject to certain risks and uncertainties, both general and specific, which could cause the return on the investment portfolios constituted under the plans, as well as the results of a Trust Foundation itself, to differ more or less considerably from the products, performance or results expressed or implied in these prospective statements. This is why the Manager warns against the dangers of having absolute confidence in these prospective statements. The subscriber who relies on them would benefit from taking this into account and carefully considering these uncertainties and related risks. Additional information on the risks is provided in the section Risk Factors. The masculine form in this document is used to designate both men and women, and is used solely for the purpose of improving readability of the document. 3

4 TABLE OF CONTENTS DOCUMENTS INCORPORATED BY REFERENCE 7 Why is it beneficial to read the documents incorporated by reference to the prospectus before subscribing to a scholarship plan?... 7 GLOSSARY 8 SUMMARY OF THE PROSPECTUS 12 The Foundation Plans, contributions, scholarships and educational assistance payments (EAPs) The Education savings plans ESPs ORGANISATION AND MANAGEMENT OF THE TRUSTS The Trusts ELIGIBLE STUDIES ACADEMIC ITINERARY TAKEN BY A STUDENT Possible direction taken by a student in Canada or Abroad Possible direction taken by a student in the province of Quebec IMPORTANT DATES WHEN SUBSCRIBING TO AN RESP FEES AND OTHER DEDUCTIONS CONVERSION OF GROUP PLANS TO AN INDIVIDUAL PLAN ANNUAL RETURNS AND TOTAL EXPENSES The Trusts annual returns Total expenses OVERVIEW OF THE FOUNDATION S STRUCTURE 25 HISTORY AND STRUCTURE THE PLANS GENERAL IMPLEMENTATION CONDITIONS Contributions...26 Government incentives...26 Earned income...26 INVESTMENT OBJECTIVES, STRATEGIES AND RESTRICTIONS 27 INVESTMENT OBJECTIVES INVESTMENT STRATEGIES ELIGIBLE INVESTMENTS Subscriber Accounts...27 Trust Account...28 Investments eligible for an RESP...28 INVESTMENT RESTRICTIONS GOVERNMENT EDUCATION SAVINGS INCENTIVES 29 Eligibility Conditions for Government Incentives...29 CANADA EDUCATION SAVINGS GRANT What is the maximum CESG amount to which a benefi ciary is entitled?.29 Can I carry forward the annual limit giving entitlement to the CESG?...29 Is the benefi ciary eligible for the CESG if he is 16 or 17 years old?...29 CANADA LEARNING BOND QUEBEC EDUCATION SAVINGS INCENTIVE What is the maximum QESI amount to which a beneficiary is entitled?...30 Can I benefi t from the QESI cumulative rights from previous years?...30 Is the benefi ciary entitled to the QESI if he is 16 or 17 years old?...30 REFUND OF GOVERNMENT INCENTIVES What are the cases in which the CESG must be returned to the Government of Canada?...30 What are the cases in which the CLB must be returned to the Government of Canada?...31 What are the cases in which the QESI must be returned to the Government of Quebec?...31 What happens to government incentives when subscriber contributions are reimbursed at the maturity of a UNIVERSITAS or REFLEX plan?...31 In what other cases must government incentives be returned?...31 When government incentives are returned, what happens to the income earned from their investment?...31 UNIVERSITAS AND REFLEX PLANS 32 Who are these plans intended for?...32 How do the plans work?...32 Who owns the money you pay into your plan?...32 ELIGIBLE STUDIES CRITERIA UNIVERSITAS plan...32 What programs of study are admissible?...32 REFLEX plan...33 What programs are admissible?...33 DESCRIPTION OF UNITS What is a whole unit?...33 What is a unit fraction?...33 MEMBERSHIP FEES How much are the membership fees?...33 Are membership fees refundable?...33 What measures does the manager take to assume the reimbursement of membership fees?...33 MINIMUM CONTRIBUTIONS What minimum amounts must I deposit to open a scholarship agreement?...34 QUALIFYING YEAR FOR SCHOLARSHIPS CHANGE OF QUALIFYING YEAR Can the qualifying year be brought forward?...34 Is it possible to defer the qualifying year?...34 How does the manager change the qualifying year?...34 What happens to the funds available after the cut-off date?...34 FULL REIMBURSEMENT OF CONTRIBUTIONS Can I recover the contributions I have paid?...35 Is it possible to keep the government incentives paid on behalf of the benefi ciary despite a reimbursement of contributions?

5 What happens to government incentives if I defer the reimbursement of my contributions?...35 WAIVER OF INTEREST What happens to the income earned on my contributions as a subscriber?...35 DEATH OR DISABILITY OF THE BENEFICIARY What should I do in the event of the benefi ciary s death or total and permanent disability?...36 What will become of my scholarship agreement in the event of the benefi ciary s death or total and permanent disability?...36 CHANGE OF BENEFICIARY Is a change of benefi ciary possible?...36 SCHOLARSHIP APPLICATION When and how can I apply for a scholarship?...37 What happens if the application is not submitted in due time?...37 CALCULATION OF SCHOLARSHIPS Where do the scholarship amounts come from?...37 What will happen to the funds if the beneficiary can no longer qualify?...37 CANCELLATION, RE-REGISTRATION AND SUSPENSION How can I cancel my scholarship agreement?...38 What are the other causes of total cancellation?...38 What happens to the government incentives in the case of total cancellation?...38 Can the membership fees be re-credited in the event of a cancellation?...38 How can I suspend my contributions?...38 What happens in case of default or delay in the payment of my contributions?...38 PLAN CONVERSION/TRANSFER...39 Can I convert my plan into another plan promoted by the Foundation?...39 Is it possible to transfer an RESP promoted by the Foundation to an RESP offered by another institution?...39 Is it possible to partially convert or transfer an RESP?...39 What are the income tax considerations of a conversion or transfer?...39 SPECULATIVE AND UNCERTAIN NATURE LIFE AND DISABILITY INSURANCE 40 INDIVIDUAL PLAN 41 For whom is the INDIVIDUAL plan intended?...41 How does the INDIVIDUAL plan work?...41 Who owns the contributions I pay into the plan?...41 ELIGIBLE STUDIES CRITERIA What are the objective eligibility criteria?...41 Membership Fees...41 DEATH OF THE BENEFICIARY What should I do in the event of the benefi ciary s death?...41 What will become of my EAP agreement in the event of the benefi ciary s death?...42 CHANGE OF BENEFICIARY Is a change of benefi ciary possible?...42 EDUCATIONAL ASSISTANCE PAYMENTS (EAPS) When and how can one apply for an EAP?...42 What EAP amounts may the benefi ciary receive?...42 Where do the sums that make up the EAP come from?...42 What happens if the benefi ciary does not qualify?...42 CANCELLATION AND RE-REGISTRATION How can I cancel my EAP agreement?...43 Can I withdraw my contributions without cancelling my EAP agreement? PLAN CONVERSION/TRANSFER Can I convert an INDIVIDUAL plan to another plan of the foundation?...43 What are the income tax considerations of a conversion or transfer?...43 PAYMENT OF ACCUMULATED INCOME What are the requirements for receiving a payment of accumulated income?...43 How can a transfer be made from an RESP to an RRSP?...43 SPECULATIVE AND UNCERTAIN NATURE GENERAL PROVISIONS APPLICABLE TO THE THREE PLANS 44 CHANGE OF SUBSCRIBER DESIGNATION OF A BENEFICIARY Does my benefi ciary have to be a Canadian resident?...44 When do I have to provide the social insurance numbers (SINs)?...44 Can I make contributions in the benefi ciary s name before he obtains his SIN?...44 LOANS AND BURSARIES APPROVAL OF THE PLANS CONTRIBUTION LIMIT What is the cumulative limit for RESP contributions?...45 What is the maximum period for contributing to the RESP?...45 DURATION OF AN RESP (CUT-OFF DATE) When must the RESP come to an end?...45 What happens to the amounts then held by the custodian? LIMITS ON SCHOLARSHIP AND EAP AMOUNTS...45 RISK FACTORS 46 NO GUARANTEE OF ACHIEVING THE INVESTMENT OBJECTIVES LEGISLATIVE CHANGES...46 NATURE OF THE PLANS ELIGIBLE STUDIES...46 INCOME TAX CONSIDERATIONS...46 POTENTIAL CONFLICTS OF INTEREST SCHOLARSHIP AND EAP LEVELS

6 TABLE OF CONTENTS INVESTMENT RISKS...47 INTEREST RATE RISK CREDIT RISK...47 INCOME TAX CONSIDERATIONS 48 WHAT IS THE TRUST S TAXATION? WHAT IS THE SUBSCRIBER S TAXATION? WHAT IS THE BENEFICIARY S TAXATION? WHAT IS THE REGISTERED EDUCATION SAVINGS PLANS TAXATION?...48 TRUST ORGANIZATION AND MANAGEMENT CONDITIONS 49 DIRECTORS AND OFFICERS OF THE FOUNDATION PORTFOLIO MANAGERS...50 Addenda Capital Inc Fiera Capital Corporation AlphaFixe Capital Inc Jarislowsky Fraser Limited Montrusco Bolton Investments Inc Terms of the contracts to provide securities consulting CONFLICTS OF INTEREST INDEPENDENT REVIEW COMMITTEE IRC TRUSTEE...54 CUSTODIAN...54 TRUST MANAGER AND DISTRIBUTOR Terms of the trust management contract Manager Terms of the trust management contract Distributor Remuneration as trust manager and distributor Directors and offi cers of the manager EXTERNAL ACTUARY...57 AUDITORS...57 POLICIES AND PROCEDURES FOR VALUING THE TRUSTS OTHER PROVISIONS 58 RELEVANT MATTERS TO SUBSCRIBERS Notices and determination of deadlines Amendments to the agreements Modifi cation of the declaration of trust Reports for subscribers DISSOLUTION OF THE TRUSTS...58 RELATIONSHIP BETWEEN THE TRUSTS AND THE DISTRIBUTOR MAIN PLAN SUBSCRIBERS EXECUTIVE MEMBERS AND OTHER INTERESTED PARTIES IN SIGNIFICANT OPERATIONS INFORMATION REGARDING PROXY VOTE MATERIAL CONTRACTS...59 LEGAL AND ADMINISTRATIVE PROCEEDINGS EXPERTS...60 EXEMPTIONS AND APPROVALS STATUTORY RIGHTS OF WITHDRAWAL AND RESCISSION ACTUARY S CERTIFICATE AND CONSENT...61 INDEPENDENT AUDITORS CONSENT TABLES OF CONTRIBUTIONS 6 3 UNIVERSITAS GROUP PLAN...63 REFLEX GROUP PLAN...65 STATISTICS ON THE UNIVERSITAS AND REFLEX GROUP PLANS 6 7 ADDITIONS AND REDUCTIONS IN SCHOLARSHIP ELIGIBILITY...67 SUMMARY OF SCHOLARSHIPS AND RETURNS 6 8 SUMMARY OF SCHOLARSHIPS...68 SUMMARY OF AVERAGE RETURNS AS AT DECEMBER 31, SUMMARY OF THE PLANS 69 SUMMARY OF THE UNIVERSITAS GROUP PLAN AS AT DECEMBER 31, SUMMARY OF THE REFLEX GROUP PLAN AS AT DECEMBER 31, SUMMARY OF THE INDIVIDUAL PLAN AS AT DECEMBER 31, CERTIFICATES 71 6

7 DOCUMENTS INCORPORATED BY REFERENCE WHY IS IT BENEFICIAL TO READ THE DOCUMENTS INCORPORATED BY REFERENCE TO THE PROSPECTUS BEFORE SUBSCRIBING TO A SCHOLARSHIP PLAN? Certain documents containing important information with regard to each Trust are incorporated to the current prospectus by reference. This implies that they are considered to be legally part of the prospectus, even if they are not printed or physically attached hereto. For each of the Trusts, the documents incorporated by reference are: The Annual Financial Statements (audited); The Semi-Annual Financial Statements (unaudited); and The Management Report of Plan Performance. These documents contain a wealth of information to help you better understand the administration of the Trusts, of the plans they issue and of the plan to which you subscribe; including past transactions, the current financial situation, future prospects and the risks related to each plan. The financial statements of each plan comply with the applicable legislation and accounting standards in Canada. They comprise the net assets available for the payment of scholarships and EAPs and provide information regarding the increase in net assets from investment activities and the status of the investment portfolio. The additional notes will be useful in helping you better understand the applicable accounting standards, the obligation to reimburse membership fees at plan maturity and the management of the Trusts assets. The Management Report of Fund Performance, on the other hand, exposes the financial highlights of the year. This report is produced by the Manager; it presents in detail the investment objectives and strategies of the Trusts in addition to providing a comprehensive analysis of the latest returns. All these documents contribute to assist you in selecting the type of plan best suited to your situation. We encourage you to review them before subscribing to a plan issued from one or other of the Trusts. You can obtain this documentation, free of charge, through one of our certified representatives, by dialling RESP (7377), or by mailing your request to the Universitas Foundation of Canada at 3005 Maricourt Avenue, Quebec City, QC G1W 4T8. It is also possible to view the above-mentioned documents, among others, by visiting our website at universitas.ca or by visiting the AMF website at sedar.com. Moreover, as a subscriber, it is possible for you to access all documentation through our customer portal at universitas.ca under the Deposit statements tab. 7

8 GLOSSARY Beneficiary Brother CESG CLB Cohort Contribution Conversion Custodian Designated provincial program Determined program of study Distribution guide Life and Disability Insurance SSQ Distributor Earned income Earned income payment Education savings plan ESP A physical person designated individually or as a member of a cohort by a subscriber, and to whom it is agreed that scholarships or EAPs may be granted according to the subscribed plan and the RESP to which it pertains, if this person is eligible. In the context of a change of beneficiary, a conversion or the transfer of an RESP, refers to the brother of a beneficiary or the son of the spouse or common-law partner of the beneficiary s mother or father. The Canada Education Savings Grant, granted pursuant to the Canada Education Savings Act, equal to 20% of the first $2,500 annually contributed into the RESP of a beneficiary, up to the year of his 17 th birthday inclusive, and includes the enhanced CESG applicable in certain cases based on the annual family income. The Canada Learning Bond (CLB) in the amount of, subject to the conditions stipulated in the Canada Education Savings Act, $500 for the first year and $100 for subsequent years until the beneficiary reaches 15 years of age, paid into the RESP of the beneficiary born on or after January 1, 2004, aged less than 21 years, and for whom a National Child Benefit Supplement is paid as part of the Canada Child Tax Benefit. The group of beneficiaries designated under the UNIVERSITAS plan or REFLEX plan who were born in the same year and who receive scholarships of the same unit value when qualified in the same plan. An amount of money entrusted to the Foundation by a subscriber on a regular or ad hoc basis in implementation of the terms of his plan so that it may be administered by the Manager, safeguarded and kept in trust by the Trustee or for him by the Custodian, and invested according to the applicable investment policy. A contribution to an education savings plan does not include an amount paid into the plan under or because of: a) the Canada Education Savings Act or a designated provincial program; or b) any other program that has a similar purpose to a designated provincial program and that is funded, directly or indirectly, by a province (other than an amount paid into the plan by a primary caregiver in its capacity as subscriber under the plan). The transfer of an RESP related to a Trust plan to another RESP related to a Trust plan. CIBC Mellon Global Security Services Company or any successor or assignee of the latter in the duties of the Custodian, certified by the Manager. Any program administered under an agreement reached pursuant to Section 12 of the Canada Education Savings Act and any program covered by regulations adopted pursuant to this Act. For the purposes of the INDIVIDUAL plan, a post-secondary program of study with a minimum duration of three consecutive weeks, which includes courses to which a beneficiary, who is at least 16 years of age, must dedicate a minimum of 12 hours per month. Distribution guide prepared pursuant to Title VIII of the Act respecting the distribution of financial products (Quebec) and given to the subscriber by the Distributor at the time he was offered the optional life and disability insurance. The Universitas Foundation of Canada entered into a group insurance contract with SSQ, Life Insurance Company Inc. to insure the subscribers of its scholarship agreements in the event of death or disability. Universitas Management Inc. or any successor or assignee of the latter in the duties of Distributor, certified by the Manager. The interest, dividends, proceeds, gains and other income generated and earned as a result of: a) the investment and reinvestment of contributions credited to the Trust Account; and b) the investment and reinvestment of interest, dividends, proceeds, gains and other income generated and earned as a result of this investment and reinvestment. An amount paid into an RESP insofar as conditions stipulated in the Income Tax Act (Canada) and the Taxation Act (Quebec) have been respected and where the amount exceeds the fair market value of any contribution and government incentive paid into the plan for reimbursement of the amount. An education savings plan, within the meaning of the Income Tax Act (Canada) or the Taxation Act (Quebec), which is a group plan (to which a subscription makes it possible to participate) or an individual savings plan, and which is qualified for registration as an RESP pursuant to these Acts. 8

9 Educational assistance payment agreement Educational assistance payment or EAP Eligible program of study Eligible studies External actuary Family member Foundation Government incentives Guardian/Primary caregiver Investment policy Manager Maturity Membership fees Plan An educational assistance payment agreement under which a subscriber purchases from the Foundation, in its capacity as promoter of a Trust, a plan issued by the latter which enables the subscriber to establish an RESP pursuant to an INDIVIDUAL plan. Any amount that the Foundation may have paid through the Manager to a qualified beneficiary or on his behalf under the terms of a plan establishing an RESP in the INDIVIDUAL plan. For the purposes of the UNIVERSITAS and REFLEX plans, a post-secondary program, attended full-time or part-time in an educational institution offering eligible studies. Eligible programs of study or programs of study determined under the terms of a plan at maturity and provided in a post-secondary educational institution. Eckler Limited or any successor or assignee of the latter in its duties as an external actuary of a Trust, certified by the Manager. In the case of a change of beneficiary, a family member is an individual who meets the following conditions: a) the individual is the brother or sister of the former beneficiary; b) the individual (new beneficiary) and the former beneficiary are related by blood or adoption to the plan s subscriber; and c) the individual (new beneficiary) had not reached 21 years of age when the initial plan was opened. The Universitas Foundation of Canada or any successor or assignee of the latter in the duties of the Foundation. In the case of a registered education savings plan, refers to the CESG, CLB and QESI. The person with custody of the beneficiary, and eligible to receive the Canada Child Tax Benefit on his behalf when the beneficiary is eligible. An investment policy adopted by the Foundation in relation to the investment and management of: a) contributions made by subscribers to a Trust s plans; b) income earned on contributions and available for scholarships; c) government incentives posted to the assets of a Trust Account; d) income earned on government incentives; and e) amounts reserved for the obligation to reimburse membership fees at maturity. Universitas Management Inc. or any successor or assignee of the latter in the duties of the Manager, certified by the Foundation. The date stipulated in the scholarship agreement for reimbursement of contributions accumulated in the subscriber s account and the membership fees that must be returned to the latter, according to the applicable education savings plan. Fees of $200 per whole unit for the UNIVERSITAS and REFLEX plans. For unit fractions, the membership fees are equal to the above amount multiplied by this fraction as a percentage with respect to a whole unit; or Fees of $200 per educational assistance payment agreement establishing an RESP pursuant to the INDIVIDUAL plan. A plan recognized in a scholarship agreement or an educational assistance payment agreement between the Foundation on behalf of the Trust issuing the plan and a subscriber, which specifically: a) is a security within the meaning of the securities legislation and is offered and distributed by the Distributor on behalf of the Trust; b) is an arrangement establishing an education savings plan or a registered education savings plan; c) enables membership with other subscribers in the UNIVERSITAS or REFLEX plan, or establishes an RESP pursuant to the INDIVIDUAL plan; and d) provides for or refers to the Trustee s commitment to safeguard and keep in trust the contributions it receives for inclusion in a Trust s assets. A plan enables the subscriber to encourage the person he designates as beneficiary to pursue postsecondary studies, while saving for himself. 9

10 GLOSSARY Post-secondary educational institution Public guardian QESI Qualified beneficiary Registered Education Savings Plan or RESP Scholarship Scholarship agreement Sister Subscriber Refers to: a) one of the following institutions located in Canada: i) A university, college or other educational institution that is accredited by a provincial government pursuant to the Canada Student Loans Act, i.e. an authority having jurisdiction in application of the Canada Student Financial Assistance Act, or designated by the Quebec Ministère de l Éducation, du Loisir et du Sport for the purposes of application of Quebec s Act respecting financial assistance for education expenses. ii) An educational institution recognized by Human Resources and Skills Development Canada to offer courses intended to teach or improve the skills needed in the exercise of a professional activity, with the exception of courses used to obtain university credits. b) an educational institution located abroad that is a university, college or other institution offering post-secondary programs in which the beneficiary is enrolled for one or more courses having a minimum duration of 13 consecutive weeks. The public curator in the province in which the beneficiary resides for whom a special allowance is paid pursuant to the Children s Special Allowances Act (Canada) or the department, agency or institution responsible for this beneficiary. For beneficiaries who reside in Quebec, the Quebec Education Savings Incentive, granted pursuant to the Taxation Act (Quebec), equal to 10% of the first $2,500 annually contributed into the RESP of a beneficiary up to the year of his 17 th birthday inclusive, and including the enhanced QESI applicable in certain cases based on annual family income. A beneficiary registered in an eligible program of study or a determined program of study, according to the RESP for which he is the designated beneficiary. A registered education savings plan pursuant to the Income Tax Act (Canada). Any amount that the Foundation may have paid through the Manager to a qualified beneficiary under the terms of a plan permitting participation in the UNIVERSITAS or REFLEX plans. Agreement under which a subscriber purchases from the Foundation, in its capacity as promoter of a Trust, a plan issued by the latter enabling the subscriber to join with other subscribers in the UNIVERSITAS or REFLEX plans. In the context of a change of beneficiary, a conversion or the transfer of an RESP, refers to the sister of a beneficiary or the daughter of the spouse or common-law partner of the beneficiary s mother or father. An individual who subscribes to one or another of the scholarship plans offered by Universitas Management Inc. (UNIVERSITAS plan, REFLEX plan or INDIVIDUAL plan), who designates one (or many) beneficiary(ies) and who may deposit sums of money (contributions) into the plan on the beneficiary(ies) s behalf. In general, the subscriber is the child s mother or father, but can also be a grandparent, another family member or a family friend. The subscriber also includes: a) any person who is the spouse or common-law partner of an existing subscriber (pursuant to the definition that applicable legislation gives to the term spouse ) and a co-subscriber; and b) on notice given to the Foundation, i) any person who acquires subscriber rights under the plan pursuant to a decree, an order or the judgment of a competent court or by virtue of a written agreement regarding the separation of an estate between such person and the subscriber as a settlement of rights arising from their marriage, common-law relationship or from its dissolution; ii) after the death of a subscriber, the subscriber s succession or any other person who makes contributions into the plan on the beneficiary s behalf; or iii) the public guardian (and any person who has his rights in compliance with the Canada Education Savings Act). 10

11 Subscriber account Total and permanent disability Trust Trust Account Trust Agreement Trustee Unit fraction Whole unit An account safeguarded by the Custodian into which are credited the contribution amounts paid by the subscriber of this account, and which must be reimbursed to the latter at maturity. The absolute inability observed in a beneficiary by a physician to perform each of the normal activities of a person of the same age following an illness or accident. One or other of the UNIVERSITAS plan Trust, the REFLEX plan Trust or the INDIVIDUAL plan Trust, which are Trusts maintained by the declaration of Trust in compliance with the Trust Agreement and relating to which assets have been transferred, contributed, paid or entrusted to the Trustee to constitute assets to be invested, managed, safeguarded and kept in trust for the benefit of individuals who have entitlement to such assets pursuant to plans issued by these Trusts and the RESPs to which they pertain. The account maintained for each Trust with the Custodian, in which are posted the deposits and withdrawals of: a) government incentives paid to the Custodian or transferred to portfolio managers to be invested and managed; and b) income earned on contributions and government incentives; into which are credited the proceeds from the investment of these amounts insofar and according to the period determined by the Manager, and on which the Foundation can give instructions to the latter for the payment of scholarships in compliance with the plans in effect. The main Trust Agreement signed on July 9, 2010, and restated on December 23, 2010, between the Foundation, the Trustee and the Manager-Distributor. Trust Eterna Inc. or any successor or assignee of the latter in the duties of Trustee certified by the Manager. A unit fraction corresponding to one or several thousandths of a whole unit. A measurement unit used to establish, according to an evaluation validated by the external actuary, a ratio between the subscribed capital to a plan, the contributions to be paid over the term of this plan, and the scholarship or EAP levels payable in relation to these contributions at maturity of the plan. 11

12 SUMMARY OF THE PROSPECTUS The following is a summary of the main features of the three types of ESPs that can be established by subscribing to a plan promoted by the Foundation. This summary must be read together with the detailed information, the figures and the financial statements incorporated by reference to this prospectus. THE FOUNDATION The Universitas Foundation of Canada is a not-for-profit organization with no capital stock, constituted on January 10, 1964 pursuant to the Quebec Companies Act, Part III (now the Business Corporations Act). It is one of the largest providers of scholarship plans eligible for registration as RESPs in Canada. Its head office is located in Quebec City, QC. The Foundation s mission is to place its expertise and sense of commitment at the service of young Canadians by offering their parents and family members registered education savings plans (RESPs). Every effort is made to provide students with the highest scholarships on the market. PLANS, CONTRIBUTIONS, SCHOLARSHIPS AND EDUCATIONAL ASSISTANCE PAYMENTS (EAPS) Under the terms of the scholarship agreement or of the educational assistance payment agreement establishing the plan to which you subscribe, you make contributions to the Manager of the issuing Trust on a regular or ad hoc basis, and these are safeguarded and kept in trust for reimbursement to you at maturity. Accordingly, your contributions represent capital that you save and which, with its earned income, is invested and managed in compliance with the investment policies adopted by the Foundation. This income accumulates sheltered from income tax. The Manager receives these contributions for the issuing Trust, pays them progressively (after deduction of the membership fees to which it is entitled) on behalf of the Trustee to the Custodian for safekeeping and conservation. The Custodian also acts as custodian of securities and other forms of investment in which these amounts are invested in accordance with the applicable investment policy. In permitting participation or in establishing an RESP, the plan to which you subscribe also helps increase the income earned on the Trust s assets and more specifically, the contributions paid into it by subscribers. The registered education savings plan offers the Trust the possibility to access tax incentives paid by the federal and Quebec governments, if applicable, as contributions made to this plan, and that the portfolio managers can invest to draw additional earned income for the benefit of the Trust. See the Government Education Savings Incentives section. When you subscribe to a group plan, you agree beforehand to surrender to the Trust in question the income earned on your contributions to enable the funding of, on one hand, your reimbursement of these contributions and membership fees at maturity of your plan and, on the other hand, the payment of scholarships to beneficiaries qualified to receive them, according to the subscribed plan and the RESP to which it pertains (see the Investment Objectives, Strategies and Restrictions section). Until these amounts are reimbursed or paid by the Custodian to the individuals entitled to them according to the terms of the plan in effect, the contributions and income received or banked by a Trust, as well as the types of investments in which these amounts are invested, are held and safeguarded in trust by the Custodian for the benefit of its beneficiaries. As a subscriber, you are among the individuals benefiting from this Trust since, specifically, you are entitled to the reimbursement of the contributions that you have paid and which are safeguarded until such time. As for the government incentives and the income they earn, they are credited to the Trust Account maintained for the Trust in question. These incentives are held in trust for the governments that paid them, and the Manager can use them for the purposes stipulated in the registered education savings plans in question. Subscription to a plan incurs fees, including membership fees. See the Summary of the Prospectus Fees and Other Deductions section. A minimum contribution amount is also required depending on the beneficiary s age and the plan selected. See the UNIVERSITAS and REFLEX Plans Minimum Contributions and INDIVIDUAL Plan sections. As with any type of investment, subscribing to a plan involves certain risks. See the Risk Factors section. 12

13 THE EDUCATION SAVINGS PLANS ESPS In addition to applying the terms of the plan to which you subscribe, the Trust which issues this plan is also used for the application of its related ESP. Accordingly, the terms of your plan share the structure of those that govern the ESP under current securities legislation and tax laws, and are therefore incorporated into your scholarship agreement or your educational assistance payment agreement. The Foundation promotes three education savings plans for which each Trust is used in the application. These are: The UNIVERSITAS group savings and scholarship plan (UNIVERSITAS plan), in the case of the UNIVERSITAS plan Trust; The REFLEX group savings and scholarship plan (REFLEX plan), in the case of the REFLEX plan Trust; and The INDIVIDUAL savings and educational assistance payment plan (INDIVIDUAL plan), in the case of the INDIVIDUAL plan Trust. The terms of each of these ESPs qualify them for registration pursuant to the Income Tax Act (Canada) and the Taxation Act (Quebec). Upon registration, they are referred to as registered education savings plans, or RESPs. The following table presents the main features of the RESPs pertaining to the plans issued by each Trust. Main features of the types of ESPs that can be established by a plan UNIVERSITAS REFLEX INDIVIDUAL Type of ESP Group Group Individual Eligible beneficiaries 0 to15 years of age inclusive 0 to 15 years of age inclusive All ages Exclusive distributor Universitas Management Contribution limits $50,000 in accumulated lifetime contributions per beneficiary for all plans combined. In this case, income tax of 1% per month applies to contributions made in excess of this limit, unless this excess is removed from the plan before the end of the month in question. Maximum duration of capitalization 17 years 31 years following the year in which the plan came into force Agreement Scholarship agreement Educational assistance payment agreement Contributions According to the table of contributions: Minimum monthly contribution of $11.25 (for a child between 0-1 years old according to the terms of the monthly contribution). See the UNIVERSITAS and REFLEX Plans Minimum Contributions section. Table established such that each subscriber s contributions generate the same income for the payment of scholarships to qualified beneficiaries in the same cohort. Posted separately to the subscriber s account. Initial contribution of $500 including membership fees. Subsequent contributions at the subscriber s discretion, subject to the limits set by law. Posted separately to the subscriber s account. Payments Scholarships Educational assistance payments (EAPs) Eligible studies According to the plan (see the Summary of the Prospectus Eligible Studies section) Change of beneficiary Permitted for a beneficiary less than 16 years of age, if replaced by a beneficiary also younger than 16 years of age. Permitted for a beneficiary less than 21 years of age, if replaced by a beneficiary also younger than 21 years of age. Permitted at any time, subscriber s choice. Permitted, under certain conditions, at any time in the event of death or total and permanent disability. Conversions and transfers Conversions are permitted, under certain conditions, between plans promoted by the Foundation. Transfers are permitted, under certain conditions, between a plan promoted by the Foundation and that of another institution (See the UNIVERSITAS and REFLEX Plans Plan Conversion/Transfer and INDIVIDUAL Plan Plan Conversion/Transfer sections). 13

14 SUMMARY OF THE PROSPECTUS Main features of the types of ESPs that can be established by a plan UNIVERSITAS REFLEX INDIVIDUAL Cancellation You can totally or partially cancel your scholarship agreement by giving 30 days notice in writing to the Manager. The Manager will retain all membership fees unless the cancellation occurs within 60 days of the agreement signing. When an agreement is cancelled within 60 days of its signing, the representative must reimburse to the Manager the entire commission advance received. When an agreement is cancelled more than 60 days after it is signed and that the subscriber has not deposited all of the membership fees due pursuant to the agreement, the representative must reimburse the Manager the portion of the commission advance exceeding the total membership fees paid by the subscriber. See the UNIVERSITAS and REFLEX Plans Cancellation, Re-registration and Suspension section. You can cancel your educational assistance payment agreement at any time by giving notice in writing to the Manager. The Manager will keep all of the membership fees of $200 unless the cancellation occurs within 60 days of signing the agreement. When an agreement is cancelled within 60 days of its signing, the representative must reimburse the Manager the entire commission advance received. Payment structure of scholarships and EAPs Number of payments Payment amounts Earned income (according to an investment policy) on contributions credited to subscribers accounts; income which is paid into the Trust account. Government incentives and income earned on these (according to the investment policy), which are paid into the Trust account. The accumulated income is divided by cohort for payment of scholarships. A maximum of three scholarships, depending on the eligible studies pursued. (See the INDIVIDUAL Plan Cancellation and Re-registration section.) Earned income (according to the investment policy) on the assets in the subscriber s account. Government incentives and income earned on these (in accordance with the investment policy). As necessary Subject to certain conditions described below pursuant to the Income Tax Act (Canada), the total amount of scholarships and EAPs a qualified beneficiary may receive during a period of 12 months is the lesser of the following: The actual cost of the beneficiary s education (including fees, books, housing, food, transportation, etc.); or $5,000. However, the amount paid will depend essentially on the sums invested in the Trust in question and on the returns obtained. Investment objectives and strategies Qualifying year See General Provisions Applicable to the Three Plans Limits on Scholarship and EAP Amounts. Contributions (for all ESPs) and government incentives (for an RESP) are invested and managed by portfolio managers. The Foundation has adopted five investment policies, i.e. a separate policy for each of the following asset categories: subscribers contributions, the income earned on these contributions used for the purposes of reimbursing scholarships and EAPs, government incentives, the income earned on these incentives, and the income earned on the contributions used to respect the obligation to reimburse membership fees. The investments made are eligible for an RESP under the Income Tax Act (Canada). The year in which the beneficiary reaches 17 years of age and undertakes eligible studies (subject to another year, after discussion and agreement with the Manager). The year when the beneficiary pursues eligible studies. 14

15 Main features of the types of ESPs that can be established by a plan Lifetime Calculation of scholarship payments Optional life and disability insurance UNIVERSITAS REFLEX INDIVIDUAL A plan must end no later than the last day of the 35 th year following the year in which it came into effect. July 1 st of each year; Method of calculation described in Note 2 of the annual financial statements incorporated by reference to this prospectus. Available, under certain conditions, for a subscriber under 60 years of age, according to the terms presented in the distribution guide. Risk factors The scholarship amounts depend on the income earned through application of the Foundation s investment policy. If the beneficiary does not pursue eligible studies, he will not be entitled to scholarships. The time and amounts are determined by the subscriber based on his needs. Not available. The EAP amounts depend on income earned through the application of the Foundation s investment policy. If the beneficiary does not pursue eligible studies, he will not be entitled to EAPs. There is no guarantee that a Trust s investment objectives will be achieved and generate sufficient earned income. Past investment performance is no guarantee for future returns. An amendment to the legislation, more specifically to tax laws, could have an adverse impact on a Trust. The other risks to which a subscriber s investment in a plan may be exposed are the subject of additional information in the Risk Factors section. Income Tax considerations The scholarships received by a beneficiary are taxable income. EAPs received by the beneficiary are taxable income. For tax purposes, contributions to an RESP are not tax-deductible or taxable when reimbursed to the subscriber. The income earned from the contributions and its management is sheltered from income tax. ORGANISATION AND MANAGEMENT OF THE TRUSTS THE TRUSTS The UNIVERSITAS plan Trust, the REFLEX plan Trust and the INDIVIDUAL plan Trust are Trusts continued by declarations governed by a Trust Agreement (the Trust Agreement ) concluded between the Foundation, Trust Eterna Inc. and Universitas Management. The Trusts issue the scholarship and EAP plans described in this prospectus. Each plan to which you subscribe is recognized in an agreement concluded, by way of the Distributor, between the Foundation, acting on behalf of the Trust issuing the plan, and you, the physical person who purchases it (the subscriber ). A plan enables you, as a subscriber, to save while encouraging the post-secondary studies of a person or a member of a group of people that you designate (the beneficiary ) to obtain scholarships or EAPs from the Trust that issued your plan. These plans enable you, pursuant to tax legislation, to participate in a group RESP or establish an RESP which is individual. (See the Summary of the Prospectus The Education Savings Plans section.) The organization and management of Trusts, as well as the distribution and execution of their plans, require the intervention of several stakeholders. The following table identifies them and describes their main functions with regard to each Trust. You should read the information presented in this table in parallel with the more detailed information included on this subject in the prospectus. 15

16 SUMMARY OF THE PROSPECTUS The Promoter The Manager The Trustee The Universitas Foundation of Canada 3005 Maricourt Avenue Quebec City, QC Directs the implementation of the Foundation s mission and role, as well as related activities and operations. Promotes the Trust, its plans and the related RESPs. Acts on behalf of the Trust to conclude scholarship agreements or educational assistance payment agreements recognizing the plans it issues. By way of its investment committee and assisted by the external actuary, develops the investment policies for the Trust s assets. Supervises the Manager s operations and management of the Trust. Universitas Management Inc Maricourt Avenue Quebec City, QC In general, directs the Trust s activities, operations and business. After consultation with the Foundation, retains the services of the Trustee, Custodian, portfolio managers, auditors and the Trust s external actuary. Receives contributions from each subscriber and promptly sends them to the Custodian on behalf of the Trustee, for crediting to the relevant subscriber account. Provides administrative services, specifically with regard to bookkeeping and registers, and the maintaining of files. Keeps separate accounting of the subscribers accounts and provides the Custodian with access to this compiled data to enable reconciliation with the accounting of subscribers accounts maintained by the Custodian. Mandates the portfolio managers and determines the proportion of Trust assets they are respectively responsible for investing and managing. Supervises the portfolio managers investment decisions and, specifically, ensures they apply the investment policies adopted respectively by the Foundation with regard to contributions, government incentives, proceeds and income earned on investment of all of the latter, as well as amounts reserved for the reimbursement of membership fees. When the Foundation instructs it, gives the Custodian the appropriate instructions to make the payments required in accordance with the provisions of the plans. Trust Eterna Inc. Quebec City, QC Acts as trustee of the Trust and in this capacity assumes the safeguarding and conservation of assets transferred, contributed or paid to it for payment into the assets of a Trust, including contributions and government incentives. Supervises the investment and management activities of the Trust s assets according to the instructions of the Manager and the Foundation. Assumes control and acts in place of the Manager and the Foundation, for which it fulfills the responsibilities with the necessary adjustments, should one or the other refuse or find itself unable to act. 16

17 The Custodian The Distributor The Portfolio managers CIBC Mellon Global Security Services Company Toronto, ON Receives contributions for crediting to the Subscriber Accounts. Receives government incentives and the proceeds and income earned on the Trust s assets for crediting to the Trust Account. Interacts with portfolio managers for the transfer of amounts to be invested originating from the Subscriber Accounts and the Trust Account. Acts as custodian of securities and other types of investments in which these funds are invested by the portfolio managers. At plan maturity, on the Manager s instructions, reimburses the subscriber the total amount of his contributions to the plan, including the refundable membership fees. When required by legislation, the Custodian reimburses the government incentives to the government(s) which paid them. Universitas Management Inc. Quebec City, QC By delegation of the Foundation, ensures the promotion of the plans. Is responsible for the offer and distribution of the Trust s plans through its representatives. Agrees with the Foundation on the responsibilities and duties incumbent on it as Distributor of plans to subscribers. Represents the Foundation (acting as promoter of the Trust in question) for the purposes of concluding, with subscribers, scholarship agreements establishing plans. Receives initially, through its representatives, cheques made out by subscribers to the Universitas Foundation in Trust to cover the first contribution amounts to be paid following the signing of their scholarship agreements, and gives these cheques to the Manager. Addenda Capital Inc. Montreal, QC Fiera Capital Corporation Montreal, QC AlphaFixe Capital Inc. Montreal, QC Jarislowsky Fraser Limited Montreal, QC Montrusco Bolton Investments Inc. Montreal, QC The Auditors Invest and manage the assets of a Trust for the portion determined by the Manager, all in compliance with the investment policies adopted by the Foundation and the applicable legislation. By delegation of the Manager and on the instructions of the latter, as applicable, exercise the voting rights relating to the investments thus made. Samson Bélair / Deloitte & Touche, L.L.P. Quebec City, QC Responsible for auditing the financial statements of each Trust. 17

18 SUMMARY OF THE PROSPECTUS The External actuary The Registrar Eckler Limited Montreal, QC Determines the amount of contributions equivalent to one whole unit. Participates in the development of the Foundation s investment policies. Prepares the annual financial projections. Approves the methodology used for the scholarship level calculations made by the Manager. Universitas Management Inc. Quebec City, QC Maintains a register of securities for each of the Trusts and has the responsibility of managing the current affairs of the latter. The registers are kept at the head office in Quebec City. ELIGIBLE STUDIES The following table summarizes the criteria that a beneficiary must satisfy regarding the post-secondary education pursued in order to qualify for the payment of scholarships as defined in the UNIVERSITAS and REFLEX plans. These criteria are met if the beneficiary has successfully completed the hours, credits or courses listed in the table for the territory in question. For more information, see the UNIVERSITAS and REFLEX Plans Eligible Studies Criteria and INDIVIDUAL Plan Eligible Studies Criteria sections. UNIVERSITAS Plan In Canada or abroad (public or private institutions) Community college (programs with a 2-year minimum duration) 1 st scholarship 2 nd scholarship 3 rd scholarship 3 semesters 5 semesters After 1 year of university (24 credits) Community college (1-year programs) After 900 hours 5 semesters (programs with a 2-year minimum duration) After 1 year of university (24 credits) Private college After 900 hours After 1,800 hours After 1 year of university (24 credits) University In Quebec (public or private institutions) After 1 year of university (24 credits) After 2 years of university (48 credits) After 3 years of university (72 credits) 1 st scholarship 2 nd scholarship 3 rd scholarship Diploma of vocational studies (DVS) After 900 hours After 5 semesters in a college, technical program of study (30 courses) Attestation of college studies (ACS) After 900 hours After 1,800 hours in the same program or two ACS programs of study or after 5 semesters in a college, technical program of study (30 courses) After 1 university semester (12 credits) After 1 university semester (12 credits) College, technical program (DCS) 3 semesters (18 courses) 5 semesters (30 courses) After 1 university semester (12 credits) University After 1 semester (12 credits) After 3 semesters (36 credits) After 5 semesters (60 credits) 18

19 REFLEX Plan In Canada or abroad (public or private institutions) Community College Private College University In Quebec (public or private institutions) Diploma of vocational studies (DVS) Attestation of college studies (ACS) College (pre-university) program (DCS) College, technical program (DCS) 1 st scholarship 2 nd scholarship 3 rd scholarship At the beginning of the 1 st year of study At the beginning of the 1 st year of study At the beginning of the 1 st year of study After 1 year (14 courses) After 900 hours After 1 year (24 credits) After 2 years (24 courses) or after 1 university year (24 credits) After 1,800 hours or after 1 university year (24 credits) After 2 years (48 credits) 1 st scholarship 2 nd scholarship 3 rd scholarship At the beginning of the 1 st year of study At the beginning of the 1 st year of study At the beginning of the 1 st year of study At the beginning of the 1 st year of study After 1 year (900 hours) After 1 year (900 hours) After 1 year (14 courses) After 1 year (14 courses) After 2 years (1,800 hours) After 2 years (1,800 hours) or, if taken at university, after 1 semester (12 credits) After 2 years (24 courses) or, if taken at university, after 1 semester (12 credits) After 2 years (24 courses) or, if taken at university, after 1 semester (12 credits) University Already paid Already paid If it has not already been paid at the college level, after 1 semester (12 credits) INDIVIDUAL Plan Anywhere in Canada or abroad (public or private institutions) Type of Eligible Studies Minimum duration Payment of EAPs Post-secondary studies recognized by the Ministry of Education (or the equivalent abroad) Part-time or full-time 3 consecutive weeks (10 hours of class or schoolwork per week) The subscriber decides on the EAP amounts paid to the beneficiary, subject to the established limits An educational institution offering programs intended to teach or improve the skills needed in the exercise of a professional activity The plans offered in this prospectus each have their own criteria establishing which post-secondary education programs qualify as eligible studies for the receipt of scholarships or EAPs. These criteria could differ from those of the Income Tax Act (Canada). 19

20 SUMMARY OF THE PROSPECTUS ACADEMIC ITINERARY TAKEN BY A STUDENT The following diagrams illustrate the possible directions taken by a student during his studies, according to the territory in question. POSSIBLE DIRECTION TAKEN BY A STUDENT IN CANADA OR ABROAD Vocational studies (Trade/Apprenticeship) High school University Community College or Private technical college (DCS) POSSIBLE DIRECTION DIRECTION TAKEN BY TAKEN A STUDENT BY A IN STUDENT THE PROVINCE IN OF THE QUEBEC PROVINCE OF QUEBEC High school Vocational studies (DVS) College (general) College (technical) or Attestation of college studies (ACS) University IMPORTANT DATES DATES WHEN WHEN SUBSCRIBING SUBSCRIBING TO AN RESP TO AN RESP REFLEX REFLEX plan Automatic transfer of the UNIVERSITAS plan to the INDIVIDUAL plan at maturity. Automatic transfer of the REFLEX plan to the INDIVIDUAL plan at maturity. REFLEX REFLEX Official Deadline RESP contributions** INDIVIDUAL plan. 20

21 FEES AND OTHER DEDUCTIONS The following table presents the list of all fees payable for the distribution and implementation of the plans covered by this prospectus. The subscriber may have to assume some of these fees directly. In other cases, it is the Trust that assumes these fees directly from income earned on contributions, which will reduce the value of the scholarships or EAPs eventually paid to qualified beneficiaries. Type of fee Amounts Paid by On Paid to Membership Fees (and cancellation fees For the UNIVERSITAS and REFLEX plans: Subscriber Contributions Manager applicable after 60 days) $200 per whole unit Note: Within 60 days, membership fees are refunded to the subscriber. Per unit fraction: amount proportional to the fees of a whole unit Refundable at maturity of the plan For the INDIVIDUAL plan: $200 Non-refundable Administration fees The administration fees paid to the Promoter and to the Manager cannot exceed 1.43% (excluding all applicable taxes) of the average annual balances of the subscriber accounts and the Trust Account The fees for the administration and distribution of the plans which are not required for the preservation or development of the organization are deducted from any excess of revenues over expenditures to bring the company s pre-tax profit to zero and to return any surplus to the Trusts Management fees The management fees include those of the Trustee, the Custodian, the portfolio managers and the Independent Review Committee Remuneration of the Independent Review Committee ( IRC ) The remuneration of IRC members for their participation in meetings or any other special assignment consists in attendance fees and an annual retainer Subscriber Contributions Manager Each of the Trusts and collected by the Manager Each of the Trusts and collected by the Manager Each Trust Trustee fees $25,000 per year The Trusts and collected by the Manager Custodian fees 0.015% on the first $200 million annually, and 0.01% on any surplus $10 per transaction on Canadian securities $20 per cheque issued $15 per electronic transfer The Trusts and collected by the Manager Income earned on contributions Income earned on contributions Income earned on contributions Income earned on contributions Income earned on contributions Manager Each of the stakeholders, as applicable Independent Review Committee Trustee Custodian 21

22 SUMMARY OF THE PROSPECTUS Type of fee Amounts Paid by On Paid to Portfolio manager fees A declining percentage established by the portfolio manager based on total assets invested under its management The Trusts and collected by the Manager Income earned on contributions Portfolio Manager Optional insurance premium Change of beneficiary Temporary suspension/ default or late payment Conversion/Transfer between plans For UNIVERSITAS and REFLEX plans exclusively Premiums may vary depending on the circumstances: refer to the Distribution Guide If the replacement beneficiary is older than the former, interest at an annual rate of 6.50% is applicable to contributions made under the plan. This adjustment is intended to ensure the adequacy of plan funding, given the age of the new beneficiary (UNIVERSITAS and REFLEX plans). This rate is reviewed annually by the Manager in consultation with the external actuary Interest at an annual rate of 6.50% on the arrears (UNIVERSITAS and REFLEX plans) in cases where there is no transfer to the INDIVIDUAL plan The income earned on contributions made to the converted/transferred plan, in whole or in part, as applicable. See the relevant subsections under the heading Plan Conversion/Transfer Subscriber His own funds SSQ Financial Group Subscriber His own funds Manager Subscriber His own funds Each Trust Subscriber Income earned on contributions The amounts retained in the UNIVERSITAS and REFLEX plans remain in the Trust Account for eventual distribution among the qualified beneficiaries in the original plan Archive search request $50 plus taxes Subscriber His own funds Manager Distributor s Established based on the number or value of the Subscriber Membership Distributor remuneration subscribed scholarship or EAP plans fees Remuneration of the scholarship plan representative Through commissions calculated according to the subscribed plans Subscriber Membership fees The scholarship plan representative In compliance with the dispositions of the Trust Agreement that is in effect, the fees appearing above may be modified with the agreement of the Foundation and the Trustee without the subscribers approval. However, the modifications must be submitted to the Independent Review Committee for approval and the Committee may require that a written notice be sent to all subscribers to inform them of the change and to provide them with appropriate justification. The Manager will not charge fees for: A delay in submitting an application for a scholarship or EAP; A change of contribution method; A change in the qualifying year or maturity date; The filing of a scholarship or EAP application; or The review of a file or calculation by the Manager. 22

23 CONVERSION OF GROUP PLANS TO AN INDIVIDUAL PLAN The following table summarizes the terms applicable to the conversion of your UNIVERSITAS or REFLEX group plan to the INDIVIDUAL plan promoted by the Foundation. Conversion of the UNIVERSITAS plan to the INDIVIDUAL plan before maturity of the agreement All membership fees in the group plan must be paid before conversion of the plan. The group plan membership fees will not be reimbursed to you, but no additional membership fees will be charged for opening the INDIVIDUAL plan. The contributions, government incentives and income earned on the incentives will be transferred to the INDIVIDUAL plan. The income earned on the contributions remains in the group plan for the benefit of those who qualify for scholarships. The beneficiary will not be entitled to his group plan scholarships. Note: At this stage, it is important to consider that if you continue the contributions to the group plan until maturity, your beneficiary will continue to be entitled to scholarships under this plan. Automatic conversion of the UNIVERSITAS plan to the INDIVIDUAL plan at maturity of the agreement Conversion of the REFLEX plan to the INDIVIDUAL plan before maturity of the agreement You may request the conversion of a REFLEX plan to an INDIVIDUAL plan after a period of three years following the effective date of your agreement. You can then transfer your contributions, the government incentives and income earned on all these amounts. It will be impossible for your beneficiary to benefit from the scholarships under the REFLEX plan on account of the transfer of your earned income to the INDIVIDUAL plan. Membership fees applicable under the REFLEX plan will not be reimbursed, but no additional membership fees will be charged for the opening of the INDIVIDUAL plan. Note: The conversion of a REFLEX plan into an INDIVIDUAL plan within a three-year period following your REFLEX plan s effective date is possible, but the accumulated income on the subscriber s contributions will not be transferred. Automatic conversion of the REFLEX plan to the INDIVIDUAL plan at maturity of the agreement At maturity of the scholarship agreement, the UNIVERSITAS plan will automatically be converted to the INDIVIDUAL plan at no additional cost. You will be reimbursed the UNIVERSITAS plan membership fees. The contributions, government incentives and income earned on the incentives will be transferred to the new INDIVIDUAL plan. The beneficiary retains his right to the UNIVERSITAS plan scholarships. At maturity of the scholarship agreement, the REFLEX plan will automatically be converted to the INDIVIDUAL plan at no additional cost. You will be reimbursed the REFLEX plan membership fees. The contributions, government incentives and income earned on the incentives will be transferred to the new INDIVIDUAL plan. As the subscriber, you have the choice to transfer the income earned on the contribution amounts until maturity. This option is valid, provided the beneficiary has not yet received a 1 st scholarship under the REFLEX plan. The amount transferred will be determined based on the returns of the INDIVIDUAL plan during the period in which the income accumulates under your REFLEX plan. If you choose not to transfer the earned income on the contributions to the new INDIVIDUAL plan, the beneficiary will maintain his right to the REFLEX plan scholarships. The Manager will contact you to obtain your instructions regarding the choices offered in relation to the transfer of the earned income on the contributions. 23

24 SUMMARY OF THE PROSPECTUS ANNUAL RETURNS AND TOTAL EXPENSES THE TRUSTS ANNUAL RETURNS The following table presents the annual returns of the assets under management, net of management and administration fees, for each of the Trusts from 2007 to It also illustrates the variation (increase or decrease), as at the last day of the fiscal year, in the contributions paid on the first day of the year. Each of the Trusts also pays management fees which include the amounts paid out to the Custodian, to the Trustee, to the portfolio managers and to the Independent Review Committee. Return Rate* UNIVERSITAS Plan Trust2.15%5.13%9.57%-5.72%5.29% REFLEX Plan Trust6.96%4.61%5.00%2.32%4.52% INDIVIDUAL Plan Trust 3.78% 3.81% 3.39% 3.52% 3.64% *Past performance does not guarantee future returns. TOTAL EXPENSES The fees required for the administration of the Trusts cannot exceed 1.43% (excluding all applicable taxes) of the average annual balances of the Subscriber Accounts and the Trust Account. These fees are paid by the Trust to the Promoter and to the Manager. The fees which are not required for the preservation or development of the organization are deducted from any excess of revenues over expenditures in order to bring the company s pre-tax profit to zero and to return any surplus to the Trusts. The total expenses are the sum of the administration fees and the management fees (excluding all applicable taxes). 24

25 OVERVIEW OF THE FOUNDATION S STRUCTURE HISTORY AND STRUCTURE Created by letters patent on January 10, 1964, pursuant to Part III of the Quebec Companies Act (now the Business Corporations Act), the Universitas Foundation of Canada is a legal entity without share capital, created for the purpose of encouraging post-secondary education through savings by offering scholarships and EAPs, and with no intention of making a financial gain. This type of legal entity is commonly referred to as a not-for-profit organization. Since 2005, the Universitas Foundation of Canada has also been known as Universitas Trust Funds and Universitas Trust Funds of Canada. The Foundation s head office is located at 3005 Maricourt Avenue, Quebec City, QC G1W 4T8. Initially, the Foundation saw itself as a form of investment club, an association of parents who wanted to meet and dedicate part of their savings to a secondary mechanism to finance the higher education of their children. This mechanism took the form of scholarship plans and came to be formally recognized and supported by fiscal measures adopted by both the federal and Quebec governments. Soon, the Foundation organized its governance and set up an independent board. It also enlisted the services of a trusteecustodian, the Royal Trust Company (which later became RBC Dexia Investor Services), to invest and manage assets for the ESPs being established by the plans it was issuing. In 1997, the Foundation acquired Unicour Inc. (now Universitas Management Inc.) in order to improve the efficiency of its use of resources and improve the plans offered to the public. Universitas Management now acts as Trust Manager and, by way of its representatives, as exclusive Distributor of the plans in the provinces of Quebec and New Brunswick. It conducts its activities in these provinces and controls a distribution network comprising nearly 250 representatives. The expertise and experience acquired by the Foundation over the years make it one of the largest providers of registered education savings plans in Canada. It manages close to $800 million in assets and has paid out nearly $400 million to date in reimbursement of contributions, and in scholarships and EAPs. The UNIVERSITAS plan Trust, the REFLEX plan Trust and the INDIVIDUAL plan Trust are Trusts continued as of July 9, 2010, by Trust declarations pursuant to an agreement reached between the Foundation, Trust Eterna Inc. (the Trustee ) and Universitas Management (depending on the context, the Manager or the Distributor ). The assets in each Trust are separate from those of the Foundation, the Trustee and the individuals who benefit from the Trust, i.e. the plan subscribers. The assets may only be disposed of in accordance with the provisions of the Trust Agreement, the plans, the related registered education savings plans and applicable laws. Accordingly, from this perspective, it can be considered that the Trust s structure offers transparency and security with regard to the safeguarding, conservation and use of the subscribers savings in the execution of the provisions of the scholarship agreement and educational assistance payment agreement. Under the terms of the Trust Agreement and separate agreements reached with the Foundation and the Manager, several stakeholders are involved in managing or implementing the Trusts and the RESPs they issue, as well as in activities related to the distribution and implementation of plans described in this prospectus. These stakeholders are the Trustee, the Foundation, the Manager, the Distributor, the portfolio managers, the Custodian, the external actuary and the auditors. THE PLANS A scholarship or an EAP plan is issued by a Trust in the form of a scholarship agreement or an educational assistance payment agreement. This agreement, implemented by the Distributor, is between the Foundation, which acts on behalf of the Trust issuing the plan and yourself, the subscriber who purchases it. The plan issues a security, within the meaning of securities legislation. The plan enables you to save while encouraging the post-secondary education of the beneficiary you designate to obtain scholarships or EAPs through the application of these provisions. The scholarships are paid by the Custodian on behalf of the Trust issuing the plan. The plan also enables you to participate in or establish an RESP within the meaning of tax legislation. This may be a group plan, in which case you participate with other subscribers (the UNIVERSITAS and REFLEX plans) or may be individual to the subscriber (such a plan is established pursuant to an INDIVIDUAL plan), in which case you are the sole member. In a group RESP, as opposed to an individual one, you agree beforehand, as a subscriber, to confer the status of beneficiary on one or more physical individuals and to surrender the income accumulated on your contributions to the benefit of the Trust. The provisions of a plan are established in reference to the terms of the ESP to which it pertains. The plan therefore incorporates the terms of this RESP, such as defined in tax legislation. The terms common to all plans promoted by the Foundation are described in the section General Provisions Applicable to the Three Plans. Once registered with the tax authorities, your RESP offers the Manager the possibility of receiving government incentives and making proceeds on the latter through additional investments. 25

26 OVERVIEW OF THE FOUNDATION S STRUCTURE GENERAL IMPLEMENTATION CONDITIONS CONTRIBUTIONS Pursuant to the plan to which you subscribe, you make a single payment or undertake to make several regular payments to the Manager. These payments are your contributions. If your plan allows you to participate in the UNIVERSITAS or REFLEX plans, the amounts of your contributions are established according to the number of subscribed units or unit fractions. See the UNIVERSITAS and REFLEX Plans Description of Units section. These contributions, posted separately in your subscriber account and maintained by the Custodian, accumulate in the assets of the Trust issuing the plan and are refundable to you at maturity of the plan, or earlier in certain cases. Accordingly, they represent a cash amount that you save until it is reimbursed to you by the Trust. The Trust Manager receives your contributions made payable to the Universitas Foundation in Trust for the Trustee; the Manager pays the contributions progressively to the Custodian, after having deducted membership fees and certain other amounts, depending on the RESP to which your plan pertains. The Custodian credits the net contributions to your subscriber account and ensures their safeguarding and conservation on behalf of the Trustee. The contributions paid are part of the Trust s assets. EARNED INCOME In the case of group plans, you agree beforehand, as a subscriber, to surrender the income earned on your contributions to the Trust that issues your plan, so that the Manager can use them to make the reimbursements and payments described below. The contributions credited to the Subscriber Accounts, as well as the government incentives credited to the Trust Account represent a capital that is made available to the Trust in question. This capital is invested and managed by the portfolio managers in compliance with the investment policies adopted by the Foundation so as to generate investment income that will make it possible to fund: The reimbursement at maturity of the contributions subscribers have paid as well as the membership fees they are entitled to recover at maturity of their plan; and The payment of scholarships and EAPs to beneficiaries, according to the plans and related RESPs (see the Investment Objectives, Strategies and Restrictions section). GOVERNMENT INCENTIVES The RESP offers the Trust the possibility of accessing tax incentives paid by the federal and/or Quebec governments, and which the portfolio managers can invest to earn additional investment income for the Trust. These incentives are paid to the Custodian who ensures their deposit in the account that the Trust maintains specifically for their receipt, i.e. the Trust Account. See the Government Education Savings Incentives section. 26

27 INVESTMENT OBJECTIVES, STRATEGIES AND RESTRICTIONS INVESTMENT OBJECTIVES Under the terms of the UNIVERSITAS, REFLEX and INDIVIDUAL Trust plans and the ESPs to which they permit membership or which they establish, the amounts corresponding to the contributions received from subscribers and credited to their accounts and the government incentives paid to the Custodian on behalf of the subscribers whose ESPs are registered (thus making them RESPs), and the balance of the Trust Account are invested, grouped in investment portfolios and managed by portfolio managers. The portfolio managers must act jointly with: The Manager, responsible for mandating them and ensuring they respect the investment policies in the interest of subscribers and beneficiaries; and The Foundation s Investment Committee, responsible for developing these policies. Five investment policies have been adopted by the Foundation to govern the execution of the portfolio managers respective mandates, i.e. a separate policy for each of the following fund categories: subscriber contributions, income earned on these contributions for the payment of scholarships and EAPs, government incentives, income earned on these incentives, and income earned on the contributions which will be used to honour the obligation to reimburse the membership fees. These policies set objectives focused on capital preservation, an attractive long-term rate of return and prudent management of portfolio risk. They comply with the provisions of securities legislation and the approvals obtained in 2001 from the Autorité des marchés financiers (AMF) or its predecessor, the Quebec Securities Commission (Decision No C-0383). See the Investment Objectives, Strategies and Restrictions Eligible Investments and the Exemptions and Approvals sections. INVESTMENT STRATEGIES The Trust s assets corresponding to the balances in the Subscriber Accounts are invested as follows: All amounts corresponding to the contributions and a portion of the amounts reserved for the obligation to reimburse membership fees are invested in bonds issued or guaranteed by the federal government, a Canadian province, as well as Treasury bonds and other short-term investments whose security is guaranteed pursuant to section 41 under the Securities Act, specifically paragraphs 1 and 2. The balance of amounts reserved for the obligation to reimburse membership fees is invested in corporate bonds and in Canadian equities. At least 90% of portfolio investments must be guaranteed by governments or public organizations. The Trust s assets corresponding to the balance in its Trust Account must be invested in diversified Canadian investments. Only a portion of the Trust Account comprised of government incentives (only those collected prior to April 20, 2012), of the income earned on subscriber contributions and of income earned of the government incentives can be invested in equities. All government incentives collected as of April 20, 2012, must be invested in bonds issued or guaranteed by the Government of Canada or a Canadian province. The mandates to manage the resulting investment portfolio are shared between five portfolio managers, whose services have been retained by the Manager. This division best accommodates the growth of the assets posted to the Trust Account and the Foundation s wish to ensure the best strategy of risk diversification. The portfolio managers are Addenda Capital Inc., Fiera Capital Corporation, AlphaFixe Capital Inc., Jarislowsky Fraser Limited and Montrusco Bolton Investments Inc. Portfolio managers have an active management mandate which aims to outperform the benchmark indexes. Performance enhancement strategies include asset allocation, stock selection, duration management, credit analysis and technical analysis. Investments must comply at all times with applicable legislation and the investment policies of the Foundation. Consequent to the application of these strategies, the investment in Canadian equities represented 27% of the total securities in the portfolios held by the Trusts as at December 31, The average investment horizon is close to eight years given the constant influx of new subscribers and the average duration of agreements. ELIGIBLE INVESTMENTS SUBSCRIBER ACCOUNTS The Trust s investment policy for assets corresponding to the balances in the Subscriber Accounts stipulates that the amounts corresponding to the contributions and the portion of the amounts reserved for the obligation to reimburse membership fees must be invested in: 1) Treasury bills and bankers acceptances; 2) Bonds issued or guaranteed by the Government of Canada or a Canadian province; and 3) Bonds issued or guaranteed by: a) a municipal corporation, an urban community or a school board; b) a transit commission or company established under Quebec law; 27

28 INVESTMENT OBJECTIVES, STRATEGIES AND RESTRICTIONS c) a public institution or a regional board within the meaning of the Act respecting health services and social services for Cree Native persons (section S-5), a public institution or a health and social services agency under the Act respecting health services and social services (section 4.2), and the Corporation d hébergement du Québec; d) a Quebec university; e) a college of general and vocational education; or f) an inter-municipal management board. With regard to the amounts corresponding to the balance of the amounts reserved for the obligation to reimburse membership fees, they are invested in corporate bonds and Canadian equities according to the specifications stipulated under the heading Trust Account. TRUST ACCOUNT The investment policy governing the Trust s assets, which correspond to the balance in its Trust Account, authorizes the five portfolio managers appointed for this purpose to make investments in compliance with the provisions of Decision no 2001-C-0383 of the Quebec Securities Commission ( now the Autorité des marchés financiers) specifically in paragraphs 8 and 9 of Section 1339 of the Civil Code of Quebec regarding investments presumed sound, in which the administrator of a property which is not his own is required to invest the cash amounts it administers and, as applicable, Regulation C-15 respecting Conditions Precedent to Acceptance of Scholarship or Educational Plan Prospectuses. Other than the eligible investments for the Subscriber Accounts, the Trust s investment policy for assets corresponding to the balance in its Trust Account stipulates that they must be invested in: Securities of chartered banks in Canada or abroad, as well as securities of borrowers with a minimum rating of A-1 according to the rating agency Standard and Poors Corporation or an R-1 Low rating according to the Dominion Bond Rating Service agency; Corporate bonds having a minimum BBB rating when purchased, according to the Dominion Bond Rating Service or equivalent; Fully paid preferred shares issued by a company whose common shares are presumed sound investments or which, during the last five financial years, has distributed the stipulated dividend on all its preferred shares; and Common shares issued by a company having met the timely disclosure requirements defined in the Securities Act (Quebec) for the past three years, insofar as they are listed on a recognized stock exchange and meet certain minimum stock market capitalization requirements. Notwithstanding the above-mentioned provisions, all government incentives collected as of April 20, 2012 must be invested in bonds issued or guaranteed by the Government of Canada or a Canadian province. The portion of the assets in the UNIVERSITAS and REFLEX plan Trusts which corresponds to the income earned on contributions is divided among the portfolios matched, by cohort, to the commitments made in favour of the beneficiaries of the plans in effect of these Trusts. These portfolios must be diversified and the concentration limits in the same stock must be respected. INVESTMENTS ELIGIBLE FOR AN RESP All types of investments to be made in compliance with the Foundation s investment policies must also respect the criteria and conditions required in order to qualify as eligible RESP investments pursuant to tax legislation. INVESTMENT RESTRICTIONS The investment activities and portfolio management conducted for the Manager of each Trust for the purposes of implementing the terms of their plans are subject to restrictions designed to ensure that the assets in the securities portfolios are sufficiently liquid and diversified. The restrictions are listed below: Bonds from the same borrower, with the exception of a government, may not represent more than 10% of the total market value of the fixed-income securities in which the assets of a Trust can be invested ; Corporate bonds are limited to 10% of the total market value of the bond portfolio ; Bonds rated A (or higher) by a recognized rating agency, in which the assets of a Trust corresponding to the amounts reserved for the obligation to reimburse membership fees can be invested, must be allocated so that the market value of each security does not exceed 1.00% of the total market value of the bond portfolio constituted directly from these assets ; Bonds with a BBB rating (or higher) by a recognized rating agency, in which the assets of a Trust corresponding to the balance in the Trust Account can be invested, must be allocated such that the market value of each security does not exceed 0.50% of the total market value of the bond portfolio constituted directly from this account; The Canadian equity portfolio must contain a minimum of 30 securities allocated among a minimum of nine sectors of the S&P/TSX composite index ; No more than 10% of the total market value of the Canadian equity portfolio may be invested in the same stock ; Non-negotiable shares on the stock market, derivatives, principal protected notes, stock market indices and mutual funds are not permitted. 28

29 GOVERNMENT EDUCATION SAVINGS INCENTIVES The federal government and the Government of Quebec have both introduced measures to support education savings. The Canada Education Savings Grant (CESG) and Canada Learning Bond (CLB) are offered by the federal government. Quebec, meanwhile, has introduced the Quebec Education Savings Incentive (QESI) for beneficiaries who reside in the province of Quebec. The government incentives are sent to the Custodian of the RESP for crediting to the Trust Account, to be paid to the assets of the Trust in question and invested in compliance with the Foundation s relevant investment policy. The Manager must keep a register for each ESP promoted by the Foundation and record in it all transactions related to government incentives. It sends this accounting data to the Custodian so that it may reconcile them with the accounting data that it keeps itself as Custodian of these amounts and as custodian of securities and other types of investment to which they are party. The government incentives and their income are added to the amount of income earned on your contributions for the calculation of scholarships and EAPs that a qualified beneficiary receives when he pursues eligible studies. The government incentives are posted for the exclusive benefit of a qualified beneficiary who pursues such studies. ELIGIBILITY CONDITIONS FOR GOVERNMENT INCENTIVES For the enhanced CESG and the CLB to be paid into your beneficiary s RESP, the following general eligibility conditions must be met: The Social Insurance Number (SIN) of the beneficiary is provided to the Manager; The SIN of the beneficiary s primary caregiver or the enterprise number of the department, agency or institution acting as public primary caregiver is provided to the Manager ; and The beneficiary is a resident of Canada. In the case of the CLB, certain additional conditions apply: Your beneficiary was born on or after January 1, 2004; He is younger than 21 years of age; and The National Child Benefit Supplement is paid on his behalf as part of the Canada Child Tax Benefit. To be eligible for the CESG, the beneficiary must be younger than 18 years of age. For the QESI to be paid into your beneficiary s RESP, the following conditions must be met: The beneficiary must be under 18 years of age; His Social Insurance Number (SIN) must be provided to the Manager, and He must reside in the province of Quebec on December 31 of the taxation year. CANADA EDUCATION SAVINGS GRANT For any eligible beneficiary, the basic CESG is equivalent to 20% of the first $2,500 annually contributed to the Trust of your RESP. An enhanced CESG is applicable to the first $500 annually contributed, i.e.: 10% for the beneficiary whose family income in 2012 exceeds $42,707, but is less than or equal to $85,414*; and 20% for the beneficiary whose family income in 2012 does not exceed $42,707.* * These amounts are indexed every year. The term family income refers to the net combined income of the primary guardian of the child and his spouse or common-law partner, as per the federal tax return. WHAT IS THE MAXIMUM CESG AMOUNT TO WHICH A BENEFICIARY IS ENTITLED? When your beneficiary only qualifies for the basic CESG rate, i.e. 20%, the maximum CESG amount is set at $500 per year. When your beneficiary is eligible for an enhanced CESG, i.e. an additional rate of 10% or 20% on the first $500 of annual contributions, the annual CESG limit is set at $550 or $600, as applicable. The total CESG lifetime amount payable to a beneficiary born after 1997 is $7,200. The CESG is not included in the calculation of your RESP contribution limit, namely a lifetime amount of $50,000 in contributions per beneficiary for all plans combined. CAN I CARRY FORWARD THE ANNUAL LIMIT GIVING ENTITLEMENT TO THE CESG? The annual contribution limit of $2,500 giving entitlement to the basic CESG can be carried forward to future years if your contributions do not reach this limit in a given year. For example, if you contribute $650 one year, the following year, you can carry forward $1,850 in unused contributions giving entitlement to the CESG of 20%. The annual contribution limit for CESG entitlement can be increased up to $5,000 per year, the CESG payable for a given year being limited to $1,000. However, the beneficiary can receive up to $1,100 of the CESG in a given year if he qualifies in that year for the enhanced CESG (exceeding the basic 20% rate) and has enough unused contribution room giving entitlement to the CESG. The enhanced portion of the CESG may not be carried forward to a subsequent year. IS THE BENEFICIARY ELIGIBLE FOR THE CESG IF HE IS 16 OR 17 YEARS OLD? The contributions made to your RESP during the year in which the beneficiary reaches the age of 16 or 17 will give entitlement to the CESG only if: At least $2,000 has been deposited in one or more RESPs on the beneficiary s behalf before the year of his 16 th birthday, and has not been withdrawn before the end of the year in which the beneficiary reached 15 years of age; or 29

30 GOVERNMENT EDUCATION SAVINGS INCENTIVES At least $100 has been deposited annually in one or more RESPs on the beneficiary s behalf for at least four years prior to the year of his 16 th birthday, and has not been withdrawn before the end of the year in which the beneficiary reached 15 years of age. The QESI payable for any taxation year is generally limited to $500. However, the beneficiary can receive a QESI of up to $550 for a given year if he is eligible that year for the enhanced QESI and has sufficient unused contribution space giving entitlement to the QESI. CANADA LEARNING BOND The amount of the CLB is $500 for the beneficiary s first year of CLB eligibility and $100 for each subsequent year during which the beneficiary under 15 years of age is eligible. The CLB can reach a maximum amount of $2,000 per beneficiary. When the CLB is paid into an RESP, the federal government can add $25 to cover part of the administration fees payable to the Distributor. QUEBEC EDUCATION SAVINGS INCENTIVE For any eligible beneficiary, the basic QESI is equivalent to 10% of the first $2,500 contributed into an RESP during a given taxation year. An additional QESI applies to the first $500 contributed into an RESP during a taxation year, which is: 5% for the beneficiary whose family income in 2012 exceeds $40,100, but is less than or equal to $80,200*; and 10% for the beneficiary whose family income in 2012 does not exceed $40,100.* * These amounts are indexed every year. The term family income refers to the combined net income of the child s primary guardian and his spouse or common-law partner, as per the provincial tax return. WHAT IS THE MAXIMUM QESI AMOUNT TO WHICH A BENEFICIARY IS ENTITLED? When your beneficiary is only eligible for the basic QESI, the maximum QESI amount is set at $250 a year. When your beneficiary is eligible for an enhanced QESI, i.e. an additional rate of 5% or 10% on the first $500 annually contributed, the annual QESI limit is set at $275 or $300, as applicable. The total QESI cumulative amount to which a beneficiary is entitled in all cases is $3,600. The QESI is not included in the calculation of your RESP contribution limit, namely a lifetime amount of $50,000 in contributions per beneficiary for all plans combined. CAN I BENEFIT FROM THE QESI CUMULATIVE RIGHTS FROM PREVIOUS YEARS? An amount of QESI cumulative rights from previous years, retroactive to February 21, 2007, can be added to the basic amount for a given year, up to a maximum of $250 a year. IS THE BENEFICIARY ENTITLED TO THE QESI IF HE IS 16 OR 17 YEARS OLD? The contributions made to your RESP during the year in which the beneficiary reaches the age of 16 or 17 will only give entitlement to the QESI if: At least $2,000 has been deposited in one or more RESPs on the beneficiary s behalf before the end of the year in which he reached 15 years of age and it was not withdrawn before the end of the year in which he reached age 15; or At least $100 per year has been deposited in one or more RESPs on the beneficiary s behalf for at least four years prior to the year of his 16 th birthday and it was not withdrawn before the end of the year in which he reached 15 years of age. REFUND OF GOVERNMENT INCENTIVES WHAT ARE THE CASES IN WHICH THE CESG MUST BE RETURNED TO THE GOVERNMENT OF CANADA? 1) The Custodian, on instructions from the Manager, reimburses the totality of the CESG paid for the beneficiary to the federal government when, at your request as subscriber, your contributions have been reimbursed to you before: a) the beneficiary is enrolled in a full-time post-secondary program of study; or b) it is determined that the beneficiary will not be pursuing eligible studies. 2) The Custodian, on instructions from the Manager, must also return the CESG to the federal government in the following cases: a) when you terminate your scholarship agreement or your educational assistance payment agreement ; b) when your registered education savings plan is abolished or its registration revoked ; c) when the beneficiary deceases or becomes totally and permanently disabled and no other beneficiary is designated ; d) when an inadmissible transfer has been made. A transfer is only admissible when: i) both RESPs have the same beneficiary, or the beneficiary of the new RESP was younger than 21 years of age when the initial plan was opened and is the brother or sister of the beneficiary of the former RESP; and ii) the new RESP meets the registration requirements as stipulated in the Income Tax Act (Canada). 30

31 e) when you replace a beneficiary who has not received the enhanced CESG (exceeding the basic 20% rate) by a new beneficiary and that none of the following conditions are met: i) the new beneficiary was younger than 21 years of age when the initial plan was opened and is the former beneficiary s brother or sister; and ii) both beneficiaries are younger than 21 years of age and are related to the initial subscriber of the plan either by blood or legal adoption. f) when you replace a beneficiary who has received the enhanced CESG (exceeding the basic 20% rate) with a new beneficiary and one of the following conditions is not met: i) the new beneficiary is the brother or the sister of the former beneficiary; or ii) the new beneficiary was younger than 21 years of age when the initial plan was opened. g) when you withdraw a portion of your contributions from a plan which has received CESG amounts, the Custodian of the RESP must reimburse a portion of the CESG calculated according to the formula provided by regulations. WHAT ARE THE CASES IN WHICH THE CLB MUST BE RETURNED TO THE GOVERNMENT OF CANADA? The Custodian, on instructions from the Manager, must also reimburse the CLB to the federal government if: a) you terminate your scholarship agreement or your educational assistance payment agreement; or b) your registered education savings plan is abolished or its registration revoked. However, the cases stipulated in paragraphs 1 and 2 (g) in the subsection What are the cases in which the CESG must be returned to the Government of Canada? do not lead to the reimbursement of the CLB. Regarding paragraphs 2 (c), (d), (e) and (f), the CLB must be returned to the federal government when the RESP s beneficiary, on whose behalf the CLB was paid, is no longer a beneficiary. W HAT HAPPENS TO GOVERNMENT INCENTIVES WHEN SUBSCRIBER CONTRIBUTIONS ARE REIMBURSED AT THE MATURITY OF A UNIVERSITAS OR REFLEX PLAN? With regard to the UNIVERSITAS and REFLEX plans, special rules apply to the retention of government incentives. See the questions Is it possible to keep the government incentives paid on behalf of the beneficiary despite a reimbursement of my contributions? and What happens to the government incentives if the reimbursement of my contributions is carried forward? in the section UNIVERSITAS and REFLEX Plans Full Reimbursement of Contributions. IN WHAT OTHER CASES MUST GOVERNMENT INCENTIVES BE RETURNED? Government incentives must be reimbursed in some other cases and under certain conditions. See the sections that cover the conditions relating to death, disability or a change of beneficiary, as well as cancellations, conversions and transfers for each type of plan established by the various Trusts. WHEN GOVERNMENT INCENTIVES ARE RETURNED, WHAT HAPPENS TO THE INCOME EARNED FROM THEIR INVESTMENT? When government incentives are reimbursed to the federal or Quebec governments, as applicable, the income earned on their investment and management are processed as follows: In the UNIVERSITAS and REFLEX group plans, they are given to the post-secondary institutions designated by the Manager or to a trust in favour of such institutions. In the INDIVIDUAL plan, the income earned on government incentives can be paid, according to the conditions stipulated in the Payment of Accumulated Income section. However, when the CLB is reimbursed to the federal government following an admissible change of beneficiary, the income earned on the CLB remains in the RESP in the name of the new beneficiary. Any CLB returned to the federal government for one of the reasons stipulated above can be paid again in favour of the same beneficiary if the CLB eligibility criteria are met once more. WHAT ARE THE CASES IN WHICH THE QESI MUST BE RETURNED TO THE GOVERNMENT OF QUEBEC? In the cases when the Manager is required to return the CESG to the federal government, it must also return the QESI to the Quebec government. See the above question What are the cases in which the CESG must be returned to the Government of Canada? 31

32 UNIVERSITAS AND REFLEX PLANS WHO ARE THESE PLANS INTENDED FOR? The UNIVERSITAS plan succeeds the group plan created in 1964, which was later called Select It is intended for beneficiaries 0 to 15 years of age inclusive. The REFLEX plan succeeds the Intermediate group plan created in It is also intended for beneficiaries 0 to 15 years of age inclusive. HOW DO THE PLANS WORK? A scholarship agreement is reached between you and the Foundation on behalf of the plan Trust in question. You make your contributions according to the tables appended to this prospectus. The Manager receives them, pays them to the Custodian for crediting to an account that the latter maintains on your behalf as a subscriber. You then have the option, as applicable, of making a single contribution or regular contributions spread over a maximum period of 17 years. If you subscribe to one of these group plans, you must make the minimum required contributions (see the UNIVERSITAS and REFLEX Plans Minimum Contributions section). Subsequently, any additional contribution to your scholarship agreement must total at least $50. The contributions are calculated so they basically generate the same accumulated income for the payment of scholarships to the cohort to which the beneficiary belongs, regardless of his age when the contributions began. Your total contributions (including those paid by an insurer in case of death or disability) may not exceed the cumulative limit of the RESP stipulated in the Income tax Act (Canada). See the General Provisions Applicable to the Three Plans Contribution Limit section. For the UNIVERSITAS and REFLEX plans, the maximum period for contributions is 17 years. The accumulated income under each of the plans is counted separately. Subsequently, it is distributed to qualified beneficiaries pursuing eligible studies according to the objective criteria of the Manager specified hereafter. WHO OWNS THE MONEY YOU PAY INTO YOUR PLAN? The contributions you make to your UNIVERSITAS or REFLEX plan, after deduction of your membership fees, remain your property. ELIGIBLE STUDIES CRITERIA In Canada or abroad, eligible studies include full-time and part-time post-secondary studies pursued in a community college, private technical college or university, according to the plan selected. In Quebec, a diploma of vocational studies (DVS), an attestation of college studies (ACS) or a diploma of technical or pre-university college studies (DCS) are also eligible, under certain conditions. See the Summary of the Prospectus Eligible Studies section. Eligible studies do not necessarily require a high school diploma as a prerequisite. To ensure that the education program and the educational institution are eligible, contact the Manager in advance. These criteria apply to both public and private educational institutions. UNIVERSITAS PLAN WHAT PROGRAMS OF STUDY ARE ADMISSIBLE? In Canada or abroad, eligible studies include programs offered in a: Community college; Private college; and University. To be considered admissible, a program of study offered in a community college must have a minimum duration of one year. In Quebec, eligible studies include programs leading to: A diploma of vocational studies (DVS); An attestation of college studies (ACS); A diploma of college, technical studies (DCS); and A university diploma. A vocational program of study (DVS in Quebec) is a program offered in a post-secondary institution intended to provide a person with specific skills or their improvement, required to exercise a professional activity. Long distance learning courses offered by a university or part of a college program of study (technical program or other program leading to an attestation of college studies) are also considered to be eligible studies. Payment of scholarships: The beneficiary is entitled to the three scholarships if enrolled in a university program of study. In Canada or abroad, the beneficiary is entitled to one scholarship if he is enrolled in a one-year program of study in a community college, or two scholarships if enrolled in a two-year program in a community college or private college. If the beneficiary pursues university studies, he will be entitled to the third scholarship. In Quebec, the beneficiary is entitled to two scholarships if he is enrolled in a college-level technical program or in a program leading to an attestation of college studies. If the beneficiary pursues university studies, he will be entitled to the third scholarship. The beneficiary is entitled to one scholarship if he is enrolled in a vocational program of study. If the beneficiary pursues college technical studies or university studies, he will be entitled to a second and third scholarship. To learn more on the eligibility criteria applicable to each of the three scholarships, refer to the table under Summary of the Prospectus Eligible studies. 32

33 REFLEX PLAN WHAT PROGRAMS ARE ADMISSIBLE? In Canada or abroad, eligible studies include programs offered in a: Community college; Private college; and University. To be considered admissible, a program of study offered in a community college must have a minimum duration of one year. In the province of Quebec, eligible studies include programs leading to: A diploma of vocational studies (DVS); An attestation of college studies (ACS); A diploma of college, pre-university studies (DCS); A diploma of college, technical studies (DCS); and A university diploma. A vocational program of study (DVS in Quebec) is a program offered in a post-secondary institution intended to provide a person with specific skills or their improvement, required to exercise a professional activity. Long distance learning courses offered by a university or part of college program of study (pre-university, technical or other program leading to an attestation of collegial studies) are also considered to be eligible studies. Payment of scholarships: The beneficiary is entitled to the three scholarships if enrolled in a university program of study. In Canada or abroad, the beneficiary is entitled to three scholarships when he is enrolled in a program of study in a community college or private college. In Quebec, the beneficiary is entitled to three scholarships when he is enrolled in a college-level technical or general program, a program leading to an attestation of college studies, or a vocational program of study. To learn more on the eligibility criteria applicable to each of the three scholarships, refer to the table under Summary of the Prospectus Eligible studies. DESCRIPTION OF UNITS WHAT IS A WHOLE UNIT? When you subscribe to a plan from the UNIVERSITAS or REFLEX plan Trusts, you will be attributed one or more units or unit fractions based on the amount to which you subscribe. A whole unit is a measurement unit used to determine, after actuarial evaluation, a relationship between the subscribed amount, the contributions you have to pay during the plan s term, and the level of scholarships that can be paid at maturity to the beneficiary you designate, if he is qualified. The amount of the scholarships paid to each qualified beneficiary is directly proportional to the number of units subscribed for him. Each whole unit makes it possible to commit to pay up to three scholarships to a beneficiary, according to the eligible studies criteria of the plan selected, and gives entitlement to a scholarship of equal value for all qualified beneficiaries in the same cohort and in the same plan. See the Summary of the Prospectus Eligible studies section. WHAT IS A UNIT FRACTION? With respect to a whole unit, a unit fraction is composed of thousandths of a unit. A unit fraction also entitles the beneficiary to receive three scholarships. The amount of the scholarship is proportional to this fraction of the scholarship amount for the whole unit. Unit fractions are subject to the same conditions applicable to a whole unit; it is possible to add one or more unit fractions to the whole unit until the beneficiary reaches 16 years of age. MEMBERSHIP FEES HOW MUCH ARE THE MEMBERSHIP FEES? To subscribe to a plan from the UNIVERSITAS or REFLEX plan Trusts, you must pay membership fees of $200 per whole unit. For a unit fraction, membership fees are proportional to the fees for a whole unit. For a whole unit, the first $100 contributed is used solely to pay the membership fees; the balance is taken at a 50% rate from the subsequent contributions. For each unit fraction, the first contributions are used solely to pay up to 50% of the total membership fees; the balance is taken at a 50% rate from the subsequent contributions. ARE MEMBERSHIP FEES REFUNDABLE? The Manager reimburses your membership fees in full if you maintain your plan in effect until the maturity date. This reimbursement is made from the Trust Account. WHAT MEASURES DOES THE MANAGER TAKE TO ENSURE THE REIMBURSEMENT OF MEMBERSHIP FEES? The Manager annually calculates the current value of its obligation to reimburse membership fees under the terms of the plans in effect. The calculations are established on the cash projections made by the external actuary on June 30 of each year. The total value of the refund obligation established is paired, in part, with secure investments in fixed-income securities. The net income from these investments is used primarily for the reimbursement of membership fees; the balance is then transferred to the Trust Account maintained by the Trust in question. 33

34 UNIVERSITAS AND REFLEX PLANS MINIMUM CONTRIBUTIONS WHAT MINIMUM AMOUNTS MUST I DEPOSIT TO OPEN A SCHOLARSHIP AGREEMENT? 1) To join a UNIVERSITAS plan scholarship agreement, you may subscribe to a minimum of one half-unit, provided you make: a) a minimum contribution of $11.25 per month when you opt for the monthly contribution method; b) a minimum contribution of $ per year when you opt for the annual contribution method; or c) a minimum contribution of $ when you opt for the single contribution method. 2) To join a REFLEX plan scholarship agreement, you may subscribe to a minimum of one half-unit, provided you make: a) a minimum contribution of $11.25 per month when you opt for the monthly contribution method; b) a minimum contribution of $ per year when you opt for the annual contribution method; or c) a minimum contribution of $ when you opt for the single contribution method. Any additional contribution must total at least $50. When the beneficiary is eligible for the CLB, the corresponding amounts paid into your RESP are not considered when calculating the minimum contributions you must make to keep your scholarship agreement in effect. QUALIFYING YEAR FOR SCHOLARSHIPS The beneficiary can qualify for his 1 st scholarship as soon as he meets the eligibility criteria presented in the Summary of the Prospectus Eligible studies section. The qualifying year is the year in which the beneficiary reaches 17 years of age. The Manager contacts all beneficiaries during the summer of their qualifying year and in the following years, up to the summer in which the latter reach 25 years of age. Subsequently, the beneficiary will have to personally contact the Manager if he enrols in an eligible program of study. It is possible to bring forward the qualifying year according to the terms stipulated below in the section Change of Qualifying Year. Only a qualified beneficiary may be entitled to scholarships. CHANGE OF QUALIFYING YEAR CAN THE QUALIFYING YEAR BE BROUGHT FORWARD? Upon maturity of your plan, you can submit a request to have the Manager bring forward the beneficiary s qualifying year. Before your plan matures and at your request, the Manager may grant to bring forward the beneficiary s qualifying year, but on condition of paying, according to its instructions, the balance of the contributions stipulated in your scholarship agreement. You must therefore have made all your contributions before your beneficiary can receive his 1 st scholarship. IS IT POSSIBLE TO DEFER THE QUALIFYING YEAR? As needed, the Manager automatically defers the beneficiary s qualifying year until the following year and can do so for as long as it remains possible to pay the scholarships before the end of the plan s life (cut-off date). The law does not permit the payment of scholarships after the plan has ended (see the UNIVERSITAS and REFLEX Plans Calculation of Scholarships section.) When the beneficiary is entitled to the CESG and you have not yet requested the withdrawal of your contributions, the accumulated CESG amount is kept in his name until the cut-off date is reached. The CLB is also kept in the name of the beneficiary. In the case of Quebec beneficiaries, the same procedure applies to the QESI. HOW DOES THE MANAGER CHANGE THE QUALIFYING YEAR? The Manager changes the qualifying year, if need be, in July of each year. The income accumulated in your plan at the end of the preceding December (end of fiscal year) and the value of the returns from the following six months along with the government incentives and income earned on these amounts, are transferred to the new qualifying year. WHAT HAPPENS TO THE FUNDS AVAILABLE AFTER THE CUT-OFF DATE? After the cut-off date, i.e. the end of an RESP s lifetime, the balance of the funds available for the payment of the beneficiary s scholarships is distributed as follows: The income earned on the subscriber s contributions is distributed among the other beneficiaries in the same cohort, depending on whether it is a UNIVERSITAS or a REFLEX plan; The CESG and CLB are reimbursed to the federal government, whereas the QESI, if applicable, is reimbursed to the Quebec government; and The income earned on the incentives is paid to an accredited educational institution in Canada or a trust established in favour of such an institution. 34

35 FULL REIMBURSEMENT OF CONTRIBUTIONS CAN I RECOVER THE CONTRIBUTIONS I HAVE PAID? You can recover your contributions in full even if the beneficiary does not pursue eligible studies. The membership fees are reimbursed in full at maturity of the agreement only. The Manager makes the full reimbursements on January 15, May 15 and September 15 of each year. When the Manager is unable to contact you at the last known address on file and you have ceased to make your contribution payments and do not claim the reimbursement of your contributions, the Manager will automatically implement the following of the two options which is most beneficial to you: If the cumulative amounts are sufficient to allow it (the equivalent of half a unit and covered membership fees) and the scholarship plan has not reached maturity, the Manager will convert the contributions into a single contribution mode to enable the beneficiary to retain his entitlement to scholarships; or The Manager will proceed with the automatic conversion to the INDIVIDUAL plan, according to the criteria stipulated in the section Plan Conversion/Transfer. The Manager will conduct an analysis of each case before proceeding with the conversion of either plan. IS IT POSSIBLE TO KEEP THE GOVERNMENT INCENTIVES PAID ON BEHALF OF THE BENEFICIARY DESPITE A REIMBURSEMENT OF CONTRIBUTIONS? The government incentives can be kept despite a reimbursement of contributions if the plan is maintained until maturity. If you converted your UNIVERSITAS plan or REFLEX plan to the INDIVIDUAL plan at maturity and wish to maintain the government incentives, at the time of your request for reimbursement, you must submit written proof to the Manager of the beneficiary s enrolment to eligible studies. If you cannot provide this proof of enrolment and you demand the reimbursement of your contributions at the maturity date, the beneficiary retains his entitlement to the scholarships and the CLB. However, the Custodian, on instructions from the Manager, must reimburse the full amount of the CESG received for the beneficiary to the federal government. WHAT HAPPENS TO GOVERNMENT INCENTIVES IF I DEFER THE REIMBURSEMENT OF MY CONTRIBUTIONS? If, at the time of the scholarship calculations for the beneficiary s cohort, it turns out the beneficiary will not be pursuing eligible studies, the CESG and the CLB must be reimbursed to the federal government. The QESI amount received for the beneficiary, if applicable, is reimbursed to the Quebec government. If you request to defer the reimbursement of your contributions after the maturity date in order to maintain the CESG in the beneficiary s name, the Manager will establish a separate account in your name to credit your contributions. These contributions are invested in compliance with paragraph 1 of the section Investment Objectives, Strategies and Restrictions Investment Strategies as of September 1 of the year in question, when calculating the scholarships, or as of March 1, depending on the case. Your contributions are reimbursed when the beneficiary is enrolled in eligible post-secondary studies or in the event that he does not pursue eligible studies. The income earned on these contributions after the maturity date is paid to the beneficiary with his 1 st scholarship when the plan has not been converted. If you converted your UNIVERSITAS or REFLEX plan into an INDIVIDUAL plan at maturity, the accumulated income will be transferred and is included in the EAPs. If it turns out that the beneficiary will not be pursuing eligible studies, this accumulated income must be paid to post-secondary institutions designated by the Manager, or to a trust in favour of such institutions. When it comes to maturity, your UNIVERSITAS plan is automatically converted into an INDIVIDUAL plan at no additional cost. It is also possible to convert automatically your REFLEX plan to the INDIVIDUAL plan. When a UNIVERSITAS or REFLEX plan comes to maturity and is converted into an INDIVIDUAL plan, the government incentives and the income earned on these amounts are attributed to the new plan. WAIVER OF INTEREST WHAT HAPPENS TO THE INCOME EARNED ON MY CONTRIBUTIONS AS A SUBSCRIBER? In your capacity as a subscriber, according to the terms of your scholarship agreement, you waive the income earned on your contributions in favour of the Trust in question, except in the case where you convert a REFLEX plan to an INDIVIDUAL plan at maturity (see the Plan Conversion/Transfer section). This accumulated income, as well as the types of investments in which it is invested belong to the Trust issuing the plan, subject to its obligation to dispose of this income as stipulated in the plan, specifically for the payment of scholarships. You thus contribute to increasing the scholarships that will be paid to qualified beneficiaries in the same cohort. If your beneficiary does not pursue eligible studies, he will not be entitled to scholarships. 35

36 UNIVERSITAS AND REFLEX PLANS DEATH OR DISABILITY OF THE BENEFICIARY WHAT SHOULD I DO IN THE EVENT OF THE BENEFICIARY S DEATH OR TOTAL AND PERMANENT DISABILITY? If the beneficiary dies or becomes totally and permanently disabled before the end of the plan, you must notify the Manager accordingly, in writing, by sending a copy of the death certificate or medical proof of disability within 90 days of death or medical diagnosis of disability. In such cases, it is possible to change the beneficiary at all times before the cut-off date, i.e. the end of the plan. WHAT WILL BECOME OF MY SCHOLARSHIP AGREEMENT IN THE EVENT OF THE BENEFICIARY S DEATH OR TOTAL AND PERMANENT DISABILITY? In this case, you can choose to: Maintain your scholarship agreement in effect and, by informing the Manager in writing, designate another beneficiary; or Cancel your scholarship agreement and obtain the reimbursement of your contributions, including membership fees. If you wish to maintain your scholarship agreement in effect and designate another beneficiary and the deceased or disabled beneficiary: Had not reached the age of 16, the new beneficiary may be younger than 16 years of age. See the UNIVERSITAS and REFLEX Plans Change of Beneficiary section; or Had reached the age of 16, you may designate a new beneficiary the same age or younger. To keep the CESG paid into the plan of the deceased or disabled beneficiary as well as the earned income from the CESG and the CLB, the new beneficiary must be a family member. If an enhanced CESG (exceeding the basic 20% rate) has been received for the former beneficiary, the CESG may be kept only if the new beneficiary is the brother or sister of the former beneficiary and was younger than 21 years of age when the initial plan was opened. The CLB paid in the name of the former beneficiary must be returned to the Government of Canada. Finally, to keep the QESI paid into the plan of the deceased or disabled beneficiary as well as the income earned on the QESI, if applicable, the new beneficiary must be a family member. If the enhanced QESI has been received for the former beneficiary, it may be kept only if the new beneficiary is the brother or sister of the former beneficiary and was younger than 21 years of age when the initial plan was opened. If you cancel your scholarship agreement, your contributions and membership fees will be reimbursed. However, the income earned on your contributions remains with the Manager and must be allocated to the scholarship payments for the other beneficiaries in the same cohort as the deceased or disabled beneficiary. Furthermore, the total amount of government incentives received in the name of this beneficiary is reimbursed to the federal and Quebec governments, as applicable. CHANGE OF BENEFICIARY IS A CHANGE OF BENEFICIARY POSSIBLE? Beneficiary changes are authorized, and there is no limit on the number of changes you can make. A change of beneficiary is only possible when the former beneficiary has not yet qualified for his 1 st scholarship at the time this change is processed. However, in a case of death or total and permanent disability, it is possible to change the beneficiary at any time before the cut-off date, i.e. the end of the plan. A change of beneficiary cannot have the effect of extending the length of a plan, which cannot exceed the last day of the 35 th year following the year in which the RESP came into effect. The Manager must be notified in writing of any change of beneficiary. Under the UNIVERSITAS plan, a beneficiary who is less than 16 years of age can be replaced by another beneficiary who is also less than 16 years old. If the new beneficiary is older than the former, the remaining contributions to the plan will be increased to compensate for the age difference, according to the amount and terms determined by the Manager. Interest at an annual rate of 6.50% applies to arrears. This rate is reviewed annually by the Manager in consultation with the external actuary. When the former beneficiary is replaced by a new beneficiary, the contributions, the CESG and the QESI then paid on behalf of the former beneficiary and the income from the CESG, QESI and CLB are deemed to have been paid in favour of the new beneficiary. However, if the new beneficiary and the former are not family members, the CESG received in the RESP must be reimbursed to the federal government in full. The CESG must also be reimbursed when an enhanced CESG (exceeding the basic 20% rate) has been received for the former beneficiary and the following conditions are not met: The new beneficiary is the brother or the sister of the former beneficiary ; and. The new beneficiary was younger than 21 years of age when the initial plan was opened. 36

37 Moreover, when either of the two preceding conditions is not satisfied, the QESI must be returned. In all cases, a change of beneficiary will result in the CLB being returned to the Government of Canada. It is possible that a change of beneficiary may have income tax considerations in terms of the cumulative limit for the new beneficiary. SCHOLARSHIP APPLICATION WHEN AND HOW CAN I APPLY FOR A SCHOLARSHIP? The qualified beneficiary must submit his scholarship application to the Manager, using the Customer Portal service of Universitas Trust Funds or, if he does not have access to the Internet, communicate with the head office so that the appropriate forms may be sent to him. You must have made all your contributions before your beneficiary receives his first scholarship. The qualified beneficiary may apply for a scholarship at any time during the year. WHAT HAPPENS IF THE APPLICATION IS NOT SUBMITTED IN DUE TIME? If the beneficiary has reached 17 years of age and has failed to apply for his 1 st scholarship, the Manager will automatically carry forward this qualifying year to the following year. The same applies for each of the subsequent years, as applicable; up to the cut-off date stipulated in the section UNIVERSITAS and REFLEX Plans Change of Qualifying Year in the question Is it possible to defer the qualifying year? CALCULATION OF SCHOLARSHIPS WHERE DO THE SCHOLARSHIP AMOUNTS COME FROM? The Manager proceeds with the calculations of scholarship amounts payable to beneficiaries of a same cohort. The external actuary must then audit the methodology behind the calculations used to determine scholarship levels in order to grant its approval. The scholarships are paid from the income earned on the amounts posted to the Trust Account maintained for the UNIVERSITAS or REFLEX plan Trusts, as applicable. This income is shared by plan Trust and by cohort of beneficiaries having the same qualifying year. The total scholarship amount is established for each cohort based on the amounts thus shared. When government incentives have been received by the Manager on behalf of a beneficiary, these amounts and the investment income from the latter are added to the scholarship amounts paid to him. The Trust has no discretionary power in determining scholarship levels. The latter are determined through the sole application of the methodology stipulated in Note 2 of the financial statements incorporated by reference to this prospectus, which has been approved by the external actuary. See the Actuary s Certificate section. Accordingly, the calculation of scholarship levels is made on July 1 of each year, by determining the adjusted fair market value (AFMV) of the remaining amount accrued for scholarship purposes and the unrealized added (or lost) value on investments available for the cohort of the year in progress and those of previous years. A same qualifying year includes beneficiaries who have brought forward or deferred their qualifying year. The AFMV established as at July 1 is shared among the units held by the beneficiaries of a cohort, who are potentially eligible for scholarships, by applying an attrition factor. Accordingly, only a portion of these units is considered and not the totality, since some beneficiaries will not meet the requirements for the payment of scholarships. The 2 nd and 3 rd scholarship levels correspond respectively to the 1 st and 2 nd scholarship levels of the previous year, increased by the return on fixed-income investments used as an assumption to establish the tables of contributions. Furthermore, if the qualified beneficiary under a UNIVERSITAS or REFLEX plan has received government incentives, the CESG, CLB, QESI (if applicable) and the income earned on all of the latter in the beneficiary s name will be added to his scholarships as follows: One third of the total amount One half of the balance The balance of the CESG, CLB, QESI (as applicable) and income earned in his name on these amounts is added to his 1 st scholarship 2 nd scholarship 3 rd scholarship However, these terms do not apply to UNIVERSITAS or REFLEX plans that have been converted to the INDIVIDUAL plan. See the INDIVIDUAL Plan Plan Conversion/Transfer section. WHAT WILL HAPPEN TO THE FUNDS IF THE BENEFICIARY CAN NO LONGER QUALIFY? If the beneficiary can no longer qualify for any of the three scholarships, the income earned on the contributions made in his name will then be distributed among the qualified beneficiaries for the 1 st, 2 nd and 3 rd scholarships of the year in progress. If the beneficiary can no longer qualify for his 2 nd or 3 rd scholarship before the cut-off date, the income earned on the contributions made in his name will be distributed among the beneficiaries qualified for scholarships. An exception to this principle is however made in the case of a conversion from a REFLEX plan to an INDIVIDUAL plan, as indicated in the section Plan Conversion/Transfer. The CESG and the CLB accumulated by beneficiaries who do not qualify for any one of the 1 st, 2 nd or 3 rd scholarships are reimbursed to the federal government. The QESI, if applicable, is then reimbursed to the Government of Quebec. 37

38 UNIVERSITAS AND REFLEX PLANS CANCELLATION, RE-REGISTRATION AND SUSPENSION HOW CAN I CANCEL MY SCHOLARSHIP AGREEMENT? You can cancel your scholarship agreement, totally or partially, by giving a 30-day written notice to the Manager. The withdrawal of your contributions, permitted at any time before the maturity date of your scholarship agreement, totally cancels your scholarship agreement. A partial cancellation occurs when the amount of the contributions initially established is reduced. You must however maintain at least half a unit in effect and undertake to contribute the minimum monthly or annual contribution amounts, as indicated in the section UNIVERSITAS and REFLEX Plans Minimum Contributions. In case of total cancellation, the Manager retains all of the membership fees, except when the cancellation occurs within 60 days of the agreement signing, in which case, the membership fees are reimbursed in full. If the cancellation is partial, the Manager will only retain the amount of membership fees proportional to the requested reduction in units. When an agreement is cancelled within 60 days of its signing, the representative must reimburse the Manager the entire commission advance received. However, when an agreement is cancelled more than 60 days after it is signed and that the subscriber has not deposited all of the membership fees due pursuant to the agreement, the representative must reimburse the Manager the portion of the commission advance exceeding the total membership fees paid by the subscriber. Moreover, instead of cancelling your scholarship agreement, it is possible to convert it to an INDIVIDUAL plan if a minimum of $500 has accumulated in the Trust Account in contributions, government incentives and income on these incentives, at the time of the application for conversion. WHAT ARE THE OTHER CAUSES OF TOTAL CANCELLATION? Your scholarship agreement is automatically cancelled: 60 days after your failure to make a scheduled contribution to your plan and will be automatically converted, upon expiry of this deadline, to the INDIVIDUAL plan according to the conditions stipulated in the section Plan Conversion/Transfer ; When the beneficiary can no longer qualify, pursuant to the terms stipulated in the section UNIVERSITAS and REFLEX Plans Change of Qualifying Year in the question Is it possible to defer the qualifying year? ; When you convert or transfer a registered education savings plan of the Foundation to another plan according to the conditions stipulated in the section Plan Conversion/Transfer ; or When you decide to withdraw your contributions in the event of your beneficiary s death or disability. WHAT HAPPENS TO THE GOVERNMENT INCENTIVES IN THE CASE OF TOTAL CANCELLATION? Unless converted or transferred to another plan, the CESG and the CLB received must be reimbursed in full to the federal government in the case of a total cancellation. The QESI, if applicable, will be returned to the Quebec government. CAN THE MEMBERSHIP FEES BE RE-CREDITED IN THE EVENT OF A CANCELLATION? If you subscribe to a new plan of the UNIVERSITAS plan Trust or a REFLEX plan Trust and designate a beneficiary under 16 years of age less than 48 months following the cancellation date of your previous agreement, the membership fees already paid, which would otherwise return to the Trust, will be fully credited to you according to the number of subscribed units under the terms of the new plan. However, this credit only applies if the cancellation takes place more than 60 days following the signing of the agreement, since fees are refunded when a cancellation occurs within this time frame. HOW CAN I SUSPEND MY CONTRIBUTIONS? Upon written request, the Manager may allow you to suspend your contributions for a maximum period of 24 months. During this period, the government incentives received do not have to be returned. The suspended contributions may be regularized by paying the arrears and interest charges at an annual rate of 6.50% before the end of the 24-month period. You can also agree on other solutions with the Manager in the best interest of qualified beneficiaries if your particular situation justifies it. WHAT HAPPENS IN CASE OF DEFAULT OR DELAY IN THE PAYMENT OF MY CONTRIBUTIONS? If you fail to make a contribution on the date stipulated in your scholarship agreement, you will be sent a written notice within two weeks. You then have 30 days following receipt of this notice to remedy the default. Interest at the annual rate of 6.50% is charged on any late contribution payment. Any default or delay in payment exceeding 60 days will result in the cancellation of your scholarship agreement and the automatic conversion of the agreement to the INDIVIDUAL plan if specific criteria are satisfied. 38

39 PLAN CONVERSION/TRANSFER CAN I CONVERT MY PLAN INTO ANOTHER PLAN PROMOTED BY THE FOUNDATION? You can convert a UNIVERSITAS plan to a REFLEX plan or vice versa, on written request sent to the Manager within the 12 months following the effective date of your initial plan, provided that the beneficiary is under 16 years of age. In this case, the contributions and government incentives are transferred to your new plan. The earned income is not transferred, except for that generated on government incentives. The membership fees already paid into the original plan, as applicable, are then credited to the new plan, according to the new number of subscribed units corresponding to the established contribution amounts. A new scholarship agreement establishing the new plan will come into effect between you and the Foundation, as promoter of the Trust in question, and replace the former scholarship agreement. You must then make your contributions according to the age of the beneficiary at the time the conversion was processed. The conversion of a UNIVERSITAS or REFLEX plan to an INDIVIDUAL plan is also possible before your scholarship agreement reaches maturity under certain conditions (see the Summary of the Prospectus Conversion of Group Plans to an INDIVIDUAL Plan section.) When your UNIVERSITAS plan scholarship agreement reaches maturity, it will automatically be converted into an INDIVIDUAL plan at no additional cost. It is also possible to convert automatically your REFLEX plan into an INDIVIDUAL plan. This conversion may enable you to obtain the payment of the government incentives to which your beneficiary could be entitled and which are still available at maturity of your group plan. It can also enable your beneficiary to have access to the incentive amounts and the income earned on the latter when the beneficiary is not pursuing eligible studies according to the eligibility criteria of the former group plan. The terms applicable to the conversion of the UNIVERSITAS or REFLEX plans to the INDIVIDUAL plan are presented in the table under the Conversion of Group Plans to an INDIVIDUAL Plan section. IS IT POSSIBLE TO TRANSFER AN RESP PROMOTED BY THE FOUNDATION TO AN RESP OFFERED BY ANOTHER INSTITUTION? The transfer of a UNIVERSITAS or REFLEX plan to an RESP promoted by another institution is permitted, provided that only the contributions, accumulated government incentives and the income earned on the incentives are transferred to the new RESP. Accordingly, the membership fees and the income earned on the contributions will not be transferred. This transfer cannot have the effect of extending the life of a plan and making it exceed its cut-off date. IS IT POSSIBLE TO PARTIALLY CONVERT OR TRANSFER AN RESP? Only a portion of the amounts held in an RESP can be attributed or transferred to another RESP in the case of a conversion of an ESP promoted by the Foundation or a plan transfer. In this case, the contributions, the CESG, the QESI and all income earned on the latter, as applicable, are deemed to have been transferred in the same proportion as the value of the amounts attributed or transferred to the new RESP with respect to that of the amounts held in the RESP from which they originate. The CLB is not considered for the purpose of this calculation. In this case, you have the option of attributing or transferring the CLB in proportion to the total value of the RESP, or transferring it in whole, in part, or not at all. WHAT ARE THE INCOME TAX CONSIDERATIONS OF A CONVERSION OR TRANSFER? The conversion from one RESP to another RESP promoted by the Foundation or the transfer of an RESP promoted by the Foundation can be done without incurring income tax considerations if: Both plans have the same beneficiary; or The beneficiary of the new plan was younger than 21 years of age when the initial plan was opened, and is the brother or sister of the former plan s beneficiary. In the case of a conversion or a transfer that does not satisfy one or other of the two aforementioned conditions, a penalty tax may be payable. Hence, the contributions that were paid into the former plan are deemed to have been made for the beneficiary of the new plan at the time of their initial payment. In such cases, the transfer may give rise to contributions that exceed the legal limits authorized by tax laws, and possibly penalties. SPECULATIVE AND UNCERTAIN NATURE The reimbursement of contributions and membership fees at maturity is stipulated in the scholarship agreement; it is ensured by asset safeguard mechanisms described in this prospectus, whose conservation in trust and their investment and management comply with the investment policies, whose objectives include focusing on the preservation of the capital and prudent portfolio risk management. See the Investment Objectives, Strategies and Restrictions section. The amount of the scholarships paid to a qualified beneficiary differs depending on whether it is a UNIVERSITAS plan or a REFLEX plan. The Manager cannot predict nor guarantee the amount of the scholarships to be paid by the UNIVERSITAS and REFLEX plan Trusts and it cannot predict whether a beneficiary will become qualified. The scholarship amounts will depend on the yield obtained by the portfolio managers, the amount of accumulated income, the value of the subscriber s contributions and the number of qualified beneficiaries for a given year. 39

40 LIFE AND DISABILITY INSURANCE As the subscriber of a scholarship agreement, you can purchase the life and disability insurance offered by SSQ Financial Group if you are less than 60 years of age on the date the insurance comes into effect. To be eligible for the insurance coverage, you must select a method of contributing to your scholarship agreement other than the single or 2-year annual contribution methods. Since the insurance offered is a combined product, you may not purchase the life insurance or disability insurance coverage separately. In the event of death or total and permanent disability before the maturity date of your scholarship agreement, the outstanding balance of contributions is paid by SSQ Financial Group. The total amount payable in case of death or total and permanent disability may not exceed $60,000. For more information about the life and disability insurance, please refer to the Distribution Guide provided by the Distributor s representative at the time the life and disability insurance product will be offered to you. 40

41 INDIVIDUAL PLAN FOR WHOM IS THE INDIVIDUAL PLAN INTENDED? The INDIVIDUAL plan was introduced in 1988 for beneficiaries of all ages. HOW DOES THE INDIVIDUAL PLAN WORK? An educational assistance payment agreement, recognizing the plan established by the INDIVIDUAL plan, is concluded between you and the Foundation on behalf of the concerned Trust, or between you and your spouse (or common-law partner) on one hand, and the Foundation, on the other hand, acting in the same capacity. The Manager receives your contributions and sends them to the Custodian. They are then credited to an account the Custodian maintains in your name as subscriber. You must pay an initial contribution of $500 which includes a membership fee of $200. This membership fee is included in the cumulative limit of the RESP established by your plan. Subsequently, you make contributions in amounts you determine yourself. You can make a single contribution or periodic payments. These contributions can be automatically debited from your bank account if they total at least $25 per month. You and your spouse (or common-law partner) may both be subscribers for the same educational assistance payment agreement. Your spouse (or common-law partner) may thus subscribe with you during the agreement signing, or choose to become a subscriber later on. Your total contributions may not exceed the lifetime limit of $50,000 per beneficiary for all plans combined, pursuant to the Income Tax Act (Canada). You cannot make contributions after the 31 st year following the year in which the plan came into effect. When you opt for an INDIVIDUAL plan, you do not participate in the group nature of the UNIVERSITAS or REFLEX plans, which offer subscribers the possibility of seeing other qualified beneficiaries, in the same cohort as their designated beneficiary, receive one or more scholarships funded in part by the income earned on your contributions. Opting for an INDIVIDUAL plan will most likely result in the EAPs paid to the beneficiary you designate in your educational assistance payment agreement being lower than those that he would have received had you subscribed to a group plan. However, the EAP eligibility criteria are not as stringent as those that must be satisfied to obtain scholarships in one or other group plans. WHO OWNS THE CONTRIBUTIONS I PAY INTO THE PLAN? The contributions you make, after deduction of membership fees, taxes (as applicable) and the types of investment in which these net contributions are invested, remain your property. ELIGIBLE STUDIES CRITERIA WHAT ARE THE OBJECTIVE ELIGIBILITY CRITERIA? Eligible studies according to the objective criteria of the Manager comprise full-time or part-time, general or technical post-secondary studies (college, community college or university) in Canada or the equivalent abroad. Programs offered in a post-secondary institution intended to provide a person with or improving the skills required in the exercise of a professional activity are also eligible. In all cases, these programs must have a minimum duration of three consecutive weeks, comprising at least 10 hours of courses or schoolwork per week. Determined education programs are also eligible studies. See the Summary of the Prospectus Eligible studies section. In this case, the EAP amount the beneficiary could receive is subject to the limits stipulated in the section General Provisions Applicable to the Three Plans Limits on Scholarship and EAP Amounts. When a beneficiary is enrolled in a long-distance course for such studies, the latter are also considered eligible. To ensure the eligibility of a program of study or an educational institution, we recommend you contact the Manager in advance. Eligible studies do not necessarily require a high school diploma as a prerequisite. MEMBERSHIP FEES A membership fee of $200 is required to subscribe to an INDIVIDUAL plan. This fee remains with the Manager and will not be reimbursed to you, unless you cancel your educational assistance payment agreement within 60 days of its signing. When an agreement is cancelled within 60 days of its signing, the representative must reimburse the Manager the entire commission advance received. No membership fees or service fees are required for the automatic conversion of a UNIVERSITAS plan to an INDIVIDUAL plan at maturity. No membership fees or service fees are required for the automatic conversion of a REFLEX plan to an INDIVIDUAL plan at maturity (see the INDIVIDUAL Plan Plan Conversion/Transfer section). DEATH OF THE BENEFICIARY WHAT SHOULD I DO IN THE EVENT OF THE BENEFICIARY S DEATH? In the event the beneficiary dies before qualifying for EAPs, you will have to inform the Manager accordingly, in writing, by sending a copy of the death certificate within 90 days of death. 41

42 INDIVIDUAL PLAN WHAT WILL BECOME OF MY EAP AGREEMENT IN THE EVENT OF THE BENEFICIARY S DEATH? In this case, you may choose to: Maintain your agreement in effect and designate another beneficiary; or Cancel your agreement by withdrawing your contributions and the earned income under the conditions stipulated in the section INDIVIDUAL Plan Payment of Accumulated Income. To keep the CESG paid into the deceased beneficiary s plan and the income from the CESG and CLB in the event you decide to maintain your agreement in effect and designate another beneficiary, the latter must be a family member. When the enhanced CESG (exceeding the basic 20% rate) has been paid on behalf of the deceased beneficiary, it may only be kept if the new beneficiary is the brother or the sister of the deceased and was younger than 21 years of age when the initial plan was opened. The CLB paid in the name of the former beneficiary must be reimbursed to the federal government. Lastly, to keep the QESI paid into the deceased beneficiary s plan and the income from the latter, if applicable, the new beneficiary must be the brother or sister of the deceased and younger than 21 years of age at the time the initial plan was opened. If you cancel your agreement by withdrawing your contributions and the earned income, the total amount of government incentives paid in the name of the beneficiary is reimbursed to the federal and Quebec governments, as applicable. CHANGE OF BENEFICIARY IS A CHANGE OF BENEFICIARY POSSIBLE? A change of beneficiary is authorized at any time upon written request to the Manager, provided it does not have the effect of extending the life of a plan, which may not exceed its cut-off date, i.e. the last day of the 35 th year following the year in which the plan came into effect. When you replace a beneficiary with a new beneficiary who is a family member of the former, the contributions, the CESG and the earned income are deemed to have been paid on behalf of the new beneficiary. However, in order to retain all grants and the QESI paid into the plan, the new beneficiary must be the brother or sister of the former beneficiary and younger than 21 years of age at the time the initial plan was opened. When you replace a beneficiary with a new beneficiary who is not a member of his family, the CESG and the enhanced CESG (exceeding the basic 20% rate) paid on behalf of the former beneficiary must, in this case, be reimbursed to the federal government. The QESI is also returned to the Government of Quebec. It is possible that a change of beneficiary may have income tax considerations in terms of the cumulative limit for the new beneficiary. EDUCATIONAL ASSISTANCE PAYMENTS (EAPS) WHEN AND HOW CAN ONE APPLY FOR AN EAP? All applications for EAPs are submitted to the Manager, using the appropriate form, no later than the last day of the plan s lifetime (see the General Provisions Applicable to the Three Plans Duration of an RESP (cut-off date) section); applications must be supported by proof of the beneficiary s qualification. The EAPs are then paid by the INDIVIDUAL plan Trust to the beneficiary according to the terms of your request. WHAT EAP AMOUNTS MAY THE BENEFICIARY RECEIVE? You determine yourself the amount of the EAPs paid to the beneficiary, subject to the limits stipulated in the section General Provisions Applicable to the Three Plans Limits on Scholarship and EAP Amounts. In addition, the Manager reserves the right to establish a maximum number of EAPs per year. The EAPs the beneficiary will receive may vary depending on the earned income from the investments made by the portfolio managers. The payment is sent to the beneficiary at the address on file. WHERE DO THE SUMS THAT MAKE UP THE EAP COME FROM? The EAPs are paid to the qualified beneficiary from your subscriber account, into which is credited the accumulated income and, if applicable, the government incentives received on behalf of the beneficiary and the income earned on the incentives. When the beneficiary is entitled to government incentives, each EAP includes a proportional amount of incentives received. The total EAPs paid or requested may not exceed the total income earned on your contributions, the government incentives paid on behalf of the beneficiary, and the income earned on the latter. WHAT HAPPENS IF THE BENEFICIARY DOES NOT QUALIFY? An EAP can only be paid to a qualified beneficiary. If the beneficiary does not qualify, the Custodian, on instructions from the Manager, reimburses the government incentives paid on behalf of the beneficiary to the federal and Quebec governments, as applicable. However, you can receive the income earned on your contributions and government incentives, pursuant to the conditions stipulated in the section INDIVIDUAL Plan Payment of Accumulated Income. In all cases, a change of beneficiary will result in the CLB being returned to the Government of Canada. 42

43 CANCELLATION AND RE-REGISTRATION HOW CAN I CANCEL MY EAP AGREEMENT? You can cancel your educational assistance payment agreement at any time, on written request to the Manager. You retain the right to withdraw your contributions (less the amount of membership fees) and the earned income under the conditions mentioned hereafter. Following the cancellation of a plan promoted by the Foundation, if you subscribe to the INDIVIDUAL plan within 48 months of the cancellation date of your initial agreement, you will be credited the full amount of membership fees already paid, up to $200. CAN I WITHDRAW MY CONTRIBUTIONS WITHOUT CANCELLING MY EAP AGREEMENT? You can withdraw all or part of your contributions without cancelling your educational assistance payment agreement, provided there is a minimum balance of $500 (including membership fees) in your plan, regardless of whether it comprises a combination of contributions, government incentives and income on the latter. PLAN CONVERSION/TRANSFER CAN I CONVERT AN INDIVIDUAL PLAN TO ANOTHER PLAN OF THE FOUNDATION? You can convert an INDIVIDUAL plan into a UNIVERSITAS or REFLEX plan before the beneficiary reaches 16 years of age. When converting an INDIVIDUAL plan into a group plan promoted by the Foundation or transferring this INDIVIDUAL plan to an RESP established with another institution, the contributions and the government incentives received, if applicable, and the income earned on the incentives can be attributed or transferred to the new plan. When converting an INDIVIDUAL plan, the $200 membership fee already paid is credited to the new plan. When the attributed contributions amount to less than a whole unit, the membership fees are credited in proportion to the unit fraction. The conditions applicable to conversions and partial transfers are the same as those for the UNIVERSITAS and REFLEX plans. See the Plan Conversion/Transfer section regarding these plans. WHAT ARE THE INCOME TAX CONSIDERATIONS OF A CONVERSION OR TRANSFER? The income tax considerations applicable to the conversion or transfer of an INDIVIDUAL plan are the same as those for the UNIVERSITAS and REFLEX plans. See the Plan Conversion/Transfer section regarding these plans. PAYMENT OF ACCUMULATED INCOME WHAT ARE THE REQUIREMENTS FOR RECEIVING A PAYMENT OF ACCUMULATED INCOME? You can obtain the payment of all or part of the accumulated income in your INDIVIDUAL plan when this payment is made during the 35 th year following the year in which your plan came into effect, or if each current or former beneficiary of the plan is deceased. You can also obtain the accumulated income when each current or former beneficiary has reached 21 years of age, is not pursuing eligible studies, and your INDIVIDUAL plan has been in force for at least 10 years. However, the Manager can waive these conditions on permission granted at its request from the Minister responsible for applying the Canada Education Savings Act, if your beneficiary has a severe and prolonged mental condition that prevents or is most likely to prevent him from pursuing eligible studies. A payment of accumulated income from an INDIVIDUAL plan can only be made to one individual, and not jointly with another. In all cases, you must be a Canadian resident to receive a payment of accumulated income. The INDIVIDUAL plan must end before March of the year following this payment. For additional information about the income tax considerations regarding the payment of accumulated income, see the Income Tax Considerations What is the subscriber s taxation? section. HOW CAN A TRANSFER BE MADE FROM AN RESP TO AN RRSP? You (or your spouse or common-law partner if you are the initial plan s subscriber and in the event of your death, or that of your co-subscriber, as applicable) may transfer up to $50,000 of the income earned in an RESP to your Registered Retirement Savings Plan (RRSP), or your spouse s or common law partner s RRSP for which you are the contributor, up to the amount of the unused contributions in the RRSP at that time. For additional information about the income tax considerations regarding a transfer to an RRSP, see the Income Tax Considerations What is the subscriber s taxation? section. SPECULATIVE AND UNCERTAIN NATURE The Manager cannot establish in advance nor guarantee the amount of accumulated income available for the payment of EAPs. The amount of these payments depends on the contributions made to your plan and the accumulated income. 43

44 GENERAL PROVISIONS APPLICABLE TO THE THREE PLANS CHANGE OF SUBSCRIBER The Income Tax Act (Canada) stipulates that it is possible to replace the subscriber of an RESP established by a plan promoted by the Foundation in the following cases: In case of separation or divorce, the subscriber can be replaced by his former spouse (or common-law partner) according to a court order or decision, or a written agreement for the purpose of dividing property between the spouses (or common-law partners) ; In the event of the subscriber s death, his estate, the person to whom the RESP is bequeathed, the individual who acquires the subscriber s rights or the person who makes the contributions in the name of the beneficiary, becomes the subscriber in turn ; When the subscriber is a public guardian, the latter can be replaced by an individual or by another public guardian pursuant to a written agreement. DESIGNATION OF A BENEFICIARY DOES MY BENEFICIARY HAVE TO BE A CANADIAN RESIDENT? Since January 1, 2004, the Canada Revenue Agency requires that the beneficiary be a Canadian resident when the designation is made. The beneficiary must also be a Canadian resident at the time you contribute to his RESP. WHEN DO I HAVE TO PROVIDE THE SOCIAL INSURANCE NUMBERS (SINS)? To obtain the registration of an ESP established by a plan, section of the Income Tax Act (Canada) requires the social insurance number (SIN) of the designated beneficiary as well as that of the subscriber or, if applicable, the business number of the department, agency or institution acting as the beneficiary s public guardian. Provision of this information to the Manager Distributor is therefore a prerequisite for the implementation of the scholarship agreement or the educational assistance payment agreement concluded between you and the Trust in question, even if the Foundation has accepted on its behalf. For any change of beneficiary, you must also provide the new beneficiary s SIN before making this change. CAN I MAKE CONTRIBUTIONS IN THE BENEFICIARY S NAME BEFORE HE OBTAINS HIS SIN? You can make contributions in the name of a beneficiary whose SIN has not yet been provided to the Manager. However, these contributions are paid into a non-interest-bearing suspense account pending our receipt of the missing SIN. Although the ESP is officially open, it cannot be registered pursuant to the Income Tax Act (Canada) and become an RESP while the SIN remains missing. If you provide the missing SIN within 12 months of the Foundation s acceptance of your application, the contributions you have made are automatically credited to your subscriber account, according to the selected plan. This transfer is made by the Manager, who then acts as your agent. If the missing SIN is provided within the 12-month period, the use of the suspense account gives you the following benefits: Your periodic contributions to the plan, as applicable, are determined based on the beneficiary s age at the date of your application, even if he moved up to the next age group when the SIN was provided (see Tables of Contributions) ; and The contributions paid to the suspense account are eligible for the CESG and QESI. When the missing SIN is not provided to the Foundation within the 12-month period, all contributions made to the suspense account will be reimbursed to you as a result of the total cancellation of your agreement, less the amount of membership fees already paid. LOANS AND BURSARIES The fact of receiving scholarships or EAPs from the Foundation has no incidence on the possibility of obtaining a loan or bursary from the Quebec government. In this province, amounts received from an RESP are not considered in the calculation of income when reviewing a request to obtain loans and bursaries. APPROVAL OF THE PLANS The ESPs established by the scholarship plans promoted by the Foundation have been accepted and are qualified for registration as RESPs pursuant to the Income Tax Act (Canada) and the Taxation Act (Quebec). The Canada Revenue Agency registration numbers for these ESPs are the following: UNIVERSITAS group education savings plan REFLEX group education savings plan INDIVIDUAL education savings plan 44

45 CONTRIBUTION LIMIT WHAT IS THE CUMULATIVE LIMIT FOR RESP CONTRIBUTIONS? The lifetime contribution limit per beneficiary is set at $50,000 for all plans combined. The government incentives received are not included in the calculation of this limit. WHAT IS THE MAXIMUM PERIOD FOR CONTRIBUTING TO THE RESP? Contributions to an INDIVIDUAL plan can be made for a maximum period of 31 years following the year in which the plan came into effect. However, under the UNIVERSITAS and REFLEX plans, the maximum period for contributions is 17 years. DURATION OF AN RESP (CUT-OFF DATE) WHEN MUST THE RESP COME TO AN END? The RESP ends no later than the last day of the 35 th year after coming into effect. Consequently, the beneficiary cannot receive any scholarships or EAPs after this cut-off date. WHAT HAPPENS TO THE AMOUNTS THEN HELD BY THE CUSTODIAN? When the plan ends, the amounts held by the Custodian must be used for : The payment of scholarships or EAPs; The reimbursement of contributions in the account of the subscriber in question; The reimbursement of government incentives (as well as the payment of amounts related to this reimbursement) that were paid pursuant to the Canada Education Savings Act or a designated provincial program; The subscriber s reimbursement of his accumulated income, in the case of the INDIVIDUAL plan; or A payment made to an accredited post-secondary institution in Canada and covered by subparagraph a) (i) of the definition of this term in subsection (1) of the Income Tax Act (Canada), or to a trust in favour of such institutions. LIMITS ON SCHOLARSHIP AND EAP AMOUNTS Subject to certain situations described below, pursuant to the terms of the Income Tax Act (Canada), the total amount that a qualified beneficiary may receive in scholarships and EAPs during any 12-month period is limited to the lesser of the following: The actual cost of the beneficiary s studies (including registration, books, housing, food, transportation, etc.); or $5,000. Exceptionally, the beneficiary can receive more than $5,000 when the ministry responsible for applying the Canada Education Savings Act has approved such an amount, in writing, following an application for exemption. This $5,000 limit does not apply when the beneficiary is enrolled full-time in an eligible program of study and has completed at least 13 consecutive weeks of such a program within the 12-month period preceding the payment. If, during a 12-month period the beneficiary is not enrolled in a program of study for 13 consecutive weeks, the $5,000 limit will apply once more. The total EAPs that a beneficiary enrolled in a specified program of study may receive during any 13-week period ending at the time of payment is limited to $2,500 or to any higher amount the ministry may exceptionally approve in writing. Moreover, the scholarship or EAP amounts paid will depend, essentially, on the sums invested in the Trust in question and on the returns obtained. 45

46 RISK FACTORS As with any investment, one in a scholarship plan involves certain risks. It is advisable to consider the following risk factors before making the decision to save in one or other of the plans promoted by the Foundation. NO GUARANTEE OF ACHIEVING THE INVESTMENT OBJECTIVES There is no guarantee that the Manager will be able to achieve his investment objectives. The scholarships and EAPs available for distribution to beneficiaries will vary depending on, essentially, the interest and distribution paid on portfolio securities and the value of these securities. There is no guarantee that a portfolio entrusted to portfolio managers will produce a return. There is no guarantee regarding the amount available for scholarships or EAPs in future years. LEGISLATIVE CHANGES The provisions of a plan are established in reference to the terms of the ESP to which it pertains and the payment of government incentives, and they incorporate these terms such as they may be defined from time to time pursuant to tax legislation for the duration of the plan. Nothing guarantees that the tax, securities or other legislation, or their official interpretations, will not be changed in a manner that would have an unfavourable effect on the plans or ESPs promoted by the Foundation and registered as RESPs, or in their administration or management by the Foundation itself, the Manager, the Trusts or another stakeholder. NATURE OF THE PLANS The plans are neither fixed-income nor participating securities such as bonds and shares of corporations. Plan subscribers do not enjoy the rights normally associated with the ownership of such securities, including the right to file lawsuits in case of abuse or indirect actions. ELIGIBLE STUDIES To qualify for scholarships payable by the UNIVERSITAS or REFLEX plan Trusts, the beneficiary must pursue eligible studies according to the plan selected (see the Summary of the Prospectus Eligible studies section). If you terminate such a plan before maturity, or if the beneficiary does not pursue eligible studies within the prescribed period, the beneficiary will lose his right to scholarships. In this case, you will receive no income earned on your contributions unless you convert this plan into an INDIVIDUAL plan, under the conditions stipulated in the section INDIVIDUAL Plan Plan Conversion/Transfer. you of some or all of the income earned on your contributions to the initial plan, for the benefit of qualified beneficiaries in the same cohort as the initial beneficiary. To be entitled to each of the three scholarships provided under a UNIVERSITAS or REFLEX plan, your designated beneficiary must meet the eligibility criteria. Depending on your beneficiary s choice of studies, it is possible he may not receive all three scholarships. In this case, the income earned on your contributions on behalf of the beneficiary will be shared among the qualified beneficiaries of the year in progress, as described in the section UNIVERSITAS and REFLEX Plans Calculation of Scholarships. INCOME TAX CONSIDERATIONS A payment of accumulated income, as well as the transfer to an RRSP of sums governed by an RESP can have income tax considerations. See the Income Tax Considerations section. POTENTIAL CONFLICTS OF INTEREST Any or all of the following persons or entities have the right to conduct promotional management or portfolio management operations for other accounts, investment organizations or investment trusts that make investments in securities held by one or other of the Trusts: A portfolio manager; A member of the portfolio manager s group in its capacity as investment fund manager or portfolio manager or a person associate to both; and A director or officer of the latter. Although a portfolio manager s officers, directors and staff will devote as much time to the Trusts as they deem appropriate for the exercise of their functions, the portfolio manager s staff may have conflicts in allocating their time and services between the Foundation and other portfolios managed for persons other than the Foundation. SCHOLARSHIP AND EAP LEVELS The Manager cannot predict the amounts of the scholarships payable by the UNIVERSITAS or REFLEX plan Trusts, nor the EAPs payable by the INDIVIDUAL plan Trust. It has no discretionary power in determining the scholarship amounts. Past performance is no guarantee of future returns. The scholarship and EAP amounts depend, among others, on the return on investments and on the amount of accumulated income. In the case of group RESPs, the scholarship amounts also depend on the amount of contributions made by the subscriber and the number of qualified beneficiaries in the same cohort for a given year. Depending on the circumstances, the conversion of a group plan to another plan promoted by the Foundation can result in depriving 46

47 INVESTMENT RISKS Due to the specific fact that a portion of the Trust Account comprised of government incentives (only those collected prior to April 20, 2012), of the income earned on subscriber contributions and of income earned of the government incentives can be invested in equities, the investment policy for the assets of a Trust equal to the balance in its Trust Account carries a slightly higher risk factor than the investment policy for assets in this Trust corresponding to the accumulated balances in Subscriber Accounts. The value of these investments may vary from day to day, according to changes in interest rates, the financial market and businesses, as well as economic conditions. The value of these investments can change following specific events affecting certain companies, the status of the stock market, the economic conditions and the general financial outlook. In general, investments in shares have a tendency to be more volatile than the investments made in fixed -income securities. Pursuant to the investment policy currently in effect, all government incentives collected as of April 20, 2012, must be invested in bonds issued or guaranteed by the Government of Canada or a Canadian province. CREDIT RISK This risk corresponds to the possibility of incurring financial losses resulting from the inability of a company, an issuer or counterparty to respect its financial commitments to the Trusts. The Foundation, through its investment policies, has established quantitative criteria for the selection of investments in order to reduce this risk. For short-term investments and investments in bonds, only the following are selected: securities issued by the Government of Canada, a provincial government, organizations with a government guarantee, a municipality, or corporations having a minimum rating of BBB when purchased for the Trusts and a minimum rating of A when purchased for the Subscriber Accounts. INTEREST RATE RISK Investments in fixed-income securities are, for their part, mainly affected by interest rates and the credit rating of the issuer of such securities, specifically the credit rating given to these securities by a recognized credit rating agency. Usually, an increase in interest rates will cause the value of fixed-income securities to fall; conversely, a drop in interest rates will generally increase the value of these securities. Investments in fixed-income securities made by a portfolio manager will typically include securities from quality Crown corporations to enhance relative protection, a strategy that can reduce the risk of losses during periods of volatile interest rates. 47

48 INCOME TAX CONSIDERATIONS Here is a brief summary of the fiscal aspects pursuant to the Income Tax Act (Canada) and the Taxation Act (Quebec) for the following entities: The Trusts; The subscribers; The Registered Education Savings Plans promoted by the Foundation; and The beneficiaries. In the opinion of Lavery, de Billy, L.L.P., the Trusts external legal counsel, this summary is an adequate statement, assuming that the scholarship agreements and the educational assistance payment agreements concluded between the subscribers and the Foundation to establish ESPs are and stay registered as RESPs, and that the current provisions of the Income Tax Act (Canada) and its regulations in effect at the time of this prospectus do not change. This summary is of a general nature only; it does not represent a legal or tax opinion. The subscriber and the beneficiary would be well advised to consult their own tax advisor regarding their personal situations in terms of income tax. an additional 20% tax on the excess amount of income paid directly into the RESP on the deduction related to the RRSP. WHAT IS THE BENEFICIARY S TAXATION? Based on current legislation, the scholarship or EAPs amounts received by the beneficiary are taxable income. The Income Tax Act (Canada) stipulates that the scholarships and EAPs a beneficiary receives must be used for the purpose of helping him pursue post-secondary studies. WHAT IS THE REGISTERED EDUCATION SAVINGS PLANS TAXATION? According to current legislation, no tax is payable pursuant to the Income Tax Act (Canada) and the Taxation Act (Quebec) by the Trusts within the meaning of tax laws (i.e. the scholarship agreement and the educational assistance payment agreement) on its income for a taxation year, since it is governed by a registered education savings plan (RESP). WHAT IS THE TRUST S TAXATION? Based on current tax legislation, the income and contributions received by the Trust are not subject to income tax. The plans offered by a Trust, following their registration, are qualified as RESPs. Plans qualified as RESPs are not required to pay tax on their taxable income under current legislation, provided that they retain this status. WHAT IS THE SUBSCRIBER S TAXATION? Based on current legislation, no income tax is payable pursuant to the Income Tax Act (Canada) or the Taxation Act (Quebec) on the accumulated income in the Subscriber Accounts and in the Trust Account, given that it is generated within RESPs. The contributions made by the subscriber are not tax deductible and are not taxable when reimbursed to him. If the maximum contribution limit for the beneficiary is exceeded, the subscriber must pay income tax equal to 1% of the excess contributions every month, unless he withdraws this excess from the RESP before the end of a given month. The subscriber must include in his income, for tax purposes, any payment of accumulated income he receives. This payment will be subject to an additional 20% tax, unless it is transferred to an RRSP. When transferred to an RRSP, the amount of income accumulated is subject to an offsetting deduction. The subscriber is subject to 48

49 TRUST ORGANIZATION AND MANAGEMENT CONDITIONS The Foundation oversees the Manager s administration and management of each Trust. This supervision can be exercised under the authority of the Trust Agreement and separate agreements reached for this purpose by the Foundation and the Manager. It may, for example, take the form of consultations between the Foundation and the Manager prior to retaining the services of the Trustee, Custodian, portfolio managers, auditors and external actuary of each Trust, or the Foundation exercising its right to require that the Manager give appropriate instructions to the Custodian to make the payments required pursuant to the terms of a Trust plan, including scholarship payments. DIRECTORS AND OFFICERS OF THE FOUNDATION The directors and officers of the Foundation are the following (in alphabetical order): Name and city of residence (2) (4) Louis Beaulieu B.A.A., Comm. Saint-Augustin-de- Desmaures, QC Director of the Foundation since 1997 (1) (2) (4) France Bilodeau FICA, FSA, CFA, ASC Quebec City, QC Director of the Foundation since 1998 Albert Caponi (3) CPA, CA Montreal, QC Director of the Foundation since 2011 André Caron Quebec City, QC Director of the Foundation since 2009 (3) (4) Marc-A. Fortier Quebec City, QC Director of the Foundation since 2003 François Grégoire Saint-Augustin-de- Desmaures, QC Director of the Foundation since 2007 Principal function President Advisia Senior Partner Aon Hewitt Assistant Vice-Principal (Financial Services) McGill University Businessman President Gestion Gifort Inc. President and CEO Forces AVENIR Name and city of residence Yves Lacasse (4) LL.B., LL.B (Common Law), MBA Saint-Augustin-de- Desmaures, QC Director of the Foundation since 2003 (1) (4) Jean Lemieux M.Sc. Lévis, QC Vice-chairman of the Board, Director of the Foundation since 1993 Monette Malewski Montreal, QC Director of the Foundation since 2005 (1) (4) Jean Marchand B.A., M.Sc.C Quebec City, QC Chairman of the Board, Director of the Foundation since 1964 (1) (4) Liette Monat MBA, Ph.D. Montreal, QC Director of the Foundation since 1994 Marie Hélène Noiseux (2) MBA, Ph.D., ASC Montreal, QC Director of the Foundation since 2012 Jean-Bernard Robichaud (3) Gatineau, QC Director of the Foundation since 1995 (1) (4) Gaston Roy Québec, QC Director of the Foundation since 2009 (1) Executive Committee (2) Investment Committee (3) Audit and Governance Committee (4) Board of Directors of Universitas Management Inc. Principal function Partner Joli-Cœur Lacasse, Lawyers President Gestion Barrage Inc. President M. Bacal Insurance Agencies Inc. President of the Foundation President Liette Monat Business Strategies Inc. Full Professor Chair of Finance Department School of Management Université du Québec à Montréal (ESG/UQAM) Special Counsel Program development division Association of Universities and Colleges of Canada Vice-President Commercial financial services Quebec RBC Royal Bank 49

50 TRUST ORGANIZATION AND MANAGEMENT CONDITIONS Committees and Boards of the Universitas Foundation canada Executive Committee: Jean Marchand, France Bilodeau, Jean Lemieux, Liette Monat, Gaston Roy Investment Committee: France Bilodeau, Louis Beaulieu, Marie Hélène Noiseux Audit and Governance Committee: The Foundation is a not-for-profit organization without share capital. Directors and officers of the Foundation receive no remuneration other than an annual retainer, meeting attendance fees and the reimbursement of meeting expenses. The remuneration of the Independent Review Committee members is paid from the Trust assets in proportion to the latter. All other remuneration is paid by the Manager from funds other than the balances in the Subscriber Accounts or Trust Accounts. No director or officer of the Foundation has a financial or other significant interest that has had or could have a considerable effect on a Trust s plans other than these remunerations and compensations in Universitas Management or any other company related to the plans or ESPs promoted by the Foundation. The Foundation directors receive an attendance fee of $800 for each meeting held by the Foundation s Board of Directors or for the meeting of any of its committees, as well as an annual retainer of $2,000. The chairman of the Foundation s Board of Directors receives an attendance fee of $1,600 for each board meeting and an annual retainer of $6,000. The chairman/president of a committee receives an attendance fee of $1,600 for every committee meeting chaired. The expertise and experience acquired by the Foundation since its beginning make it one of the most important promoters of ESPs eligible for registration as RESPs in Canada. The following sections describe the main functions fulfilled by these stakeholders with regard to the management of each Trust. This information, which is intended to help you better understand the features of the plans, and the rights and obligations of a subscriber party to a scholarship agreement, is completed with the more detailed information presented in this prospectus in relation to certain of these stakeholders. PORTFOLIO MANAGERS To implement the investment policies for the Trust s assets and manage the resulting investment portfolios, the Manager has retained the services of securities advisors registered as portfolio managers pursuant to securities legislation. These are Addenda Capital Inc., Fiera Capital Corporation, AlphaFixe Capital Inc., Jarislowsky Fraser Limited and Montrusco Bolton Investments Inc. From left to right: Marc-A. Fortier, Albert Caponi, President (seated), Jean-Bernard Robichaud Over the past five years, all directors and executive committee members have held the same position within the Foundation and served the same primary function, as previously described, with the exception of Marc-A. Fortier, who previously held the position of President-CEO of the Société immobilière du Québec; André Caron, who served as President of the Fédération des commissions scolaires du Québec and Jean Lemieux who served as General Manager of the Résidence Caroline-Vachon. The management of fixed-income securities in the Subscriber Accounts and the Trust Accounts is entrusted to Addenda Capital Inc., Fiera Capital Corporation and AlphaFixe Capital Inc. The investment in Canadian equities of the assets in each of the three Trust Accounts, and a portion of the amount reserved for the obligation to reimburse membership fees in the Subscriber Accounts is managed by Jarislowsky Fraser Limited and Montrusco Bolton Investments Inc. The portfolio managers are responsible for conducting research and making the choice, purchase and sale of securities in compliance with the qualitative and quantitative limits established in the investment policies. By delegation of the Manager and in compliance with the instructions of the latter, as applicable, they exercise the voting rights relating to the investments thus made as part of their respective mandate, in accordance with the objectives of the Foundation s investment policies. The voting reports prepared by the portfolio 50

51 managers are available on the Foundation s website, at universitas. ca. However, the Manager, with the agreement of the Foundation s Investment Committee, reserves the right to personally exercise the voting rights, in whole or in part, by giving the portfolio managers reasonable notice of its intention to do so. ADDENDA CAPITAL INC. Addenda Capital, founded in October 1996, specializes in investment management, the added value coming from disciplined processes and close attention to its clients needs. Addenda Capital offers a comprehensive range of fixed-income, Canadian equity, U.S. equity, commercial mortgages and balanced fund strategies. Its Montreal, Guelph, Regina and Toronto offices offer customized solutions that include asset allocation, liability driven investments, portable alpha strategies and currency hedging. A teamwork approach is used for the development of the firm s active duration bond strategy which is established annually. Addenda Capital s investment philosophy is based on an active management style and on a proven ability to anticipate the movement of interest rates. Its mandate is to invest plan assets in fixed-income debt securities, in accordance with defined asset composition allocations and add value primarily by managing the term, although securities selection and management of the yield curve and credit spreads can also be used. The guidelines provided also include the return objectives and risk management parameters. The individuals in this firm primarily responsible for providing the Trusts with portfolio management services are: Name and functions Benoît Durocher, M.A. Executive Vice-President and Head of Economic Strategy Martin Labrecque, CFA Vice-President Business Development and Client Partnerships Length of service with the portfolio advisor 14 years 27 years 5 years 30 years Experience in the business sector Most of the services rendered to the Trusts are provided in Montreal, QC. FIERA CAPITAL CORPORATION Fiera Capital Corporation manages approximately $54 billion in assets; it is a publicly traded company, controlled and partly owned by its principals. The firm offers unique expertise in the management of traditional and alternative investment strategies, and distinguishes itself in the management of Canadian active and structured fixed income, of Canadian and foreign equities, in asset allocation and nontraditional strategies. Fiera Capital Corporation was founded in September 2003 through the acquisition of certain assets, professionals and infrastructures from Desjardins Group s investment management division, one of the largest Quebec-based financial institutions. Subsequently, the firm expanded through its acquisition of Senecal Investment Counsel in 2005, a Toronto-based money management boutique and of YMG Capital Management in 2006, a publicly traded firm with over 20 years of investment experience, specializing in structured and active fixed income management. In 2010, the firm merged with Sceptre Investment Counsel Limited, a publicly traded company with over 50 years of investment experience, specialized in the management of Canadian equities and balanced portfolios. In April 2012, Fiera Capital Corporation acquired Natcan Asset Management from National Bank of Canada. Following this transaction, the firm increased its dominant position in the Canadian portfolio management market. The firm has offices in Montreal, Toronto, Vancouver, Halifax, and in the United States, and relies on over 220 employees, of whom 90 are investment professionals. Fiera Capital Corporation offers superior portfolio management, innovative investment strategies and products, and a proven ability to continually surpass clients expectations. The firm s investment philosophy is based on a multi-strategy style whereby active duration management, portfolio positioning on the yield curve, sector selection and active management of corporate securities represent means to add value versus the benchmark. Investment decisions are taken by the senior portfolio managers, who have ultimate responsibility for the portfolios after analysis and consultation with other members of the bond management team. Decisions are not subject to the approval of a committee, except in terms of asset allocation. The individuals in this firm primarily responsible for providing the Trusts with portfolio management services are: Name and functions Christopher Laurie, MBA, CFA Vice-President and Senior Portfolio Manager, Fixed Income Catherine Payne, CFA Vice-President and Portfolio Manager, Fixed Income Derek Allen Brown, MBA, CFA Assistant Portfolio Manager, Fixed Income Length of service with the portfolio advisor 18 years 25 years 9 years 19 years 2 years 9 years Experience in the business sector Most of the services rendered to the Trusts are provided in Montreal, QC and Toronto, ON. ALPHAFIXE CAPITAL INC. Founded in 2008 by seasoned managers, AlphaFixe Capital is an investment management firm specializing in fixed income. From its 51

52 TRUST ORGANIZATION AND MANAGEMENT CONDITIONS office in Montreal, AlphaFixe Capital primarily serves institutional clients which consist of pension funds, insurance companies, foundations and religious communities. AlphaFixe Capital offers a full range of strategies specific to the bond market. AlphaFixe Capital s investment philosophy is based on a rigorous risk management process. The concepts of capital preservation and flexibility in implementing different strategies are transposed into the company s internal models that are both sophisticated and accessible. Investment strategy decisions are team-based and reflect a fundamental long-term view. AlphaFixe Capital s mission is to create consistent added value by advocating a fundamental approach based on the intrinsic value of assets and a limited risk tolerance model. To achieve this, AlphaFixe Capital uses five distinct sources of added value, which can be deployed according to different market opportunities. In addition, an internal assessment model of bond issuers incorporates the analysis of ESG factors (Environmental, Social and Governance). The individuals in this firm primarily responsible for providing the Trusts with portfolio management services are: Name and functions Stéphane Corriveau, ASA President and Managing Director Sébastien Rhéaume, CA, CFA Managing Director Jacques-A. Caussignac, M.Sc. Managing Director Length of service with the portfolio advisor 4 years 21 years 4 years 21 years 4 years 13 years Experience in the business sector All of the services rendered to the Trusts are provided in Montreal, QC. JARISLOWSKY FRASER LIMITED Jarislowsky Fraser Limited is a registered investment advisory firm that manages pension funds, foundations and corporate and private portfolios for clients in North America and overseas. The company was founded in 1955 as an investment research firm. In the early 1960 s, the firm began to use its research material to counsel private investors and, in 1966, extended its client base to include pension funds. The firm s Montreal, Toronto, Calgary and Vancouver offices offer portfolio management services to governments, corporations, universities, labour unions and individuals. Jarislowsky Fraser s primary objective is the growth of its clients capital while maintaining a low level of risk. The firm s philosophy is founded upon time-proven conservative principles of investment management based on fundamental research. The firm constructs diversified high quality portfolios that are designed to protect existing investments and achieve long-term growth for its clients. Jarislowsky Fraser Limited is an independent firm with no affiliates. The firm is owned by its senior partners who manage all aspects of the firm s activities. The decision-making process is based on a team approach at Jarislowsky Fraser Limited. All investment decisions are reviewed and approved by the investment strategy committee. Although this committee sets the investment boundaries and framework, the portfolio managers are directly responsible for investing all the securities in each client s portfolio and for the continuous monitoring and adjustment of asset allocation and the weighting of sectors and individual securities, ensuring that each account is in compliance with its specific investment policy. The individuals in this firm primarily responsible for providing the Foundation with portfolio management services are: Name and functions Length of service with the portfolio advisor G. Pierre Lapointe, CFA Portfolio manager Executive Vice-President and Director 27 years 29 years Jacques Nolin, B.Sc., MBA Portfolio Manager Senior Partner 24 years 26 years Experience in the business sector Most of the services rendered to the Trusts are provided in Montreal, QC. MONTRUSCO BOLTON INVESTMENTS INC. Montrusco Bolton Investments Inc. (MBII) is a portfolio management firm that offers services to private and institutional clients, including pension funds, foundations, as well as insurance and mutual fund companies. The firm, founded in 1946, has its head office in Montreal, where all assets are managed, and other offices in Quebec City, Saint-Hyacinthe, Toronto and Calgary. MBII is a private company whose shares are owned by key employees and two strategic partners: Affiliated Managers Group Inc. and the Fonds de solidarité FTQ (Solidarity Fund). MBII s investment philosophy is to achieve long-term growth of assets while preserving capital. The firm s bond management philosophy is based on caution, returns and capital protection. The bond portion of a balanced portfolio must not put capital at risk and, therefore, must be managed with 52

53 care and discipline. Furthermore, as part of the investment process and an optimal strategic management, MBII analyzes the following: management of weightings per asset class, credit quality analysis, management of sector weightings, and management of the term and yield curve. For equities, MBII uses two management styles, i.e. fundamental management and quantitative management. This combination leverages the systematic character of human behaviour and that of growth at a reasonable price. The firm therefore capitalizes on the diversification power that these two strategy styles can create, since the quantitative approach generates an alpha that weakly correlates with that produced by the fundamental management team. Asset allocation decisions aside, investment decisions made by portfolio managers are not subject to the committee s supervision, approval or ratification. Asset allocation decisions are studied and made by the asset allocation committee, comprising five investment professionals. The individuals in this firm primarily responsible for providing the Foundation with portfolio management services are: Name and functions Richard Guay, MBA, CFA Senior Vice-President Christian N. Godin, M. Sc. Senior Vice-President Head of Canadian Equities John Goldsmith, MBA, CFA Vice-President, Canadian Equities Length of service with the portfolio advisor 12 years 19 years 11 years 19 years 8 years 15 years Ismaël Chiadmi, M. Sc. Senior Vice-President, Quantitative Products and Fixed Income 15 years 25 years Experience in the business sector Most of the services rendered to the Trusts are provided in Montreal, QC. TERMS OF THE CONTRACTS TO PROVIDE SECURITIES CONSULTING The fees paid to each portfolio manager are determined on a quarterly basis by applying separate sliding fee scales based on a percentage of the account under management. When applying these scales, for example, the total of the Trust Accounts added to that of the Subscriber Accounts (as at December 31, 2011) would imply annual fees amounting to 0.17% of assets under management. The fees for portfolio management are drawn from the accumulated income in the Subscriber Accounts. Either party may terminate, at any time, the agreements concluded between them with a 30-day written notice to this effect. CONFLICTS OF INTEREST The Manager Distributor is a wholly-owned subsidiary of the Foundation acting as promoter of the Trusts, the plans offered and their related ESPs, and has the specific mission to oversee the Manager s administration and management of the Trusts. It is therefore possible that issues of conflict of interest may arise in the relations between the Foundation and the Manager - Distributor. For more detailed information on this subject, see the Trust Manager and Distributor and Independent Review Committee sections. INDEPENDENT REVIEW COMMITTEE IRC The Manager for investment funds governed by Regulation respecting Independent Review Committee for Investment Funds, has established an Independent Review Committee (hereinafter the IRC ) comprised of three individuals who have no significant relationship to the Foundation, the Manager or an entity related to either of the latter. The IRC acts for each Trust. With regard to issues of conflict of interest, the provisions of Regulation stipulate that as investment fund manager and considering its obligations pursuant to securities legislation, the Manager must determine, with respect to each of these issues that it expects to arise within the Trusts operations, if the issue or type of issue in question: Requires the adoption of written policies and procedures, whether for overseeing the management of such an issue or preventing potentially harmful effects for subscribers; Is already subject to some remedial measures; or Applies to it or not. The IRC is an independent body that is integrated into the governance structure of the Trusts, and whose action aims to improve the quality of their management through the monitoring of conflict of interest issues which may arise in the Trusts administration, asset management or operations. In this context, a conflict of interest issue is: A situation where a reasonable person would consider that the Manager or an entity related to the latter has an interest that might conflict with the ability of the Manager to act in the best interest of its mission; or A provision relating to conflicts of interest or transactions involved that prohibit a Trust, its Manager, or an entity related to the latter, to conduct a proposed operation or which imposes a restriction in this regard, and whose application in the circumstances is not generally or specifically exempted by securities legislation or a regulator s decision. 53

54 TRUST ORGANIZATION AND MANAGEMENT CONDITIONS The IRC s primary role is to review and take position on issues of conflict of interest, which the Manager submits to it for decision or approval, as applicable, and to perform other functions prescribed by securities legislation, the IRC Charter or policies and procedures of the Foundation. The IRC members are: From left to right: Kim Thomassin, LL.B., President Viateur Gagnon, Director (standing) André Gauthier, CPA, CA Each member has served on the IRC since December 18, 2009.The composition of the IRC has been maintained for each Trust to take into account the fact that henceforth Universitas Management will act as Trust Manager pursuant to the new Regulation respecting Registration Requirements, Exemptions and Ongoing Registrant Obligations. The IRC must produce, for each fiscal year of the Trusts and no later than the date on which they file their annual financial statements, a report to subscribers describing the IRC s composition and activities. This report is available on the Canadian Securities Administrators website at sedar.com, or available on request, free of charge, by contacting the Manager by at [email protected] or via its website at universitas.ca. The remuneration of the IRC members for their participation in meetings or any other special assignment is paid by the Trusts. Regular IRC members each receive an attendance fee of $1,500 per meeting and an annual retainer of $2,000. The member charged with the presidency receives an attendance fee of $1,750 per meeting, as well as an annual retainer of $4,000. TRUSTEE Under the terms of the Trust Agreement, the Manager is normally responsible for selecting the Trustee. However, this choice must be made in the best interest of subscribers and beneficiaries, while respecting the Foundation s mission and its general strategy. Furthermore, the Trustee s business place must be located in Canada and hold a permit authorizing it, pursuant to Canadian or Quebec legislation, to offer its services to the public. Under the terms and conditions of an agreement signed on July 9, 2010, between the Manager, the Foundation and Trust Eterna Inc., the latter has been given the responsibility to act as Trustee for each of the Trusts. Trust Eterna Inc. is a trust company holding a permit pursuant to the Act respecting Trust companies and savings companies (Quebec), whose place of business is located at 1134 St-Louis, Suite 400, Quebec City, QC G1S 1E5. In its capacity and for the benefit of persons who are entitled, pursuant to plans in effect and related RESPs, the Trustee assumes the safeguarding and conservation in trust of the assets transferred, contributed, paid or entrusted to it, to constitute assets to be invested and managed by the issuing Trust, including the contributions and earned income on the latter, until these amounts are reimbursed or paid to the beneficiaries in compliance with the terms governing these plans and related RESPs. See the Summary of the prospectus Plans, Contributions, Scholarships and Educational Assistance Payments (EAPs) section. In addition, the Trustee oversees the investment and management activities of the Trust s assets, according to the Manager s instructions. Some of these functions can be delegated to the Manager or Custodian. In the event of the Manager s refusal or inability to act pursuant to any law or regulation applicable to it or pursuant to an order, judgment, decision, decree or directive issued by a court or a government, administrative, judicial, quasi-administrative or quasi-judicial authority, the Trustee has agreed to act in the Manager s place. It then fulfils the responsibilities of the stakeholder it replaces and, in this regard, the provisions of the Trust plans and the related RESP pertaining to the replaced stakeholder apply to the Trustee, with the necessary adjustments. Pursuant to the terms of the Trust Agreement, the Trustee receives annual fees of $25,000 for the exercise of its functions with regard to the Trusts. These are paid from the investment income on the Trusts assets corresponding to the balances in their Subscriber Accounts. The Trustee may resign and the Manager may relieve the Trustee of its functions by giving the other party a 90-day written notice. Whenever it deems it advantageous to do so and in the best interest of subscribers, beneficiaries, or the Foundation s mission and general strategy, the Manager may, by separate agreement with the Trustee, stand in for the Trustee or appoint one or more additional Trustees for one or other of the Trusts without having to obtain prior consent from the subscribers of its plans then in effect. CUSTODIAN Under the terms of the Trust agreement, the Manager can retain the services of the Custodian it deems competent, at its discretion. However, this choice must at all times be made in the best interest of the subscribers and beneficiaries, and in accordance with the Foundation s mission, its general strategy and the vocation of the Trusts. 54

55 Pursuant to the terms and conditions of an agreement dated October 1, 2010, between the Manager and CIBC Mellon Global Security Services Company, the latter acts as Custodian for each Trust. The Custodian s place of business is located at 320 Bay Street, Toronto, ON M5H 4A6. In this capacity, the Custodian receives the contributions for crediting to the Subscriber Accounts as well as government incentives, income earned on the Trust s assets and the net gains transferred to the Manager by subscribers for crediting to the latter s account. Subscriber contributions, to which are added provisions determined by the Manager to cover the reimbursement of membership fees, are credited to an omnibus account maintained in the Trustee s name for the Trust in question and which enables a breakdown of these amounts per subscriber account. The Custodian acts as custodian of securities and other forms of investment in which these amounts are invested, and as agent for the registers of the Trust in question. At maturity of a plan or upon arrival at term in compliance with its provisions, the Custodian reimburses the subscriber, from the assets of the Trust issuing this plan, the full amount of his contributions, including the membership fees that must be returned to him, according to the instructions given by the Manager on behalf of the Trustee. It also reimburses from the assets of the Trust in question, the government incentives paid by the federal and/or Quebec governments, as applicable, to the RESP pertaining to its plans, under the conditions stipulated in the tax legislation governing the relevant registered education savings plan. The Custodian s fees are paid directly from the investment income on assets in the Subscriber Accounts. They have been established by applying the following fee: 0.015% on the first $200 million and 0.01% on the rest; $10 per transaction on Canadian equities; $20 per cheque issued and $15 per electronic transfer. The service agreement between the Manager and the Custodian is currently in effect for 3 years, but either party may terminate it before this date by giving a 90-day written notice to the other party. TRUST MANAGER AND DISTRIBUTOR Universitas Management Inc. acts as Trust Manager and plan Distributor. It is a wholly-owned subsidiary of the Foundation. Universitas Management is registered as an investment fund manager and scholarship plan dealer, pursuant to the Securities Act (Quebec). TERMS OF THE TRUST MANAGEMENT CONTRACT MANAGER In its capacity as Manager, the main responsibility of Universitas Management is to manage the activities, operations and business of the Trusts. Specifically, Universitas Management, under the supervision of the Foundation, selects and retains the services of most of the other stakeholders of the Trusts management and operational structure, i.e. the Trustee, Custodian, portfolio managers, the external actuary and auditors. As Manager, Universitas Management provides the necessary administrative services for the Foundation s activities. The Manager is also responsible for operations related to accounting, for establishing internal controls, and for keeping subscriber records. The Manager keeps separate accounting for each account held by a subscriber with whom a scholarship agreement or an educational assistance payment agreement has been concluded. The manager keeps the subscribers files up-to-date and records their personal information therein, such as name and address. These records are kept at the manager s head office and the Custodian may access them at all times in order to reconcile the subscribers accounting data with the operations kept in its own books. The Manager is responsible for the Trusts cash management operations and the inherent bank transactions. Among other things, the Manager receives the contribution cheques from the subscribers and deposits them in trust. He sends the net contributions (after deduction of membership fees) to the Custodian as expeditiously as possible so that they can be credited to the Subscriber Accounts and to ensure they are invested quickly by the portfolio managers. The Manager is responsible for appointing and mandating the portfolio managers of the Trusts. Specifically, the Manager is the one who, under the supervision of the Foundation s Investment Committee, ensures that the decisions they make, while exercising their mandates, respect the investment policy s provisions. The Manager is responsible for giving instructions to the Custodian and to the portfolio managers so that the scholarship payments are made according to the subscribed plans and ESPs they pertain to. TERMS OF THE TRUST MANAGEMENT CONTRACT DISTRIBUTOR Through its sales force of nearly 250 registered scholarship plan representatives and its administrative personnel, Universitas Management also acts as exclusive Distributor of plans issued by the Trusts, in compliance with current securities legislation and tax laws. Universitas Management has performed this type of activity since March 2, 1964, and has done so for the Trusts pursuant to a service agreement renewed on January 20, In its capacity as Distributor, Universitas Management is responsible for the offer and distribution of the Trusts plans and by delegation of the Foundation, ensures their promotion. It agrees with the Foundation on other responsibilities and duties incumbent on the Distributor of plans to subscribers. Since Universitas Management 55

56 TRUST ORGANIZATION AND MANAGEMENT CONDITIONS acts as Distributor and Manager of the Trusts, the latter are deemed to be connected issuers of Universitas Management within the meaning of Regulation respecting Underwriting Conflicts. The Distributor receives a fee based on the number or value of subscribed scholarship or EAP plans. The membership fees paid by the subscriber, in compliance with the plan that he acquires from a Trust, are paid to the Distributor to pay commissions to representatives and other distribution fees. The representatives are remunerated through commissions calculated according to the plans they sell. They may also receive, according to the case and the ESP in question, an additional remuneration based on the number of units corresponding to subscriber contributions or based on the retention rate of plans in circulation. As applicable, the representatives remuneration is paid by the Distributor directly from membership fees it receives from the Foundation. DIRECTORS AND OFFICERS OF THE MANAGER The members of the Manager s Board of Directors are also officers of the Foundation. Their remuneration, however, is paid exclusively by the Manager. You will find all relevant information regarding these officers in the chart under Trust Organization and Management Conditions Directors and Officers of the Foundation. The remuneration of the Management Committee members is also paid by the Manager. Universitas Management Management Committee REMUNERATION AS TRUST MANAGER AND DISTRIBUTOR The Trusts pay annual administration fees to the Foundation, as plan promoter and to Universitas Management, acting as Manager and Distributor. These fees are drawn from the assets of each Trust, and serve as compensation for the exercise of functions executed by the Foundation and Universitas Management. These annual administration fees are of 1.43% (excluding applicable taxes) of the average cumulated balances in the Subscriber Accounts and the Trust Account. The administration fees are used to pay the costs for the administration of each of the Trusts, with the exception of the fees for the IRC which are taken directly from the Trusts assets pursuant to securities legislation. In addition, the administration fees which are not required for the preservation or development of the organization are returned to the Trusts so that plan beneficiaries may profit from them. See the General Provisions Applicable to the Three Plans and the Annual Returns and Total Expenses sections. From left to right: Isabelle Grenier, Saint-Augustinde-Desmaures, QC Vice-President, Corporate Affairs and HR, Ultimate Designated Person and Chief Compliance Officer Jean Marchand, Quebec City, QC President of Universitas Foundation Pascal Gilbert, Lévis, QC Vice-President, Sales and Marketing Josiane Rivard, Lévis, QC Vice-President, Finance and Administration Christian Lebeuf, Lévis, QC Vice-President, Information Technology Sonia Dupèré, Lévis, QC Vice-President, Customer Service and Contract Management 56

57 EXTERNAL ACTUARY Eckler Limited acts in the capacity of external actuary of each Trust. The actuary assists in determining the amount of contributions that must be paid per whole unit subscribed under the terms of a scholarship agreement. For this purpose, it validates the assessment and evaluation practices used to establish the measurement unit. Another of its responsibilities is to approve the methodology used to calculate and determine the scholarship levels that can be paid to eligible beneficiaries. This methodology is described in Note 2 of the Trusts annual financial statements incorporated by reference to this prospectus. See the Actuarial Certificate section. Moreover, the Manager annually calculates the current value of its obligation to reimburse membership fees pursuant to the terms of the plans in effect issued by each Trust. To do this, the calculations are based on cash flow projections made by the external actuary as at June 30 of each year. The total value of the refund obligation established is paired with investments in secured fixed-income securities. Lastly, the external actuary participates in developing the investment policies approved by the Foundation. AUDITORS The Trusts auditors are Samson Bélair/Deloitte & Touche, L.L.P., 925 Grande Allée Ouest, Suite 400, Quebec City, QC G1S 4Z4. POLICIES AND PROCEDURES FOR VALUING THE TRUSTS The value of the assets held by the Trusts and the value of its liabilities are established as follows: Cash is measured at fair value deemed to be equal to face value ; The Manager implements the recommendations of the Accounting Guideline issued by CICA AcG-18 Investment Companies. This applies to companies qualified as Investment companies and requires that such companies evaluate all of their investments at fair value. Treasury bills and short-term investment are valued at cost plus accrued interest, which approximates fair value. The fair value of investments in bonds corresponds to the bid price provided by a recognized vendor at the close of trading on the valuation date. The fair value of shares is determined using the bid price published on the principal exchange where the security is traded. When the rate of a security does not represent its fair value, the Custodian will set its value using the rate obtained from an external agency, i.e. from the recognized rating agency with which it has dealings ; Accounts payable and accrued liabilities are calculated on an accrual basis accounting and are measured at fair value which corresponds to their approximate cost; The subscriber s savings are measured at fair value, which corresponds to the subscribers contributions since they can request the reimbursement of the latter at any time ; The obligation to refund membership fees at maturity is assessed by an independent actuary and is based on cash flow projections that he establishes on June 30 of each year. The hypotheses used to determine the value of the obligation to reimburse membership fees reflect executive management s best estimate regarding the future payment of such reimbursement to subscribers at maturity, and combine both economic and noneconomic assumptions. Non-economic assumptions include considerations such as the termination of plans before their maturity date. The main economic assumption is the discount rate. The latter corresponds to the weighting of the return assumptions in stocks and bonds according to the guidelines of the investment policy for the reimbursement obligation of membership fees at maturity, after deduction of expenses for the increase in net assets from investment activities ; The value of net assets available for the payment of EAPs is determined on a monthly basis by the Manager. The latter obtains, from the Custodian, the valuation of the monthly investments on the last day of each month and adds the excess value of other assets and liabilities at that date. The Custodian confirms that since it has undertaken the responsibility of providing the assessment of the portfolio s securities, i.e. since August 2008, the valuation methods described have been maintained. 57

58 OTHER PROVISIONS RELEVANT MATTERS TO SUBSCRIBERS NOTICES AND DETERMINATION OF DEADLINES Any written notice or document to be served for the purposes herein must be delivered by hand or sent by mail or fax. The relevant period shall begin on the day following delivery or sending and, except for its last day, shall include legal holidays. The laws in force in the jurisdiction in which the notice is delivered or sent shall determine whether a particular day is a legal holiday. In the 90 days following the time when an individual becomes a beneficiary of the plan, the Manager is obligated, pursuant to the Income Tax Act (Canada), to inform this beneficiary (or his father, mother or public guardian if the beneficiary is under age 19 and normally resides with his father or his mother, or is under the care of a public guardian) in writing of the existence of the plan and the name and address of the plan subscriber. AMENDMENTS TO THE AGREEMENTS Any request for a change to the scholarship agreement or the educational assistance payment agreement must be made in writing to the Manager and signed by the subscriber. The Manager and the Trustee may also agree, without consulting the beneficiary or the subscriber, to change or amend the provisions of the scholarship agreement or the educational assistance payment agreement if in their opinion, this change or amendment is: Made for the purpose of complying with any federal law or law of a Canadian province or any order, rule or regulation adopted pursuant to such law; or Necessary to overcome administrative difficulties to the extent that the subscribers and beneficiaries are not adversely affected. Other changes may only be made with the consent of the Manager, the Trustee and the subscribers. The Manager or the Trustee convenes a meeting of subscribers on giving at least 21 days notice to consider and approve all other changes. A resolution of the subscribers may be adopted by simple majority of the votes cast by the subscribers at a meeting or represented by proxy. Each scholarship agreement or educational assistance payment agreement carries the right to one vote. MODIFICATION OF THE DECLARATION OF TRUST The Foundation and the Trustee may act jointly, without need of approval from the subscribers, to bring changes to the Trust agreement and to the declarations of Trust with regards to: The Management of the Trusts or any change of an administrative nature, provided that such changes are not likely to adversely affect the subscribers and beneficiaries; The addition of a protection or an additional benefit to subscribers or beneficiaries; and The maintenance of the status of each of the Trusts or plans for which they are established, pursuant to tax laws. However, amendments to the provisions of the Trust Agreement or Declaration of Trust to resolve an issue of considerable relevance to subscribers and beneficiaries other than a matter referred to in the preceding paragraph, can only be effected with the consent of subscribers in the form of a resolution obtained by assembly according to the procedure provided under the Trust Agreement. Notably, the Foundation or the Trustee may convene a meeting of subscribers on notice of at least 21 days. A resolution of the subscribers may be adopted by the simple majority of votes cast by subscribers at a meeting or represented by proxy. For example, a modification to the components of a Trust would require the approval of subscribers in the form of a resolution. REPORTS FOR SUBSCRIBERS In March of each year, the Management Report of Fund Performance and the audited Annual Financial Statements (as at December 31) are sent to subscribers, upon written request, along with their deposit statements. The Semi-Annual Financial Statements (dated June 30) will also be sent to each subscriber upon written request. Accordingly, the Manager annually contacts each subscriber asking him to confirm if he wishes to receive the annual and semiannual financial statements. These documents are available on the Canadian Securities Administrators website at sedar.com. DISSOLUTION OF THE TRUSTS In the event of the Manager s refusal or inability to act pursuant to an applicable law or regulation or further to an order, judgment, decision, decree or directive from a court or government, administrative, judicial, quasi-administrative or quasi-judicial authority, the Trustee agrees to act in place of the Manager pursuant to the Trust agreement restated on December 23, In the unlikely event of the dissolution of the Trusts, the Trustee would retain the assets to liquidate them and take the necessary measures to fulfill the reimbursement obligations and ensure the payments for which the Trusts would normally be responsible, pursuant to the terms of the scholarship agreement and educational assistance payment agreement. 58

59 RELATIONSHIP BETWEEN THE TRUSTS AND THE DISTRIBUTOR Universitas Management is duly registered under applicable securities legislation to act as a scholarship plan dealer in the provinces of Quebec and New Brunswick. Through nearly 250 representatives, Universitas Management acts as the exclusive Distributor of scholarship plans issued by the Trusts. Universitas Management acts as Trust Manager and, by way of its representatives, as exclusive Distributor of the plans. Since the Distributor is the Manager of the Trusts, the latter are deemed to be its connected issuers within the meaning of Regulation respecting Underwriting Conflicts. See the Trust Manager and Distributor section. MAIN PLAN SUBSCRIBERS To the Foundation s knowledge, no physical or moral person is the registered or actual owner of more than 10% of the scholarship plans issued by the Trusts. EXECUTIVE MEMBERS AND OTHER INTERESTED PARTIES IN SIGNIFICANT OPERATIONS No director or officer of the Foundation holds any significant interest that has had or could have a considerable effect on the plans issued by the Trusts. INFORMATION REGARDING PROXY VOTE The exercise of proxy voting rights relative to portfolio securities is delegated to portfolio managers, who perform this responsibility in compliance with the Foundation s investment policy objectives. These reports will be available on the Foundation s website at universitas.ca. Addenda Capital Inc., Fiera Capital Corporation and AlphaFixe Capital Inc. do not manage any investment trusts which would entitle them to a voting right. Jarislowsky Fraser Limited and Montrusco Bolton Investments Inc. implement policies and procedures for proxy voting, which aim to create or enhance the economic value of their customer s portfolio. This implies voting with members of the board of directors, who, as representatives of the Trusts, must act in the best interest of the latter. Nevertheless, if the portfolio managers believe that a proposal will unduly increase the risk or reduce the economic value of the Trusts, or that it is not in the interest of the latter, their vote will go against those of the board of directors. They may also refuse to participate in a vote if they believe it is in the interest of the Trusts. However, the Foundation s investment committee reserves the right to personally exercise its voting rights by giving the portfolio managers reasonable notice of its intention to do so. MATERIAL CONTRACTS The Foundation and the Manager are party to the following major contracts: 1. The agreement between the Foundation and Universitas Management, Manager Distributor, dated January 20, This agreement stipulates the responsibilities of Universitas Management pursuant to the plans issued by the latter proxy of certain responsibilities and tasks of the Foundation s investment fund manager and as exclusive Distributor. This contract was extended and split in two on December 23, 2010, so as to clearly define the two roles of Universitas Management. 2. The agreement between the Foundation and the Trustee dated July 9, 2010, and restated on December 23, This agreement states the responsibilities of Trust Eterna Inc. in administering the Foundation s RESPs. 3. The agreement between the Foundation and the Custodian dated October 1, This agreement states the responsibilities of the custodian charged with keeping the registers of CIBC Mellon Global Securities Services Company in managing the Trusts assets. See the Trust organization and Management Conditions Custodian section. 4. The agreement between the Foundation and Addenda Capital Inc. dated May 28, This agreement states the powers and responsibilities of this portfolio manager. An addendum to this agreement was signed on January 11, 2011, to set forth the role of Universitas Management as investment fund manager. See the Trust Organization and Management Conditions Portfolio Managers section. 5. The agreement between Universitas Management Inc. and Fiera Capital Corporation, dated April 1, This agreement states the powers and responsibilities of this portfolio manager. See the Trust Organization and Management Conditions Portfolio Managers section. 6. The agreement between Universitas Management and AlphaFixe Capital Inc. dated July 1, This agreement states the powers and responsibilities of this portfolio manager. See the Trust Organization and Management Conditions Portfolio Managers section. 7. The agreement between the Foundation and Jarislowsky Fraser Limited dated May 25, This agreement states the powers and responsibilities of this portfolio manager. An addendum to the agreement was signed on December 20, 2011 to set forth for the role of Universitas Management as investment fund manager. See the Trust Organization and Management Conditions Portfolio Managers section. 59

60 OTHER PROVISIONS 8. The agreement between the Foundation and Montrusco Bolton Investments Inc. dated September 1, This agreement states the powers and responsibilities of this portfolio manager. An addendum to this agreement was signed on January 1, 2011 to set forth the role of Universitas Management as investment fund manager. See the Trust Organization and Management Conditions Portfolio Managers section. 9. The administration contract between Trust Eterna Inc., the UNIVERSITAS, REFLEX AND INDIVIDUAL plan Trusts, the Foundation and Universitas Management dated December 23, This contract states the services rendered by the Foundation with regard to the Trusts. 10. The group insurance policy agreement between the Foundation and SSQ Financial Group dated February 26, 2008 regarding the optional life and disability insurance offered to subscribers pursuant to the conditions described in the Distribution Guide. 11. The agreement between the Foundation and the Minister of Human Resources and Social Development Canada (CESG and CLB) dated April 6, This agreement states the conditions governing the reception and administration of the Canada Education Savings Grant and/or of the Canada Learning Bond. 12. The agreement between the Foundation and Revenu Quebec dated June 27, This agreement states the conditions regarding the implementation and administration of the Quebec Education Savings Incentive (QESI). Copies of the above-mentioned documents can be consulted during normal business hours at the Foundation s head office or at the Distributor s head office at 3005 Maricourt Avenue, Quebec City, QC G1W 4T8. LEGAL AND ADMINISTRATIVE PROCEEDINGS The Manager and the Foundation are not party to any significant dispute regarding their property. On the 20 th of August, 2012, the Autorité des marchés financiers du Québec (the AMF ) submitted a request to the Bureau de décision et de révision (the Bureau ) for the assessment of an administrative penalty of $15,000 against the Universitas Foundation of Canada for having failed to respect articles 11 and 13 of the Securities Act, article 1.1 (4) of Regulation C-15 regarding the conditions precedent to the acceptation of scholarship foundation prospectuses and article 14.1(2) of Regulation respecting General Prospectus Requirements. The allegations made against the Foundation, arising from a continuous disclosure review carried out in 2010 by the AMF, refer mainly to investments that were not agreed to by regulations and to having neglected to leave the share certificate issued by Gestion Universitas in the custody of the custodian. Following the AMF s review, the Foundation immediately took the required corrective actions to the AMF s satisfaction. The noncompliant elements that were raised with regards to investment management and the administrative sanctions assessed by the AMF as regards them did not have and will not have any financial impact on the subscribers or the beneficiaries. EXPERTS The contribution tables presented in this prospectus were prepared in collaboration with the Trusts external actuary. The issues raised in the Income Tax Considerations section and certain other issues of a legal nature concerning the Trust plans and RESPs have been examined by Lavery, de Billy, L.L.P. The financial statements were audited by Samson Bélair/Deloitte & Touche, L.L.P. EXEMPTIONS AND APPROVALS In 2001, pursuant to Decision No C-0383 of the Quebec Securities Commission (now the Autorité des marchés financiers), the Foundation obtained an exemption from application of Article 4 of Regulation No. 15 respecting Conditions Precedent to Acceptance of Scholarship or Educational Plan Prospectuses, so as to allow the Foundation to invest the assets in its account in common shares of companies. For more details on the investment terms and conditions stipulated in Decision No C-0383, see the Investment Objectives, Strategies and Restrictions section. In 2011, pursuant to decision No FIIC-0185 of the Autorité des marchés financiers, the Trusts obtained an exemption from application of Article 4.1 of Regulation respecting General Prospectus Requirements authorizing the Trusts to incorporate by reference into their prospectus the annual and semi-annual financial statements, as well as the management reports on the performance of the plans. STATUTORY RIGHTS OF WITHDRAWAL AND RESCISSION The securities legislation of certain Canadian provinces provides the subscriber or purchaser with a right of rescission. This right may be exercised within two business days of receipt or deemed receipt of the prospectus and any amendment. In the provinces of Quebec and New Brunswick., this right of rescission is available to the subscriber or the purchaser. In several provinces, the securities legislation further provides a subscriber or purchaser with remedies for rescission or, in some cases, revisions of the price or damages if the prospectus contains a misrepresentation or is not delivered. These rights must be exercised within the prescribed time limit. The purchaser should refer to applicable provisions or eventually consult with a legal adviser on this matter. 60

61 Actuary s Certificate To the Universitas Foundation of Canada Subscribers An audit was performed for the four following elements: 1. Tables of contributions in the prospectus: These tables must be calculated so that the amounts invested by each subscriber bring in roughly the same level of investment income to the scholarships of the beneficiary s cohort. The tables must take into account the age of the beneficiary at the time of subscription, the duration of the savings and the method of contributing selected by the subscriber. 2. Distribution of income and expenditures for 2011: The distribution of the income and expenditures of the Foundation by cohort and by plan must be just and fair. 3. Calculation of scholarships whose payment is made between July 1, 2012, and June 30, 2013: The level of the scholarships paid to beneficiaries must be calculated to represent, on the date of their payment, an accurate share and a just and proper division of the net income accumulated in the Scholarship Fund. ACTUARY S CONSENT This letter refers to the prospectus of the Universitas Foundation of Canada, dated November 2, 2012 relating to the continuous offering of education saving plan units of the UNIVERSITAS plan trust, the REEEFLEX plan trust and the INDIVIDUAL plan trust. I agree to have my actuarial report dated November 2, 2012, included in the above-mentioned prospectus intended for subscribers of the Foundation, concerning the following four elements: 1. Tables of contributions in the prospectus 2. Distribution of income and expenditures for Calculation of scholarships whose payment is made between July 1, 2012, and June 30, Valuation of the reimbursement obligation for agreement membership fees at maturity as at December 31, 2010 and 2011 I declare that I have read the prospectus and that I have no reason to believe that the information contained therein is not in accordance with the documents that were subject to my verification. 4. Valuation of the reimbursement obligation for agreement membership fees at maturity as at December 31, 2010 and 2011: The valuation of the reimbursement obligation for agreement membership fees at maturity is the value of the obligation to pay to group plan subscribers, upon the agreement maturity, an amount equal to the membership fees paid, without regard to the revenue generated on the subscriber s savings. It is our opinion that the methodologies used, as well as the assumptions made by the Universitas Foundation of Canada regarding these four elements are proper and fair, and well documented. Luc Farmer, F.S.A., F.I.C.A. Montreal, November 2, 2012 Our audit was carried out in compliance with the general standard of the Canadian Institute of Actuaries (CIA) and generally accepted actuarial principles. Luc Farmer, F.S.A., F.I.C.A. Montreal, November 2,

62 Independent Auditors Consent We have read the prospectus of Universitas Foundation of Canada (the Foundation ), dated November 2, 2012 relating to the continuous offering of education saving plan units of the UNIVERSITAS plan trust, the REEEFLEX plan trust and the INDIVIDUAL plan trust (collectively the Trusts ). We have complied with Canadian generally accepted standards for an auditor s involvement with offering documents. We consent to the incorporation by reference in the abovementioned prospectus of our reports to the subscribers of each of the Trusts on the statements of net assets available for scholarship payments as at December 31, 2011 and 2010, the statement of investment portfolio as at December 31, 2011 and the statements of increase in net assets related to investment activities and changes in net assets available for scholarship payments for the years ended December 31, 2011 and Our reports are dated March 22, Quebec, November 2, CPA auditor, CA, public accountancy permit No. A

63 TABLE OF CONTRIBUTIONS UNIVERSITAS GROUP PLAN Age of beneficiary CONTRIBUTIONS* $ $ $ $ $ $ $ $ WHOLE UNIT - Three successivte scholarships Monthly Number of Contributions Total Savings 2, , , , , , , , Year Monthly Total Savings 1, , , , , , , , Year Monthly Total Savings 1, , , , , , , , Annual Number of Contributions Total Savings 2, , , , , , , , Year Annual Total Savings 1, , , , , , , , Year Annual Total Savings 1, , , , , , , , Year Annual , Total Savings 1, , , , , , , , Single Contribution 1, , , , , , , , Total Savings 1, , , , , , , , Monthly RESP Maximizer Duration (months) Number of Units Total Savings 49, , , , , , , , Annual RESP Maximizer 2, , , , , , , , Duration (years) Number of Units Total Savings 49, , , , , , , , Monthly CESG Maximi zer** Duration (months) Number of Units Total Savings 35, , , , , , , , Annual CESG Maximi zer** 2, , , , , , , , Duration (years) Number of Units Total Savings 35, , , , , , , , * Contributions for a unit fraction (1/1000) are proportional to the contributions for a whole unit. ** The CESG Maximizer modes assume that the beneficiary is not already registered in an RESP and that no CESG has been obtained from the Canada Education Savings Program (CESP). Thus, these modes presuppose the recovery of unused CESG amounts. 63

64 TABLE OF CONTRIBUTIONS UNIVERSITAS GROUP PLAN Age of beneficiary CONTRIBUTIONS* $ $ $ $ $ $ $ $ WHOLE UNIT - Three successive scholarships Monthly , Number of Contributions Total Savings 4, , , , , , , , Year Monthly Total Savings 5-Year Monthly Total Savings 3, , , , , Annual , , , , , Number of Contributions Total Savings 4, , , , , , , , Year Annual Total Savings 5-Year Annual , , Total Savings 2, , , , , Year Annual 1, , , , , , , , Total Savings 2, , , , , , , , Single Contribution 2, , , , , , , , Total Savings 2, , , , , , , , Monthly RESP Maximizer , , , Duration (months) Number of Units Total Savings 49, , , , , , , , Annual RESP Maximizer 5, , , , , , , , Duration (years) Number of Units Total Savings 49, , , , , , , , Monthly CESG Maximi zer** Duration (months) Number of Units Total Savings 35, , , , , , , , Annual CESG Maximi zer** 4, , , , , , , , Duration (years) Number of Units Total Savings 36, , , , , , , , * Contributions for a unit fraction (1/1000) are proportional to the contributions for a whole unit. ** The CESG Maximizer modes assume that the beneficiary is not already registered in an RESP and that no CESG has been obtained from the Canada Education Savings Program (CESP). Thus, these modes presuppose the recovery of unused CESG amounts. Ex ample of savings - UNIVERSITAS group plan 3-year child After 1 year After 5 years At maturity Monthly Contribution of $16.90 Total Contribution $ $1, $2, Whole Unit Membership Fees $ $ $ 0.00 Initial Contribution of $16.90 Savings $ $ $2,

65 REFLEX GROUP PLAN Age of beneficiary CONTRIBUTIONS* $ $ $ $ $ $ $ $ WHOLE UNIT - Three successive scholarships Monthly Number of Contributions Total Savings 2, , , , , , , , Year Monthly Total Savings 1, , , , , , , , Year Monthly Total Savings 1, , , , , , , , Annual Number of Contributions Total Savings 2, , , , , , , , Year Annual Total Savings 1, , , , , , , , Year Annual Total Savings 1, , , , , , , , Year Annual Total Savings 1, , , , , , , , Single Contribution 1, , , , , , , , Total Savings 1, , , , , , , , Monthly RESP Maximizer Duration (months) Number of Units Total Savings 49, , , , , , , , Annual RESP Maximizer 2, , , , , , , , Duration (years) Number of Units Total Savings 49, , , , , , , , Monthly CESG Maximi zer** Duration (months) Number of Units Total Savings 35, , , , , , , , Annual CESG Maximi zer** 2, , , , , , , , Duration (years) Number of Units Total Savings 35, , , , , , , , * Contributions for a unit fraction (1/1000) are proportional to the contributions for a whole unit. ** The CESG Maximizer modes assume that the beneficiary is not already registered in an RESP and that no CESG has been obtained from the Canada Education Savings Program (CESP). Thus, these modes presuppose the recovery of unused CESG amounts. 65

66 TABLE OF CONTRIBUTIONS REFLEX GROUP PLAN Age of beneficiary CONTRIBUTIONS* $ $ $ $ $ $ $ $ WHOLE UNIT - Three successive scholarships Monthly Number of Contributions Total Savings 4, , , , , , , , Year Monthly Total Savings 5-Year Monthly Total Savings 3, , , , , Annual , , , , Number of Contributions Total Savings 3, , , , , , , , Year Annual Total Savings 5-Year Annual , , Total Savings 2, , , , , Year Annual 1, , , , , , , , Total Savings 2, , , , , , , , Single Contribution 2, , , , , , , , Total Savings 2, , , , , , , , Monthly RESP Maximizer , , , Duration (months) Number of Units Total Savings 49, , , , , , , , Annual RESP Maximizer 5, , , , , , , , Duration (years) Number of Units Total Savings 49, , , , , , , , Monthly CESG Maximi zer** Duration (months) Number of Units Total Savings 36, , , , , , , , Annual CESG Maximi zer** 3, , , , , , , , Duration (years) Number of Units Total Savings 35, , , , , , , , * Contributions for a unit fraction (1/1000) are proportional to the contributions for a whole unit. ** The CESG Maximizer modes assume that the beneficiary is not already registered in an RESP and that no CESG has been obtained from the Canada Education Savings Program (CESP). Thus, these modes presuppose the recovery of unused CESG amounts. TABLE OF CONTRIBUTIONS - UNIVERSITAS AND REFLEX GROUP PLANS The Tables of Contributions are calculated so that the amounts invested by each subscriber earn approximately the same level of net investment income in scholarships for the beneficiary s cohort. Economic and non economic hypotheses were used to determine the Tables of Contributions. In short, the following factors are taken into consideration: the beneficiary s age at the time of contribution, the duration of the savings and the mode of contribution selected by the subscriber. Moreover, the amount accumulated by a given group of beneficiaries depends on the net return actually achieved on investments, on the cancellation rate during the entire contribution period, on administrative expenses and finally, on the proportion of beneficiaries who claim scholarships (attrition effect). The interest rates, net of all charges, considered are the following: 3.0% for bonds and 6.0% for Canadian equities. At all times, the partial or total cancellation of an agreement while the savings plan is in effect may result in the loss of memberships fees already paid. However, the membership fees are reimbursed in full at maturity. The subscriber may change the mode of contribution on written notice to the Manager. Contributions must be made in Canadian dollars. 66

67 STATISTICS ON THE UNIVERSITAS AND REFLEX GROUP PLANS ADDITIONS AND REDUCTIONS IN 2011 The following table presents the 2010, statistics of subscribers whose group plan had not yet reached maturity as at December 31, 2011: UNIVERSITAS REFLEX Number of subscribers 1 As a % of the nbr of Subscribers 2 Nbr of Units As a % of the nbr of Units Number of subscribers 1 As a % of the nbr of Subscribers 2 Nbr of Units As at January 1, , , , ,627.8 Additions in 2011 Purchase of units 3,441 10, ,363 60,983.5 Transfers from another institution Reductions in 2011 Agreement cancellations Transfers to another institution Unit cancellations (without agreement cancellation) Transfers between plans promoted by the Foundation in 2011 As a % of the nbr of Units Treatment of accumulated income % 3, % 1, % 5, % The accumulated income remains in the Trust s Account % % % % The accumulated income accrued on the contributions remains in the Trust s Account. Only the income earned on the government incentives is transferred % % % % The accumulated income corresponding to the cancelled units remains in the Trust s Account % 1, % % % When transferring from a group plan promoted by the Foundation to another group plan promoted by the Foundation, only the income earned on the government incentives is transferred. When transferring from a from one of the group plan promoted by the Foundation to the INDIVIDAL plan, accumulated income accrued on the contributions can be transferred. In the case of the REFLEX group plan, a choice to this effect must be made. See the Conversion of group plan to the INDIVIDUAL plan. As at December 31, , , , , During the course of a year, subscribers may add or deduct units from their scholarship agreements. These variations are included in the additions and reductions shown. The subscribers for these added or removed units are included in the number of subscribers as at January 1, which is why this number, to which are added the variations over the course of the year, does not coincide with the number of subscribers as at December The units included in a scholarship agreement which has reached maturity during the year are not shown in the reductions. For this reason, the number of units as at January 1, to which are added the variations over the course of the year, does not coincide with the number of units as at December 31. SCHOLARSHIP ELIGIBILITY The following table presents statistics on the scholarships paid to the beneficiaries of the 2003 to 2009 cohorts. UNIVERSITAS 1 REFLEX % 2004 % 2005 % 2006 % 2007 % 2008 % 2009 % 2005 % 2007 % 2008 % 2009 % Nbr of beneficiaries whose plan has reached maturity and who are eligible for scholarships 1,617 1,734 1,860 2,013 2,141 2,514 2, Nbr of beneficiaries who received no scholarship % % % % % % 1,436 50% - 0% - 0% - 0% 9 21% Nbr of beneficiaries who received their 1 st scholarship 1,070 66% 1,108 64% 1,204 65% 1,306 65% 1,370 64% 1,521 61% 1,463 50% 1 100% 5 100% 4 100% 33 79% Nbr of beneficiaries who received their 2 nd scholarship % % 1,094 59% 1,167 58% 1,188 55% 1,211 48% % - 0% 5 100% 3 75% 21 50% Nbr of beneficiaries who received their 3 rd scholarship % % % % % % 232 8% - 0% 5 100% 2 50% - 0% 1 The cohorts illustrated are those in which the beneficiaries could have qualified for a 1 st scholarship from 2003 to 2009 respectively. The 2009 cohort is the most recent in which the beneficiaries were potentially entitled to their three scholarships. Please note that the number and percentage of beneficiaries who received scholarships in these cohorts keep growing over the years, until the cut-off dates are reached. That is why the cohorts from earlier years present a higher eligibility rate (%) for scholarship. 2 The 1 st scholarship for the REFLEX plan was paid in 2006 to a beneficiary of the 2005 cohort. As for the UNIVERSITAS plan, the number and percentage of beneficiaries who receive scholarships in a given cohort continue to increase over the years. Therefore, the statistics presented are not necessarily representative. 67

68 SUMMARY OF SCHOLARSHIPS AND RETURNS SUMMARY OF SCHOLARSHIPS UNIVERSITAS Group plan Qualifying Year:** Number of units 52, , , , , , , ,907.0 Amount paid or set aside per whole unit $ $ $ $ $ $ $ $ 1 st scholarship ,023 1,064 1,160 1,119 1,081 2 nd scholarship * ,057 1,102 1,173 1,176 1,151 3 rd scholarship * * 971 1,106 1,138 1,215 1,189 1,210 TOTAL - 3 scholarships (excluding the CESG, CLB and the QESI) * * 2,840 3,186 3,304 3,548 3,484 3,442 The UNIVERSITAS plan is intented for children between 0 and 15 years of age inclusive. * The amount of these Scholarships will be known in 2013 and ** Qualifying year to obtain a first scholarship from the UNIVERSITAS and REFLEX plans is set at 17 years old. REFLEX Group plan Qualifying Year:** Number of units Amount paid or set aside per whole unit $ $ $ $ $ $ $ $ 1 st scholarship 400*** ,011 1,046 1,078 1,072 2 nd scholarship * ,047 1,057 1,133 1,141 3 rd scholarship * * 879 1,000 1,081 1,095 1,145 1,199 TOTAL - 3 scholarships (excluding the CESG, CLB and the QESI) * * 2,556 2,870 3,139 3,198 3,356 3,412 The REFLEX plan is intented for children between 0 and 15 years of age inclusive. * The amount of these Scholarships will be known in 2013 and ** Qualifying year to obtain a first scholarship from the UNIVERSITAS and REFLEX plans is set at 17 years old. *** This scholarship level only applies to the subscribed REFLEX plans pertaining to the contribution table in force until September 7, It cannot be considered as an indication of the scholarship level which will apply to the REFLEX plans subscribed to after this date. SUMMARY OF AVERAGE RETURNS AS AT DECEMBER 31, 2011 UNIVERSITAS Average return as at December 31, 2011, over a period of 1 year 3 years 5 years 10 years Gross return at market value 3.50% 6.78% 4.39% 7.46% Total expenses % 1.21% 1.23% 1.40% Net return at market value 2.15% 5.57% 3.16% 6.06% REFLEX Average return as at December 31, 2011, over a period of 1 year 3 years 5 years 10 years Gross return at market value 8.34% 6.72% 5.90% 7.56% Total expenses % 1.20% 1.23% 1.40% Net return at market value 6.96% 5.52% 4.67% 6.16% INDIVIDUAL Average return as at December 31, 2011, over a period of 1 year 3 years 5 years 10 years Gross return at market value 5.42% 5.01% 4.95% 4.52% Total expenses % 1.35% 1.32% 1.44% Net return at market value 3.78% 3.66% 3.63% 3.08% 1 The expenses include the administration fees and the management fees. 68

69 SUMMARY OF THE PLANS SUMMARY OF THE UNIVERSITAS GROUP PLAN AS AT DECEMBER 31, 2011 Qualifying year Agreements in force Equivalence in whole units Subscribers savings Accumulated surplus for scholarships As at December 31, 2011 As at December 31, 2010 As at December 31, 2011 As at December 31, ,760,031 66,185, ,531 56, ,656,260 23,322,401 65,029,123 7,362, ,630 14, ,520,847 24,227,292 7,654,823 6,672, ,836 15, ,233,468 22,915,376 6,087,246 5,395, ,185 17, ,452,350 23,744,630 5,598,382 4,604, ,332 18, ,776,236 23,047,127 4,452,062 3,482, ,848 18, ,973,850 20,433,428 2,800,580 2,075, ,350 21, ,753,683 20,877,128 2,314,115 1,272, ,194 18, ,185,895 16,633, , , ,149 19, ,712,064 14,989, ,965 (392,760) ,156 20, ,928,849 13,065,869 (132,942) (828,777) ,142 22, ,020,826 11,032,675 (557,535) (1,219,549) ,523 26, ,605,418 10,050,000 (794,736) (1,655,255) ,391 28, ,050,973 7,292,387 (1,577,484) (1,859,219) ,063 28, ,539,607 4,138,918 (2,255,027) (1,591,844) ,537 21, ,261,513 1,498,720 (2,315,388) (658,221) ,430 11, , ,492 (1,284,651) (37,985) , ,716 (312,108) 122, , ,663, ,237,572 86,034,717 89,135,798 69

70 SUMMARY OF THE PLANS SUMMARY OF THE REFLEX GROUP PLAN AS AT DECEMBER 31, 2011 Qualifying year Agreements in force Equivalence in whole units Subscribers savings Accumulated surplus for scholarships As at December 31, 2011 As at December 31, 2010 As at December 31, 2011 As at December 31, ,481, , ,567,425 1,627, , , ,648,911 2,174, , , ,632,785 2,137, , , , ,032,873 2,454, , , ,190 1, ,796,126 3,031, , , ,572 2, ,649,615 3,858, , , ,211 3, ,673,771 4,687, , , ,374 5, ,192,412 6,750,192 1,194, , ,146 7, ,253,644 7,705,736 1,042,396 (29,984) ,123 10, ,699,135 8,633, ,666 (287,762) ,081 13, ,118,652 8,717, ,621 (558,721) ,183 18, ,943,822 8,807, ,129 (896,363) ,841 21, ,612,853 7,126,046 (315,128) (1,129,204) ,056 26, ,752,600 4,763,143 (892,760) (1,315,347) ,779 27, ,735,896 1,767,145 (1,727,583) (730,914) ,824 34, ,740, ,533 (1,807,058) (61,415) ,480 27, ,338 (1,080,173) 74, , ,411,542 77,012,103 3,070,210 (3,334,088) SUMMARY OF THE INDIVIDUAL PLAN AS AT DECEMBER 31, 2011 Agreements in force Equivalence in whole units Subscribers savings Accumulated surplus for EAPs As at December 31, 2011 As at December 31, 2010 As at December 31, 2011 As at December 31, ,641 2, ,067,347 7,894, , ,811 Total 199, , ,142, ,143,894 89,607,447 86,133,521 70

71 Certificates 71

72 CERTIFICATE of the: UNIVERSITAS Plan Trust REFLEX Plan Trust INDIVIDUAL Plan Trust (collectively, the Trusts ) This prospectus, together with the documents incorporated herein by reference, constitutes full, true and plain disclosure of all material facts relating to the securities offered by this prospectus as required by the securities legislation of Quebec and New Brunswick. November 2, 2012 Universitas Foundation of Canada as Promoter of the Trusts On behalf of the Board of Directors of Universitas Foundation of Canada ( s ) Jean Marchand ( s ) Jean Lemieux Jean Marchand Jean Lemieux President Vice -President ( s ) Louis Beaulieu ( s ) France Bilodeau Louis Beaulieu France Bilodeau Director Director Universitas Management Inc. as Trusts Manager On behalf of the Board of Directors of Universitas Management Inc. ( s ) Jean Marchand ( s ) Jean Marchand Jean Marchand Jean Marchand President President ( s ) Josiane Rivard ( s ) Louis Beaulieu Josiane Rivard Louis Beaulieu Vice -President, Finance and Administration Director Trust Eterna as Trustee for the Trusts ( s ) François Ricard François Ricard Director of Administration ( s ) Robert Archer Robert Archer Secretary 72

73 CERTIFICATE OF THE DISTRIBUTOR To the best of our knowledge, information and belief, this prospectus, together with the documents incorporated herein by reference, constitutes full, true and plain disclosure of all material facts relating to the securities offered by this prospectus as required by the securities legislation of Quebec and New Brunswick. November 2, 2012 Universitas Management Inc. as Distributor of Trust Plans ( s ) Jean Marchand Jean Marchand President ( s ) Josiane Rivard Josiane Rivard Vice -President, Finance and Administration On Behalf of the Board of Directors of Universitas Management Inc. ( s ) Jean Marchand Jean Marchand President ( s ) Louis Beaulieu Louis Beaulieu Director 73

74 NOTES

75 OUR NUMBERS SPEAK FOR THEMSELVES Data collected as of December 31, 2011* and based on a 10-year period , , April 30 Dec. 31 Amounts paid in scholarships, EAPs and returned savings* 181, (in millions of dollars) 200, , , , , , , , , , , ,000 80,000 60,000 40,000 20, , ,6 April 30 Dec , , , Subscribers' savings* (in millions of dollars) 185,5 213,2 243,4 Number of beneficiaries 100, , , , , , , , , , , * The 2003 numbers are as at April 30. The numbers are as at December 31.

76 Our partners Auditors Barristers and Solicitors Portfolio Managers Trustee Custodian Actuaries Insurer Exclusive Distributor Quebec : 3005 Maricourt Avenue, Quebec City, Quebec G1W 4T8