Investment Jargon. Not sure what a word means? This is your one-stop guide to definitions of common financial terms.

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1 Investment Jargon Not sure what a word means? This is your one-stop guide to definitions of common financial terms. A B C D E F G H I J K L M N O P Q R S T U V W X Y Z A Access ID Account Balance Active Member Additional Voluntary Contributions (AVCs) Address Change Adjusted Cost Base (ACB) Adjusted Cost Base - ACB, Stock Plan Annual Return Annualized Return Annuitant Annuitant, Contingent Annuity Annuity, Deferred Annuity, Guaranteed Annuity, Joint Asset Allocation Asset Allocation Programs Asset Classes Asset Mix AVC Average Final Earnings B Balanced Funds Before-Tax Dollars Benchmark Beneficiary Beneficiary, Absolute or Irrevocable Beneficiary, Change Beneficiary, Contingent Benefit Benefit Formula Bond Funds Bonds Book Value Book Value, Stock Plan Break in Service

2 C Canada Customs and Revenue Agency (CCRA) Canada Pension Plan (CPP) Canadian Equity Funds Capital Gains or Losses Carrier Cash Investments Cash Surrender Value Charges Commuted Value Compensation Compound Interest Compulsory Plan Consumer Price Index (CPI) Contingent Beneficiary Continuous Service Contributory Pension Plan CPP Credited Service Currency risk D DBPP DCPP Death Benefit Deferred Annuity Deferred Profit Sharing Plan (DPSP) Defined Benefit Pension Plan (DBPP) Defined Contribution Pension Plan (DCPP) Department of National Revenue (DNR) Derivatives Risk Disability Pension Benefit Disposable Income Diversification Diversified Funds Dividend Division of Pension Credits Dollar Cost Averaging DPSP E EAFE Earnings Effective Date Eligibility Requirements Employee Contribution Employee Profit Sharing Plan (EPSP) Enrolment Entry Age EPSP Equity Fund Expenses

3 F Fees Fixed Income Fund Foreign Equity Funds Forfeiture Funds G GARP GIC Government Program Group Registered Retirement Saving Plan (Group RRSP) Growth Growth at a Reasonable Price (GARP) Growth Fund Guaranteed Annuity Guaranteed Funds Guaranteed Income Supplement (GIS) Guaranteed Investment Certificate (GIC) Guaranteed Maturity Unit Value H Home Buyers' Program I Index Index Fund Indexing Inflation Interest Rate Interest Rate Risk International Fund Investment Funds Investment Choices Irrevocable Beneficiary L Large Cap versus Small Cap Funds Leave of Absence Leaving the Plan LIF Life Expectancy Life Income Fund (LIF) Load Locked-In Retirement Account (LIRA) Locked-In Locked-In Retirement Income Fund (LRIF) M Market Value Adjustment (MVA) Market Value Money Market Funds Money Purchase Pension Plan Mutual Fund MVA

4 N Non-Contributory Plan Non-Registered Savings Plan (NREG) Normal Retirement Age Normal Retirement Date NREG O Old Age Security (OAS) P PA Password Past Service Pension Pension Adjustment (PA) Pension Benefits Acts (PBAs) Pension Plan Pensionable Earnings Pensionable Service Personal Identification Number (PIN) Plan Sponsor Policyholder Pooled Fund Pooling Portability Power of Attorney Present Value Profit Sharing Pension Plan Projected Pension Benefits Pro-rate Public Pension Plan Q Qualification Date Quebec Pension Plan (QPP) R Registered Pension Plan (RPP) Registered Plan Registered Retirement Income Fund (RRIF) Registered Retirement Savings Plan (RRSP) Required Contributions Retirement Income Retiring Allowance Return Revenue Canada Risk and Return RRIF RRSP RRSP Contribution Limit

5 S S&P/TSX Composite Index Salary Scale Savings Plan Sector Rotation Segregated Fund SC 91 Day T-Bill Index SC Universal Bond Index Short-term Trading Specialized Funds Spill Limit Spousal RRSP Spouse's Pension Allowance Stocks Surviving Spouse Benefit Survivor Benefit T Tax Credit Tax Deductible Tax Deferral Tax Receipts Tax Shelter Taxes on Withdrawals Termination Transaction Fees T-1007 T-2033 T-2037 T2151 T4A U Units V Value Value Fund Vesting Voluntary Withdrawals W Waiting Period Withdrawals Y Year's Basic Exemption (YBE) Year's Maximum Pensionable Earnings (YMPE)

6 Access ID Your Access ID can be found in the Welcome Letter you received when you first joined the plan, or on any Account Statement we send you. Account Balance Your Account Balance is based on the previous business day's closing values. You can find this under the "Balances" selection on this Plan Member website or via our interactive Customer Care phone system at SUN-LIFE. Active Member An individual actively employed and currently making contributions to a Registered Pension Plan or Deferred Profit Sharing Plan. Additional Voluntary Contributions - AVCs Additional voluntary pension plan contributions made by you in addition to the contributions that are required under the plan. Extra benefits are purchased with the AVCs. Although AVCs are not locked-in, they are subject to pension legislation and unless plan terms dictate otherwise, can only be withdrawn at death, termination of service or retirement. Address Change You can change your address either online under MY ACCOUNT INFO>Personal Info if applicable to your plan, by contacting a Sun Life Financial Call Centre Representative at SUN-LIFE, or through your employer. Adjusted Cost Base - ACB For non-registered plans, the Adjusted Cost Base (ACB) of a unit of a particular segregated / trust fund or a share of a stock, is the total dollar amount used to purchase units in that segregated / trust fund or shares, plus the amount of income allocated from the segregated / trust fund or any reinvested dividends from shares, minus the adjusted cost base of the units or shares previously sold, divided by the total number of such units or shares held by you. The ACB we provide is based on our records relating to your account. If you hold shares of the same stock outside of the employee savings plan, it is your responsibility to combine all such shares for ACB calculation purposes. Please consult your financial and/or tax advisor for assistance. Adjusted Cost Base - ACB, Stock Plan If you are a member of a stock plan, the adjusted Cost Base (ACB) is the amount of money that has been contributed to the non-registered plan by you and/or your employer plus any reinvested dividends, if applicable, minus the cost of the shares that have been withdrawn, if applicable. The ACB we provide is based on our records relating to your account. If you hold shares of the same stock outside of the employee savings plan, it is your responsibility to combine all such shares for ACB calculation purposes. Please consult your financial and/or tax advisor for assistance. Annual Return Is a fund or plan return over a one-year period. Annualized Return An overall rate of return, usually over a period of two or more years, converted to an equivalent rate over each one year period. For example, if you have a return of 9% in the first year, 4% in the second year and 18% in the third year, this is averaged as a 10% return in each of the three years. So, 10% would be the 3-year annualized return. Annuitant An individual in receipt of an annuity payment (usually a monthly pension).

7 Annuitant, Contingent (note: also under Annuitant, Joint) Persons named to receive annuity payments if the primary annuitant dies. The contingent annuitant is usually the spouse, and may also be referred to as the joint annuitant. Annuity An annuity is a contract that provides periodic payments to an annuitant, and is designed to continue for a fixed period, or until death. Annuity, Deferred An annuity under which the first payment is not made until the expiration of a fixed number of years, or the attainment of a stated age or a contract which includes an undertaking on the part of the insurer to provide an annuity. A Deferred Annuity is frequently used to refer to a life annuity payable, at some future date, to an employee whose membership in a pension plan terminated before the normal retirement age. Payments usually start at normal retirement age. Annuity, Guaranteed An annuity which provides that payments are guaranteed for a specified length of time, and after that period, for as long as the annuitant lives. For example, under an annuity guaranteed for five years, if the annuitant lives for fifteen years, payments will be made for the full fifteen years. However, if the annuitant dies after three years, however, the annuity will be paid to a beneficiary for a further two years, until the payments have been made for a total of five years. Annuity, Joint Persons named to receive annuity payments if the primary annuitant dies. The contingent annuitant is usually the spouse, and may also be referred to as the joint annuitant. Asset Allocation Asset Allocation refers to the way that you divide your portfolio between the various asset classes. It is the most important way to diversify your investments, and diversification is the key to lowering your investment risk (by not putting all your eggs in one basket, so to speak). Check out the "Tools" selection on this Plan Member website and the online "Asset Allocation" calculator. Asset Allocation Programs Are similar to Balanced Funds in that they invest in all of the asset classes. However, they are usually part of a series (or program) of funds, each fund appropriate for an investor with a different risk tolerance level. Each one holds a different mix of stocks, bonds and cash, creating funds ranging from conservative to aggressive. Asset Classes A grouping of similar investments. For example, all of the following are different asset classes: Guaranteed Funds and Money Market Funds, Bond Funds, Balanced Funds, Canadian Equity Funds (large cap to small cap), American/International funds and single Stock funds. Asset Mix Describes the proportion of your investments that you currently have invested in each of the asset classes. For example you might have 30% in bond funds, 40% in Canadian Equity Funds and 30% in foreign equity funds. AVC See Additional Voluntary Contributions. Average Final Earnings The amount of salary used to determine your accrued pension if you are participating in a "final average earnings plan". The amount is calculated by taking the average of a specified number of years of annual salary just prior to retirement.

8 Balanced Funds (note: also under Diversified Funds) Invests in a mix of stocks, bonds, and cash investments. The mix will change as market conditions change, but it usually stays within a pre-determined ranges (for example, stocks 40-60%, bonds 30-50%, cash 0-30%). Many Balanced funds invest in foreign stocks up to the maximum allowed by foreign content regulations. Balanced Funds tend to be more risky than Bond Funds, but less risky than Equity Funds. The benefit of a Balanced Fund is that it provides automatic diversification by investing in a variety of asset classes and thereby reducing the risk if one asset class performs poorly. Before-Tax Dollars Money that enters your plan account before income taxes are calculated. Taxes are deferred until you receive a payout from the plan. Benchmark An industry average of similar investments used to compare and evaluate the performance of other funds. The S&P/TSX Composite Index is a common benchmark for Canadian Equity Funds. The S&P 500 is a common benchmark for American Equity Funds. The MSCI EAFE Index is common for International Funds. The SC Universal Bond Index is a common benchmark for Fixed Income Funds. SC 91-Day T-Bill Index is a common benchmark for Money Market Funds. Beneficiary The person or persons named by the plan member, in writing, to receive the policy or plan death benefit. Beneficiary rules may vary by province. See also Beneficiary - Absolute or Irrevocable Beneficiary, Absolute or Irrevocable An unalterable beneficiary - the owner relinquishes the right to change the designation without an approval when such a beneficiary is named. For residents of Québec, a spouse beneficiary is automatically considered irrevocable, unless otherwise stipulated. Sun Life Financial's application form allows a plan member to indicate that the designation is revocable. Beneficiary, Change (note: also under Change Beneficiary) You can change your beneficiary either online under MY ACCOUNT INFO>Personal Info if applicable to your plan, or, write to us and include your name, plan number and name of your employer. For legal reasons, we currently require your signature on your request. We cannot accept faxes. Please mail your request to Sun Life Financial, Group Retirement Client Services, 225 King Street West, 14th floor, Toronto, ON M5V 3C5. Beneficiary, Contingent An alternate beneficiary whose rights under a policy, or a plan will depend on the death of the original beneficiary or some other condition or provision. Benefit A general term applied to any form of payment that may be made to a person under the terms of a pension plan, depending on the circumstances. Benefit Formula A pension plan calculation that defines the method used to determine an employee's pension amount.

9 Bond Funds (note: also under Fixed Income Funds) Typically invest in bonds issued by Canadian governments and companies. As well as paying a rate of interest, many bonds held in these funds also have a "market value" which can rise and fall. So Bond Funds have the potential for higher returns than Money Market or Guaranteed Funds, but there is a greater risk of loss as well. Bonds (note: also under Fixed Income) When you buy a bond, you are actually lending money to a company or the government. The borrower promises to pay back the amount of the loan, plus interest, according to a specific schedule. Bonds are usually less risky than stocks, but the market value of a bond, especially long-term bonds, can go up and down as interest rates change. Book Value The book value of your investments under each registered plan is determined by the original/established investment purchase price paid/set, and may include the amount of reinvested distributions (depending on the type of investment), less the book value of any withdrawals. The book value is reported for your information only. Book Value, Stock Plan If you are a member of a stock plan, the Book Value is the amount of money that has been contributed to the registered plan by you and/or your employer plus any reinvested dividends, if applicable, minus the cost of the shares that have been withdrawn, if applicable. The book value is reported for your information only. Break in Service An interruption in employment for reasons other than those allowable and explained under the terms of the pension plan. Please see your plan booklet for details. Canada Customs and Revenue Agency - CCRA (note: also under Revenue Canada and Department of National Revenue) The federal government body with which pension plans must be registered for contributions to be tax deductible. Formerly Revenue Canada or the Department of National Revenue. Canada Pension Plan - CPP A government pension plan that provides a monthly pension benefits for Canadians who have contributed to the plan. Benefits available include: retirement income; survivor benefits for widows, widowers and orphans; and a death benefit. The act operates in all Canadian provinces except Quebec where a separate plan the Quebec Pension Plan, with similar benefits and contributions is in effect. Canadian Equity Funds Invest primarily in stocks of Canadian companies. Some of these funds may invest up to 30% of their assets in stocks of companies located in other countries. Because stocks have traditionally risen in value more than other types of investments, they offer the greatest potential for long-term growth. However, with stock prices fluctuating more than other types of investments, investing in stocks is also riskier. Capital Gains or Losses An increase or decrease in the value of an account. Any transaction in a non-registered account could incur capital gains (market value less book value) or losses. If so, you are required to report the gain/loss as income. If you are allowed to withdraw money from your registered account, the entire withdrawal becomes taxable to you. Carrier General term used to refer to an insurance company, trust company or other financial institution with responsibility for some or all functions under a group retirement and savings plan, usually including investments.

10 Cash Investments Cash investments usually take the form of guaranteed funds (also known as GICs), short-term deposits or government treasury bills. Cash investments are designed to protect your money while earning a current rate of return. The value of a cash investment doesn't vary widely, so it is less risky than stocks or bonds. Based on past performance, cash investments tend to provide lower returns over the long term than the other asset classes. While stocks and bonds have a greater risk of declining in value over the short term, the risk of a loss lessens considerably the longer you own them. See also Guaranteed Investment Certificates Cash Surrender Value The amount which a policyholder may be permitted to collect, in cash, upon surrendering a policy before it matures. Charges Depending on plan rules, you may be required to pay Investment Management Fees for the funds you invest in. You may also be required to pay administration fees. Check your plan booklet for more details. Commuted Value A single amount of money which represents the current worth of future benefits payable. The future benefits are discounted to the present to obtain the commuted value. Compensation The salary or wages received by an individual from an employer in the year, plus any other amounts that must be included when calculating the person's annual taxable income from that employer. Compound Interest Interest credited to the investor at a set rate, on specified dates, and added to the original deposit to earn further interest. Usually interest compounds annually. Compulsory Plan A pension plan that eligible employees must join as a condition of employment. Consumer Price Index - CPI The Consumer Price Index measures the cost of various goods and services. It is used to determine the rate of inflation. In other words, the percentage of change in the CPI over a given year is the annual inflation rate. Contingent Beneficiary See Beneficiary, Contingent Continuous Service The period during which the same employer continuously employs a plan member. This may be defined in a pension plan (or by law) so as to include certain periods of absence, and service with an associated or previous employer. Contributory Pension Plan A pension plan that allows members to make contributions to qualify for plan benefits. Some plans require that members contribute regularly. The members' contributions are usually related to their earnings. CPP See Canada Pension Plan Credited Service The period of service (as defined by the pension plan) that is used for such purposes as determining benefit amounts, entitlement to plan benefits and/or vesting.

11 Currency risk Currency risk refers to changes in value of securities in response to changes in value of the Canadian dollar versus foreign currencies. A strengthening of the Canadian dollar tends to reduce the Canadian dollar value of foreign investments for Canadian investors; a weakening of the Canadian dollar tends to increase the Canadian dollar value of foreign investments for Canadian investors. DBPP See Defined Benefit Pension Plan DCPP See Defined Contribution Pension Plan Death Benefit When applied to a pension plan, the sum of money paid in the event that a member of the plan dies before the pension commences. Deferred Annuity See Annuity - Deferred Deferred Profit Sharing Plan - DPSP A profit sharing plan under which the employer contributions are deductible under the Income Tax Act, but are not taxable in the hands of the employee until they are withdrawn. Employee contributions are not permitted. Defined Benefit Pension Plan - DBPP A registered pension plan which provides a certain level of income at retirement. The amount of retirement income is calculated using a pre-determined formula. Defined Contribution Pension Plan - DCPP A Defined Contribution Pension Plan is also known as a Money Purchase Pension Plan. Employer contributions and employee contributions (if the plan permits them) are directed into an individual account for each employee. Contribution levels are usually expressed using a specific formula related to earnings such as 5% of annual salary. When the employee reaches retirement, the accumulated contributions and investment earnings are used to purchase a pension for the individual. No specific income level can be guaranteed with this type of plan. Department of National Revenue - DNR (note: also under Revenue Canada and Canada Customs and Revenue Agency (CCRA)) The old name for a department of the federal government with which pension plans must be registered for contributions to be tax-deductible. The new name is the Canadian Customs and Revenue Agency. Derivatives Risk A derivative is a contract between two parties, the value of which is based on the performance of an underlying asset, such as for example a stock, commodity, currency, or market index. Derivatives may be used to gain a right to buy or sell the underlying asset on a certain future date as well as to limit, or hedge against, losses that may occur because of an investment in a security or exposure to a currency or market. Risks associated with derivatives include the following: the hedging strategy may not be effective; there is no guarantee that a derivatives contract can be bought or sold when desired; the price of a derivative may not accurately reflect the value of the underlying asset; the cost of the derivative contract may increase; the other party to the contract may not be able to honour its obligations and may default; the use of derivatives can amplify both gains and losses in a Fund.

12 Disability Pension Benefit A pension payable to an employee who is unable to continue working due to a disability. This pension may be based on service to the date of disability or, in some cases, based on past and prospective service (for example, a pension equal to what would have been received had the employee remained in service until normal retirement age at the last salary). Disposable Income Generally, a person's income from all sources, minus income taxes and other necessary expenses. Diversification Diversification is a strategy that helps reduce the risk associated with investing. When you diversify your holdings, you spread them over a range of investments by choosing different funds or different types of investments to balance your risk exposure. If you belong to a retirement plan that directs all of its investments into guaranteed funds or a single stock fund, you may want to vary the holdings in your personal portfolio to establish a broader blend of investments. Equity funds add an additional component of diversification for you since each fund contains a mixed portfolio of investments. One of our equity funds typically holds stocks of fifty or more large companies as well as a small selection of money market instruments. By contributing to your group plan, you're diversifying your retirement contributions in two ways. You're choosing from a mix of different funds available to you under your group plan. And, each market-based fund contains a diversified portfolio of investments. Diversified Fund Also known as Balanced Funds, a Diversified Fund invests in a mix of stocks, bonds, and cash investments. The mix will change as market conditions change, but it usually stays within a pre-determined range (for example, stocks 40-60%, bonds 30-50%, cash 0-30%). Many Diversified Funds invest in foreign stocks up to the maximum allowed by foreign content regulations. Diversified Funds tend to be more risky than Bond Funds, but less risky than Equity Funds. The benefit of a Diversified Fund is that it provides automatic diversification by investing in a variety of asset classes and thereby reducing the risk if one asset class performs poorly. Dividend Dividends represent payments made by companies to their shareholders. Companies that issue stock may pay dividends quarterly, semi-annually, or annually if they have earnings to distribute to shareholders. Our equity funds hold the stocks of many firms and whenever these firms pay dividends, the payments are deposited to the fund and distributed among the unit holders. Division of Pension Credits Also known as "credit splitting". A provision in the Canada Pension Plan or Quebec Pension Plan whereby one spouse, on dissolution of a marriage or common-law relationship, may obtain an equal division of pension credits earned under the CPP/QPP by one or both partners during the relationship. This provision is now included in various pension benefits acts to apply to employer-sponsored pension plans.

13 Dollar Cost Averaging Dollar Cost Averaging is a way that you can minimize the effects of an investment's volatility by buying it in regular instalments, over a number of months or years. It's easy to do, simply invest a set amount or a fixed percentage of your pay in a fund at regular intervals. The unit price of the fund will be higher in some months, and lower in others. The average price you pay should be somewhere in the middle. Provided the investment gains value over the long term, you'll profit from your purchases during the short-term price declines. Dollar cost averaging lets you use an investment's volatility to your advantage. DPSP See Deferred Profit Sharing Plan EAFE The EAFE is the Morgan Stanley Capital International, Europe, Australasia, Far East Index. The index reflects the performance of a diversified portfolio of major non North American companies. Earnings A person's income from employment or self-employment, usually excluding such forms of income as rents or bond interest. In some pension plans certain bonuses, sick pay, etc., may also be excluded from earnings in calculating benefits and contributions. Effective Date The date that a retirement plan goes into effect and coverage starts. Eligibility Requirements Conditions that determine if an employee is eligible for membership in the group retirement plan. Employee Contribution Deductions from an employee's pay applied towards a pension plan or other company benefit. Employee Profit Sharing Plan - EPSP A profit-sharing plan under which employer contributions are tax deductible by the employer but declared as income by the employee. Employee contributions are permitted but are not tax deductible. Payments out of the fund are generally tax-free. Investment earnings are taxable as earned. Enrolment You may enrol online if offered by your employer. Please contact your employer or a Sun Life Financial Call Centre Representative to request a Member Enrolment kit. Entry Age The age when a Plan Member was included in a pension plan, or would have been included if the plan had always been in effect. EPSP See Employee Profit-Sharing Plan Equity Fund See Canadian Equity Fund or Foreign Equity Fund Expenses Depending on plan rules, you may be required to pay Investment Management Fees for the funds you invest in. Please check your plan booklet or contact your employer for further information.

14 Fees As a member, you are not required to pay transaction fees. You may however, depending on plan rules, pay a fee for withdrawals and fund management fees. This will depend on your plan rules and you may find this information in your enrolment kit. Note: a 2% fee will be charged (and paid to the fund) when a plan member initiates an interfund transfer into a fund followed by an interfund transfer out of the same fund within 30 days. The assessment of the fee is subject to materiality for administration purposes. See Short-term Trading for more details. Fixed Income Fund Also known as Bond Funds, these funds typically invest in bonds issued by Canadian government and companies. As well as paying a rate of interest, many bonds held in these funds also have a "market value" that can rise and fall. Foreign Equity Funds Invest primarily in stocks of companies located outside of Canada. As with Canadian Equity Funds, historically Foreign Equity Funds offer greater potential for long-term growth, but can be riskier than other types of investments. One of the important roles of Foreign Equity Funds is in diversifying your portfolio. Canada's share of the world equity market is only about 3%, so there are far more investment opportunities out-of-country than in. By diversifying your equity investments globally, you spread your portfolio over a greater percentage of the world market and reduce your overall investment risk. Forfeiture An employer contribution under a Defined Contribution Pension Plan or a Deferred Profit Sharing Plan, which is given up by a Plan Member who terminates service before becoming fully vested in the Plan. In some plans, forfeitures are re-allocated to other active Plan Members; in other plans they are used to reduce the employer's cost. Canada Customs and Revenue Agency requires that forfeitures are used up or reallocated by December 31st of the year following the year it arose. Funds (note: also under Investment Funds) For most plans offered in your company Group Retirement and Savings Plan, fund information is available on this Plan Member Services website. You can view and print reports pertaining to the funds available in your plan. Fund information is also provided in the Member Enrolment kit when you first join the plan. GARP See Growth at a Reasonable Price GIC See Guaranteed Investment Certificate Government Program Any legislative program under which benefits (pensions, income supplements, etc.) are provided by a government in its role as government rather than its role as an employer (e.g., Old Age Security, Canada Pension Plan, Guaranteed Income Supplement). Group Registered Retirement Saving Plan - Group RRSP A savings or retirement plan sponsored by a company for its employees. A Group Registered Retirement Savings Plan (RRSP) is subject to the same legislative rules as an individual RRSP. Growth The manager chooses stocks for the portfolio based on an assessment of a company's ability to grow its business profitably. If the manager is right, the company's stock will increase in price as the company achieves business and earnings growth.

15 Growth at a Reasonable Price - GARP The manager looks for the stocks of growth companies that they can buy for a reasonable price. This is a combination of value and growth investing. Growth Fund Consists of company stocks with better than average growth prospects. The investment manager of a growth fund chooses stocks for the portfolio based on an assessment of a company's ability to grow its business profitability. If the manager is right, the company's stock will increase in price as the company achieves business and earnings growth. Guaranteed Annuity See Annuity, Guaranteed Guaranteed Funds When you invest in a Guaranteed Fund, you earn a set rate of interest that is guaranteed for a specific term, so it's a very low-risk investment. There is a range of short and long-term rates available. Guaranteed Income Supplement - GIS A monthly payment under the Federal Old Age Security (OAS) Act to needy pension recipients. It is based on a guaranteed minimum income amount. Guaranteed Investment Certificate - GIC A fixed-dollar deposit with a bank or other financial institution with a pre-determined rate of return and maturity date. Guaranteed Maturity Unit Value The guaranteed maturity unit value reflects the fund s highest month-end unit value to date. While the fund is valued each business day and its unit value does fluctuate, you will receive the maturity unit value only upon the fund s maturity date. The maturity unit value is guaranteed by ABN AMRO Bank N.V. All transactions prior to maturity will be processed at the fund's current unit value. Home Buyers' Program A program offered by the Canada Customs and Revenue Agency to help first-time home buyer's borrow funds from their Registered Retirement Savings Plan to facilitate the purchase of a home. If you meet the eligibility requirements, you are required to complete the Application for a First Time Homebuyer's Withdrawal (T1036). This form is available at any Canada Customs and Revenue Agency office or any bank. Index The Manager uses a passive investment style by simply buying and selling assets to match the characteristics of an index (i.e. S&P/TSX Composite Index). The performance of an index fund should be similar to the performance of the index. Because of the passive style these funds tend to have lower management fees. Index Fund A fund whose investment manager uses a passive investment style by simply buying and selling assets to match the characteristics of an index (i.e. TSE 300). The performance of an Index Fund should be similar to the performance of the index. Because of their passive style, these funds tend to have lower management fees. See also Consumer Price Index Indexing The periodic adjustment of a benefit amount (typically after retirement) according to a formula, usually based on a recognized price or wage index such as the Consumer Price Index (CPI) or the Average Industrial Wage Index. Typically, indexing involves increasing a payment to keep pace with increases in the cost-of-living. Inflation See Consumer Price Index

16 Interest Rate The cost of borrowing money over a period of time. When you lend your money to a person or company, you expect them to pay something in return. This is usually expressed as a percentage of the money loaned and is referred to as the interest rate. If you're borrowing money, the interest on your loan goes to the lender. International Fund A fund that invests primarily in the common stock of companies based outside of Canada. Interest Rate Risk Interest rate risk refers to changes in value of fixed income securities, such as bonds, in response to changes in interest rates. If interest rates rise, the value of the fixed income security tends to fall; if interest rates fall, the value of the fixed income security tends to rise. Investment Funds (note: also under Funds) For most plans offered in your company Group Retirement and Savings Plan, fund information is available on this Plan Member Services website. You can view and print reports. Fund information is also provided in the Member Enrolment kit when you first join the plan. Investment Choices On this Plan Member Services website, please select "About My Funds" to learn more. You will be able to read information such as top ten holdings and performance charts to help you to make the fund choice that best fits your needs. Irrevocable Beneficiary See Beneficiary - Irrevocable Large Cap versus Small Cap Funds Some funds invest exclusively in large companies (known as large capitalization or "large cap" funds), others in small companies ("small cap" funds). The distinction is important because small cap funds tend to be higher risk investments than large cap funds. The reason? Small companies are typically not as well established as large companies and often have a shorter track record of success. And while the potential growth of smaller companies offers the potential for greater returns over the long term, the short-term ups and downs can be significant. Leave of Absence Any absence from employment, approved by the employer, which would still qualify for pension service. Leaving the Plan (note: also under Termination) Upon termination of employment, there maybe a number of options available to you depending on the type of assets you have with us. If you have non-registered assets, you may transfer them to a non-registered account with an external institution, our Group Choices Plan or take the assets in cash. If you have registered pension assets and they are locked-in, you can transfer the assets to a locked-in account with an external institution, our Group Choices Plan, or purchase an annuity and transfer funds to another pension plan if allowable. If you have assets in an RRSP or DPSP, you may transfer those to an RRSP account with an external institution, into the Group Choices Plan, take the assets in cash (less applicable taxes) or purchase an annuity. LIF See Life Income Fund

17 Life Expectancy The number of years a person is expected to live based on current mortality statistics. Factors such as gender and age are used in the calculation of mortality statistics. Life Income Fund - LIF A Life Income Fund (LIF) provides you with income during your retirement years. It is designed to hold savings that originate from a Registered Pension Plan that are "locked-in" by pension legislation. The LIF is very similar to the RRIF but there are two key differences: In addition to the requirement for a minimum annual withdrawal (same minimum as for a Registered Retirement Income Fund), LIFs also have a maximum withdrawal set by pension legislation. Your annual withdrawal must be within these minimum and maximum amounts. You must convert your LIF to a life annuity (in most provinces), when you reach age 80. Load The commission and other service fees charged upon the sale or purchase of mutual fund units. Generally, either a front-end load (at the time of purchase), or a back-end load (at the time of sale) is charged. Locked In Retirement Account - LIRA A LIRA is essentially the same as a Registered Retirement Savings Plan, but only locked-in pension funds can be accepted. In addition to purchasing a life annuity with the funds, the owner may transfer funds in a LIRA to a Registered Pension Plan (RPP) if the RPP allows, another LIRA, a Life Income Fund or a Locked-in Retirement Income Fund, if one exists. Locked-in Required contributions become unavailable (locked-in) after an employee has been a member of a pension plan for a specific length of time. Locked-in money can be used to purchase an annuity, a Locked-in Retirement Account/Locked-in Registered Retirement Savings Plan, a Life Income Fund, or a Locked-in Retirement Income Fund. Locked-In Retirement Income Fund - LRIF An LRIF provides you with income during your retirement years. It is designed to hold savings that originate from a registered pension plan that are "locked-in" by pension legislation. LRIFs are currently available in a limited number of provinces. The LRIF is very similar to the LIF but there are two key differences: The maximum withdrawal amount is calculated in a different way. It is generally equal to the investment earnings in your LRIF in the previous year (or 6% of your LRIF balance in the first two years). There is no requirement to buy a life annuity at age 80, although you are permitted to convert your LRIF assets to a life annuity at any time. Market Value Adjustment - MVA This term is used in connection with Guaranteed Funds. It describes the difference between the book value of the amount guaranteed under a fund, and the market value amount that is actually paid when a guaranteed deposit is withdrawn prior to maturity. The MVA may be positive or negative, depending on interest rates at the time of liquidation. Market Value (note: also under Adjusted Cost Base) Market value is the balance in the account after the funds invested have been valued. Book value is the amount of money that has been contributed to the account, also know as the Adjusted Cost Base. The difference between the book value and the market value determines if any capital gains/losses have been established which will then be reflected on your T3 slip each year. The ACB is reported to you for your information and for tax planning purposes. It is an estimate of the cost base at this point in time. However, it does not include capital gains which may be allocated to you as a result of Fund Realization as these values are only included at the end of each year.

18 Money Market Funds Invest primarily in short-term (under one year) government treasury bills and corporate notes. Because they are short term and issued mostly by the government or high-quality businesses, they are very low-risk and also earn a fairly low rate of return. Money Purchase Pension Plan See Defined Contribution Pension Plan Mutual Fund A mutual fund combines the assets of many investors into a single pool. A professional investment manager manages them. Our segregated funds usually invest either in units of a pooled fund or mutual funds. MVA See Market Value Adjustment Non-Contributory Plan A pension plan which does not require any employee contributions in order to qualify for benefits. The employer makes all contributions. Non-Registered Savings Plan - NREG A savings plan under which contributions made by members is not tax deductible. Any withdrawals made from such a plan are not taxable. Normal Retirement Age The age that employees are expected or entitled to retire, specified in a Registered Pension Plan. Often it is the age at which benefits are first paid out of the plan without reduction penalties. Normal Retirement Date The earliest date a pension plan member may receive an unreduced pension or annuity on terminating employment for any reason other than disability. NREG See Non-Registered Savings Plan Old Age Security - OAS A Canadian program that provides retirement benefits to those who qualify. Payment levels are adjusted to reflect increases in the cost-of-living. PA See Pension Adjustment Password Formerly called PIN (for Personal identification Number). A Password for Sign in to the Plan Members Services website was communicated to you in a Welcome Letter when you first enrolled in the plan. If you have forgotten your Password you can click on the words, Forgot My Password, under the Sign in area. If you need assistance, call Sun Life Financial at the Call Centre number provided by your employer (if applicable) or call SUN-LIFE. If you are a member of the PSHCP or PDSP Plan, call or (613) (in the Ottawa area) for assistance. Past Service A service which has been recognized for pension purposes as rendered by the employee, to the employer, prior to the inception of the plan or prior to the employee's entry into the pension plan. This is also referred to as Prior Service.

19 Pension A payment, or series of payments, paid to a retired employee. Pension Adjustment - PA The Pension Adjustment (PA) reflects the pension benefit accruing to a plan member during the year, under an employer-sponsored plan. This amount is subtracted from the contribution ceiling (dollar amount) to determine the member's maximum Registered Retirement Savings Plan contribution limit. Under money purchase plans or Defined Contribution Pension Plan, the PA is simply the total of the employer's and employee's required contributions, any Additional Voluntary Contributions made by the employee, and any allocated forfeitures. For Defined Benefit Pension Plans, the PA for a member is determined directly from the amount of benefit the member earned in the year. The formula is 9 X the benefit accrual - $600 plus the dollar amount of any Additional Voluntary Contributions made by the member. Pension Benefits Acts - PBAs Legislation governing plans registered through provincial pension commissions. The aim of the PBAs is to protect the rights of plan members, and to ensure that promised benefits are provided. Pension Plan A plan which provides a regular income for retired employees for the rest of their lives. Many pension plans also provide income for employees who have terminated employment, or who have a permanent disability when they reach retirement age. Some plans provide for income to continue being paid to surviving spouses of deceased members. Pensionable Earnings The portion of an individual's total earnings used in calculating the pension entitlement under a registered plan, as defined in the plan document. In addition to basic salary, pensionable earnings may or may not include bonuses, overtime payments, taxable benefits and so on. Pensionable Service See Credited Service Personal Identification Number - PIN See Password Plan Sponsor The individual(s) or company responsible for the contracting and administrative duties of the savings or pension plan. Policyholder The policyholder is the person or sponsor to whom a contract is issued. In terms of a pension or savings plan, this is likely your employer, labour union or trustee. In terms of an individual life insurance policy, or other such contract, the policyholder is the person to whom the contract is issued. Pooled Fund A pooled fund, similar to a mutual fund, combines the assets of many investors into a single pool. The fund is managed by a professional investment manager. Sun Life Financial's Segregated Funds usually invest either in units of a pooled fund or a mutual fund. See also Segregated Fund

20 Pooling In pension plans, this term used to describe any method by which certain risks or costs are shared by all members of a group, and certain group advantages are gained. See also Pooled Fund Portability The term portability is used to describe the provisions which allow terminated employees to transfer the value of their deferred pension benefit or the value of their contributions and those made on their behalf, to another pension plan. The pension plan can include a LIRA, a LIF, an LRIF (if one exists in your province) or a deferred or immediate life annuity. Depending on plan rules, you may or may not be allowed to transfer assets into your group plan with Sun Life Financial. The application forms referred to here can be found on the Canada Customs and Revenue Agency's website. Simply select "Forms" from this Plan Member Services site menu. If your plan allows, the form T2033 must be completed to transfer Registered Retirement Savings Plan assets. If the assets are locked-in, we would also require a Locking-In Agreement as well as an application form to be completed for the investment product that you select. For transferring pension or DPSP assets, please complete form T2151. If the assets are locked-in, we require a Locking-In Agreement as well as an application form to be completed for the investment product that you select. Power of Attorney A Power of Attorney gives legal authority to one or more person(s) to sign certain documents should you become unable to do so. Power of Attorney may be revoked at any time, provided you are mentally competent. It can be general in scope, covering all aspects of your financial affairs, or it can be limited to giving authority to act on certain aspects of your estate. Present Value The value, today, of money to be received in the future. Profit Sharing Pension Plan An arrangement under which payments, computed by reference to business profits, are made by an employer, in trust, for the benefit of employees whether or not the employees contribute. Projected Pension Benefits An estimate of pension plan benefits calculated by using a particular set of actuarial assumptions. Such items as the effects of past and anticipated future service credits, past and anticipated future compensation, and age are taken into account. Pro-rate To withdraw proportionally from each fund. For example: If your selected withdrawal amount is: $3, And your Fund Balances are: Canadian Equity Fund = $ 2, Bond Fund = $ 1, Balance Fund = $ 7, Total Fund Balance = $10, Your total withdrawal amount will be pro-rated across your funds. For example, your Canadian Equity Fund will be pro-rated by 20% [($2,000/$10,000)*$3,000=$600.00] as shown below: Canadian Equity Fund = $ Bond Fund = $ Balance Fund = $2,100.00

21 Public Pension Plan A pension plan such as Old Age Security or Canada Pension Plan/Quebec Pension Plan provided by the government. Qualification Date The date on and after which, under the laws of a designated province, a pension plan is required to maintain its qualification for registration. Quebec Pension Plan - QPP A government pension plan that provides retirement benefits for each contributor living in the province of Quebec. Recipients of QPP benefits are not eligible to receive benefits from the Canada Pension Plan. See also Canada Pension Plan Registered Pension Plan - RPP An employer-sponsored pension plan that is registered with Canada Customs and Revenue Agency and with the appropriate provincial pension commission. A Registered Pension Plan qualifies for favourable tax treatment by the federal and provincial governments. Registered Plan Any plan that has been submitted to and formally approved by the appropriate governmental agencies and for which a registration number has been granted by these agencies. Registered Retirement Income Fund - RRIF A Registered Retirement Income Fund provides you with income during your retirement years. A RRIF is like a continuation of your Registered Retirement Savings Plan whereby your funds remain tax sheltered and you continue to choose how those funds are invested. The main difference is that rather than contributing as with a Registered Retirement Savings Plan, the RRIF is designed to provide payments. With a RRIF you must withdraw a minimum amount each year (except for the year of purchase). There is no maximum limit on the amount that can be withdrawn but of course if you make significant withdrawals, your funds may not last as long as you originally intended. Registered Retirement Savings Plan (RRSP) A savings vehicle for retirement, approved under the Income Tax Act. Taxes are deferred on contributions and income earned until the savings are withdrawn. Required Contributions Contributions that an employer and employee are obligated to make under the terms of the plan. Retirement Income Income from pensions and other sources, to which a retired person is entitled. Retirement income may include both private and public pension payments, income from personal savings, government income supplements, and imputed income (e.g., free health insurance premiums). Retiring Allowance An amount received upon or after retirement from office or long-time service, or with respect to loss of office or employment. A retiring allowance is usually paid as a single sum or in a few annual instalments. Although it must be included as income in the year of receipt, it can be transferred, within limits, to an RPP or an RRSP. Return Return is the amount of money that you earn on your investment. Normally, it is expressed as a percentage of your original investment. Revenue Canada (note: also under DNR and Canada Customs and Revenue Agency - CCRA) The new name is the Canadian Customs and Revenue Agency (CCRA).