Company Details

Directors and Officers

The following are the names, office(s) held and principal occupations of the directors and officers of Scotia Managed Companies Administration Inc.:

Stephen D. Pearce
Chief Financial Officer, Secretary and Director
(Director, Scotia Capital Inc.)

Robert Hall
President, Chief Executive Officer and Director
(Managing Director, Scotia Capital Inc.)

Roberta Carano
Director
(Director, Scotia Capital Inc.)

The following are the members of the Independent Review Committee:

Timothy Spark
Chairman

Louise Morwick

James Mountain


Profile

Cascadia Diversified Monthly Advantaged Income Fund (the "Fund") has been created to provide investors with tax-advantaged exposure to Class I units of PIMCO Monthly Income Fund (Canada) (the "PIMCO Fund").

The Fund provides exposure to a multi-sector, global bond strategy actively managed by Alfred Murata and Dan Ivascyn of PIMCO Canada Corp. The strategy has the following highlights:
(i) diversified portfolio of non-Canadian dollar fixed income instruments of varying maturities;
(ii) high average credit quality assets - minimum 50% investment grade bonds (BBB- or above);
(iii) intermediate-average portfolio duration, emphasizing a combination of income and capital appreciation; and
(iv) low correlation with the overall bond market.

The Fund's objectives are to: (i) provide stable monthly tax-advantaged distributions; (ii) the potential for long-term capital appreciation; and (iii) exposure to the PIMCO Monthly Income Fund (Canada).

Summary Statistics as at 12/30/2016

HideClass A Units
Net Asset Value (NAV) per Unit (calculated monthly) $10.37
Units Outstanding 2,902,810
Total NAV $30,106,280
Expense Ratio 2.40%
IPO Date January 10, 2013
FUNDServ Code SMA300
Issue Price $10.00

HideClass F Units
Net Asset Value (NAV) per Unit (calculated monthly) $10.49
Units Outstanding 404,688
Total NAV $4,243,999
Expense Ratio 2.27%
IPO Date January 10, 2013
FUNDServ Code SMA301
Issue Price $10.00

General Information

NAVs and Distributions

Below are the recent monthly NAVs and distributions.

DateClass AClass FDistributions/Unit
31-Jan-16$9.92$10.00$0.0417
29-Feb-16$9.77$9.86$0.0417
31-Mar-16$9.99$10.08$0.0417
30-Apr-16$10.14$10.24$0.0417
31-May-16$10.18$10.28$0.0417
30-Jun-16$10.14$10.24$0.0417
29-Jul-16$10.31$10.41$0.0417
31-Aug-16$10.38$10.49$0.0417
30-Sep-16$10.44$10.55$0.0417
31-Oct-16$10.42$10.53$0.0417
30-Nov-16$10.30$10.41$0.0417
31-Dec-16$10.37$10.49$0.0417

Distribution Policy

The Fund intends to make monthly cash distributions to Unitholders of record on the last Business Day of each calendar month through the partial settlement of the Forward Agreement. The monthly distributions received by Unitholders will be characterized primarily as returns of capital and capital gains for tax purposes. Amounts distributed on the Units that represent returns of capital are generally non-taxable to a Unitholder but reduce the Unitholder's adjusted cost base of the Units for tax purposes.

The Fund will not have a fixed distribution but intends to pay monthly distributions through pre-settlement of the Forward Agreement based on, among other things, the total return of the PIMCO Fund comprising the Notional Portfolio less the expenses of the Fund for the period. If the total return of the PIMCO Fund is lower than its cash distribution yield, the Fund expects to distribute an amount based on, among other things, the cash distributions paid on the PIMCO Fund, which units comprise the Notional Portfolio, less the expenses of the Fund for the period.

If the total return of the units of the PIMCO Fund comprising the Notional Portfolio is less than the amount necessary to fund the monthly distributions (through partial settlement of the Forward Agreement) and all expenses of the Fund and if the Manager chooses to nevertheless effect settlements of the Forward Agreement to ensure that such monthly distributions are paid, this will result in a portion of the capital of the Fund being returned to Unitholders and, accordingly, net asset value per Unit would be reduced. The amount of monthly distributions may fluctuate from month to month and there can be no assurance as to the amount of the targeted distributions or that the Fund will make any distribution in any particular month.

Redemptions

Unitholders may redeem Units on the last Business Day in a month (a "Redemption Date"), subject to certain conditions. In order to effect such a redemption, the Units must be surrendered by no later than 12:00 p.m. (Toronto time) on the date which is the last Business Day of the month preceding the Redemption Date. Unitholders surrendering a Unit for redemption on a Redemption Date will receive a redemption price equal to the NAV per Unit as of such date (which in turn will be based on the Forward Amount received by the Fund on the partial pre-settlement of the Forward Agreement undertaken to fund such redemption), less any costs and expenses incurred by the Fund in connection with funding the redemption (the "Redemption Price").

Payment of the Redemption Price will be made on or before the 10th business day following such Redemption Date, subject to the Manager's right to suspend redemptions in certain circumstances. Concurrently with the payment of the Redemption Price, the Fund may pay to the redeeming Unitholder a cash distribution in the amount of the net realized capital gains or income of the Fund incurred by it to fund the payment of the redemption price. The NAV per Unit of each class of Units will vary depending on the performance of the Fund by virtue of the Forward Agreement and will also vary depending on the fees and expenses allocated to the particular class of Units of the Fund.

Taxation

A Unitholder will generally be required to include in computing income for a taxation year the amount of the Fund's net income for the taxation year, including net realized taxable capital gains, paid or payable to the Unitholder (whether in cash or in Units) in the taxation year. Amounts payable to a Unitholder in excess of the aggregate of the Unitholder's share of net income and the full amount of capital gains will reduce the adjusted cost base of the Unitholder's Units. If the reductions to a Unitholder's adjusted cost base would cause the adjusted cost base of a Unit to be negative, the Unitholder will be deemed to realize a capital gain equal to such negative amount. Provided the Fund elects in accordance with the Income Tax Act (Canada) to have each of its Canadian securities treated as capital property, gains or losses realized by the Fund on the sale of Canadian securities will be taxed as capital gains or capital losses. A Unitholder who disposes of Units held as capital property (on redemption or otherwise) will realize a capital gain (or capital loss) to the extent that the proceeds of disposition (other than any amount payable by the Fund which represents an amount that is otherwise required to be included in the Unitholder's income) exceed (or are exceeded by) the aggregate of the adjusted cost base of Units and any reasonable costs of disposition.