AGF Management Limited

Blake Goldring - Chairman and Chief Executive Officer Kevin McCreadie - President and Chief Investment Officer Robert Bogart - Executive Vice President and Chief Financial Officer Gordon Forrester - Executive Vice President, Marketing and Product and Head, Retail

Gary Ho - Desjardins Capital Markets Graham Ryding - TD Securities Tom MacKinnon - BMO Capital Geoff Kwan - RBC Capital Markets Paul Holden - CIBC Scott Chan - Canaccord Genuity

Thank you, operator. Good morning, everyone.

I am Bob Bogart, CFO of AGF Management Limited. Thank you for joining us today for discussion of our second quarter 2015 financial results.

Please note that the slides supporting today’s call and webcast can be found in the Investor Relations section of agf.com. As the operator mentioned, speaking on the call today will be Blake Goldring, Chairman and CEO; Kevin McCreadie, President and Chief Investment Officer; Gordon Forrester, EVP and Head of Retail is with us and he will be available for questions.

Turning to Slide 4, I will provide the agenda for today’s call. We’ll discuss the highlights of the second quarter, provide a business update on the key segments of our business, we will review the financial results, discuss our capital liquidity position, and finally, close by outlining our focus for the remainder of 2015.

After the prepared remarks, we will be happy to take any questions. With that, I will now turn the call over to Blake.

Thank you, Bob. Thank you, everyone for joining us on today’s conference call.

Today, I am going to start off with a discussion about the current market valuation of our stock price. I feel responsibility to our shareholders to address the decline in our share price.

Specifically, I want to address the fundamental disconnect between what’s happening in our firm compared to our stock price performance. Our stock price has declined by about half since last year.

Over the same period, our AUM actually increased. Earnings have remained generally flat.

Investment performance has improved. We have invested in new talent, particularly in new investment leadership.

Our retail fund net redemptions have continued to improve. We have also made significant strategic progress in a number of areas, including our alternatives platform.

Our stock went down for other reasons, mostly extraneous. In autumn of last year, there were some concerns in the market about regulatory reform.

There was perception that independent firms, especially AGF would be exposed when our share price fell. Then in December, we have revised our dividend, partly to allocate capital to our alternatives platform, despite the fact that we affirmed our commitment to pay a competitive yield, this caused a rotation away from investors seeking high yield.

The rotation caused weakness in the share price. This was exacerbated by our removal from the dividends index in February, and another index last week.

In total, we believe there were as many as 8 million shares sold from index funds so far this calendar year. So we know there is a disconnect between underlying value of the firm and the market’s perspective, but we are focused on creating shareholder value and we are focused on the long-term.

Today, you are going to hear updates on our growth plans for each of our platforms and what we are doing to execute against them. We will also walk you through our second quarter 2015 fiscal results.

Turning to Slide 6, I will start with retail. Market gains softened in Q2 2015.

Emerging markets modestly outperformed developed markets during the period. In the U.S.

the economy grew at a slower rate than expected leading to a delay in expected timing of an interest rate hike by the Federal Reserve. China’s stock markets continued their meteoric rise despite slowing economic growth.

European equity markets continued to outperform as the European Central Bank expanded its asset purchase program in March, which is expected to continue until late 2016. Canadian equities underperformed U.S.

equities during Q2 2015 as a result of being weighted down by materials, particularly in the resource sector. Although net sales in May moderated somewhat, mutual fund net sales have been strong in Canada this year with $37 billion of long-term net sales up 10%.

As I mentioned, we have experienced continued and consistent improvement in redemptions in retail. And in fact, for 28 month, we have experienced lower net redemptions compared to the same month in the previous year.

Addressing the redemption issue is primary. We are now focused on increasing gross sales.

Mutual fund gross sales were up slightly in Q2. Including the sub-advisory counts, our wholesaler service, gross sales have increased 13%.

To accelerate this increase, AGF has three strategic priorities for our retail business. One, enhance the firm’s overall investment performance.

Two, work closely with strategic business partners to facilitate distribution. Three, provide innovative products and pricing solutions around specific needs.

Under Kevin’s leadership, we are establishing the required processes and risk controls to enhance investment performance. Kevin will provide an update on his progress in just a moment.

We continue to work closely with our strategic partners to increase our gross sales. For instance, one of the segregated funds we sub-advised registered the best performance of any Canadian segregated fund in Canada in 2014.

This fund is generating net sales and has strong momentum. Working with our partner, we added a rip option to the fund lineup that is exhibiting good gross sales momentum.

We are recently notified that we were added to a new fee-based platform, and we have been successfully marketing our fund of fund solution, Elements through an agreement with one of our other strategic partners. We have also had large inflows and outflows when we are added or taken off of existing platforms.

During the quarter, we won two mandates from strategic partners, while we lost another due to a rebalancing. The net effect will be a reduction in AUM of approximately $600 million.

However, the impact on annual revenue will be minimal. Product innovation continues to be a positive development for us.

Since 2012, we have launched a number of new assets, new funds that have addressed specific needs and raised over $1.5 billion in new assets. We recently launched the AGF global convertible bond fund.

As one of the few convertible products on the market, AGF Global Convertible Bond Fund is designed to help our clients diversify their portfolios in an uncertain rate environment, which we find ourselves in currently. In addition to having the right products, we are also investing in our brand to support our distribution, and we are making progress.

In a recent study completed by Credo Consulting, AGF was recognized the firm with the highest ranking change in a survey that assessed advisors’ perception of brands. AGF’s website was also rated highly in a study performed by Kasina, a respected consulting firm.

Before I leave retail, I will speak briefly to CRM2. CRM2 is the law that will be fully implemented by July 2016.

It stipulates and requires enhanced disclosure. Most of the discourse on the regulatory front is commonly referred to as CRM2, but it actually relates to 81407 which is the discussion paper on mutual fund fees, which mentioned seven items being considered unbundling trailers being one.

We have stated on previous calls that the noise around the possibility of disembedding trailers was overdone, and we believe that the discussion would, at some point, move to adviser’s best interest standards. Irrespective of our belief, most of the markets seemed to take a Y2K, the sky is going to fall approach predicting that a ban on trailers would happen abruptly in Q1 2015.

As it turns out, the CSA has not banned trailers, but deferred that decision as it conducts a thoughtful research. It does seem that the regulators are planning for a best interest standard.

In fact, the overseas priorities for 2016, which were finalized last week was an action plan to “develop and evaluate regulatory provisions to create a best interest duty.” The draft OSE priorities were issued back in April, so we find it curious as no one is talking about it.

The industry has now received the Brondesbury report and is awaiting a second study on mutual fund fees. The report does not change our view on how things may unfold.

Based on our review of existing research, the Brondesbury report concluded the commission-based compensation influence advisors, but it also cautions that a new compensation scheme may not lead to a better outcome for investors. The fact that compensation influences people is fundamental.

I am sure that doctors, lawyers, accountants, mechanics are all influenced by their compensation too, but we have to pay all these professionals, so they continue to provide their services. The question is, what’s the best way to protect investors while still compensating advisors?"

As the Brondesbury report alluded to, more work needs to be done here. The report did mention that advice is biased when a fund company and distributor share ownership.

This insight supports our focus on the best interest issue. We think that the issue and the bias issue can both be solved with the best interest standard.

We also believe the best interest standard should lead to more choice and open architecture, which is good for advisors and investors alike. AGF is well positioned for a market that has more open architecture.

We will continue to focus on our value proposition as an independent partner to distribution platforms. If one of the regulatory outcomes is to disembed trailers, AGF, like most other firms in the industry, already has fee disclosed products, such as a high net worth series and our fee based series F class.

We are continuing to further develop in the way we structure our product suite to help advisors transition to fee-based solutions. We are also positioning ourselves to participate on the fee-based platforms of our distribution partners.

Another thing to keep in mind, AGF has a diversified business. A portion of our $19 billion of retail mutual funds are already fee disclosed.

We also have $12 billion in institutional and sub-advisory AUM and over $4.5 billion in our high net worth channel. The last two channels are already operated on a fully disclosed basis.

This means that we have over half of our AUM in fee disclosed assets. So, we feel very good about not having all our eggs in one basket and we are looking forward for growth in each of our platforms that I have mentioned.

With that, I will now pass the call over to Kevin.

Thanks, Blake. I will start by talking about the investment platform.

The in-depth review of our investment process is complete and we are implementing changes in investment process for each strategy as well as how we manage risk. We are also beginning to make product changes.

In 2Q, we transferred the management of the AGF Dividend Income Fund to Highstreet. Highstreet is specialized in risk management and low volatility, which has become increasingly important to investors.

We will look for similar opportunities in the future to address circumstances of duplication or underperformance. Future changes could result in one-time charges, particularly if we choose to merge or close funds.

Some of the changes we will make will be necessary to meet our targets. We targeted having 50% of our AUM above median over three years and 50% above median over 1 year.

As Blake mentioned, 45% of our AUM is now above median over three years. Our 1 year number stands at 47%.

As the leading indicator, our shorter term performance is also good and provides confidence that the improvement is sustainable. We often profile our global capabilities led by Steve Way, particularly in the institutional channel.

Our global team manages strategies in key categories such as global core, emerging markets and global dividends. Global and emerging markets remain in very high demand and we believe this trend is still early in the cycle.

Planned sponsors and consultants continue to move to reduce home country buyers and invest in global oriented strategies. We have seen strong performance from our global team.

Our emerging market strategies have lagged recently, but I am comfortable with this in the short-term. Emerging markets have become volatile, as components such as China have soared higher, despite economic growth stagnant.

Our emerging market strategy is running in a high quality manner. As an example, we have it underway in China.

This quality bias is largely understood and appreciated by our clients and prospects. However, in a potential rising rate environment, some investors are cautious on emerging markets generally, so we could see a pause on new money in the short-term.

This might delay the growth we had expected from emerging market strategy this year. Turning to Slide 8 and I will talk more about our institutional business.

In Q2, our Q1 pipeline that we discussed last quarter fully transacted. In addition to the Q1 pipeline, we recorded $60 million of new sales during the quarter that were not in the Q1 pipeline.

This represents our pure institutional business. The sub-advisory changes we mentioned earlier roll up to our retail business.

We plan to work hard to capitalize on the progress we have made with our global consulting relations as well as direct relations with planned sponsors. One of our areas of focus will be the essential infrastructure fund.

After meetings with a diverse group of institutional investors and investment consultants in Canada, United States, United Kingdom and Europe we are pleased with the progress we are making towards first close, which we aim to achieve by the end of the year. With our global team and infrastructure fund launched, our capability is lined up very well with the consultant searches and the demand we are seeing in the marketplace.

We have optimism about growth in the institutional business. And with that, I will turn the call back over to Bob.

Thanks Kevin. Slide 9 reflects the summary of our financial results for the current quarter as compared to the previous quarter and from the second quarter of 2014.

EBITDA for the quarter was $36 million, up 6.2% from $33.9 million in Q1. Second quarter EPS came in at $0.17 per share compared to $0.16 per share in Q1.

Turning to Slide 10, I will walk to the basis points yield on our business. This slide shows our investment management revenue, operating expenses and EBITDA as percentage of average AUM on the current quarter as well as trailing 12 month views.

Note that the results reflect our core investment management business, only excluding one-time items and other income. With respect to revenue, revenue yield remained consistent with the previous 12-months period as the mix within our business remained relatively constant.

SG&A for the quarter came in at $47 million, which is slightly higher than the full year guidance provided during the Q1 call which was triggered by some of the seasonality of expenses, particularly around data cost of sales and marketing expenses. As Kevin mentioned, we are considering making changes in cases where there is duplication or underperformance and you may see some one-time items related to this over the next few quarters.

As we have done over the past year, we may choose to reinvest a portion of those savings into our growth platforms, namely alternatives, private clients and to continue our brand support in retail channel. We remain focused on balancing reinvestments versus improving efficiency in order to leverage our quarterly SG&A burden going forward.

EBITDA basis points decreased to 32 in the quarter, down from 34 basis points on a trailing 12-months view. That decrease is primarily attributable to the expenses.

Turning to Slide 11, I will discuss free cash flow and capital uses. This slide represents the last five quarters of free cash flow shown by the blue bars on this chart.

The cash flow represented is consolidated free cash flow. The increase in free cash flow from Q1 2015 to the current quarter relates primarily to the timing of Smith & Williamson dividends.

We have received $1.7 million dividend in the quarter. Our Q2 dividend payout ratio was 39%.

With respect to future capital uses, we have previously mentioned our capital commitments for the alternatives platform is $150 million. $50 million of that amount relates to Stream Asset Financial LP, of which roughly 60% has been funded.

The investment thesis for the fund is operating as expected and the return of profile that we set out to achieve has been net to-date. We are quite pleased with the progress and the deal flow.

We will continue to draw down on our remaining commitment over 2015 and 2016. The remaining $100 million is committed to the essential infrastructure fund.

AGF advanced $103 million to facilitate the acquisition of the seed investment in January. When closing of the fund occurs, we will receive a return of seed capital to bring our investment down to our proportionate share of total capital committed.

As Kevin mentioned, we now expect to close of fund by the end of our fiscal year. As way of background, we started marketing the fund in late March following the acquisition of our interest in the passenger terminal at Billy Bishop Toronto City Airport, which is the ninth largest airport in Canada.

The passenger terminal is a marquee cornerstone asset for the fund. It represents critical transportation infrastructure for the city of Toronto and surrounding region and is performing in line with our expectations.

Security and investment of this caliber demanded significant time and attention from the InstarAGF team throughout the ownership transition, which shifted the launch of the fund and the start of the fundraising beyond our initially targeted timeframe. We feel that the investment at time has been worth it.

The high quality and return profile of the asset has broad appeal for our investors. Airport investment opportunities are very rare in North America.

Our client base is also recognized that InstarAGF success in acquiring the terminal demonstrates the team’s investment philosophy, access the deal flow and deep relationships in Canada and international. With respect to the alternatives platforms, in total, we recognized earnings of $2.5 million in the current quarter.

This includes our share of the platform earnings in capacity as GP, in addition to the earnings generated by the LP investment. With respect to AGF’s interest in the fund manager, InstarAGF, we will continue to reinvest in that management fee income back into the platform to further develop the fund offerings throughout the platform.

Management fees will be absorbed by operating expenses. So, this will limit the amount of management fee income we recognized for another few years.

InstarAGF will also participate in the profitability of the fund through its carried interest, assuming it meets its performance hurdles. Moving to other capital considerations during Q2, we repurchased 190,000 shares for total consideration of approximately $1.4 million.

Since the end of May, we purchased further 971,000 shares for total consideration of $6.5 million. So in total for 2015, we’ve repurchased 4 million shares for $30 million or nearly 5% of our outstanding shares.

Going forward, the NCIB will primarily be used to purchase shares in the employee benefit trust. Now, turning to Slide 12, I will turn it to Blake to wrap up today’s call.

Thanks Bob. In summary, I’d like to remind you of our primary goals for the remainder of 2015, which were clearly laid out in our last conference call.

For 2015, we are focusing on the following: one, investment performance and process. As Kevin mentioned, we are now executing on those changes that we have identified.

We are encouraged by the improvement in our investment performance and process. Two, our retail product platform, we still have more to do to achieve our objective of generating positive sales.

However, Q2 was yet another quarter in which we made continued progress. Three, alternatives, we are on track to have our second fund launched by the end of the year.

I want to thank everyone on the AGF team for their hard work, and I am proud of the results that we achieved in Q2 and excited to accomplish more in the remainder of 2015. Thank you very much for listening today.

And now, we will take your questions.

Thanks. Question for Kevin, the AUM above median improved on a 1-year basis, but I think it dropped on a 3-year and I think most people look at the 3-year.

And you have talked about a turnaround. Can you elaborate further on where you stand and when you expect the fund performance to translate into better net sales?

Is this still kind of more of an 18, 24 months timeframe?

Yes, Gary, last quarter, we had talked about the fact that the 3-year number is going to move around a bit as you drop and roll things off. And as you are thinking obviously, the goal is to continually drive the one in shorter term periods and that builds that 3-year on a sustainable basis.

So, you will see it move around a little bit up and down as we drop things off. So, yes, I would not move up the 18-month timeframe, but it’s really a factor of what rolls it around.

And then I guess it’s still on track with your expectations more or less?

Yes. And I am pretty happy with where we are, I think in volatile market, we held up well, and shorter-term performance is pretty good.

So, I feel very comfortable.

Okay. And then just on the $60 million additional net sales for the institutional in the quarter, Kevin, what mandates that these go into?

And are these Canadian, U.S. clients?

And can you comment on kind of the RFPs kind of what products are still in demand and I think you mentioned global and infrastructure?

Yes. So, I will take your first question first, Gary, which is on the $60 million, wasn’t a option overlay strategy.

There is a couple of mandates actually run by our Highstreet team, which as you know many of our strategies emanate from today. And second, in terms of search activity, it was actually pretty high during the quarter.

So, we are involved in a number of active searches now that haven’t come to the final stages, but – and it is heavily concentrated, I would say in global core and emerging markets and it’s pretty broad spread, Asia, Europe, U.S. and even a little bit of Canada.

Okay, great. And then just lastly, I just want to get more color on the tax item that was disclosed this quarter, that was a bit of a surprise for me, I am just wondering how far along is the tax – CRA tax review and are there other items that they are looking at currently?

So Gary, it’s Bob, are you mentioning the FAPI issues?

Yes.

Yes. Well, let me just fill a little background.

So FAPI stands for foreign accrual property income, and the application of which would increase the tax burden for Canadian based companies that’s got certain income from foreign sources. Generally, FAPI doesn’t apply to active business income.

In our case, the CRA is questioning whether or not the income we earn from our foreign subs should be deemed as non-active business income. If it’s not active, it doesn’t receive the tax shelter afforded active business income and would attract Canadian – additional Canadian tax above the tax burden that’s applied in the foreign jurisdiction.

So in May, we have received a proposed audit adjustment letter. It has not been finalized that would increase our taxes payable from 2007 to 2012, but supported by the opinion of our external tax experts, AGF strongly disagrees with the CRA’s position on both the technical merits of the issue as well as one of the tax policy, and we are going to strongly object to any related assessments that may be issued.

So this issue is still – it is early and it’s still on the big influx.

Okay. And are there anything else that CRA is looking at currently that you are aware of?

No, we have disclosed I believe in Q4 of last year, an issue with respect to certain deductions, in addition to the transfer pricing issue, which has been well traveled on these calls.

Okay, perfect, that’s it for me. Thank you.

Hi, maybe I can just start with – you mentioned that you are continuing to streamline your fund lineup, there may be some one-time charges and whatnot coming through here, what’s your – I guess ultimately what’s the strategy here, are you just looking to redeploy any expenses that you would save from doing that back into other areas of your business, are you actually expecting expense savings?

Yes. Graham, this is an evolution.

So, this will playout over time, but it’s – the way to think about it is, we will invest some of those proceeds back into growth opportunities, but you should expect there to be net savings from those activities as we either consolidate funds or teams. So, a little bit will be reinvested back obviously as part of the strategy we discussed in the December timeframe.

Okay, great. And then on a similar line, I know you are just on the expense front, the transfer agency business that’s being brought back into the house, would you be able to quantify what the expected impact is on your revenue expenses, is it something that we will notice?

Graham, maybe just as a way for others on the call, I’ll just provide a bit of context to – into the Citi transaction if that would be helpful. So AGF formerly owned Unisen, which was the wholly owned subsidiary that provided third party administrative services.

In October of 2005, we sold Unisen Holdings to Citigroup. And as part of that transition and transaction signed a 10-year servicing agreement, whereby Citi would provide transfer agency and client servicing for AGF’s mutual fund operations.

So as the 10-year anniversary approached, Citi made a corporate-level decision to exit the business in North America. And after reviewing several options, AGF signed a letter of intent with Citigroup to essentially take back the transfer agency services from Citi, which will occur by the end of the current fiscal year.

So the fund accounting and company services will be transitioned to the leading Canadian market service provider. So those will be outsourced – continued to be outsourced solutions.

The in-sourcing of the transfer agency back into AGF was carefully considered and done for several reasons. First, we felt that we can provide an improved service level that would be more efficient and effective for both our advisors and our unit holders.

It will also allow us to remain closer to the voice of the customer. Secondly, the terrific employees who service AGF today are dedicated to our clients and will be coming over as part of that transition.

In fact, many of them were with us when we owned Unisen. Thirdly, the – AGF will continue to partner with its current IT technology outsourcing partners to maintain the system infrastructure, the regulatory and tax updates, etcetera.

So effectively we will be performing the business process around that technology. And then finally, we believe that post transition, we are going to be able to offer better service at a more competitive fee for our unitholders.

So, those are the – just kind of the background to the Citi transaction and why we are taking it in-house or at least part of those services in-house. With respect to the financial impact, there is not going to be any fee increase to our unitholder as a result of the transition, that’s first and foremost.

In fact, we would expect to reduce the expenses borne by our unitholders as we season the business within our company over time. There were certain incentives that were provided by Citi to offset any transition expenses, so we don’t expect any 2015 impact to our SG&A.

We will be investing some capital to set up the operations, primarily related to leaseholds and some desktop technology. But overall, our margin in percentage terms will be impacted just due to the fact that the revenue and expense will now be accounted on our financials both in the revenue and the expense side as opposed to just a net expense heretofore, albeit we expect a nominal increase in our overall contribution margin dollars.

The – they will have some negative impact on the percentage.

Okay, thanks. Good color.

And then maybe just lastly, just to be clear, the $600 million that you highlighted, I guess, from one large mandate that’s going out offset by two mandates coming in. Is that going to be captured within your institutional AUM or is that within your retail AUM?

It’s – for purposes of the pipeline reported, there maybe some confusions. We have never recorded gains or outflows, so inflows or outflows of our sub-advisory mandates in the institutional pipeline.

For purposes of accountability within the organization, we treat that as retail.

And the reason we treat it as retail is because the clients we aligned the support service models against the clients. These clients still have advisory sales forces.

So, we provide wholesaling support, hence the reason why, from the business standpoint, it rolls on to the retail accountability.

Okay, got it. But when you – when we are looking at sort of the different AUM buckets that you provide, it’s going to be within, I guess, $16.7 billion is where you are at now in the institutional high net worth side, that’s where we should see the impact?

That’s correct, Graham. We’d like to keep the retail for external disclosure in line with FX reporting and hence would not – these sub-advisory accounts don’t come underneath our FX reporting.

Perfect. Got it.

Thank you.

Yes, thanks very much. Good morning, everyone.

I just want to follow up a little bit more on the FAPI tax issue. Worst case kind of scenario is $33 million paid to the tax authorities?

And if you combine that with that CRA notification that I think you got in the first quarter of this year on the deduction issue, that might be another $10 million. So, that takes out a significant portion of your cash.

I am just playing a worst case scenario here, so just kind of walk me through this? And in terms of commitments you have, I think there is a $22 million commitment to Stream fund.

And what other kind of commitments do you have here going forward, just trying to work through some of the workings of the cash?

Yes. Well, Tom, so first, let me say that w have got a comprehensive cash flow forecast that models business variability and sensitivities including these types of CRA issues.

So, with that said, even the most conservative scenario. We have got the financial resources to fund the nominee [ph] and potential future CRA assessments.

In addition, let’s not forget that we are generating excess free cash flow on a quarterly basis, that’s available to fund our strategic initiatives. And finally, because we are in such strong disagreement with the CRA position, we are not going to settle these issues in a quarter or two, these are most likely – unless they acquiesce to our position, they are going to be multiyear type issues that we’ll have to deal with.

Yes. And then in terms of commitments, am I correct, there is a $22 million commitment to the Stream fund, is there any other commitments that we have?

No, there are no other commitments.

And the – on the closure of the infrastructure fund, the essential infrastructure fund is there some money that comes back to you? And then has that been recommitted back into funds, how does that work?

Maybe just a recap on that please.

That’s correct. So let’s assume that the 100 is committed and would be dedicated to the essential infrastructure fund.

If they were to do a close, that would say $400 million, then our pro rata seed money that we warehoused with respect to the terminal comes back. But that has been rededicated towards the essential infrastructure fund over the next 3 years to 4 years as the investment period progresses.

And for accounting purposes, does that come back into cash or does that sit in another account?

It comes back as cash. There would be a footnote – there would be a footnote to this – indicating that is committed to the LP.

Okay. Thanks very much.

Hi, good morning. Just wanted to clarify just on the infrastructure fund and maybe confusing apples-with-oranges, but Kevin I thought you mentioned the close of the fund was going to be the end of the year as being – it was the first closing, I thought Bob you might have said it might have been the final close, just wanted to get clarification because I think gives you what these funds that you can get a first close, but you can do subsequent closings, so I just wanted – if you can provide some color on that?

Yes. Geoff, this is Kevin.

It’s – we anticipate the first close being towards the end of fiscal year, probably the second close somewhere in the early part of next year. But you are correct, there will be multiple closes on this fund, the first close being targeted for year end.

Okay, okay. Thanks.

Bob, just going back to the tax thing that came up in the quarter, are you able to say, like obviously you have got this as a potential thing coming down may be a notice at some point, like do you think maybe in the next quarter or two that we might find out whether or not this actually turns into a formal notice or is it really just tough to say at this point?

Yes, it’s tough to say at this point. I think we have had an initial meeting with the CRA that we felt was helpful with respect to our position.

But it’s just too early to tell, Geoff.

Okay. The last question I had was again, Bob I think you were mentioning with the NCIB that it was – I believe you were saying it was going to be mostly earmarked for employee trust and Blake you made the comments at the beginning just about what the share price and it seems like obviously you guys feel that it’s been overdone, you guys have quite a bit of room still on the debt facility and as well as cash on the balance sheet, is it something that you might be more aggressive on the buyback given where the share price is?

Yes. Let me say you that firstly a number of insiders have actually been buying during obviously in the moment have been in blackout, Geoff.

And currently, we will be very opportunistic. We do have a plan as far as making sure that our shares have looked after.

But we always look at these things opportunistically, obviously very good value right now.

Okay, thank you.

Thanks. Good morning.

Bob, I wanted to ask you a question to start and that’s related to the investment stream, so you made a comment during your remarks that, that the size of that investment would go down over time as capitals return to you, but there should be additional closings on that fund, if I am not correct in terms of the $50 million commitments, so maybe you can give us a little bit more color on how the total investment in that fund should look over the next, say 12 months, 18 months?

Well, we haven’t fully invested the fund yet as I mentioned in the remarks. So and to Tom’s point there is another $22 million that – $20 million or so that has to get invested over the investment period.

We think that will happen over a 12 months to 18 months timeframe. As there are – as this based on structured financing of this – of these particular investments, we are going to be getting return of capital as well as earnings on a quarterly basis back from the fund on a monthly basis, I should say.

In addition, there will be monetization events which occur, which would then also provide additional capital returned back to the investors. But I would think about primarily in a way to we view it, Paul is over the next 12 months to 18 months we are going to be contributing close to $20 million worth of additional capital to this LP.

Got it. And the timing of that will just be dependent on when they find additional investments to put the capital into?

Yes, that’s right. And they have got a very strong pipeline.

So like I said, we are pretty confident we will get this done through 2016.

Got it. The next question is on the fund performance my impression is you sort of completed the process in terms of implementing the risk management changes.

It sounds like you might be the next step here might be to hire additional people to help on the research front. Is that correct?

Yes, Paul, I think that, as we have said earlier and in previous quarters, the goal here is to really focus on risk side, make sure our processes are aligned that we have the right teams running those processes, but at the same time, invest in those areas of growth. So today, we are actually – we are probably going to somewhere this summer or maybe early fall onboard several new global team analysts, which is a place as you can see the opportunity that’s big performance has been terrific.

So, it makes sense for us to redeploy some of those savings back in to the growth side of our business, but to the earlier comment I made, the net will come down in terms of – as we remove some of the cost, we should have some net savings. That will play out over a couple of quarters.

Good morning, guys. Is there any change in the – target of the first close of $400 million on a total basis, the $700 million to $750 million?

Are those still targets you see that are reachable on that fund?

Yes. Based on the investments we are talking to and pipeline that we are looking at, no change in that right now.

And when I look at the institutional side in past quarters, you guys talked about the global core, the global dividend, the emerging markets is a bit slower, are there any other types of mandates that the consultants are looking at AGF, like maybe U.S., they are the clean stuff or any domestic or balance? Is there any other mandate that kind of pop up?

Yes, I mean, those are the main mandates that we have seen a few for Canadian-only products from a couple of U.S. institutional investors.

We are in Asia right now. There is some interest in Asia, ex-Japan product that we have a very strong performing product in that place and then some of our quantitative abilities down in Highstreet, but the bulk of the search activity right now is – that we are seeing really is around our EM and global suite if I have to characterize it.

Okay, thanks a lot.

Hi, guys. Sorry, I have one more question that seemed to get cut off there.

Just can you give us some any kind of update on actual sales going into F series and gold label, whether that’s growth rate or percentage of sales in those fund types?

Paul, as we have said in the past, we don’t disclose at the share class level in terms of granularity. What I would say is we continue to invest in making sure that our F shares are competitive from an MER standpoint.

And also we continue to invest in the Q shares, our high net worth platform. The growth rate continues to be above the AUM percentage that we have within the funds today.

So, we see increasing traction on that. And as I said – I mentioned recently, as we put the high net worth pricing on to the Elements program and we are seeing good success in terms of growing that and thus adding to that growth rate percentage.

Okay, thank you.

Thank you very much everyone for joining us today. Our next earnings call will take place on September 23, 2015 when we review our third quarter results for fiscal 2015.

Details of that call will be posted on our website. Finally, an archive of today’s audio webcast with supporting materials will be available in the Investor Relations section of our website.

Good day, everyone.