Happy New Year! We would like to wish you and your family all of

December 2017

Happy New Year! We would like to wish you and your family all of the very best for 2018.

2017 was another good year for our managed portfolios! We are pleased to report that all

of our mandates outperformed the S&P/TSX Composite Index, which generated 6.03%

last year. We remain pleased with how the portfolios are positioned for the New Year.

Real GDP accelerated in most countries in 2017 resulting in strong, synchronized global

growth. We believe that there will be more divergence in growth during 2018, with some

countries slowing while others accelerate or maintain a steady level of growth. On

balance, areas of weakness should be offset by strength elsewhere allowing global

growth to be sustained near 2017 levels. Equity markets should do well in 2018, but the

combination of weaker growth in some regions, high valuations, and ongoing Fed

tightening should lead to a return of volatility in the equity markets from the unusually low

volatility experienced in 2017. We expect one or two significant equity market corrections

in 2018 which would be more normal than the 2017 experience.

The prospect of sustained good growth in the United States prevents the 2018 Developing

Markets (DM) slowdown from being more pronounced, and erases our previous concerns

about aggregate global growth prospects in 2018. Rebuilding and replacement demand

after the hurricanes led to a surge of business sales growth that shrank inventory levels

that had been building. The rebuilding stimulus won't likely be sustained, but the U.S.

business sector begins 2018 with much leaner inventories than had been the case prior to

the hurricanes. The economy therefore benefits from the need to replenish inventories at

the same time that new fiscal stimulus is being applied, offset by escalating monetary

restraint and the fading stimulus of hurricane rebuilding. On a fourth quarter, year over

year basis, Fed officials expect U.S. growth of 2.5% in 2018, matching the 2.5% growth in

2017. The consensus, still being upwardly revised to account for tax reform legislation,

has similar 2018 expectations of 2.4% U.S. real growth over the four quarters of 2018.

Quarterly Market Commentary

Emerging market (EM) economies are expected to sustain a high level of growth in 2018,

as a modest slowing in China is offset by accelerating growth elsewhere, notably India,

Brazil, Indonesia and Mexico. On balance, we calculate a consensus expectation of

5.25% real GDP growth in 2018, essentially unchanged from the 5.31% growth recorded

in 2017.

We expect global growth in 2018 will continue very near the high level of growth recorded

in 2017. While annual measures of global growth will likely budge, monthly and quarterly

measures of global growth such as industrial production, the PMIs and quarterly real GDP

should weaken in a growing number of countries in the second half of 2018, while

remaining at aggregate levels that should still be considered good growth. Slower growth

in some regions of the world, combined with high valuations and continued Fed tightening

should lead to a return of equity market volatility. The bull market is intact so we expect to

continue to recommend investors 'buy the dip' when corrections occur.

Some of the names that we continue to hold and favour for 2018 include:

ENERCARE INC.

In its core Home Services portfolio, Enercare continues to deliver improved aggregation

trends concurrent with pricing/mix improvement and we believe that the company is well-

positioned to take advantage of a convergence of home services. Meanwhile, Service

Experts continues to exceed our expectations, while the sub-metering business continues

to have a strong pipeline of embedded growth. WE believe that the embedded growth in

sub-metering and the roll-out of rentals at Service Experts could result in a combined

~$2.00-$3.00 per share of additional value. Additionally, Enercare pays an attractive

4.9% dividend yield and we believe that the company's current valuation offers investors a

good entry point into the name.

We believe that Enercare is an attractive long-term holding, as it is a well-run company

with good growth opportunities and a portfolio of rental assets that have a history of

generating stable and recurring cash flows supportive of the attractive dividend.

CANADIAN NATIONAL RAILWAY

CN characterized Q4/17 as somewhat challenging. We believe that three issues were at

play: 1) volume growth is slowing as CN laps more difficult prior year comparables (similar

to its peers); 2) the company entered Q4/17 with some capacity challenges as a result of

YTD volume growth that has well surpassed initial expectations; and 3) winter weather

conditions have arrived early in western Canada. Beyond these temporary resource

issues, we see higher-than-expected volume growth as a "high-quality problem", and we

would argue that CN has higher visibility to 2018/2019 volume growth vs. its Class I peers,

based on: 1) the diversity of CN's franchise; 2) the company's low exposure to coal (~4%

of revenue); and 3) the ~$1.1bln-$2.2bln revenue growth pipeline (2018-2020) that CN

presented at its June 2017 investor meeting.

We view CN as a relatively low-risk, high-quality industrial company, which should be a

core holding.

Quarterly Market Commentary

BCE INC.

For investors who covet stability, predictability, and yield, BCE delivered on plan yet again

in Q3. Subsequent to consensus expectations coming down a bit pre-quarter, BCE

delivered slight beats on most financial and subscriber metrics in Q3.

NEW FLYER INDUSTRIES

New Flyer is generating strong free-cash-flow currently, with its capital-light business

model, and we expect this to continue in the near term, given a strong industry outlook,

record backlog, and continued opportunities for cost-rationalization. Furthermore, New

Flyer has a demonstrated track-record of creating value through disciplined mergers and

acquisitions, and we expect this to continue being a part of the story going forward.

CIBC

Our positive outlook on CIBC reflects relative valuation and performance. We also favor

CIBC's recent approach to building franchises rather than building silos and entering into

creative financing transactions. CIBC is trading at an 11% discount to the group on

2018E EPS, versus an average discount of 9% over the past five years. We believe that

the market has more than priced in: a) concerns surrounding CIBC's mortgage growth; b)

the capital hit associated with the PrivateBancorp deal; and c) earnings dilution

associated with PrivateBancorp.

TELUS CORP.

Telus increased the dividend by 2.54% this quarter. We are now using a five-year

discounted cash flow model to value the wireline segment. We have gained greater

confidence in the company's ability to both increase EBITDA margins and lower capex

over the next 3-5 years, owing to industry-leading investments in FTTH networks and

services.

MAGNA INTERNATIONAL

Despite the cautionary outlook on Getrag this quarter, we do not believe the impact

should be material to offset Magna from growing in excess of the industry over our

investment horizon. Additionally, we view Magna as well-positioned to participate in the

car of the future, with a financial position of strength enabling the company to remain

active with its Normal Course Issuer Bid, potentially increase its dividend, and/or pursue

additional merger and acquisition opportunities.

EMERA

Emera increased the dividend by 8.13% this quarter. We believe that Emera's

investments in: 1) transmission; 2) reducing the carbon intensity of its portfolio; 3) gas

generation and transportation; and 4) utilities will contribute to the company's ability to

grow earnings per share and dividends by high single digits through to 2020. When

coupled with a relatively low-risk business model and attractive dividend yield, we expect

Emera to be appealing to investors looking for income and growth.

Quarterly Market Commentary

ALGONQUIN POWER & UTILITIES CORP.

We believe that Algonquin offers a compelling valuation in the context of an extensive

growth pipeline that includes development activity, potential acquisitions, utility rate-base

investments, and potential international investments via Atlantica Yield and the AAGES

joint venture. Management has built a strong merger and acquisition track record through

the growth of its unregulated and regulated businesses. Given the company's diverse

investment opportunities, conservative payout ratio, and manageable leverage, we view

management's 10% annual dividend growth target as realistic.

CANADIAN TIRE

Canadian Tire increased the dividend by 38.5% this quarter and announced a Normal

Course Issuer Bid to repurchase $550 million of its shares through 2018.

Canadian Tire remains a preferred name within our coverage universe based upon our

investment thesis that the market continues to undervalue Canadian Tire's Retail

operations, that the strategy and initiatives in place in our view position the company for

earnings per share growth, and that the material active normal course issuer bid provides

a degree of downside protection to the share price.

PREMIUM BRANDS

Premium Brands was very active in the quarter. They announced the acquisition of

Buddy's Kitchen Inc., Raybern Foods, and a non-material 50% interest in Shaw Bakers for

$200 million. As a result, we are raising our 2018 and 2019 EBITDA estimates by 7-8% to

reflect the anticipated accretion.

Premium Brands is not finished yet, as management suggested that several transactions

are nearing closing within the next 3-6 months. Combined with strong organic growth,

contributions from previous acquisitions, and good management execution, we have little

hesitation in recommending investors buy Premium Brands shares, provided that it is in

line with their investment objectives and risk tolerance.

ALIMENTATION COUCHE TARD

In our opinion, consensus estimates still look too low. Despite the challenging industry

backdrop, we expect the CST and Holiday acquisitions, significant synergies, and modest

(yet ahead of peers) organic growth, to deliver >20% earnings per share compound

annual growth rate through fiscal 2020.

After moving sideways for much of the past 18 months, sentiment has turned more

favourable of-late as management meetings appear to be giving investors comfort with

respect to Couche- Tard's long-term growth potential (regardless of the expectation that

fuel demand will start declining 1-2% annually beyond 2025). With a forward Price-

Earnings ratio of only 16x and >20% earnings per share compound annual growth rate

through F2020, we still see meaningful upside to the shares.

TRANSCANADA

TransCanada has extended its 8 - 10% compound annual growth rate dividend outlook by

one year through to 2021. The company has also reiterated its forecast that the dividend

compound annual growth rate will be at the upper end of the range through 2020. The

dividend is supported by earnings and cash flow growth, as well as strong coverage ratios.

Quarterly Market Commentary

We believe that a positive final investment decision on Keystone would be a catalyst for

the stock. TransCanada has a strong incumbency in the two most prolific natural gas

basins in North America (the Marcellus/Utica and Montney), combined with access to

large markets, in our view. Growing connectivity over time should provide customers with

increasing optionality as it moves approximately a quarter of North American natural gas

demand. The company's 91,500 km of pipelines have increasing value as new pipelines

become more difficult to build, in our view. We believe that TransCanada's scale, energy

infrastructure expertise, low-risk business model, and financial strength are competitive

advantages when pursuing new assets.

TORONTO DOMINION BANK

We continue to favour the bank’s U.S. exposure and strong domestic personal and

commercial business. The advantages of the U.S. exposure relate to: a) the positive

effects of rising interest rates; b) slightly stronger forecast economic growth and continued

market share gains; and c) the moderating expense growth expected to play-out from the

restructuring initiatives in the U.S. In periods when personal & commercial business

(rather than capital markets) drives earnings growth, TD has historically outperformed its

peers.

If you should have any questions or comments, please do not hesitate to contact us.

The recommendations and opinions expressed herein are those of MK Total Wealth Management Group and do not necessarily reflect those of TD Wealth and

are not specifically endorsed by TD Wealth. The information contained herein has been provided by TD Wealt

h Private Investment Advice and is for information

purposes only. The information has been drawn from sources believed to be reliable. Where such statements are based in whole or in part on information provided

by third parties, they are not guaranteed to be accurate or complete. Graphs and charts are used for illustrative purposes only and do not reflect future values or

future performance of any investment. The information does not provide financial, legal, tax or investment advice. Particular

investment,

trading or tax strategies

should be evaluated relative to each individual’s objectives and risk tolerance. TD Wealth Private Investment Advice, The Tor

onto-

Dominion Bank and its affiliates

and related entities are not liable for any errors or omissions in

the information or for any loss or damage suffered.

MK Total Wealth Management Group consists

of Jeff MacDonald, Senior Vice President & Investment Advisor, Peter Konidis, Vice President & Investment Advisor, Daniela Porretta, Client Relationship

Associat

e, Stephanie Burgess, Client Service Associate and Tania Vera-Miloslavich, Client Service Associate. MK Total Wealth Management Group is part of

TD Wealth Private Investment Advice, a division of TD Waterhouse Canada Inc. TD Waterhouse Canada Inc. is a su

bsidiary of The Toronto-

Dominion Bank.

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