SLGI ASSET MANAGEMENT INC.

INTERIM MANAGEMENT REPORT OF FUND PERFORMANCE for the period ended June 30, 2021

Sun Life BlackRock Canadian Universe Bond Fund This page is intentionally left blank Sun Life BlackRock Canadian Universe Bond Fund

This interim management report of fund performance contains financial highlights but does not contain the complete financial statements of the investment fund. You can request a free copy of the semi-annual financial statements (unaudited) by calling 1-877-344-1434, by sending an email to us at [email protected] or by writing to us at SLGI Asset Management Inc., 1 York Street, Suite 3300, Toronto, Ontario, M5J 0B6. The financial statements are available on our website at www.sunlifeglobalinvestments.com and on SEDAR at www.sedar.com. Securityholders may also contact us using one of these methods to request a copy of the investment fund’s proxy voting policies and procedures, proxy voting disclosure record or quarterly portfolio disclosure. SLGI Asset Management Inc. (the "Manager") is an indirect wholly owned subsidiary of Sun Life Financial Inc.

MANAGEMENT DISCUSSION OF FUND After November 26, 2021, all DSC and LL purchase options will be closed to purchases, including purchases made PERFORMANCE through systematic plans such as pre-authorized chequing plans. Securities purchased under the DSC and LL purchase Results of Operations options on or prior to November 26, 2021 may continue to During the period, the net asset value of the Sun Life be held in investor accounts. Switching securities between BlackRock Canadian Universe Bond Fund (the “Fund”) Funds held under the DSC or LL purchase option will increased from $1.1 billion to $1.2 billion due to positive net continue to be permitted. sales, partially offset by negative performance. We are implementing these changes in anticipation of During the period, the Fund returned -3.5% for Series I regulatory changes mandated by the Canadian Securities securities, this result equalled the Fund's benchmark, FTSE Administrators ending the sale of DSC and LL purchase Canada Universe Bond Index, which returned -3.5%. Please options across all Canadian jurisdictions that takes effect on refer to the ‘Past Performance’ section of this report for June 1, 2022. performance of the series. For any impacted systematic plans that are investing into The Canadian economic backdrop improved during the DSC or LL purchase options, new instructions will need to be period as the pandemic eased. This led investors to favour provided on or before November 26, 2021. Without new equities over bonds. The improving economic backdrop was instructions, these systematic plans will be terminated after negative for bond returns as interest rates rose during the November 26, 2021. period. The FTSE Canadian Universe Bond Index delivered Effective on or before March 31, 2022, the Manager will no negative returns. Higher quality bonds lagged lower quality longer pay trailing commissions to dealers that do not make bonds. Industries most negatively impacted by the pandemic, suitability determinations (the “Impacted Dealers”), such as such as energy, transportation, and lodging, gained from the Order Execution Only dealers. The Manager is implementing re-opening. The Fund tracks the performance and risk profile this change in anticipation of the regulatory requirement of the benchmark and did as expected. mandated by the Canadian Securities Administrators to end the payment of trailing commissions to Impacted Dealers Recent Developments that takes effect on June 1, 2022. Effective on or before A year ago COVID-19 swept across the world triggering sharp March 31, 2022, accounts at Impacted Dealers will only be market declines. Economic activity slowed as governments permitted to purchase or hold securities of the following worldwide applied lockdown measures to limit the spread of series of SLGI Asset Management mutual funds, each of the virus. Global equity markets recovered after the arrival of which does not pay trailing commissions. The permitted COVID-19 vaccines and billions of dollars of stimulus Fund series includes Series F, Series F5, Series FT5, spending by governments worldwide. Central banks globally Series F8, Series FT8, Series FH, Series IS, Series O and lowered or kept their benchmark interest rates low to aid the Series OH. economic recovery. The Manager cautioned an uneven economic recovery pending COVID-19 infection rates as well Related Party Transactions as questions around the need for continued government SLGI Asset Management Inc. is the manager, trustee and stimulus to aid an economic recovery. portfolio manager of the Fund. For its services, the Manager The Manager will stop offering the deferred sales charge receives a management fee that is calculated as a (“DSC”) and low load sales charge (“LL”) purchase options on percentage of the average net asset value of the Fund. This each of its Funds. This change will take place after the close fee is calculated daily and payable monthly. of business on or about November 26, 2021 across all Funds.

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The Manager is responsible for the provision of all general The Fund also pays certain operating expenses directly (the management and administrative services required by the “Fund Costs”). Fund Costs include: borrowing costs incurred Fund in its day-to-day operations, including providing or by the Fund from time to time; costs in connection with arranging for the provision of investment advice, portfolio transactions; fees and expenses payable to or in bookkeeping, recordkeeping and other administrative connection with the Fund’s IRC; taxes payable by the Fund; services for the Fund. and the costs of complying with any new regulatory or legal requirement imposed on the Fund. The Fund allocates Fund As trustee, the Manager holds legal title to the Fund's Costs proportionately among each series of securities of the investments in trust for securityholders. Fund to which they apply. The Fund Costs that are specific to As portfolio manager, the Manager is responsible for a series of securities are allocated to that series. These managing the investment portfolio of the Fund directly or amounts are paid out of the assets attributed to each series through sub-advisors. The Manager has retained BlackRock of securities of the Fund, which reduces the return you may Asset Management Canada Limited to act as a sub-advisor receive. for the Fund. Certain mutual funds managed by the Manager (“Sun Life Financial Highlights Funds”) may have direct or indirect holdings in Sun Life The following tables show selected key financial information Financial Inc. or its affiliates or other funds managed by SLGI about the Fund and are intended to help you understand the Asset Management Inc., or its affiliates. Other funds managed Fund’s financial performance for the previous five years or by SLGI Asset Management Inc., or its affiliates, may invest in for the periods since inception to June 30, 2021. securities of the Sun Life Funds. The Fund’s Net Asset Value per Security ($)(1) Fees and expenses payable to or in connection with the Sun Life Funds’ Independent Review Committee ("IRC") are Sun Life BlackRock Canadian Universe Bond Fund - allocated to the series to which they apply in a manner that, Series I in the Manager’s view, is considered fair and reasonable. The amounts of these charges are disclosed in the line item 2021 2020 2019 2018 2017 2016 ($) ($) ($) ($) ($) ($) “Independent review committee fees” in the Fund’s Net asset value, beginning of Statements of Comprehensive Income (Loss). period 11.10 10.71 10.31 10.48 10.53 10.75 The Manager has a distribution agreement with Sun Life Increase (decrease) from operations: Financial Investment Services (Canada) Inc. (the “Dealer”), a Total revenue 0.14 0.30 0.31 0.31 0.32 0.32 company under common control under which the Dealer Total expenses ------may distribute securities of the funds offered by the Manager Realized gains (losses) for the period - 0.20 (0.01) (0.07) (0.05) 0.07 in the jurisdictions in which the Dealer is so authorized. Unrealized gains (losses) for the The Manager is an indirect wholly owned subsidiary of Sun period (0.48) 0.31 0.35 (0.09) (0.03) (0.16) Life Financial Inc. Total increase (decrease) from operations(2) (0.34) 0.81 0.65 0.15 0.24 0.23 Distributions: Fund Administrative Expenses From income (excluding The Manager pays certain operating expenses of the Fund dividends) (0.14) (0.31) (0.31) (0.31) (0.31) (0.32) (the “Administration Expenses”) in return for a fixed From dividends ------From capital gains - (0.11) - - - (0.07) administration fee paid to the Manager by the Fund Return of capital - - - - - (0.02) (“Administration Fee”). The Administration Fee is based on Total annual distributions(3) (0.14) (0.42) (0.31) (0.31) (0.31) (0.41) the net asset value of each series of securities of the Fund. Net asset value, end of period 10.57 11.10 10.71 10.31 10.48 10.53 The Administration Expenses include, but are not limited to, record keeper fees, accounting, audit and legal fees, bank (1) This information is derived from the Fund’s audited annual financial statements and from the semi-annual unaudited financial statements for the current period ended and interest charges, safekeeping and custodial fees, taxes, June 30, 2021. administrative and systems costs, costs of reports to (2) Net Assets and distributions are based on the actual number of securities investors, prospectuses and other disclosure documents, outstanding at the relevant time. The increase/decrease from operations is based on the weighted average number of securities outstanding over the financial period. regulatory filing fees (including those incurred by the (3) Distributions were paid in cash, reinvested in additional securities of the Fund, or Manager) and trustee fees for registered plans. The amount both. of this charge is disclosed as Fixed annual administration fees in the Fund’s Statement of Comprehensive Income found in the semi-annual financial statements (unaudited).

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Ratios and Supplemental Data Past Performance The performance information shown assumes that all Sun Life BlackRock Canadian Universe Bond Fund - Series I distributions made by the Fund in the periods shown were 2021 2020 2019 2018 2017 2016 reinvested in additional securities of the Fund. The Total net asset performance information does not take into account sales, (1) value ($000s) 1,188,796 1,071,644 1,669,576 1,199,764 1,062,441 879,538 redemption, distribution, other optional charges or income Number of securities outstanding(1) 112,460,218 96,587,711 155,845,711 116,342,657 101,358,626 83,548,055 tax payable by any securityholder that would have reduced Management expense returns or performance. How the Fund has performed in the ratio (%) ------past does not necessarily indicate how it will perform in the Management expense ratio before waivers or future. absorption (%)(2) ------Trading expense Year-by-Year Returns ratio (%)(3) ------Portfolio turnover The following bar chart shows the Fund’s annual rate (%)(4) 10.18 42.40 20.04 25.67 30.98 67.89 performance for the period shown. The chart shows, in Net asset value per percentage terms, how much an investment made on the security ($)(1) 10.57 11.10 10.71 10.31 10.48 10.53 first day of each financial year would have grown or (1) This information is provided as at December 31 of the period shown, except for the decreased by the last day of each period. most recent semi-annual period, which is at June 30, 2021. (2) Management expense ratio is based on total expenses (excluding broker commissions and other portfolio transaction costs) including the Fund’s allocated Series I Securities – Annual return for the periods ended percentage of Fund-on-Funds’ expenses for the stated period and is expressed as an December 31 and the six month period ended June 30, 2021 annualized percentage of daily average Net Asset Value during the period. 15% (3) The trading expense ratio represents total commissions and other portfolio transaction costs expressed as an annualized percentage of daily average Net Asset Value during the period. 9.8% (4) The Fund’s portfolio turnover ratio indicates how actively the Fund’s portfolio 10% 8.8% manager manages its portfolio investments. A portfolio turnover ratio of 100% is 7.6% 6.9% equivalent to the Fund buying and selling all of the securities in its portfolio once in the course of the year. The higher a Fund’s portfolio turnover ratio in a year, the 5% greater the trading costs payable by the Fund in the year, and the greater the 3.6% 3.4% chance of an investor receiving taxable capital gains in the year. There is not 2.5% 1.7% 1.4% necessarily a relationship between a high portfolio turnover rate and the performance of the Fund. 0% -1.2% -3.5% Management Fees -5% The maximum annual management fee paid by the Fund is a 2011(*) 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 percentage of the average daily net asset value of each (*) for the period of April 15, 2011 to December 31, 2011. series of securities of the Fund exclusive of any applicable taxes and operating expenses, which is accrued daily and is paid to the Manager monthly in arrears. Management fees pay for portfolio and investment advisory services, oversight of any service providers, marketing and promotional activities, arranging for the distribution and sale of securities of the Fund, general administration of Fund operations and sales and trailing commissions paid to dealers. Series I management fees are not paid by the Fund. Series I investors negotiate management fees and pay directly to the Manager.

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Summary of Investment Portfolio* Forward-Looking Statements as at June 30, 2021 This management report of fund performance may contain forward-looking statements about the Fund, including its Top 25 Investments strategies, results of operations, performance and condition. Forward-looking statements include statements that are Percentage of Net predictive in nature, or that depend upon or refer to future Asset Value of the events or conditions. They are based on current beliefs, Holding Name Fund (%) expectations and projections about future events and are 1 Government of Canada, 2.75%, Dec 01, 2048 1.4 2 Government of Canada, 0.50%, Dec 01, 2030 1.4 inherently subject to, among other things, risks, uncertainties 3 Government of Canada, 2.00%, Dec 01, 2051 1.3 and assumptions about the Fund and various economic 4 Province of Quebec, 3.50%, Dec 01, 2048 1.2 factors. Many factors could cause the Fund’s actual results, 5 Government of Canada, 1.25%, Jun 01, 2030 1.1 performance or achievements to be materially different from 6 Government of Canada, 1.00%, Sep 01, 2022 1.0 any future results, performance or achievements that may be 7 Government of Canada, 0.25%, Nov 01, 2022 1.0 expressed or implied by such forward-looking statements. 8 Canada Housing Trust No 1, 2.40%, Dec 15, 2022 0.9 These factors could include, among other things, general 9 Canada Housing Trust No 1, 2.90%, Jun 15, 2024 0.9 economic, political and market factors, including interest and 10 Government of Canada, 0.50%, Sep 01, 2025 0.9 foreign exchange rates, business competition, technological 11 Government of Canada, 0.25%, May 01, 2023 0.9 changes, changes in government regulations or in tax laws and 12 Government of Canada, 2.00%, Sep 01, 2023 0.9 pandemics. Although the forward-looking statements 13 Government of Canada, 0.25%, Apr 01, 2024 0.9 contained in this report are based upon what management 14 Province of Ontario, 2.90%, Jun 02, 2049 0.9 currently believes to be reasonable assumptions, the Manager 15 Government of Canada, 0.25%, Mar 01, 2026 0.9 cannot assure current or prospective investors that actual 16 Province of Ontario, 2.60%, Jun 02, 2025 0.8 results, performance or achievements will be consistent with 17 Province of Ontario, 2.65%, Dec 02, 2050 0.8 these forward-looking statements. The words “may”, “could”, 18 Government of Canada, 2.25%, Jun 01, 2025 0.8 “would”, “should”, “believe”, “plan”, “anticipate”, “expect”, 19 Province of Ontario, 2.90%, Dec 02, 2046 0.8 “intend”, “forecast”, “objective”, and similar expressions are 20 Government of Canada, 0.25%, Feb 01, 2023 0.8 intended to identify forward-looking statements. The Manager 21 Government of Canada, 5.75%, Jun 01, 2029 0.7 does not undertake any obligation to update or revise any 22 Province of Ontario, 3.45%, Jun 02, 2045 0.7 forward-looking statements to reflect events or circumstances 23 Province of Ontario, 2.60%, Jun 02, 2027 0.7 after the date of this document or to reflect new information 24 Canada Housing Trust No 1, 1.95%, Dec 15, 2025 0.7 25 Canada Housing Trust No 1, 2.35%, Sep 15, 2023 0.7 or the occurrence of unanticipated events, except as required 23.1 by law. Total Net Asset Value (000s) $ 1,188,796

Sector Allocation

Percentage of Net Asset Value of the Fund (%) Canadian Provincial Government Bond 37.4 Canadian Federal Government Bond 32.5 Canadian Corporate Bond 28.1 Canadian Municipal Government Bond 1.5 Other Assets less Liabilities 0.4 Cash and Cash Equivalents 0.1 100.0

(*) All information is as at June 30, 2021. The summary of investment portfolio may change due to ongoing portfolio transactions of the Fund. Unless otherwise noted positions are long. You may obtain quarterly updates to these holdings free of charge by calling us at 1-877-344-1434, visiting our website at www.sunlifeglobalinvestments.com or by sending an email to us at [email protected].

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Sun Life BlackRock Canadian Universe Bond Fund

SLGI Asset Management Inc. 1 York Street, Suite 3300, Toronto, Ontario, M5J 0B6 Telephone: 1-877-344-1434 | Facsimile: 416-979-2859 [email protected] www.sunlifeglobalinvestments.com

© SLGI Asset Management Inc. and its licensors, 2021. SLGI Asset Management Inc. is a member of the Sun Life group of companies. All rights reserved. Sun Life Global Investments is a trade name of SLGI Asset Management Inc., Sun Life Assurance Company of Canada and Sun Life Financial Trust Inc. SLGI Asset Management Inc. is the investment manager of the Sun Life Mutual Funds, Sun Life Granite Managed Solutions and Sun Life Private Investment Pools.