desjardins financial corporation inc

This document is important and requires your immediate attention. If you are in doubt as to how to deal with it, you shouldconsult your investment dealer, broker, lawyer or other professional advisor.This document does not constitute an offer or a solicitation to, nor will deposits be accepted from or on behalf of, anyperson in any jurisdiction in which such offer or solicitation is unlawful.The Offers have not been approved by any securities regulatory authority nor has any securities regulatory authoritypassed upon the fairness or merits of the Offers, or upon the adequacy of the information contained in this document. Anyrepresentation to the contrary is an offence.

January 21, 2011

DESJARDINS FINANCIAL CORPORATION INC.(a member of the Desjardins Financial Group)

OFFERS TO PURCHASEall of the issued and outstanding Common Shares

andall of the issued and outstanding First Preferred Shares, Series Three

andall of the issued and outstanding First Preferred Shares, Series Four

of

WESTERN FINANCIAL GROUP INC.on the basis of

$4.15 in cash for each Common Shareand

$100 in cash for each First Preferred Share, Series Threeand

$100 in cash for each First Preferred Share, Series Four

Desjardins Financial Corporation Inc. (the “Offeror”) hereby offers (the “Offers”) to purchase, upon the terms andsubject to the conditions described herein: (i) at a price of $4.15 in cash per share, all of the issued and outstandingcommon shares, together with the associated rights (the “SRP Rights”) outstanding under the Shareholders Rights Plan(such common shares together with the SRP Rights, the “Common Shares”) of Western Financial Group Inc.(“Western”), including the Common Shares that may become issued and outstanding after the date of the Offers andprior to the Expiry Time (as defined below) upon the exercise or conversion, as the case may be, of Convertible Securities(as defined herein) (the “Common Share Offer”), (ii) at a price of $100 in cash per share, all of the issued and outstandingFirst Preferred Shares, Series 3 (the “Series 3 Shares”) of Western (the “Series 3 Share Offer”), and (iii) at a price of$100 in cash per share, all of the issued and outstanding First Preferred Shares, Series 4 (the “Series 4 Shares” and,together with the Common Shares and the Series 3 Shares, the “Shares”) of Western (the “Series 4 Share Offer”).

The board of directors of Western, following consultation with its financial and legal advisors, has unanimouslydetermined that the Common Share Offer is in the best interest of Western and the holders of Common Shares (the“Common Shareholders”) and, accordingly, has unanimously recommended that Common ShareholdersACCEPT the Common Share Offer and TENDER their Common Shares to the Common Share Offer.

The Common Shares, the Series 3 Shares and the Series 4 Shares are listed and posted for trading on the Toronto StockExchange (the “TSX”) under the symbols “WES”, “WES.PR.A” and “WES.PR.B”, respectively. The Offers represent apremium of approximately 69% to the closing price of the Common Shares on December 23, 2010, being the last tradingday prior to the announcement of the Offeror’s intention to make the Common Share Offer, which was $2.45, a premiumof approximately 22% to the closing price of the Series 3 Shares on December 23, 2010, which was $81.75, and a premiumof approximately 23% to the closing price of the Series 4 Shares on December 23, 2010, which was $81.50. The Offersalso represent a premium of approximately 68%, 22% and 22% respectively over the volume-weighted average tradingprices of the Common Shares, the Series 3 Shares and the Series 4 Shares on the TSX for the 20 trading days prior toDecember 23, 2010.

As of the date hereof, the Offeror and its Affiliates (as defined herein) do not beneficially own, directly or indirectly, nordo they exercise direction over, or have the right to acquire any Common Shares or Convertible Securities.

The Offeror and Western have entered into a support agreement (the “Support Agreement”) dated December 23, 2010pursuant to which the Offeror has agreed to make the Common Share Offer and Western has agreed to support andrecommend the Common Share Offer, all subject to the terms and conditions described therein. See Section 5 of theCircular, “Agreement Relating to the Offers”.

THE OFFERS WILL BE OPEN FOR ACCEPTANCE UNTIL 5:00 P.M. (MONTRÉAL TIME) ONFEBRUARY 28, 2011, UNLESS THE OFFERS ARE EXTENDED (THE “EXPIRY TIME”) OR WITHDRAWNBY THE OFFEROR.

The Offers are subject to certain conditions described under “Conditions of the Offers” in Section 4 of the Offersincluding, without limitation, that at the Expiry Time: (i) there shall have been validly deposited under the Common ShareOffer and not withdrawn at the Expiry Time, such number of Common Shares which, together with any Common Sharesbeneficially owned or over which control or direction is exercised by the Offeror and its Affiliates and joint actors,represents in the aggregate at least 662⁄3% of the aggregate of the outstanding Common Shares and the Common Sharesissuable upon (A) the conversion of all the issued and outstanding First Preferred Shares, Series Two of Western (the“Series 2 Shares”), (B) the conversion of all the issued and outstanding First Preferred Shares, Series Five of Western (the“Series 5 Shares”), (C) the conversion of all the $16,710,000 aggregate principal amount of convertible unsecuredsubordinated debentures due June 30, 2014 of Western (the “Convertible Debentures”), and (D) the exercise ofoutstanding in-the money Options (as defined herein) for Common Shares of Western (such entitlements for CommonShares collectively referred to as the “In-the-Money Convertible Securities”), (ii) all outstanding Options shall havebeen exercised, terminated or otherwise cancelled, (iii) all Appropriate Regulatory Approvals (as defined herein) shallhave been obtained on terms and conditions satisfactory to the Offeror, acting reasonably, and (iv) the sale of Western’sinterest in Jennings Capital Inc. shall have been completed. In addition to the foregoing, with respect to each of theSeries 3 Share Offer and the Series 4 Share Offer, there shall have been deposited under each of such offer and notwithdrawn at the Expiry Time, such number of Series 3 Shares or Series 4 Shares, as the case may be, which, together withany Series 3 Shares or Series 4 Shares beneficially owned or over which control is exercised by the Offeror and itsAffiliates and joint actors, represent in the aggregate at least 662⁄3% of the Series 3 Shares or Series 4 Shares, as the casemay be. Subject to applicable law, the Offeror reserves the right to withdraw the Offers and to not take-up and pay for orextend the period of time during which the Offers are open, and postpone taking up and paying for, any Shares (as definedherein) deposited under the Offers, unless each of the conditions of the Offers are satisfied or waived at or before theExpiry Time.

The Offers are made only for the Common Shares, Series 3 Shares and Series 4 Shares and are not made for anyIn-the-Money Convertible Securities. Any holder of the In-the-Money Convertible Securities who wishes to participate inthe Common Share Offer must exercise or convert the In-the-Money Convertible Securities to obtain certificatesrepresenting Common Shares, and deposit those Common Shares in accordance with the Common Share Offer. SeeSection 1 of the Offers, “The Offers” and Section 3 of the Offers, “Manner of Acceptance”.

If the Offeror takes up and pays for a sufficient number of Shares deposited under the Offers, the Offeror currently intendsto acquire any Shares that are not deposited by way of a Compulsory Acquisition or Subsequent Acquisition Transaction.

Shareholders (as defined herein) who wish to accept an Offer and tender their Shares must properly complete and executethe accompanying Letter of Transmittal (printed on yellow paper) and holders of In-the-Money Convertible Securitieswho wish to conditionally exercise the conversion rights attached to such securities, accept the Common Share Offer andtender the Underlying Common Shares must properly complete and execute the accompanying Letter of Transmittal(printed on blue paper) and, in each case, tender it or a manually signed facsimile thereof, together with the certificate(s)representing their Shares or In-the-Money Convertible Securities, as the case may be, and all other documents required bythe relevant Letter of Transmittal at or prior to the Expiry Time, at any one of the offices of the Depositary (as definedbelow) in accordance with the instructions in the Letter of Transmittal or request their broker, investment dealer,commercial bank, trust company or other nominee to effect the transaction on their behalf. Alternatively, Shareholdersand holders of In-the-Money Convertible Securities may accept the Offers by: (i) following the procedures for book-entrytransfer described in Section 3 of the Offers, “Manner of Acceptance — Acceptance by Book-Entry Transfer”; or(ii) following the procedures for guaranteed delivery described in Section 3 of the Offers, “Manner of Acceptance —Procedure for Guaranteed Delivery”, using the accompanying Notice of Guaranteed Delivery (printed on green paper or amanually signed facsimile thereof, where the certificate(s) representing the Shares are not immediately available, or if thecertificate(s) and all of the required documents cannot be provided to the Depositary before the Expiry Time. Holders

whose Shares or the In-the-Money Convertible Securities, as the case may be, are registered in the name of a nomineeshould consult their broker, investment dealer, commercial bank, trust company or other nominee for assistance intendering their Shares or Common Shares underlying their In-the-Money Convertible Securities. Shareholders andholders of In-the-Money Convertible Securities will not be required to pay any fee or commission if they accept an Offerby tendering their Shares or Common Shares underlying their In-the-Money Convertible Securities directly with theDepositary.

The Offeror has retained Desjardins Securities Inc. to serve as dealer manager (the “Dealer Manager”) for the Offers inCanada. The Dealer Manager may form a soliciting dealer group comprised of members of The Investment IndustryRegulatory Organization of Canada and members of Canadian stock exchanges to solicit acceptances of the Offers. In thatevent, the Offeror will pay typical soliciting dealer fees in connection with the tender of Shares. Depositing Shareholders(as defined herein) will not be obligated to pay any fee or commission if they accept an Offer by using the services of theDealer Manager or transmitting their Shares directly to Computershare Investor Services Inc. (“Computershare” or the“Depositary”).

Questions and requests for assistance may be directed to the Depositary or Georgeson Shareholder CommunicationsCanada Inc. (the “Information Agent”) for the Offers. Contact details for such persons may be found below and on theback page of this document. Additional copies of this document and related materials may be obtained without charge onrequest from the Depositary or the Information Agent at their respective offices specified below and on the back page ofthis document. Copies of this document and related materials may also be found on SEDAR at www.sedar.com.

No person has been authorized to give any information or make any representation other than those contained in thisdocument, and, if given or made, that information or representation must not be relied upon as having been authorized bythe Offeror.

This document does not constitute an offer or a solicitation to any person in any jurisdiction in which such offer orsolicitation is unlawful. The Offers are not being made to, nor will tenders be accepted from or on behalf of,Shareholders in any jurisdiction in which the making or acceptance of the Offers would not be in compliance withthe laws of such jurisdiction. However, the Offeror may, in its sole discretion, take such action as it may deemnecessary to extend the Offers to Shareholders in any such jurisdiction.

THE DEPOSITARY FOR THE OFFERS IS:

By Facsimile Transmission

1-905-771-4082

By Mail

P.O. Box 702131 Adelaide Street East

Toronto, ONM5C 3H2

By Registered Mail, Hand or by Courier

100 University Avenue9th Floor

Toronto, ONM5J 2Y1

Attention: Corporate Actions

Toll Free (North America): 1-800-564-6253Overseas: 1-514-982-7555

E-Mail: [email protected]

ANY QUESTIONS OR REQUESTS FOR ASSISTANCE MAYBE DIRECTED TO OUR INFORMATION AGENT:

Address:

100 University Avenue11th Floor, South Tower

Toronto, OntarioM5J 2Y1

Toll Free (North America): 1-866-725-6575Collect (Overseas): 1-781-575-2168

E-Mail: [email protected]

NOTICE TO SHAREHOLDERS IN THE UNITED STATES

THE OFFERS HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE UNITED STATES SECURITIESAND EXCHANGE COMMISSION (THE “SEC”) OR ANY STATE SECURITIES REGULATORYAUTHORITY, NORHAS THE SEC OR ANY SUCH STATE SECURITIES AUTHORITY PASSED UPON THE ACCURACY ORADEQUACY OF THE OFFERS OR THE CIRCULAR. ANY REPRESENTATION TO THE CONTRARY IS ACRIMINAL OFFENCE.

The Offers are made for the securities of a Canadian issuer. The Offers are subject to applicable disclosurerequirements in Canada. Shareholders in the United States should be aware that such requirements are different fromthose in the United States.

The enforcement by Shareholders of civil liabilities under United States federal securities laws may be affectedadversely by the fact that each of Western and the Offeror are incorporated or otherwise established and located outsidethe United States, that all of their respective officers and directors are non-residents of the United States, that all of theexperts named in the Circular are non-residents of the United States, and that all or a substantial portion of the assets ofWestern and the Offeror and the persons referred to above are located outside the United States. Shareholders may not beable to sue Western or the Offeror, or their respective officers or directors, as applicable, in a foreign court for violations ofUnited States federal securities law. It may be difficult to compel the Offeror and its affiliates to subject themselves to aUnited States court’s jurisdiction or to enforce a U.S. court’s judgment.

Shareholders should be aware that the Offeror or its affiliates, directly or indirectly, may bid for or make purchases ofShares or Convertible Securities, during the period of the Offers, as permitted by applicable Canadian Laws or provincialLaws or regulations. See Section 12 of the Offers, “Market Purchases”.

This document does not address any United States federal income tax consequences of the Offers toShareholders in the United States. Shareholders in the United States should be aware that a disposition of Sharesmay have tax consequences both in the United States and in Canada, which may not be described herein.Accordingly, Shareholders in the United States should consult their own tax advisors with respect to theirparticular circumstances and tax considerations applicable to them in connection with the Offers.

NOTICE TO HOLDERS OF IN-THE-MONEY CONVERTIBLE SECURITIES

No offer is made for In-the-Money Convertible Securities or other rights to acquire Common Shares (except for theSeries 3 Share Offer and the Series 4 Share Offer). Any holder of In-the-Money Convertible Securities or other rights toacquire Common Shares who wishes to accept the Common Share Offer must exercise or convert such In-the-MoneyConvertible Securities or other rights to obtain Common Shares and deposit certificates representing the Common Sharesissued upon such exercise or conversion, as the case may be, under the Common Share Offer. Any such exercise must besufficiently in advance of the Expiry Time to assure the holders of In-the-Money Convertible Securities or other rights toacquire Common Shares that they will have Common Share certificate(s) available for deposit before the Expiry Time orin sufficient time to comply with the procedures referred to in Section 3 of the Offers, “Manner of Acceptance —Procedure for Guaranteed Delivery”.

Alternatively, holders of In-the-Money Convertible Securities can utilize the procedures referred to inSection 3 of the Offers “Manner of Acceptance” in order to exercise their conversion right pursuant to suchConvertible Securities conditional upon completion of the Common Share Offer and deposit the underlyingCommon Shares to the Common Share Offer.

Holders of In-the-Money Convertible Securities or any other rights to acquire Common Shares should consult theirown tax advisors for advice with respect to the actual or potential tax consequences to them in connection with a decisionthey may make to exercise or convert, or not to exercise or convert, their In-the-Money Convertible Securities or otherrights to acquire Common Shares prior to the Expiry Time or thereafter. Generally, the conversion of Series 2 Shares,Series 5 Shares and Convertible Debentures into Common Shares under their respective terms by a holder thereof will bedeemed not to be a disposition of such Series 2 Shares, Series 5 Shares and Convertible Debentures, as applicable, for thepurposes of the Tax Act and accordingly, such holder will not realize a capital gain or capital loss on such conversion.Generally, the cost to a holder of the Common Shares acquired on such conversion will be equal to the adjusted cost baseof the Series 2 Shares, Series 5 Shares and Convertible Debentures, as applicable, to such holder immediately before theconversion. The holder’s adjusted cost base of the Common Shares so acquired will be determined by averaging the cost

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of such Common Shares with the adjusted cost base to the holder of all Common Shares owned by such holderimmediately prior to the conversion.

Subject to the receipt of all required government authorizations and approvals, the Board of Directors will make suchnecessary amendments to the Option Plan (as defined herein) and take all such steps as may be necessary or desirable(including obtaining waivers and consents) to allow any person holding Options, that may do so under Securities Laws (asdefined herein), to exercise their unvested Options on an accelerated vesting basis solely for the purpose of tenderingunder the Common Share Offer all Common Shares issued upon such exercise prior to the Expiry Time, provided that anysuch amendment shall provide that if a holder fails to exercise the Options held prior to the Expiry Time, such Optionsshall expire and be of no further force and effect and the holders thereof shall have no further claim in respect thereof.Subject to the foregoing, Western has agreed under the Support Agreement to give notice promptly following the mailingof the Common Share Offer and Circular to all persons holding Options of: (i) the vesting of all unvested Options; and(ii) the termination of all non-exercised Options as of 5:00 p.m. (Montréal time) on the Expiry Time, in each caseconditional upon the Offeror taking up and paying for Common Shares under the Common Share Offer.

Western has agreed under the Support Agreement to use its commercially reasonable efforts to facilitate all personsholding in-the-money Options to exercise all of their Options and to deposit all Common Shares issued upon such exerciseto the Common Share Offer or amend or modify the Option Plan to provide for the cashless exercise or surrender of vestedand non-exercised Options in lieu of the exercise thereof.

CURRENCY

All references to “$” or “C$” mean Canadian dollars.

FORWARD LOOKING STATEMENTS

Certain statements in the Offers and accompanying Circular under “Background to the Offers”, “Offeror’s Reasonsto Accept the Offers”, “Purpose of the Offer and Plans for Western”, “Effect of the Offers on Market and Listing”, “Effectof the Offers on Outstanding Indebtedness” and “Acquisition of Shares Not Deposited Under the Offers”, in addition tocertain statements contained elsewhere in the Offers and Circular, are forward-looking statements and are prospective innature. Forward-looking statements are not based on historical facts, but rather on current expectations and projectionsabout future events, and are therefore subject to risks and uncertainties which could cause actual results to differmaterially from the future results expressed or implied by the forward-looking statements. These statements generally canbe identified by the use of forward-looking words such as “may”, “should”, “will”, “could”, “except”, “intend”,“estimate”, “plan”, “anticipate”, “expect”, “believe”, or “continue” or the negative thereof or similar variations. Suchstatements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Importantfactors that could cause actual results to differ materially from the Offeror’s expectations include, among other things,changing and prolonged financial and economic uncertainty; regulatory and legal developments; competition, industrytrends and availability of capital resources; changes in interest rates; credit quality; liquidity; movement in credit spreads;changes in accounting standards and policies; and changes in tax laws. Such forward-looking statements should,therefore, be construed in light of such factors and the Offeror is under no obligation and expressly disclaims any intentionor obligation to update or revise any forward-looking statements, whether as a result of new information, future events orotherwise, except as required by applicable Law.

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TABLE OF CONTENTS

NOTICE TO SHAREHOLDERS IN THE UNITED STATES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iNOTICE TO HOLDERS OF IN-THE-MONEY CONVERTIBLE SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . iCURRENCY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iiFORWARD LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iiSUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1THE OFFERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

1. THE OFFERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52. TIME FOR ACCEPTANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53. MANNER OF ACCEPTANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54. CONDITIONS OF THE OFFERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105. EXTENSION AND VARIATION OF THE OFFERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126. TAKE UP AND PAYMENT FOR DEPOSITED SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 127. RETURN OF DEPOSITED SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 138. RIGHT TO WITHDRAW DEPOSITED SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149. NOTICE AND DELIVERY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

10. CHANGES IN CAPITALIZATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1511. SHARES NOT DEPOSITED UNDER THE OFFERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1612. MARKET PURCHASES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1613. OTHER TERMS OF THE OFFERS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

CIRCULAR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 181. THE OFFEROR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 182. WESTERN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 183. BACKGROUND TO THE OFFERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 204. OFFEROR’S REASONS TO ACCEPT THE OFFERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215. AGREEMENT RELATING TO THE OFFERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 226. PURPOSE OF THE OFFERS AND PLANS FOR WESTERN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 317. SOURCE OF OFFERED CONSIDERATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 328. BENEFICIAL OWNERSHIP OF AND TRADING IN SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . 329. EFFECT OF THE OFFERS ON MARKET AND LISTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

10. EFFECT OF THE OFFERS ON OUTSTANDING INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . . . . . 3311. COMMITMENTS TO ACQUIRE SECURITIES OF WESTERN . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3312. ARRANGEMENTS, AGREEMENTS OR UNDERSTANDINGS, OTHER BENEFITS TO

INSIDERS, AFFILIATES AND ASSOCIATES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3313. MATERIAL CHANGES AND OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3414. REGULATORY MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3415. ACQUISITION OF SHARES NOT DEPOSITED UNDER THE OFFERS . . . . . . . . . . . . . . . . . . . . . 3516. CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS . . . . . . . . . . . . . . . . . . . . . . 3817. BUSINESS RELATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4018. DEPOSITARY AND INFORMATION AGENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4019. DEALER MANAGER AND SOLICITING DEALER GROUP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4020. BENEFITS FROM THE OFFERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4121. LEGAL MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4122. OFFEREES’ STATUTORY RIGHTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4123. DIRECTORS’ APPROVAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

GLOSSARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42CONSENT OF MCCARTHY TÉTRAULT LLP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48APPROVAL AND CERTIFICATE OF THE OFFEROR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

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SUMMARY

The following is a summary only and is qualified in its entirety by the detailed provisions contained in the Offers andCircular. You should read the Offers and Circular in their entirety. Certain capitalized and other terms used in thissummary are defined in the Glossary.

The Offers

The Offeror hereby offers to purchase, upon the terms and subject to the conditions of the Offers, (i) all of the issuedand outstanding Common Shares (including associated SRP Rights and any Common Shares which may become issuedand outstanding after the date of the Offer and prior to the Expiry Time upon the exercise or conversion, as the case maybe, of Convertible Securities) for consideration per Common Share of $4.15, (ii) all of the issued and outstanding Series 3Shares for a consideration per Series 3 Share of $100, and (iii) all of the issued and outstanding Series 4 Shares for aconsideration per Series 4 Share of $100. See Section 1 of the Offers, “The Offers”.

The Offers represent a premium of approximately 69% to the closing price of the Common Shares on December 23,2010, being the last trading day prior to the announcement of the Offeror’s intention to make the Common Share Offer,which was $2.45, a premium of approximately 22% to the closing price of the Series 3 Shares on December 23, 2010,which was $81.75, and a premium of approximately 23% to the closing price of the Series 4 Shares on December 23, 2010,which was $81.50. The Offers also represent a premium of approximately 68%, 22% and 22% respectively over thevolume-weighted average trading prices of the Common Shares, the Series 3 Shares and the Series 4 Shares on the TSXfor the 20 trading days prior to December 23, 2010.

The Offeror

The Offeror is a member of the Desjardins Financial Group and a wholly-owned indirect subsidiary of the Fédérationdes caisses Desjardins du Québec. The Desjardins Financial Group is the leading cooperative financial group in Canadaand the sixth largest in the world, with assets of over $175 billion. Drawing on the strength of its caisse network in Québecand Ontario, and its subsidiaries across Canada, it offers a full range of financial products and services to its 5.8 millionmembers and clients. Desjardins specializes in wealth management and life and health insurance, property and casualtyinsurance, personal services, business and institutional services. The Offeror is incorporated under the laws of theProvince of Québec and its registered and head office is located at 1 Complexe Desjardins, South Tower, 39th Floor,Montréal, Québec, H5B 1B2. See Section 1 of the Circular, “The Offeror”.

Western

Western is a leading P&C insurance brokerage network and offers complimentary life insurance and bankingservices in over 90 communities, to more than 550,000 individuals and businesses in Western Canada through its whollyowned network of offices, its affiliated insurance brokers, Western Life Assurance Company, Bank West and WesternFinancial Insurance Company. Western is incorporated under the laws of the Province of Alberta, its head ofice is locatedat 1010 – 24th Street, S.E., High River, Alberta, T1V 2A6 and its registered office address is 3700, 400 – 3rd Avenue S.W.,Calgary, Alberta, T2P 4H2. See Section 2 of the Circular, “Western”.

Purpose of the Offers

The purpose of the Offers is to enable the Offeror to acquire all outstanding Shares and to complete the transactionsdescribed in Section 6 of the Circular, “Purpose of the Offers and Plans for Western” and Section 15 of the Circular,“Acquisition of Shares Not Deposited Under the Offer”.

Conditions of the Offers

The Offers are subject to certain conditions described under “Conditions of the Offers” in Section 4 of the Offersincluding, without limitation, that at the Expiry Time: (i) there shall have been validly deposited under the Common ShareOffer and not withdrawn at the Expiry Time, such number of Common Shares which, together with any Common Sharesbeneficially owned or over which control or direction is exercised by the Offeror and its Affiliates and joint actors,represents in the aggregate at least 662⁄3% of the aggregate of the outstanding Common Shares and the Common Sharesissuable upon the exercise or conversion, as the case may be, of In-the-Money Convertible Securities, (ii) all outstandingOptions shall have been exercised, terminated or otherwise cancelled, (iii) all Appropriate Regulatory Approvals shallhave been obtained on terms and conditions satisfactory to the Offeror, acting reasonably, and (iv) the sale of Western’sinterest in Jennings Capital Inc. shall have been completed. In addition to the foregoing, with respect to each of the

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Series 3 Share Offer and the Series 4 Share Offer, there shall have been deposited under each of such offer and notwithdrawn at the Expiry Time, such number of Series 3 Shares or Series 4 Shares, as the case may be, which, together withany Series 3 Shares or Series 4 Shares beneficially owned or over which control is exercised by the Offeror and itsAffiliates and joint actors, represent in the aggregate at least 662⁄3% of the Series 3 Shares or Series 4 Shares, as the casemay be. Subject to applicable law, the Offeror reserves the right to withdraw the Offers and to not take-up and pay for orextend the period of time during which the Offers are open, and postpone taking up and paying for, any Shares (as definedherein) deposited under the Offers, unless each of the conditions of the Offers are satisfied or waived at or before theExpiry Time.

Time for Acceptance

The Offers are open for acceptance until the Expiry Time, being 5:00 p.m. (Montréal time) on February 28, 2011unless the Offers are withdrawn or extended by the Offeror. The Expiry Time may be extended at the Offeror’s solediscretion. See Section 5 of the Offers, “Extension and Variation of the Offers”.

Manner of Acceptance

Shareholders who wish to accept an Offer and tender their Shares must properly complete and execute theaccompanying Letter of Transmittal (printed on yellow paper) and holders of In-the-Money Convertible Securities whowish to conditionally exercise the conversion rights attached to such securities, accept the Common Share Offer andtender the Underlying Common Shares must properly complete and execute the accompanying Letter of Transmittal(printed on blue paper) and, in each case, tender it or a manually signed facsimile thereof, together with the certificate(s)representing their Shares or In-the-Money Convertible Securities, as the case may be, and all other documents required bythe relevant Letter of Transmittal at or prior to the Expiry Time, at any one of the offices of the Depositary (as definedbelow) in accordance with the instructions in the Letter of Transmittal or request their broker, investment dealer,commercial bank, trust company or other nominee to effect the transaction on their behalf. Alternatively, Shareholdersand holders of In-the-Money Convertible Securities may follow the procedure for guaranteed delivery described inSection 3 of the Offers, “Manner of Acceptance — Procedure for Guaranteed Delivery” using the accompanying Noticeof Guaranteed Delivery. Holders whose Shares or In-the-Money Convertible Securities, as the case may be, are held in anaccount with an investment dealer, stockbroker, bank, trust company or other nominee should contact their representativeif they wish to accept an Offer.

In-the-Money Convertible Securities

Holders of In-the-Money Convertible Securities or other rights to acquire Common Shares who wish to accept theCommon Share Offer must exercise or convert such In-the-Money Convertible Securities or other rights to obtainCommon Shares and deposit certificates representing the Common Shares issued upon such exercise or conversion, as thecase may be, under the Common Share Offer. Any such exercise must be sufficiently in advance of the Expiry Time toassure the holders of In-the-Money Convertible Securities or other rights to acquire Common Shares that they will haveCommon Share certificate(s) available for deposit before the Expiry Time or in sufficient time to comply with theprocedures referred to in Section 3 of the Offers to Purchase, “Manner of Acceptance”.


Take Up and Payment for Deposited Shares

Upon the terms and subject to the conditions of the Offers (including but not limited to the conditions specified inSection 4 of the Offers, “Conditions of the Offers”), the Offeror will take up Shares validly tendered to an Offer and notwithdrawn pursuant to Section 8 of the Offers “Right to Withdraw Deposited Shares”, not later than ten (10) calendar daysafter the Expiry Time and will pay for the Shares taken up as soon as possible, but in any event not later than three(3) Business Days after taking up the Shares. Any Shares tendered to an Offer after the first date on which Shares havebeen taken up by the Offeror will be taken up and paid for not later than ten (10) days after such tender. See Section 6 of theOffers, “Take Up and Payment for Deposited Shares”.

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Withdrawal of Deposited Shares

Except as otherwise provided in Section 8 of the Offers, “Right to Withdraw Deposited Shares”, all deposits ofShares are irrevocable.

Acquisitions of Shares not Deposited under the Offers

If the Offeror takes up and pays for not less than 90% of the issued and outstanding Shares of any class to which anOffer relates, other than such Shares held on the date of the Offers by or on behalf of the Offeror, the Offeror intends, to theextent possible, to acquire all Shares of that class (including in respect of the Common Share Offer, Common Shares thatmay be issued as a result of the exercise of the rights under any Convertible Securities) that are held by any Person who didnot accept the relevant Offer by Compulsory Acquisition.

If the Offeror acquires less than 90% of the Shares of any class under the Offers or the right of CompulsoryAcquisition described above is not available for any reason, the Offeror will acquire the remaining Shares pursuant to aSubsequent Acquisition Transaction under which the consideration payable to Shareholders will be equal in amount toand in the same form as that payable under the Offers.

See Section 6 of the Circular, “Purpose of the Offers and Plans for Western” and Section 15 of the Circular,“Acquisition of Shares Not Deposited Under the Offers”.

Recommendation of the Board of Directors

The Board of Directors, following consultation with its financial and legal advisors, has unanimously determinedthat the Common Share Offer is in the best interests of Western and the Common Shareholders and, accordingly, hasunanimously recommended that Common Shareholders accept the Common Share Offer. The Board of Directors is notmaking a recommendation to holders of the Series 3 Shares and the Series 4 Shares as to whether to accept the Series 3Share Offer and the Series 4 Share Offer. For further information on the deliberations of the Board of Directors and relatedmatters, see the Directors’ Circular accompanying the Offers.

Support Agreement

On December 23, 2010, the Offeror agreed to make, and Western agreed to support, the Common Share Offer,subject to the conditions set forth in the Support Agreement. Under the terms of the Support Agreement, Western has,inter alia, agreed to support the Common Share Offer, not to solicit or, except as described therein, agree to anyAcquisition Proposal and to make a Termination Payment to the Offeror under certain circumstances. See Section 4 of theCircular, “Agreements Related to the Offers”.

Regulatory Matters

The Offeror’s obligation to take up and pay for Shares tendered under the Offers is conditional upon all AppropriateRegulatory Approvals having been obtained on terms satisfactory to the Offeror, acting reasonably. See Section 14 of theCircular, “Regulatory Matters”. These approvals include the approval of the Minister of Finance (Canada) and theCompetition Act Approval.

Certain Canadian Federal Income Tax Considerations

Generally, a Shareholder who holds Shares as capital property and disposes of those Shares pursuant to the Offerswill realize a capital gain (or capital loss) equal to the amount by which the proceeds of disposition of the Shares exceed(or are less than) the aggregate of the adjusted cost base to the Shareholder of the Shares and any reasonable costs ofdisposition.

Shareholders are urged to read Section 16 of the Circular, “Certain Canadian Federal Income TaxConsiderations”, and consult their own tax advisors for advice with respect to the tax consequences to them ofdisposing of Shares pursuant to the Offers or any Compulsory Acquisition or Subsequent Acquisition Transaction.

Depositary

The Offeror has engaged Computershare Investors Services Inc. to act as the Depositary for the Offers. TheDepositary may contact Shareholders by mail, telephone and facsimile and may request banks, brokers, investmentdealers and other nominees to forward materials relating to the Offers to beneficial owners of Shares. The Depositary willfacilitate book-entry only transfers of Shares tendered under the Offers. The Depositary will receive reasonable and

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customary compensation from the Offeror for its services in connection with the Offers, will be reimbursed for certainout-of-pocket expenses and will be indemnified against certain liabilities and expenses in connection with the Offers.

Dealer Manager, Soliciting Dealer Group and Information Agent

The Offeror has retained Desjardins Securities Inc. to serve as dealer manager for the Offers in Canada. The DealerManager may form a soliciting dealer group comprised of members of The Investment Industry Regulatory Organizationof Canada and members of Canadian stock exchanges to solicit acceptances of the Offers. In that event, the Offeror willpay typical soliciting dealer fees in connection with the tender of Shares. Depositing Shareholders will not be obligated topay any fee or commission if they accept an Offer by using the services of the Dealer Manager or transmitting their Sharesdirectly to the Depositary.

The Offeror has also retained Georgeson Shareholder Communications Canada Inc. to act as Information Agent inconnection with the Offers. The Information Agent will receive reasonable and customary compensation from the Offerorfor its services in connection with the Offers, will be reimbursed for certain out-of-pocket expenses and will beindemnified against certain liabilities and expenses in connection with the Offers.

Questions and requests for assistance may be directed to the Information Agent for the Offers, GeorgesonShareholder Communications Canada Inc., at 1-866-725-6575 toll free in North America, or at 1-781-575-2168 outsideof North America, or by e-mail at [email protected].

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THE OFFERS

January 21, 2011

TO: THE HOLDERS OF COMMON SHARES, FIRST PREFERRED SHARES, SERIES THREE AND FIRSTPREFERRED SHARES, SERIES FOUR OF WESTERN FINANCIAL GROUP INC.

1. THE OFFERS

The Offeror hereby offers to purchase, upon the terms and subject to the conditions of the Offers, (i) all of the issuedand outstanding Common Shares (including associated SRP Rights and any Common Shares which may become issuedand outstanding after the date of the Offers and prior to the Expiry Time upon the exercise or conversion, as the case maybe, of any Convertible Securities) for consideration per Common Share of $4.15 (the “Common Share Consideration”),(ii) all of the issued and outstanding Series 3 Shares for a consideration per Series 3 Share of $100 (the “Series 3 ShareConsideration”), and (iii) all of the issued and outstanding Series 4 Shares for a consideration per Series 4 Share of $100(the “Series 4 Share Consideration” and, together with the Common Share Consideration and the Series 3 ShareConsideration, the “Offered Consideration”) other than Shares held by the Offeror or its Affiliates.


The Offers are made only for Shares and not for any In-the-Money Convertible Securities. Any holder ofIn-the-Money Convertible Securities or other rights to acquire Common Shares who wishes to accept the CommonShare Offer must exercise or convert such In-the-Money Convertible Securities or other rights to obtain Common Sharesand deposit certificates representing the Common Shares issued upon such exercise or conversion, as the case may be,under the Common Share Offer. Any such exercise must be sufficiently in advance of the Expiry Time to assure theholders of In-the-Money Convertible Securities or other rights to acquire Common Shares that they will have CommonShare certificate(s) available for deposit before the Expiry Time or in sufficient time to comply with the proceduresreferred to in Section 3 of the Offers, “Manner of Acceptance — Procedure of Guaranteed Delivery”.


The accompanying Circular, Letter of Transmittal and Notice of Guaranteed Delivery which are incorporatedinto and form part of the Offers contain important information that should be read carefully before making adecision with respect to the Offers.

2. TIME FOR ACCEPTANCE

The Offers are each open for acceptance from the date hereof until the Expiry Time, being 5:00 p.m. (Montréal time)on February 28, 2011 unless any such Offer is withdrawn or extended by the Offeror. The Expiry Time may be extended atthe Offeror’s sole discretion pursuant to Section 5 of the Offers, “Extension and Variation of the Offers”.

3. MANNER OF ACCEPTANCE

Letter of Transmittal

The Offers may be accepted by Shareholders, and the Common Share Offer may be accepted by holders ofIn-the-Money Convertible Securities who wish to deposit their underlying Common Shares, by depositing the followingdocuments with the Depositary at any one of the offices specified in the Letter of Transmittal no later than the ExpiryTime:

(a) certificate(s) representing the Shares for which the relevant Offer is accepted, or in the case of In-the-MoneyConvertible Securities, certificate(s) representing the In-the-Money Convertible Securities for which theywish to deposit their underlying Common Shares to the Common Share Offer;

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(b) in the case of the Shares, an executed copy of the Letter of Transmittal (printed on yellow paper) and, in thecase of the In-the-Money Convertible Securities, an executed copy of the Letter of Transmittal (printed on bluepaper) in each case in the form accompanying the Offers, or a manually signed facsimile thereof; and

(c) any other relevant documents required by the rules set out in the relevant Letter of Transmittal.

Participants in CDS should contact the Depositary with respect to the tender of their Shares under the Offers or theconditional exercise of the conversion rights attached to their In-the-Money Convertible Securities and the tender of theunderlying Common Shares to the Common Share Offer. CDS will be issuing instructions to its participants as to (i) themethod of tendering such Shares to the Offers, and (ii) the method for conditionally exercising the conversion rightsattached to In-the-Money Convertible Securities and tendering the underlying Common Shares to the Common ShareOffer. Shareholders and holders of In-the-Money Convertible Securities will not be required to pay any fee or commissionif they accept an Offer by tendering their Shares or Common Shares underlying In-the-Money Convertible Securitiesdirectly with the Depositary.

The Offers will be deemed to be accepted only if the Depositary has actually received these documents at or beforethe Expiry Time at one of the addresses for the Depositary indicated on the Letter of Transmittal.

Shareholders and holders of In-the-Money Convertible Securities who cannot comply on a timely basis with theseprocedures for deposit of the requisite certificate(s) for Shares or In-the-Money Convertible Securities, as the case may be,may deposit certificate(s) representing Shares or In-the-Money Convertible Securities to the procedure for guaranteeddelivery described below.

Holders of In-the-Money Convertible Securities or other rights to acquire Common Shares who wish to accept theCommon Share Offer must exercise or convert such In-the-Money Convertible Securities or other rights to obtainCommon Shares and deposit certificates representing the Common Shares issued upon such exercise or conversion, as thecase may be, under the Common Share Offer. Any such exercise must be sufficiently in advance of the Expiry Time toassure the holders of In-the-Money Convertible Securities or other rights to acquire Common Shares that they will haveCommon Share certificate(s) available for deposit before the Expiry Time or in sufficient time to comply with theprocedures referred to in this Section 3 under “Procedure for Guaranteed Delivery”. Alternatively, holders ofIn-the-Money Convertible Securities can utilize the procedures referred to in Section 3 of the Offers “Mannerof Acceptance” in order to exercise their conversion right pursuant to such Convertible Securities conditional uponcompletion of the Common Share Offer and deposit the underlying Common Shares to the Common Share Offer.

SRP Rights

Unless waived by the Offeror, Common Shareholders are required to deposit one SRP Right for each Common Sharedeposited under the Common Share Offer in order to effect a valid deposit of such Common Share. No additional paymentwill be made for the SRP Rights and no amount of the consideration to be paid by the Offeror for the deposited CommonShares will be allocated to the SRP Rights. The following procedures must be followed in order to effect the valid depositof the SRP Rights associated with the deposited Common Shares:

(a) if the Separation Time (as defined in the Shareholder Rights Plan) under the Shareholder Rights Plan has notoccurred prior to the Expiry Time and Rights Certificates (as defined in the Shareholder Rights Plan) have notbeen distributed by Western, a deposit of Common Shares will also constitute a deposit of the associated SRPRights;

(b) if the Separation Time occurs before the Expiry Time and Rights Certificates have been distributed by Westernprior to the time Common Shares are deposited under the Common Share Offer, Rights Certificatesrepresenting SRP Rights equal in number to the number of deposited Common Shares must be deliveredwith the Letter of Transmittal or, if available, a book-entry confirmation must be received by the Depositarywith respect thereto; and

(c) if the Separation Time occurs before the Expiry Time and Rights Certificates have not been distributed by thetime Common Shares are deposited under the Common Share Offer, or the Rights Certificates have beendistributed but not received by the Common Shareholder(s) making the deposit, the Common Shareholder(s)may deposit its SRP Rights before receiving Rights Certificates by using the guaranteed delivery procedure setout in Section 3 of the Offers, “Manner of Acceptance — Procedure for Guaranteed Delivery”.

Note that, in any case, a deposit of Common Shares constitutes an agreement by the Common Shareholder(s) makingthe deposit to deliver Rights Certificates representing SRP Rights equal in number to the number of Common Shares

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deposited by the Common Shareholder(s) or, if available, a Book-Entry Confirmation, in each case, must be received bythe Depositary with respect thereto, on or before the third trading day on the TSX after the date, if any, that RightsCertificates are distributed. The Offeror reserves the right to require, if the Separation Time occurs before the ExpiryTime, that the Depositary receive from the Common Shareholder(s) making the deposit, prior to taking up the CommonShares deposited for payment pursuant to the Common Share Offer, Rights Certificates (or, if available, a Book-EntryConfirmation) from the Common Shareholder(s) representing SRP Rights equal in number to the Common Sharesdeposited by the Common Shareholder(s).

Signature Guarantees

No signature guarantee is required on the Letter of Transmittal if:

(a) the Letter of Transmittal is signed by the registered owner of the Shares or In-the-Money ConvertibleSecurities, as the case may be, exactly as the name of the registered holder appears on the certificate(s)deposited therewith, and the Offered Consideration is to be delivered directly to such registered holder; or

(b) Shares or In-the-Money Convertible Securities, as the case may be, are tendered for the account of an EligibleInstitution.

In all other cases, all signatures on the Letter of Transmittal must be guaranteed by an Eligible Institution. If acertificate representing Shares or In-the-Money Convertible Securities, as the case may be, is registered in the name of aPerson other than a signatory of a Letter of Transmittal or if the Offered Consideration is to be delivered to a Person otherthan the registered owner, the certificate must be endorsed or accompanied by an appropriate power of attorney, in eithercase, signed exactly as the name of the registered owner appears on the certificate with the signature on the certificate orpower of attorney guaranteed by an Eligible Institution.

Method of Delivery

The method of delivery of Shares or In-the-Money Convertible Securities, as the case may be, the Letter ofTransmittal, the Notice of Guaranteed Delivery and all other required documents is at the option and risk of the tenderingholder. The Offeror recommends that those documents be delivered by hand to the Depositary and that a receipt beobtained or, if certificate(s) for Shares or In-the-Money Convertible Securities, as the case may be, and the otherdocuments are to be sent by mail, registered mail with return receipt requested, properly insured, is recommended, and itis suggested that the mailing be made sufficiently in advance of the Expiry Time to permit delivery to the Depositary on orprior to such time. Delivery will only be effective upon actual receipt of certificate(s) for such Shares or In-the-MoneyConvertible Securities, as the case may be, by the Depositary.

A holder who wishes to tender Shares or Common Shares underlying In-the-Money Convertible Securities, as thecase may be, to an Offer and whose Shares or In-the-Money Convertible Securities are registered in the name of a broker,investment dealer, commercial bank, trust company or other nominee should immediately contact such nominee in orderto take the necessary steps to be able to tender such Shares or Common Shares underlying In-the-Money ConvertibleSecurities, as the case may be, to the relevant Offer.

Procedure for Guaranteed Delivery

If a Shareholder wishes to accept an Offer, or if a holder of In-the-Money Convertible Securities wishes to exercisethe conversion rights attached to such securities and tender the underlying Common Shares to the Common Share Offerand either: (i) the certificate(s) representing such holder’s Shares or In-the-Money Convertible Securities, as the case maybe, are not immediately available; or (ii) such Shareholder cannot deliver the certificate(s) and Letter of Transmittal to theDepositary by the Expiry Time, those Shares or the Common Share underlying the In-the-Money Convertible Securitiesmay nevertheless be tendered to an Offer provided that all of the following conditions are met:

(a) such tender is made only at the principal office of the Depositary in Toronto, Ontario, by or through an EligibleInstitution;

(b) a Notice of Guaranteed Delivery (printed on green paper (or a manually signed facsimile thereof), properlycompleted and duly executed, including a guarantee to deliver by an Eligible Institution in the form set out inthe Notice of Guaranteed Delivery, is received by the Depositary at its principal office in Toronto, Ontario, ator before the Expiry Time; and

(c) the certificate(s) representing the Deposited Shares, in proper form for transfer, together with a properlycompleted and duly signed Letter of Transmittal (or a manually signed facsimile thereof), relating to such

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Shares, with signatures guaranteed if so required in accordance with the Letter of Transmittal, and all otherdocuments required by such Letter of Transmittal, are received at the Toronto, Ontario, office of theDepositary by 5:00 p.m. (Montréal time) on the third trading day on the TSX after the Expiry Time.

The Notice of Guaranteed Delivery may be delivered by hand or couriered or transmitted by facsimile or mailed tothe Depositary only at its principal office in Toronto, Ontario, and must include a guarantee of delivery by an EligibleInstitution in the form set forth in the Notice of Guaranteed Delivery. Delivery of the Notice of Guaranteed Delivery andthe Letter of Transmittal and accompanying certificate(s) and other required documents to any office other than theToronto, Ontario office of the Depositary does not constitute delivery for the purpose of satisfying the guaranteed delivery.

Procedures for Holders of In-the-Money Convertible Securities

Holders of In-the-Money Convertible Securities can utilize the procedures referred to above under “Letter ofTransmittal” and Procedure for Guaranteed Delivery” in order to exercise their conversion right pursuant to suchIn-the-Money Convertible Securities conditional upon completion of the Common Share Offer and deposit the underlyingCommon Shares to the Common Share Offer.

Acceptance by Book-Entry Transfer

Shareholders may accept an Offer and holders of In-the-Money Convertible Securities may conditionally exercisethe conversion rights attached to such securities and tender the underlying Common Shares to the Common Share Offer byfollowing the procedures for a book-entry transfer established by CDS, provided that a Book-Entry Confirmation throughCDSX is received by the Depositary at its office in Toronto, Ontario prior to the Expiry Time. The Depositary hasestablished an account at CDS for the purpose of the Offers. Any financial institution that is a participant in CDS maycause CDS to make a book-entry transfer of a holder’s Shares or In-the-Money Convertible Securities, as the case may be,into the Depositary’s account in accordance with CDS procedures for such transfer. Delivery of Shares or In-the-MoneyConvertible Securities, as the case may be, to the Depositary by means of a book-entry transfer will constitute a validtender under the Offers.

Shareholders and holders of In-the-Money Convertible Securities, through their respective CDS Participants, whouse CDSX to accept an Offer or conditionally exercise the conversion rights attached to In-the-Money ConvertibleSecurities and tender the underlying Common Shares to the Common Share Offer through a book-entry transfer of theirholdings into the Depositary’s account with CDS shall be deemed to have completed and submitted a Letter of Transmittaland to be bound by the terms thereof and therefore such instructions received by the Depositary are considered a validtender in accordance with the terms of the Offers.

Holders whose Shares or In-the-Money Convertible Securities, as the case may be, are registered in the name of aninvestment dealer, stock broker, bank, trust company or other nominee should immediately contact that nominee forassistance if they wish to accept an Offer.

Shareholders and holders of In-the-Money Convertible Securities who wish to accept an Offer orconditionally exercise the conversion rights attached to In-the-Money Convertible Securities and tender theunderlying Common Shares to the Common Share Offer by Book-Entry Confirmation should contact theDepositary for assistance. Contact details for the Depositary may be found on the last page of the Circular.

Determination of Validity

All questions as to the form of documents and the validity, eligibility (including time of receipt) and acceptance forexchange of any deposit of Shares will be determined by the Offeror in its sole discretion, which determination will befinal and binding on all parties. The Offeror reserves the absolute right to reject any and all deposits of Shares determinedby it not to be in proper form, or the payment of cash in respect of which may, in the opinion of the Offeror’s counsel, beunlawful. The Offeror also reserves the absolute right to waive: (i) any of the conditions of the Offers; or (ii) any defect orirregularity in any deposit of Shares. No deposit of Shares will be deemed to be properly made until all defects andirregularities have been cured or waived. None of the Offeror, the Depositary or any other Person will be under any duty togive notification of any defect or irregularity in deposits or incur any liability for failure to give any such notice. TheOfferor’s interpretation of the terms and conditions of the Offers (including the Letter of Transmittal and the Notice ofGuaranteed Delivery) will be final and binding on all parties. The Offeror reserves the right to permit the Offers to beaccepted in a manner other than as set forth herein.

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Under no circumstances will any amount be paid by the Offeror or the Depositary by reason of any delay in makingpayments to any Person on account of Shares validly deposited pursuant to the Offers.

Dividends and Distributions; Liens

Subject to the terms and conditions of the Offers and subject, in particular, to Shares being validly withdrawn by oron behalf of a Depositing Shareholder, and except as provided below, by accepting an Offer pursuant to the procedures setforth above, a Shareholder irrevocably assigns to the Offeror, free and clear of all liens, restrictions, charges,encumbrances, claims, adverse interests, equities and rights of others, all of the rights and benefits of a Shareholderin and to the Shares identified in the Letter of Transmittal delivered to the Depositary (the “Deposited Shares”) and in andto all rights and benefits arising from such Deposited Shares including any and all dividends, distributions, payments,securities, property or other interests excluding Permitted Distributions (collectively, “Distributions”), which may bedeclared, paid, accrued, issued, distributed, made or transferred on or in respect of the Deposited Shares or any of them onand after December 23, 2010, including any dividends, distributions or payments on such Distributions. PermittedDistributions, which may be retained by Shareholders, means (i) cash dividends on the Common Shares, and (ii) semi-annual cash dividends on the Preferred Shares, in each case, declared and paid in accordance with the past practice ofWestern.

If, notwithstanding such assignment, any Distributions are received by or made payable to or to the order of aShareholder, then: (i) in the case of any cash dividend, distribution or payment (other than a Permitted Distribution), theamount of the dividend, distribution or payment shall be received and held by a Shareholder for the account of the Offeroruntil the Offeror pays for such Shares and to the extent that such dividend, distribution or payment does not exceed theconsideration per Share payable by the Offeror pursuant to an Offer, the consideration per Share pursuant such Offer willbe reduced by the amount of any such dividend, distribution or payment; (ii) in the case of any non-cash dividend,distribution, payment, right or other interest, the whole of any such non-cash dividend, distribution, payment, right orother interest shall be received and held by such Shareholder for the account of the Offeror and shall be promptly remittedand transferred by the Shareholder to the Depositary for the account of the Offeror, accompanied by appropriatedocumentation of transfer; and (iii) in the case of any cash dividend, distribution or payment in an amount that exceeds theconsideration per Share payable by the Offeror pursuant to an Offer, the whole of any such cash dividend, distribution orpayment shall be received and held by a Shareholder for the account of the Offeror and shall be promptly remitted andtransferred by the Shareholder to the Depositary for the account of the Offeror, accompanied by appropriatedocumentation of transfer. Shareholders should consult their own tax advisors for advice with respect to the taxconsequences to them of the declaration or payment of any Distribution in the circumstances described above, if any.

Power of Attorney

An executed Letter of Transmittal (or, in the case of Shares deposited by book-entry transfer by the making of a book-entry transfer into the Depositary’s accounts with CDS) irrevocably approves, constitutes and appoints, effective on andafter the date that the Offeror takes up and pays for the Deposited Shares covered by the Letter of Transmittal or book-entry transfer (which Shares upon being taken up and paid for are, together with any Distributions thereon, hereinafterreferred to as the “Purchased Securities”), each officer of the Depositary and each officer of the Offeror and any otherPerson designated by the Offeror in writing (each an “Appointee”) as the true and lawful agents, attorneys and attorneys-in-fact and proxies, with full power of substitution and resubstitution (such power of attorney being deemed to be anirrevocable power coupled with an interest), of the depositing Shareholder with respect to the Purchased Securities. TheLetter of Transmittal or the making of a book-entry transfer authorizes an Appointee, in the name and on behalf of suchShareholder: (i) to register or record the transfer and/or cancellation of such Purchased Securities (to the extent consistingof securities) on the appropriate register maintained by or on behalf of Western; (ii) for so long as any Purchased Securitiesare registered or recorded in the name of such Shareholder (whether or not they are now so registered or recorded), toexercise any and all rights of such Shareholder including the right to vote, to execute and deliver any and all instruments ofproxy, authorizations or consents in form and on terms satisfactory to the Offeror in respect of any or all PurchasedSecurities, to revoke any such instrument, authorization or consent, and to designate in such instrument, authorization orconsent any Person or Persons as the proxy of such Shareholder in respect of the Purchased Securities for all purposesincluding in connection with any meeting or meetings (whether annual, special or otherwise or any adjournment thereof,including any meeting to consider a Subsequent Acquisition Transaction) of holders of relevant securities of Western;(iii) to execute, endorse and negotiate, for and in the name of and on behalf of such Shareholder, any and all cheques orother instruments representing any Distribution payable to or to the order of, or endorsed in favour of, such Shareholder;and (iv) to exercise any other rights of a holder of Purchased Securities.

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A Shareholder accepting an Offer under the terms of the Letter of Transmittal revokes any and all other authority,whether as agent, attorney-in-fact, attorney, proxy or otherwise, previously conferred or agreed to be conferred by theShareholder at any time with respect to the Deposited Shares or any Distributions. The Shareholder accepting an Offeragrees that no subsequent authority, whether as agent, attorney-in-fact, attorney, proxy or otherwise will be granted withrespect to the Deposited Shares or any Distributions by or on behalf of the Depositing Shareholder unless the DepositedShares are not taken up and paid for under an Offer. A Shareholder accepting an Offer also agrees not to vote any of thePurchased Securities taken up and paid for under an Offer at any meeting (whether annual, special or otherwise or anyadjournment or postponement thereof) of holders of relevant classes of Shares and not to exercise any or all of the otherrights or privileges attached to such Purchased Securities, or otherwise act with respect thereto. The Shareholderaccepting an Offer agrees to execute and deliver to the Offeror, at any time and from time to time, as and when requestedby, and at the expense of, the Offeror, any and all instruments of proxy, authorization or consent, in form and on termssatisfactory to the Offeror, in respect of any such Purchased Securities. Such Shareholder further agrees to designate inany such instruments of proxy the Person or Persons specified by the Offeror as the proxyholder of the Shareholder inrespect of all or any such Purchased Securities.

Further Assurances

A Shareholder accepting an Offer covenants under the terms of the Letter of Transmittal to execute, upon request ofthe Offeror, any additional documents, transfers and other assurances as may be necessary or desirable to complete thesale, assignment and transfer of the Purchased Securities to the Offeror. Each authority therein conferred or agreed to beconferred may be exercised during any subsequent legal incapacity of such holder and shall, to the extent permitted bylaw, survive the death or incapacity, bankruptcy or insolvency of the holder and all obligations of the holder therein shallbe binding upon the heirs, executors, administrators, attorneys, personal representatives, successors and assigns of suchShareholder.

Binding Agreement

The acceptance of an Offer pursuant to the procedures set forth above constitutes a binding agreement between adepositing Shareholder and the Offeror, effective immediately following the Offeror taking up Shares deposited by suchShareholder, in accordance with the terms and conditions of the relevant Offer. This agreement includes a representationand warranty by the depositing Shareholder that: (i) the Person signing the Letter of Transmittal or on whose behalf abook-entry transfer is made owns the Deposited Shares and has full power and authority to deposit, sell, assign andtransfer the Deposited Shares and any Distributions being tendered to an Offer; (ii) the Deposited Shares and Distributionshave not been sold, assigned or transferred, nor has any agreement been entered into to sell, assign or transfer any of theDeposited Shares and Distributions, to any other Person; (iii) the deposit of the Deposited Shares and Distributionscomplies with applicable Laws; and (iv) when the Deposited Shares and Distributions are taken up and paid for by theOfferor, the Offeror will acquire good title thereto, free and clear of all liens, restrictions, charges, encumbrances, claimsand rights of others.

4. CONDITIONS OF THE OFFERS

Subject to the provisions of the Support Agreement, the Offeror shall have the right to withdraw any or all of theOffers (or extend any or all of the Offers to postpone taking up and paying for any Shares tendered to the Offers) and shallnot be required to take up, purchase or pay for, any Shares tendered to the Offers unless all of the following conditions aresatisfied or waived by the Offeror at or prior to the Expiry Time:

(a) there shall have been validly deposited under the Common Share Offer and not withdrawn as at the ExpiryTime, such number of Common Shares which, together with any Common Shares beneficially owned or overwhich control or direction is exercised by the Offeror and its Affiliates and joint actors, represents in theaggregate at least 662⁄3% of the aggregate of the outstanding Common Shares and the Common Shares issuableupon the exercise or conversion, as the case may be, of In-the-Money Convertible Securities (the “MinimumTender Condition”);

(b) all outstanding Options shall have been exercised, terminated or otherwise cancelled;

(c) the Appropriate Regulatory Approvals shall have been obtained on terms satisfactory to the Offeror, actingreasonably;

(d) the Offeror shall have determined in its reasonable judgment that (i) no act, action, suit or proceeding shallhave been taken, commenced or threatened before or by any Governmental Entity or by any elected or

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appointed public official or private Person (including any individual, corporation, firm, group or other entity)in Canada or elsewhere, whether or not having the force of Law; and (ii) no Law shall have been proposed,enacted, promulgated or applied, in either case:

(i) to cease trade, enjoin, prohibit or impose material limitations or conditions on the completion of any ofthe Contemplated Transactions;

(ii) which would materially and adversely affect the ability of Offeror to proceed with any of theContemplated Transactions;

(iii) which, if the Offeror consummated any of the Contemplated Transactions, would reasonably beexpected to lead to a Material Adverse Effect; or

(iv) seeking to prohibit or limit the ownership or operation by the Offeror of any material portion of thebusiness or assets of Western or any of its Subsidiaries or to compel the Offeror to dispose of or holdseparate any material portion of the business or assets of Western or any of its Subsidiaries as a result ofany of the Contemplated Transactions;

(e) the Offeror shall not have become aware after the date hereof of any untrue statement of a material fact, or anomission to state a material fact that is required to be stated or that is necessary to make a statement notmisleading in the light of the circumstances in which it was made (after giving effect to all subsequent filingsin relation to all matters covered in earlier filings), in any public document filed by or on behalf of Westernwith any Securities Regulatory Authority in Canada or elsewhere on or before the date hereof;

(f) all representations and warranties of Western set forth in the Support Agreement shall be true and correct in allrespects, unless the failure of such representations and warranties to be true and correct, individually or in theaggregate, would not constitute a Material Adverse Effect;

(g) Western shall have complied with all covenants and obligations in all material respects that are to be compliedwith under the Support Agreement at or prior to the Expiry Time unless the failure of Western to comply withsuch covenants or obligations, individually or in the aggregate, would not constitute a Material Adverse Effect;

(h) a Material Adverse Effect shall not have occurred;

(i) the Support Agreement shall not have been terminated, and no event shall have occurred that, with notice orlapse of time or both, gives the Offeror the right to terminate the Support Agreement;

(j) the Shareholder Rights Plan shall have been waived in respect of any of the Contemplated Transactions, ceasetraded or terminated; and

(k) Western shall have completed the Jennings Transaction.

In addition to the foregoing, with respect to each of the Series 3 Share Offer and the Series 4 Share Offer, there shallhave been deposited under each of such offer and not withdrawn at the Expiry Time, such number of Series 3 Shares orSeries 4 Shares, as the case may be, which, together with any Series 3 Shares or Series 4 Shares beneficially owned or overwhich control is exercised by the Offeror and its Affiliates and joint actors, represent in the aggregate at least 662⁄3% of theSeries 3 Shares or Series 4 Shares, as the case may be.

The foregoing conditions are for the exclusive benefit of the Offeror and may be asserted by the Offeror regardless ofthe circumstances giving rise to any such condition. The Offeror may, in the Offeror’s sole discretion, waive any of theforegoing conditions, in whole or in part, at any time and from time to time, both before and after the Expiry Time, withoutprejudice to any other rights which the Offeror may have. Failure by the Offeror at any time to exercise any of theforegoing rights will not be deemed to be a waiver of any such right and each such right shall be deemed to be an ongoingright which may be asserted at any time and from time to time.

Any waiver of a condition or the withdrawal of any of the Offers shall be effective upon written notice, or othercommunication confirmed in writing by the Offeror to that effect, to the Depositary at its principal office in Toronto,Ontario. The Offeror, forthwith after giving any such notice, will make a public announcement of such waiver orwithdrawal and provide a copy of such notice to the TSX, and to the extent required by applicable Laws, cause theDepositary as soon as is practicable thereafter to notify the Shareholders and holders of Convertible Securities in themanner set forth in Section 9 of the Offers, “Notice and Delivery”. If an Offer is withdrawn, the Offeror will not beobligated to take up, accept for payment or pay for any Shares tendered to such Offer.

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Any determination by the Offeror concerning any event or other matter described in the foregoing conditions of thisSection 4 will be final and binding upon all parties.

5. EXTENSION AND VARIATION OF THE OFFERS

Each Offer is open for acceptance until the Expiry Time, unless such Offer is withdrawn or is extended by theOfferor.

Subject to the limitations described below, the Offeror expressly reserves the right, in its sole discretion, at any timeand from time to time while an Offer is open for acceptance, to vary the terms of such Offer or extend the Expiry Time forsuch Offer (but in any case, not beyond the Outside Date), in accordance with the Support Agreement and applicableLaws, by giving notice in writing to the Depositary at its principal office in Toronto, Ontario. Also, if at any time beforethe Expiry Time of an Offer, or at any time after the Expiry Time of an Offer, but before the expiry of all rights ofwithdrawal with respect to such Offer, a change occurs in the information contained in the Offers and Circular, asamended from time to time, that would reasonably be expected to affect the decision of a Shareholder to accept or reject anOffer (other than a change that is not within the control of the Offeror or a Subsidiary of the Offeror), the Offeror will givewritten notice of such change to the Depositary at its principal office in Toronto, Ontario. Upon the giving of such notice tothe Depositary, the Expiry Time or withdrawal rights, as applicable, will be deemed to be extended to the date specified insuch notice or as required by applicable Law, or in the case of a variation, an Offer will be deemed to be varied in themanner described in such notice, as the case may be. The Offeror will, as soon as practicable after giving any such noticeto the Depositary, publicly announce the extension, variation or change and, if required by applicable Law, cause theDepositary to mail a copy of any such notice to Shareholders as required by applicable securities legislation at theirrespective addresses appearing in the share register of Western. In addition, the Offeror will provide a copy of such noticeto the TSX and the applicable Securities Regulatory Authorities. Any notice of extension, variation or change will bedeemed to have been given and be effective on the day on which it is delivered or otherwise communicated to theDepositary at its principal office in Toronto, Ontario. The Support Agreement restricts the Offeror’s ability to amendcertain terms and conditions of the Common Share Offer without the prior written consent of Western. See Section 5 of theCircular, “Agreement Relating to the Offers”.

During any extension of an Offer, all Shares previously tendered and not withdrawn will remain subject to therelevant Offer and may be accepted for purchase by the Offeror in accordance with the terms of such Offer, subject toSection 8 of the Offers, “Right to Withdraw Deposited Shares”. An extension of the Expiry Time of an Offer will not, inand of itself, constitute a waiver by the Offeror of any of its rights under Section 4 of the Offers, “Conditions of theOffers”.

Under applicable Securities Laws, if there is a variation in the terms of an Offer, the period during which Shares maybe tendered to the relevant Offer will not expire before ten (10) days after the date that the notice of variation has beendelivered.

If, before the Expiry Time of an Offer, the Offeror in its sole discretion elects to increase the Offered Consideration,such increase will be applicable to all holders whose Shares for which the Offered Consideration has been increased aretaken up under such Offer.

6. TAKE UP AND PAYMENT FOR DEPOSITED SHARES

Upon the terms and subject to the conditions of the Offers (including but not limited to the conditions specified inSection 4 of the Offers, “Conditions of the Offers”), the Offeror will take up Shares, validly tendered to the relevant Offerand not withdrawn pursuant to Section 8 of the Offers, “Right to Withdraw Deposited Shares”, not later than ten(10) calendar days after the Expiry Time of the relevant Offer and will pay for the Shares taken up as soon as possible, butin any event not later than three (3) Business Days after taking up the Shares. Any Shares tendered to an Offer after the firstdate on which Shares have been taken up by the Offeror will be taken up and paid for not later than ten (10) days after suchtender.

Subject to Law, the Offeror expressly reserves the right in its sole discretion to delay taking up and paying for anyShares or to terminate any of the Offers and not take up or pay for any Shares pursuant to that Offer if any conditionspecified in Section 4 of the Offers, “Conditions of the Offers” is not satisfied or waived, by giving written notice thereofor other communication confirmed in writing to the Depositary at its principal office in Toronto, Ontario. The Offeror alsoexpressly reserves the right, in its sole discretion and notwithstanding any other condition of the Offers, to delay taking upand paying for Shares in order to comply, in whole or in part, with any Law.

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For the purposes of the Offers, the Offeror will be deemed to have taken up and accepted for payment Shares validlytendered and not validly withdrawn pursuant to an Offer if, as and when the Offeror gives written notice or othercommunication confirmed in writing to the Depositary of its acceptance for payment of such Deposited Shares pursuant toan Offer at its principal office in Toronto, Ontario.

The Offeror will pay for Shares validly tendered to the relevant Offer and not withdrawn by providing the Depositarywith the Offered Consideration, in the form of sufficient funds for transmittal to Persons who have tendered Shares to suchOffer. The Depositary will act as the agent of the Persons who have tendered Shares in acceptance of an Offer for thepurposes of receiving the Offered Consideration, from the Offeror and transmitting such consideration to such Persons.Receipt of the cash representing the Offered Consideration by the Depositary will be deemed to constitute receipt ofpayment by Persons depositing Shares pursuant to an Offer. Under no circumstances will interest accrue or be paid by theOfferor or the Depositary, to Persons depositing Shares, on the purchase price of Shares purchased by the Offeror,regardless of any delay in making such payment.

Settlement with each Shareholder who has validly tendered and not validly withdrawn Shares under the relevantOffer will be made upon the Depositary forwarding a cheque for an amount in Canadian dollars to which such Shareholderis entitled.

Subject to the foregoing and unless otherwise directed by the Letter of Transmittal, the cheque(s) will be issued in thename of the registered Shareholder of the Shares so tendered. Unless the Person depositing the Shares instructs theDepositary to hold the cheque(s) for pick-up by checking the appropriate box in the Letter of Transmittal, the cheque willbe forwarded by first class insured mail to such Person at the address specified in the Letter of Transmittal. If no suchaddress is specified, the cheque will be sent to the address of the Shareholder as shown on the securities registermaintained by or on behalf of Western. Cheques mailed in accordance with this paragraph will be deemed to be deliveredat the time of mailing.

If any Deposited Shares are not accepted for payment pursuant to the terms and conditions of an Offer for any reason,or if certificates are submitted for more Shares than are tendered, certificate(s) for unpurchased Shares (or unconvertedIn-the-Money Convertible Securities) will be returned, at the Offeror’s expense, to the Depositing Shareholder or holderof In-the-Money Convertible Securities as soon as it is practicable following the Expiry Time or withdrawal or earlytermination of an Offer. Unless otherwise directed in the Letter of Transmittal, certificate(s) representing unpurchasedShares or In-the-Money Convertible Securities will be forwarded to the address of the registered Shareholder orIn-the-Money Convertible Securities holder as shown on the securities register maintained by or on behalf of Western.

Pursuant to rules of the Canadian Payments Association, a $25 million ceiling has been established on cheques, bankdrafts and other paper-based payments processed through Canada’s clearing system. As a result, any payment to aShareholder in excess of $25 million will be effected by the Depositary by wire transfer in accordance with the LargeValue Transfer System Rules established by the Canadian Payments Association. Accordingly, settlement with aShareholder involving a payment in excess of $25 million will be made only in accordance with wire transfer instructionsprovided by the Shareholder to the Depositary in writing. In the event wire transfer instructions are required as set outabove, the Depositary will contact the Shareholder promptly following the Expiry Time for the purposes of obtaining wiretransfer instructions. Any delay in payment by the Depositary resulting from the provision by the Shareholder of wiretransfer instructions will not entitle the Shareholder to interest or other compensation in addition to the amounts to whichthe Shareholder is entitled pursuant to an Offer.

Shareholders and holders of In-the-Money Convertible Securities will not be required to pay any fee orcommission if they accept an Offer by tendering their Shares or Common Shares underlying their In-the-MoneyConvertible Securities directly with the Depositary.

7. RETURN OF DEPOSITED SHARES

If any Deposited Shares are not taken up and paid for pursuant to the terms and conditions of the relevant Offer forany reason, they will be returned, at the Offeror’s expense, to the Depositing Shareholder or In-the-Money ConvertibleSecurities holder as soon as is practicable following the early termination, Expiry Time or withdrawal of an Offer andcertificates representing unpurchased Shares (or unconverted In-the-Money Convertible Securities) will be forwarded tothe address of the registered Shareholder or In-the-Money Convertible Securities holder as shown on Western’s securitiesregister (unless otherwise directed in the Letter of Transmittal) or by crediting the securities ledger position of the ledgeraccount maintained by the applicable CDS Participant in the amount of the unpurchased Shares or unconvertedIn-the-Money Convertible Securities. Holders of In-the-Money Convertible Securities who have conditionally converted

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their In-the-Money Convertible Securities and accepted the Common Share Offer with respect to their underlyingCommon Shares will remain holders of In-the-Money Convertible Securities if Deposited Shares are not taken up andpaid for pursuant to the terms and conditions of the Common Share Offer.

8. RIGHT TO WITHDRAW DEPOSITED SHARES

Except as otherwise stated in this Section 8, all deposits of Shares (including deposit of underlying Common Sharesby a holder of In-the-Money Convertible Securities) pursuant to the Offers are irrevocable. Unless otherwise required orpermitted by applicable Laws, any Shares (including Common Shares underlying In-the-Money Convertible Securities)tendered in acceptance of the Offers may be withdrawn by or on behalf of the Depositing Shareholder or the holders ofIn-the-Money Convertible Securities:

(a) at any time before the Shares (including Common Shares underlying In-the-Money Convertible Securities)have been taken up by the Offeror;

(b) at any time before the expiration of ten (10) calendar days from the date upon which either:

(i) a notice of change relating to a change which has occurred in the information contained in an Offer orthe Circular, which change is one that would reasonably be expected to affect the decision of aShareholder to accept or reject an Offer (other than a change that is not within the control of the Offeroror a Subsidiary of the Offeror) in the event that such change occurs before the Expiry Time of an Offer orafter the Expiry Time but before the expiry of all rights of withdrawal in respect of such Offer; or

(ii) a notice of variation concerning a variation in the terms of an Offer (other than a variation consistingsolely of an increase in the consideration offered for the Shares pursuant to an Offer where such Offer isnot extended for a period greater than ten (10) calendar days);

is mailed, delivered, or otherwise properly communicated, but subject to abridgment of that period pursuant tosuch order or orders as may be granted by applicable courts or securities regulatory authorities and only if suchDeposited Shares have not been taken up by the Offeror at the date of the notice; or

(c) at any time after three (3) Business Days from the date the Offeror takes up the Shares (including CommonShares underlying In-the-Money Convertible Securities), if such Shares have not been paid for by the Offeror.

For a withdrawal to be effective, a written or facsimile transmission notice of withdrawal must be received in a timelymanner by the Depositary at the place of deposit of the relevant Shares or In-the-Money Convertible Securities, as the casemay be. Any such notice of withdrawal must: (i) be made by a method, including a manually signed facsimiletransmission, that provides the Depositary with a written or printed copy; (ii) be signed by or on behalf of the Person whosigned the Letter of Transmittal (or Notice of Guaranteed Delivery) that accompanied the Shares or In-the-MoneyConvertible Securities to be withdrawn; (iii) specify the number of Shares or In-the-Money Convertible Securities to bewithdrawn, the name of the registered Shareholder and the certificate number shown on the certificate(s) representingeach Share and In-the-Money Convertible Securities to be withdrawn; and (iv) must be actually received by theDepositary at the place of deposit for the applicable Shares or In-the-Money Convertible Securities, as the case may be (orNotice of Guaranteed Delivery in respect thereof). No signature guarantee is required on a notice of withdrawal if thenotice of withdrawal is signed by the registered holder exactly as the name of the registered holder appears on thecertificate(s) representing Shares or In-the-Money Convertible Securities deposited with the Letter of Transmittal or if theShares or In-the-Money Convertible Securities were deposited for the account of an Eligible Institution. In all other cases,the signature on a notice of withdrawal must be guaranteed by an Eligible Institution. The withdrawal will take effect uponactual receipt by the Depositary of the properly completed notice of withdrawal. A withdrawal of Shares (includingCommon Shares underlying In-the-Money Convertible Securities) tendered to an Offer can only be accomplishedin accordance with the foregoing procedure. The withdrawal will take effect only upon actual receipt by theDepositary of the properly completed and executed written or facsimile notice of withdrawal.

Alternatively, if Shares (including Common Shares underlying In-the-Money Convertible Securities) have beendeposited pursuant to the procedures for book-entry transfer, as set forth in Section 3 of the Offers, “Manner ofAcceptance — Acceptance by Book-Entry Transfer”, any notice of withdrawal must specify the name and number of theaccount at CDS to be credited with the withdrawn Shares or In-the-Money Convertible Securities, as the case may be, andotherwise comply with the procedures of CDS.

All questions as to form and validity (including time of receipt) of notices of withdrawal will be determined bythe Offeror in its sole discretion and such determination will be final and binding. There will be no duty or

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obligation on the Offeror, the Depositary or any other Person to give notice of any defect or irregularity in anynotice of withdrawal, and no liability will be incurred by any of them for failure to give such notice.

Withdrawals may not be rescinded and any Shares (including Common Shares underlying In-the-Money ConvertibleSecurities) properly withdrawn will thereafter be deemed not validly deposited for the purposes of the Offers. However,withdrawn Shares (including Common Shares underlying In-the-Money Convertible Securities) may be re-deposited atany subsequent time prior to the Expiry Time by again following any of the procedures described in Section 3 of theOffers, “Manner of Acceptance”.

If the Offeror extends the period of time during which the Offers are open, is delayed in taking up or paying for theShares or is unable to take up or pay for Shares for any reason, then, without prejudice to the Offeror’s other rights underthe Offers, the Depositary may, subject to applicable Laws, retain on behalf of the Offeror all Deposited Shares andDistributions, and such Shares may not be withdrawn except to the extent that depositing Shareholders are entitled towithdrawal rights as set forth in this Section 8 or pursuant to applicable Laws.

9. NOTICE AND DELIVERY

Without limiting any other lawful means of giving notice, any notice which the Offeror or the Depositary may give orcause to be given under the Offers will be deemed to have been properly given to registered Shareholders and registeredholders of Convertible Securities if it is mailed by prepaid first class mail to the registered Shareholders and to theregistered holders of Convertible Securities at their respective addresses appearing in the appropriate registers maintainedby Western in respect of the Shares or the Convertible Securities, as the case may be, and will be deemed, unless otherwisespecified by applicable Laws, to have been received on the first Business Day following the date of mailing. Theseprovisions apply notwithstanding any accidental omission to give notice to any one or more Shareholders or holders ofConvertible Securities and notwithstanding any interruption of mail service in Canada following mailing. Except asotherwise required or permitted by Law, in the event of any interruption of mail service in Canada, the Offeror intends tomake reasonable efforts to disseminate the notice by other means such as publication. Except as otherwise required orpermitted by Law, if post offices are not open for the deposit of mail, or there is reason to believe that there is or could be adisruption in all or any part of the postal service, any notice which the Offeror or the Depositary may give or cause to begiven under the Offers will be deemed to have been properly given and to have been received by Shareholders and holdersof Convertible Securities if: (i) it is given to the TSX for dissemination through its facilities; (ii) if it is published once inthe National Edition of The Globe and Mail or the National Post; or (iii) it is given to the Marketwire NewsWire Servicefor dissemination through its facilities.

Unless post offices are not open for the deposit of mail, the Offers, the Circular, the Letter of Transmittal and theNotice of Guaranteed Delivery will be mailed to registered Shareholders and registered holders of Convertible Securitiesby first class mail, postage prepaid or made available in such other manner as is permitted by applicable regulatoryauthorities and the Offeror will use its reasonable efforts to furnish such documents to brokers, banks and similar Personswhose names, or the names of whose nominees, appear on the security holder list of Western, or, if applicable, who arelisted as participants in a clearing agency’s security position listing, for subsequent transmission to beneficial owners ofShares when such list or listing is received.

Wherever the Offers call for documents to be delivered to the Depositary, those documents will not beconsidered delivered unless and until they have been physically received at one of the addresses listed for theDepositary in the Letter of Transmittal or the Notice of Guaranteed Delivery, as applicable. Wherever the Offerscall for documents to be delivered to a particular office of the Depositary, those documents will not be considereddelivered unless and until they have been physically received at the particular office at the address listed in theLetter of Transmittal or Notice of Guaranteed Delivery, as applicable.

10. CHANGES IN CAPITALIZATION

If, on or after the date of the Offers, Western should divide, combine, reclassify, consolidate, convert or otherwisechange any of the Shares or its capitalization, or should disclose that it has taken or intends to take any such action, thenthe Offeror may, in its sole discretion and without prejudice to its rights under Section 4 of the Offers, “Conditions of theOffers”, make such adjustments to the Offered Consideration or other terms of the Offers (including the type of securitiesoffered to be purchased and the consideration payable therefor) as it deems appropriate to reflect such division,combination, reclassification, consolidation, conversion or other change. Under the terms of the Support Agreement,Western is not permitted to take such action except with the prior consent of the Offeror.

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11. SHARES NOT DEPOSITED UNDER THE OFFERS

If the Offeror takes up and pays for not less than 90% of the issued and outstanding Shares of any class to which anOffer relates, other than such Shares held on the date of the Offers by or on behalf of the Offeror, the Offeror intends, to theextent possible, to acquire all Shares of that class (including in respect of the Common Share Offer, Common Shares thatmay be issued as a result of the exercise of the rights under any Convertible Securities) that are held by any Person who didnot accept the relevant Offer by Compulsory Acquisition.

If the Offeror acquires less than 90% of the Shares of any class under the Offers or the right of CompulsoryAcquisition described above is not available for any reason, the Offeror will acquire the remaining Shares pursuant to aSubsequent Acquisition Transaction under which the consideration payable to Shareholders will be equal in amount toand in the same form as that payable under the Offers.

See Section 6 of the Circular, “Purpose of the Offers and Plans for Western” and Section 15 of the Circular,“Acquisition of Shares Not Deposited Under the Offers”.

12. MARKET PURCHASES

To the extent permitted by Securities Laws, the Offeror may, from time to time, from the date hereof until the ExpiryTime, acquire Common Shares and Convertible Securities other than pursuant to the terms of the Offers by way of openmarket purchases through facilities of the TSX or otherwise. Under Section 2.2(3) of MI 62-104 and Section 2.1 of OSCRule 62-504, as applicable, the Offeror may purchase Common Shares and Convertible Securities other than under theterms of the Offers provided:

(a) the aggregate number of Common Shares on a diluted basis (taking into account any Convertible Securitiesacquired) beneficially acquired does not exceed 5% of the outstanding Common Shares as of the date of theOffers;

(b) the purchases are made in the normal course through the facilities of the TSX;

(c) the Offeror issues and files a news release containing the information required under Section 2.2(3) of MI62-104 and Section 2.1 of OSC Rule 62-504, as applicable, immediately after the close of business of the TSXon each day in which Common Shares or Convertible Securities have been purchased; and

(d) the broker involved in such trades provides only customary broker services and receives only customary feesor commissions, and no solicitation is made by the Offeror, the seller or their respective agents.

In no event will the Offeror make any such purchases of Common Shares or Convertible Securities through thefacilities of the TSX until the third clear trading day following the date of the Offers.

Although the Offeror has no present intention to sell Shares taken up under the Offers, the Offeror reserves the rightto make or enter into arrangements, commitments or understandings at or prior to the Expiry Time to sell any of suchShares after the Expiry Time, subject to compliance with Section 2.7(2) of MI 62-104 and Section 93.4(2) of the SecuritiesAct (Ontario) as applicable.

For the purposes of this Section 12, the “Offeror” includes the Offeror and any Person acting jointly or in concertwith the Offeror.

13. OTHER TERMS OF THE OFFERS

The Offeror reserves the right to transfer or assign, in whole or from time to time in part, to one or more Personsdesignated by or affiliated with the Offeror, the right to purchase all or any portion of the Shares tendered to the Offers, butany such transfer will not relieve the Offeror of its obligations under the Offers or prejudice the rights of DepositingShareholders to receive payment for Shares validly tendered and accepted for payment pursuant to the Offers.

No broker, investment dealer or other Person (including the Depositary) has been authorized to make anyrepresentation or warranty on behalf of the Offeror or any of its Subsidiaries in connection with the Offers other thanas contained in the Offers and, if any such representation or warranty is given or made, it must not be relied upon as havingbeen authorized. No broker, investment dealer or other Person shall be deemed to be the agent of the Offeror or any of itsSubsidiaries or the Depositary for the purposes of the Offers.

The Offers and all contracts resulting from the acceptance of the Offers shall be governed by and construed inaccordance with the Laws of the Province of Alberta and the federal Laws of Canada applicable therein. Each party to any

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agreement resulting from the acceptance of the Offer unconditionally and irrevocably attorns in respect thereof to the non-exclusive jurisdiction of the courts of the Province of Alberta.

This document does not constitute an offer or a solicitation to any Person in any jurisdiction in which such offer orsolicitation is unlawful. The Offers are not being made to (nor will deposits of Shares be accepted from or on behalf of)Shareholders residing in any jurisdiction in which the making of the Offers or the acceptance thereof would not be incompliance with the Laws of such jurisdiction. The Offeror may, in its sole discretion, take such action as it may deemnecessary to make the Offers in any such jurisdiction and extend the Offers to Shareholders in any such jurisdiction.

The Offeror, in its sole discretion, shall be entitled to make a final and binding determination of all questionsrelating to the Offers, the Circular and the Letter of Transmittal and the Notice of Guaranteed Delivery, thevalidity of any acceptance of the Offers and the validity of any withdrawal of Shares.

The provisions of the Circular, the Letter of Transmittal and the Notice of Guaranteed Delivery accompanying theOffers, including the instructions contained therein, are incorporated into and form part of the terms and conditions of theOffers.

Where the Offers provide that the time for the taking of any action, the doing of any thing or the end of any period,expires or falls upon a day that is not a Business Day, the time shall be extended and action may be taken, the thing may bedone or the period shall end as the case may be, on the next Business Day.

The Offers and the accompanying Circular together constitute the take-over bid circular required under Canadianprovincial securities legislation with respect to the Offers. Shareholders are urged to refer to the accompanying Circularfor additional information relating to the Offers.

Dated: January 21, 2011

DESJARDINS FINANCIAL CORPORATION INC.

(signed) Marc Laplante

Senior ExecutiveVice President Strategy,Performance and Development

(signed) Raymond Laurin

Senior Vice-PresidentFinance and Treasury Executive Divisionand Office of the CFO

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CIRCULAR

This Circular is furnished in connection with the Offers dated January 21, 2011 by the Offeror to purchase, upon theterms and subject to the conditions described therein, (i) all of the issued and outstanding Common Shares, includingthose Common Shares that may become outstanding upon the exercise or conversion of Convertible Securities, (ii) all ofthe issued and outstanding Series 3 Shares, and (iii) all of the issued and outstanding Series 4 Shares, other than Sharesheld by the Offeror or its Affiliates. The terms and provisions of the Offers, Letter of Transmittal and Notice of GuaranteedDelivery are incorporated into and form part of this Circular. Terms defined in the Offers and the Glossary and nototherwise defined in this Circular shall have the respective meanings given thereto in the Offers and the Glossary unlessthe context otherwise requires. Unless otherwise indicated, information concerning Western and the Offeror is given as atJanuary 17, 2011.

1. THE OFFEROR

The Offeror is a member of the Desjardins Financial Group and a wholly-owned indirect subsidiary of the Fédérationdes caisses Desjardins du Québec. The Desjardins Financial Group is the leading cooperative financial group in Canadaand the sixth largest in the world, with assets of over $175 billion. Drawing on the strength of its caisse network in Québecand Ontario, and its subsidiaries across Canada, it offers a full range of financial products and services to its 5.8 millionmembers and clients. Desjardins specializes in wealth management and life and health insurance, property and casualtyinsurance, personal services, business and institutional services. For the year ended December 31, 2009, the DesjardinsFinancial Group had total income of approximately $10.7 billion and surplus earnings before member dividends ofapproximately $1.08 billion.

The Offeror is incorporated under the laws of the Province of Québec and its registered and head office is located at 1Complexe Desjardins, South Tower, 39th Floor, Montréal, Québec, H5B 1B2.

2. WESTERN

Western is a leading P&C insurance brokerage network and offers complimentary life insurance and bankingservices in over 90 communities, to more than 550,000 individuals and businesses in Western Canada through theNetwork, affiliated insurance brokers, Western Life Assurance Company, Bank West and Western Financial InsuranceCompany. Western is one of only a few Canadian organizations operating in the banking, life, and property and casualtyinsurance sectors. In addition Western owns and operates the largest insurance network of brokerages in Western Canada.

Western is a reporting issuer in each province of Canada. The Common Shares, the Series 2 Shares, the Series 3Shares, the Series 4 Shares, the Series 5 Shares and the Convertible Debentures are listed and posted for trading on theTSX under the symbols “WES”, “WES.PR.D”, “WES.PR.A”, “WES.PR.B”, “WES.PR.C” and “WES.DB”, respectively.

Western is incorporated under the laws of the Province of Alberta, its head office is located at 1010 – 24th Street,S.E., High River, Alberta, T1V 2A6 and its registered office address is 3700, 400 – 3rd Avenue S.W., Calgary, Alberta,T2P 4H2.

Authorized and Outstanding Share Capital

The authorized share capital of Western consists of an unlimited number of Common Shares, an unlimited number ofFirst Preferred Shares and an unlimited number of Second Preferred Shares. As at January 17, 2011, there were validlyissued and outstanding: (i) 60,326,701 Common Shares; (ii) 128,677 Series 2 Shares; (iii) 250,000 Series 3 Shares;(iv) 200,000 Series 4 Shares; and (v) 352,150 Series 5 Shares.

As of January 17, 2011, there were outstanding Options to acquire 1,165,052 Common Shares.

On April 21, 2009, Western issued $16,710,000 aggregate principal amount of Convertible Debentures maturing onJune 30, 2014.

The Offeror understands that, assuming the exercise or conversion of all In-the-Money Convertible Securities,83,091,809 Common Shares would be subject to the Common Share Offer.

As of January 17, 2011, the Offeror and its Affiliates do not beneficially own, directly or indirectly, nor do theyexercise direction over, or have the right to acquire any Common Shares or Convertible Securities.

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Conversion Rights

The Series 2 Shares are convertible into Common Shares at any time at the holder’s option at a price of $3.60 perCommon Share.




The Convertible Debentures are convertible into Common Shares at any time at the holder’s option at a price of $3.00per Common Share.

Price Range and Trading Volume

The Common Shares, the Series 3 Shares and the Series 4 Shares are listed and posted for trading on the TSX.

The following table sets forth, for the periods indicated, the high and low trading prices and the trading volume of theCommon Shares on the TSX (as reported by the TMX Group and Bloomberg) for the periods indicated.

Year Period High Low Volume

Price Range

C$ C$

2010 July . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.57 2.13 2,269,5732010 August . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.35 2.19 1,226,1042010 September . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.42 2.21 1,198,5832010 October . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.60 2.42 1,766,2372010 November . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.59 2.42 1,656,5902010 December . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.16 2.41 8,774,9322011 January 1 to 17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.12 4.10 6,078,965

The closing price of the Common Shares on December 23, 2010, the last trading day prior to the announcement of theOfferor’s intention to make the Common Share Offer, was $2.45.

The following table sets forth, for the periods indicated, the high and low trading prices and trading volume of theSeries 3 Shares on the TSX (as reported by the TMX Group and Bloomberg) for the periods indicated.


Price Range

C$ C$

2010 July . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85.10 82.50 6,0402010 August . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86.00 82.00 10,4272010 September . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88.00 86.00 4,1882010 October . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89.00 86.00 2,2002010 November . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89.00 86.00 3,9552010 December . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99.75 80.00 33,3402011 January 1 to 17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.00 99.51 24,170

The closing price of the Series 3 Shares on December 23, 2010, the last trading day prior to the announcement of theOfferor’s intention to make the Common Share Offer, was $81.75.

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The following table sets forth, for the periods indicated, the high and low trading prices and trading volume of theSeries 4 Shares on the TSX (as reported by the TMX Group and Bloomberg) for the periods indicated.


Price Range

C$ C$

2010 July . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85.50 82.50 2,2502010 August . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86.50 82.54 1,7972010 September . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88.00 84.00 2,9302010 October. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88.00 85.99 2,8152010 November . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89.95 83.10 5,6002010 December . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99.75 80.00 25,1842011 January 1 to 17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99.90 99.50 17,653

The closing price of the Series 4 Shares on December 23, 2010, the last trading day prior to the announcement of theOfferor’s intention to make the Common Share Offer, was $81.50.

Prior Distributions and Purchase of Shares of Western

Based solely on publicly available information, the Offeror believes that during the 12 months preceding the date ofthe Offers, Western has not distributed or purchased any Shares (excluding Common Shares distributed pursuant to theexercise of Options or Convertible Securities) other than 6,514,750 Common Shares issued pursuant to a public offeringand 3,879,747 Common Shares issued pursuant to a private placement both completed on June 29, 2010 at a price of $2.65per share in each case.

Western Dividends

The following table discloses the dollar amount of cash dividends declared per share for the Common Shares andeach class of Preferred Shares outstanding during the financial years ended 2008, 2009, and 2010:

Class of Share 2010 2009 2008

Amount of Dividend per Share

Common Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $0.03 $0.04 $0.04Series 2 Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $6.75 $6.75 $6.75Series 3 Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $6.75 $6.75 $6.75Series 4 Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $6.75 $6.75 $6.75Series 5 Shares(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $9.68 $0.00 $0.00

(1) Series 5 Shares were issued on September 2, 2009.

3. BACKGROUND TO THE OFFERS

The Support Agreement is the result of arm’s length negotiations conducted between representatives of the Offerorand Western and their respective advisors. The following is a summary of the events leading up to the negotiation of theSupport Agreement and the meetings, negotiations, discussions and actions between the parties that preceded theexecution and public announcement of the Support Agreement.

During the fall of 2009, representatives of Western and Affiliates of the Offeror began discussions regarding apotential partnership covering several product lines.

On November 13, 2009, an Affiliate of the Offeror entered into a confidentiality agreement with Western to explorepartnership opportunities. Thereafter, Affiliates of the Offeror carried out some initial due diligence and held discussionswith Western’s management regarding a potential partnership. These discussions continued through the summer and fallof 2010.

In early November 2010, Affiliates of the Offeror presented to Western a formal proposal with respect to apartnership. Following a meeting of Western’s Board of Directors on November 10, 2010, management of Westernrequested a 30-day moratorium on discussions.

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On December 11, 2010, an Affiliate of the Offeror was invited to consider participating in an offer for Western with athird party pursuant to which an Affiliate of the Offeror would acquire Bank West. Affiliates of the Offeror considered theproposal and determined that it would not meet the Offeror’s strategic objectives for pursuing a partnership with Western.

On December 17, 2010, an Affiliate of the Offeror presented an unsolicited proposal to acquire all of the issued andoutstanding Common Shares. Following such proposal, Western asked the Affiliate of the Offeror to complete its duediligence investigations, including preparing and negotiating a definitive acquisition agreement and present its final offerto the Board of Directors for consideration at a meeting to be held on December 22, 2010. Affiliates of the Offeror wereprovided access to Western’s virtual data room on December 17, 2010.

Between December 17, 2010 and December 22, 2010, Affiliates of the Offeror conducted due diligence and theOfferor and Western, together with their legal and financial advisors, negotiated a support agreement that set out the termsof the proposed transaction, including representations, warranties, conditions and transaction protection measures.

On December 22, 2010, the Offeror was informed by Western’s representatives that the Board of Directors met toconsider the Offeror’s proposal to acquire all of the Common Shares and a third party proposal for the acquisition ofWestern’s outstanding Common Shares that contained a condition Western must first dispose of Bank West on termsreasonably satisfactory to such third party. Discussions continued during the evening of December 22 and again on themorning of December 23 between the Offeror and Western and their respective financial advisors. On December 23, 2010,the Offeror provided a revised offer to acquire all of the issued and outstanding Common Shares for a cash price of $4.15per share.

The Western Board of Directors met on December 23, 2010 to consider the Offeror’s revised offer following whichmanagement of Western advised the Offeror that its offer would be accepted.

The Support Agreement was executed and delivered by the parties on December 23, 2010. Immediately thereafter, ajoint news release was issued by the Offeror and Western announcing the proposed Common Share Offer and theexecution of the Support Agreement.

Subsequent to the execution of the Support Agreement, and in accordance with the terms of the Support Agreement,the Offeror advised Western that it intended to make the Series 3 Share Offer and the Series 4 Share Offer in addition to theCommon Share Offer.

4. OFFEROR’S REASONS TO ACCEPT THE OFFERS

Shareholders should consider the following factors, which the Offeror considers to be relevant, in making theirdecision to accept the Offers.

Premium Over Market Price


Review of Strategic Alternatives

The Common Share Offer is the culmination of an active process that considered various means of enhancingshareholder value. The Board of Directors carefully considered several strategic alternatives for Western, including thepossibility of selling all or a portion of the assets of Western, the sale of or entering into a strategic partnership in respect ofits Bank West subsidiary, a merger or other form of business combination and the continuation of Western’s existingbusiness plan. The Board of Directors believes the Common Share Offer represents the best strategic alternative identifiedas a result of this process.

Fairness Opinion

Western’s financial advisor, TD Securities Inc., has delivered the Fairness Opinion to the Board of Directors, statingthat, as of the date of the Support Agreement and based upon and subject to the analyses, assumptions, qualifications and

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limitations discussed therein, the consideration under the Common Share Offer is fair, from a financial point of view, tothe Common Shareholders.

Current Industry Conditions and Future Prospects for Western

Western’s business, financial condition, results of operations, current business plan and future prospects in thecontext of current industry and economic conditions influenced the Board of Directors in its deliberations. Among thesefactors the Board of Directors considered and weighed its view of the risks, uncertainties and costs associated with thecontinued ownership of Western’s assets relative to the immediate and greater value to be derived by CommonShareholders from the Common Share Offer.

Immediate Value and Liquidity

The consideration to be paid to Shareholders pursuant to the Offers is all cash, which provides certainty of value toShareholders. Shareholders will be able to realize fair value for their investment immediately pursuant to the Offers.

The Board of Directors is not making a recommendation to holders of the Series 3 Shares and the Series 4 Shares asto whether to accept the Series 3 Share Offer and the Series 4 Share Offer.

5. AGREEMENT RELATING TO THE OFFERS

Support Agreement

Pursuant to the Support Agreement, the Offeror agreed to make or cause to be made, and Western agreed to support,the Common Share Offer, subject to the conditions set forth therein. The following is a summary of the principal terms ofthe Support Agreement. It does not purport to be complete and is qualified in its entirety by reference to the full text of theSupport Agreement filed by Western with the Canadian Securities Administrators and available on SEDAR atwww.sedar.com.

Western Approval of the Common Share Offer

Western has represented to the Offeror that the Board of Directors has unanimously determined that the CommonShare Offer is in the best interest of Western and the Common Shareholders and, accordingly, unanimously recommendsthat the Common Shareholders accept the Common Share Offer.

Representations and Warranties of Western

Western made customary representations and warranties in the Support Agreement, including those in respect of thefollowing matters: (i) organization and qualification; (ii) authority relative to and enforceability of the SupportAgreement; (iii) absence of conflict or breach and required filings and consents; (iv) capitalization and listing; (v) reportsand public issuer obligations to securities regulators; (vi) financial statements; (vii) absence of undisclosed liabilities;(viii) shareholder and similar agreements; (ix) absence of certain changes or events; (x) litigation; (xi) compliance withapplicable Law; (xii) brokers; (xiii) restrictions on business activities; (xiv) rights of other Persons; (xv) absence of ceasetrade orders; (xvi) licenses; (xvii) regulatory matters; (xviii) loan portfolio; (xix) material contracts; (xx) labour matters;(xxi) employees; (xxii) tax matters; (xxiii) intellectual property; (xxiv) non-Arm’s Length transactions; and (xxv) booksand records.

Representations and Warranties of the Offeror

The Offeror made customary representations and warranties in the Support Agreement, including those in respect ofthe following matters: (i) organization; (ii) authority relative to and enforceability of the Support Agreement; (iii) absenceof conflict or breach and required filings and consents; (iv) Investment Canada Act status; and (v) availability of sufficientfunds to pay the purchase price under the Common Share Offer in respect of all of the outstanding Common Shares on aFully-Diluted Basis.

Covenants by Western

Western has agreed and covenanted that (i) the businesses of Western and its Subsidiaries will be conducted only in,and Western and its Subsidiaries shall not take any action except in the ordinary course of business and in a mannersubstantially consistent with past practice and in compliance with applicable Laws; (ii) it will use reasonable commercialefforts to maintain, and use reasonable commercial efforts to cause each Subsidiary to maintain, its existing insuranceexcept where replaced by insurance from insurers with at least as favourable credit ratings where such replacement

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insurance offers similar coverage, is subject to no more onerous deductibles and is at a similar cost; (iii) it will not take anyaction, which would render, or which reasonably may be expected to render, any representation or warranty made by itunder the Support Agreement untrue in any material respect; (iv) it will promptly notify the Offeror orally and in writingof: (A) the occurrence of any Material Adverse Effect, and of any material governmental or third party complaints,investigations or hearings (or communications indicating that the same are being contemplated), and it shall consult withthe Offeror in respect of any matters relating to the foregoing; or (B) the occurrence, or failure to occur, of any event orstate of facts which occurrence or failure would or would be likely to (x) cause any of the representations of Westerncontained in the Support Agreement to be untrue or inaccurate (without giving effect to, applying or taking intoconsideration any materiality or Material Adverse Effect qualification already contained within such representation orwarranty) in any material respect; or (y) result in the failure in any material respect of Western to comply with or satisfyany covenant, condition or agreement (without giving effect to, applying or taking into consideration any qualificationalready contained in such covenant, condition or agreement) to be complied with or satisfied prior to the Expiry Time;(v) it will use reasonable commercial efforts to make or cooperate as necessary in the making of all necessary filings andapplications under all applicable Laws required in connection with the transactions contemplated by the SupportAgreement and take all reasonable action necessary to be in compliance with such Laws.

Western has also agreed and covenanted that it will not, and will not permit any of its Subsidiaries to, directly orindirectly: (i) amend or propose to amend its articles or by-laws or comparable organizational documents; (ii) split,combine or reclassify any outstanding securities or undertake any capital reorganization; (iii) issue any securities (otherthan the issuance of Common Shares upon the exercise of currently outstanding Convertible Securities in accordance withtheir terms); (iv) declare, set aside or pay any dividends on or make any other distributions on or in respect of anysecurities other than the Permitted Distributions; (v) take any action or fail to take any action that is intended to, or wouldreasonably be expected to, individually or in the aggregate, prevent, materially delay or materially impede the ability ofthe Offeror to consummate the Contemplated Transactions or the other transactions contemplated by the SupportAgreement or materially reduce the benefits of the Common Share Offer to the Offeror; (vi) grant or commit to grant anyoptions, warrants, convertible securities or rights to subscribe for, purchase or otherwise acquire or exchange into anyshares or other ownership interest in Western or its Subsidiaries; (vii) other than in connection with transactions betweenWestern and one or more wholly-owned Subsidiaries or between or among wholly-owned Subsidiaries, directly orindirectly redeem, purchase or otherwise acquire or commit or offer to acquire any share, warrant or other ownershipinterest in Western or its Subsidiaries; (viii) guarantee the payment of any indebtedness of any Person other than Westernor a Subsidiary or permit any Subsidiary to do so; or (ix) enter into any non-Arm’s Length transactions, other thantransactions solely between Western and one or more wholly-owned Subsidiaries or between or among wholly-ownedSubsidiaries.

Western has also agreed and covenanted that it will, and will cause each of its Subsidiaries to, use commerciallyreasonable efforts to cooperate with the Offeror in structuring, planning and preparing any transaction and shall take suchactions as are necessary to carry out any reorganization (including for tax purposes) of their respective capital, assets andcorporate structure as the Offeror may reasonably require; provided, however, that no such transaction or reorganizationwill be undertaken unless (i) the Offeror has made the Common Share Offer; (ii) the Offeror has agreed to pay thereasonable implementation costs and any direct or indirect costs and liabilities including tax costs and liabilities that maybe incurred to unwind any such transaction or reorganization if the Offeror does not take up the Common Shares under theCommon Share Offer including actual out-of-pocket costs and expenses for filing fees and external counsel and auditorswhich may be incurred; (iii) the effectiveness thereof shall only occur immediately prior to the Offeror taking up theCommon Shares under the Common Share Offer (but following the Offeror publicly announcing its intention to do so);and (iv) such transaction or reorganization shall not, in the opinion of Western, acting reasonably, materially impede ordelay the Offeror taking up the Common Shares under the Common Share Offer or the making of a Superior Proposal byanother Person and provided further that no such actions shall be considered to constitute a breach of the covenants,representations or warranties under the Support Agreement.

Western has also agreed and covenanted that it will, and will cause each of its Subsidiaries to (i) use commerciallyreasonable efforts to facilitate the retention of employees of Western and its Subsidiaries identified by the Offerorincluding by granting to any such employee any increase in compensation or entering into or modifying any employmentcontract with any such employee (whether with an existing employee or a new employee), in each case on terms approvedby the Offeror and subject to the terms of the Support Agreement; and (ii) promptly notify the Offeror if any of Western’ssenior executive officers receives oral or written notice or otherwise becomes aware that any such employee intends toleave the employ of Western or any of its Subsidiaries.

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Except as required by applicable Laws or any agreement to which Western or any of its Subsidiaries is a party as atDecember 23, 2010 and in the case of clauses (i) and (ii) below, for such ordinary course salary and compensationincreases and bonuses as are approved by Western in the normal course consistent with past practice and disclosed to theOfferor, or otherwise disclosed in writing to the Offeror prior to December 23, 2010, Western will not, and it will notpermit any of its Subsidiaries, to do any of the following: (i) increase the amount of (or accelerate the payment or vestingof) any benefit or amount payable under any Employee Plan or any other contract, agreement, commitment, arrangement,plan or policy providing for compensation or benefits to any former, present or future director, officer or employee ofWestern or any of its Subsidiaries; (ii) increase (or enter into any commitment or arrangement to increase) thecompensation or benefits, or otherwise extend, expand or enhance the engagement, employment or any related rights,of any former, present or future director, officer, employee or consultant of Western or any of its Subsidiaries, except fornormal increases for Persons who are not directors or officers made in the ordinary course of business consistent with pastpractice, provided that the overall compensation budget will not increase by more than 1% on an annual basis; (iii) amend,vary or modify the Employee Plans; or (iv) adopt, establish, enter into or implement, or permit any of its Subsidiaries toadopt, establish, enter into or implement, any employee benefit plan, policy, severance or termination agreementproviding for any form of benefits or other compensation to any former, present or future director, officer or employee ofWestern or any of its Subsidiaries holding, in the case of any officer or employee, a position of vice president or anyposition senior thereto or amend, or permit any of its Subsidiaries to amend, any employee benefit plan, policy, severanceor termination agreement.

Pre-Closing Transactions by Western

Western agreed to consummate the Jennings Transaction prior to the Expiry Time.

Additional Covenants of Western in Contemplation or Furtherance of the Common Share Offer

Western has agreed and covenanted to, within ten (10) Business Days after the date of the Support Agreement,deliver to the Offeror a list of all consents of third parties required under its material contracts.

Western has also agreed and covenanted to use commercially reasonable efforts to cause the In-the-MoneyConvertible Securities to be converted into Common Shares prior to the Expiry Time in accordance with their termsand to allow all Persons holding such In-the-Money Convertible Securities to deposit the Common Shares issued uponsuch conversion to the Common Share Offer.

Western has also agreed and covenanted to, immediately following the acquisition pursuant to the Common ShareOffer by the Offeror of such number of Common Shares as is at least equal to the number of shares required to satisfy theMinimum Tender Condition, if so requested by the Offeror, to use its commercially reasonable efforts to facilitate thereconstitution of the Board of Directors, subject to applicable Laws, through resignations of some or all, as applicable, ofWestern’s directors (upon receipt of a full discharge from Western regarding their duties as directors subject to theobligations of directors contained in the ABCA and confirmation that Western will maintain insurance coverage ascontemplated under the Support Agreement) and the appointment of nominees of the Offeror in their stead.

Covenants of the Offeror

The Offeror has agreed and covenanted that: (i) it shall not, directly or indirectly take any action or fail to take anyaction that is intended to, or would reasonably be expected to, individually or in the aggregate, prevent, materially delay ormaterially impede the ability of the Offeror to consummate the Common Share Offer or the other transactionscontemplated under the Support Agreement; (ii) it shall not take any action, which would render, or which reasonablymay be expected to render, any representation or warranty made by it in the Support Agreement untrue in any materialrespect; (iii) it shall use reasonable commercial efforts to satisfy (or cause the satisfaction of) certain conditions precedentto the Common Share Offer set out in the Support Agreement, to the extent the same are within its control and it shall nottake any action or enter into any transaction, which would, or would reasonably be expected to: (A) cause any suchcondition precedent to become incapable of satisfaction or that is inconsistent with the successful completion of thetransactions contemplated by the Support Agreement; or (B) render the transactions contemplated by the SupportAgreement incapable of completion or materially more difficult to complete; (iv) it shall promptly notify Western orallyand in writing of the occurrence, or failure to occur, of any event or state of facts which occurrence or failure would orwould be likely to (x) cause any of the representations of the Offeror contained in the Support Agreement to be untrue orinaccurate (without giving effect to, applying or taking into consideration any materiality qualification already containedwithin such representation or warranty) in any material respect; or (y) result in the failure in any material respect of the

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Offeror to comply with or satisfy any covenant, condition or agreement (without giving effect to, applying or taking intoconsideration any qualification already contained in such covenant, condition or agreement) to be complied with orsatisfied prior to the Expiry Time; (v) it shall use reasonable commercial efforts to make or cooperate as necessary in themaking of all necessary filings and applications under all applicable Laws required in connection with the transactionscontemplated by the Support Agreement herein and take all reasonable action necessary to be in compliance with suchLaws; (vi) it shall make the Common Share Offer in accordance with the provisions of the Support Agreement and incompliance with all applicable Laws; (vii) subject to the terms and conditions of the Support Agreement and of theCommon Share Offer, it shall take up the Common Shares deposited under the Common Share Offer and pay for suchCommon Shares in accordance with the Support Agreement and Securities Laws; and (viii) it shall defend all lawsuits orother legal, regulatory or other proceedings against the Offeror challenging or affecting the Support Agreement or themaking or completion of the Contemplated Transactions.

Joint Covenants of the Parties in Respect of Filings and Authorizations

Each of the Parties has agreed and covenanted to cooperate in respect of the Appropriate Regulatory Approvals aspromptly as practicable after the execution and delivery of the Support Agreement to: (i) identify the AppropriateRegulatory Approvals, (ii) make, or cause to be made, all such filings and submissions under all applicable Laws as maybe required in connection with the Common Share Offer; and (iii) use all their commercially reasonable efforts to obtain,or cause to be obtained, and secure all Appropriate Regulatory Approvals; and both Parties will use all commerciallyreasonable efforts to take, or cause to be taken, all other actions necessary, proper or advisable in order for them to fulfiltheir obligations under the Support Agreement including fulfilling as soon as is practicable any reasonable requests foradditional information. Subject to any applicable Laws, the Parties have agreed to coordinate and cooperate with oneanother in exchanging such information and supplying such assistance as may be reasonably requested by each inconnection with the foregoing including, to the extent permissible, providing each other with all notices and informationsupplied or filed with any Governmental Entity and all notices and correspondence received from any GovernmentalEntity (except for notices, information and correspondence which the Offeror or Western, in each case acting reasonably,considers confidential and sensitive which may be filed on a confidential basis provided that the arrangements are madeamong the Parties and their counsel as necessary for any such confidential notice, information and correspondence to beexchanged on a ’counsel only’ basis).

Each of the Parties has further agreed and covenanted to: (i) not participate in any substantive meeting or discussion,either in person or by telephone, with any Governmental Entity, in connection with the transactions contemplated by theSupport Agreement unless it consults with the other Party in advance and, to the extent not prohibited by suchGovernmental Entity, gives the other Party the opportunity to attend and participate in such meeting or discussion; (ii) notextend, directly or indirectly, any waiting periods required in connection with any Appropriate Regulatory Approval, orenter into any agreement with any Governmental Entity to delay the Effective Time or to not consummate the transactionscontemplated by the Support Agreement; and (iii) use commercially reasonable efforts to obtain the AppropriateRegulatory Approvals within 60 calendar days from the date of the Support Agreement.

In respect of the obtaining of the Competition Act Approval, each of the Parties has agreed and covenanted to (i) assoon as reasonably practicable, in consultation with each other, make or cause to be made such filings and submissions(the “Competition Filings”) as may be required by law or advisable; (ii) consult with each other in respect of any requestsand enquiries from the Commissioner or any other Governmental Entity pertaining to any applicable Competition Filingor the Common Share Offer; and (iii) comply at the earliest practicable date with any reasonable request or requirementfor additional information or documentary material received from the Commissioner or any other Governmental Entitypertaining to a Competition Filing.

Non-Solicitation Obligations of Western

The Support Agreement contains certain “non-solicitation” provisions pursuant to which Western has agreed that itwill not directly or indirectly:

(a) solicit, assist, initiate, encourage or otherwise facilitate (including by way of furnishing information orentering into any form of written or oral agreement, arrangement or understanding) any inquiries, offers orproposals regarding an Acquisition Proposal or otherwise co-operate in any way with, or assist with orparticipate in any way in any effort or attempt by any Person to make an Acquisition Proposal;

(b) encourage, enter into or participate in any discussions or negotiations regarding an Acquisition Proposal;

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(c) withdraw, modify or qualify (or propose to do so) in a manner adverse to the Offeror, the approval orrecommendation of the Board of Directors or any committee thereof of the Common Share Offer or theSupport Agreement;

(d) approve or recommend or propose publicly to approve or recommend any Acquisition Proposal; or

(e) accept, recommend, approve or enter into any letter of intent, agreement in principle, agreement,understanding or arrangement in respect of an Acquisition Proposal or providing for the payment of anybreak, termination or other fees or expenses to any Person in the event that Western completes the transactionscontemplated in the Support Agreement or any other transaction with the Offeror or any of its Affiliates agreedto prior to any termination of the Support Agreement, whether formal or informal.

The Support Agreement provides that, notwithstanding the foregoing restrictions, nothing contained in the SupportAgreement shall prevent the Board of Directors from entering into an agreement, or engaging in discussions ornegotiations with or furnishing information to any Person who has made a bona fide written Acquisition Proposal thatthe Board of Directors has determined is, or could reasonably be expected to lead to, a Superior Proposal.

Western has also agreed to immediately terminate any existing discussions or negotiations with any parties (otherthan the Offeror) with respect to any proposal that constitutes, or which could reasonably be expected to constitute, anAcquisition Proposal, whether or not initiated by Western. Western has also agreed not to amend, modify or waive any ofthe standstill provisions of the confidentiality agreements or standstill agreements entered into by Western with otherparties relating to a potential Acquisition Proposal. Immediately upon execution of the Support Agreement, Western hasrequested the return or destruction of all information provided to any third parties who have entered into a confidentialityagreement with Western relating to any potential Acquisition Proposal and has covenanted to use commerciallyreasonable efforts to ensure that such requests are honoured in accordance with the terms of such confidentialityagreements.

Western has also agreed, from and after the date of the Support Agreement, to notify the Offeror as soon aspracticable and in any event within 24 hours following receipt of any inquiry, proposal or offer (or any amendmentthereto) or request relating to or constituting an Acquisition Proposal, any request for discussions or negotiations, and/orany request for non-public information relating to Western or for access to properties, books and records or a list of theCommon Shareholders or other holders of Convertible Securities of which Western’s representatives, are or becomeaware, or any amendments to the foregoing. Such notice shall include the terms and conditions of, and the identity of thePerson making, any inquiry, proposal or offer (including any amendment thereto), and shall include, in the case of aproposal or offer, copies of any such proposal or offer or any amendment to any of the foregoing. Western has also agreedto keep the Offeror promptly and fully informed of the status, including any change to the material terms, of any suchproposal or offer or any amendment to the foregoing, and will respond promptly to all inquiries by Offeror with respectthereto.

If Western receives a request for material non-public information in relation to a potential Acquisition Proposal froma Person who proposes a bona fide Acquisition Proposal (that was not solicited, encouraged or facilitated after the date ofthe Support Agreement in contravention of the Support Agreement), and (i) the Board of Directors determines in goodfaith after consultation with its financial advisors and its legal counsel, that such Acquisition Proposal is, or couldreasonably be expected to lead to, a Superior Proposal (notwithstanding that such Acquisition Proposal may be subject toa due diligence condition at such time), and (ii) the failure to provide such party with access to such information regardingWestern would be inconsistent with the fiduciary duties of the Board of Directors, then, and only then, Western mayprovide such Person with access to information regarding Western, subject to the execution of a confidentiality agreementproviding for standstill provisions other than to effect a Superior Proposal, provided however that Western sends a copy ofany such confidentiality agreement to the Offeror promptly upon its execution and the Offeror is provided with a list of orcopies of the information provided to such Person and is immediately provided with access to similar information towhich such Person was provided.

Offeror Opportunity to Match

Except as described below, Western has agreed that it will not accept, approve, recommend or enter into anyagreement, understanding or arrangement in respect of an Acquisition Proposal (other than a confidentiality agreementpermitted by the Support Agreement) and/or withdraw, modify or qualify its approval or recommendation of the CommonShare Offer and recommend or approve the Acquisition Proposal, unless:

(a) the Board of Directors determines that the Acquisition Proposal constitutes a Superior Proposal;

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(b) Western has complied with the non-solicitation provisions in the Support Agreement and has provided theOfferor with a copy of the Acquisition Proposal;

(c) a period (the “Response Period”) of five Business Days shall have elapsed from the later of (i) the date onwhich the Offeror received written notice from the Board of Directors that the Board of Directors determinedto accept, approve, recommend or enter into a binding agreement to proceed with the Superior Proposal (the“Superior Proposal Notice”), and (ii) the date the Offeror received a copy of such Acquisition Proposal;

(d) after the Response Period, the Board of Directors determines in good faith, after consultation with its financialadvisors and outside counsel, that such Acquisition Proposal continues to constitute a Superior Proposal; and

(e) Western concurrently terminates the Support Agreement and has paid or concurrently pays to the Offeror theTermination Payment.

During the Response Period, the Offeror will have the right, but not the obligation, to offer to amend in writing theterms of the Support Agreement and the Common Share Offer. Western has agreed that, if requested by the Offeror, it willnegotiate with the Offeror in good faith to amend the terms of the Support Agreement and the Common Share Offer. TheBoard of Directors will review any such written amendment to determine, in good faith in the exercise of its fiduciaryduties, whether the Acquisition Proposal to which it is responding would be a Superior Proposal when assessed against theCommon Share Offer as it is proposed by the Offeror to be amended. If the Board of Directors does not so determine, theBoard of Directors will cause Western to enter into an amendment to the Support Agreement reflecting the offer by theOfferor to amend the terms of the Common Share Offer and upon the execution by the Parties of such amendment willreaffirm its recommendation of the Common Share Offer, as so amended. If the Board of Directors does so determine,Western may approve, recommend, accept or enter into an agreement, understanding or arrangement to proceed with theSuperior Proposal.

The Support Agreement further provides that the Board of Directors shall, within three Business Days, reaffirm itsapproval or recommendation of the Common Share Offer by press release after: (i) any Acquisition Proposal (which isdetermined not to be a Superior Proposal) is publicly announced or made; or (ii) the Board of Directors determines that aproposed amendment to the terms of the Common Share Offer and the Support Agreement would result in the AcquisitionProposal not being a Superior Proposal. The Offeror and its legal advisor shall be given a reasonable opportunity to reviewand comment on the form and content of any such press release and Western shall incorporate all reasonable commentsmade by the Offeror and its counsel.

Termination Payment and Expense Reimbursement

Western has agreed to pay to the Offeror a termination payment (the “Termination Payment”) of $10,000,000 uponthe occurrence of any of the following events (each a “Termination Payment Event”):

(a) the Board of Directors:

(i) withdraws, qualifies, changes or modifies in a manner adverse to the Offeror any of its recommendationsor determinations under the Support Agreement;

(ii) recommends or approves, or publicly proposes to recommend or approve, an Acquisition Proposal, orcauses Western to enter into any letter of intent, agreement or undertaking related to any AcquisitionProposal, other than a confidentiality and standstill agreement as contemplated in the SupportAgreement or resolves to do any of the foregoing; or

(iii) fails to reaffirm its approval or recommendation of the Common Share Offer in accordance with theSupport Agreement;

(b) the Offeror has received a Superior Proposal Notice from Western and either: (i) the Offeror does not deliver anoffer to amend the terms of the Common Share Offer and the Support Agreement during the Response Period;or (ii) the Offeror does offer to amend the terms of the Common Share Offer and the Support Agreementduring the Response Period but the Board of Directors determines, acting in good faith and in the properdischarge of its fiduciary duties, that the Acquisition Proposal referred to in the Superior Proposal Noticecontinues to be a Superior Proposal compared to the proposed amended terms of the Common Share Offer andthe Support Agreement and Western enters into an agreement to give effect to the Superior Proposal;

(c) the Offeror terminates the Support Agreement as a result of Western being in default of its covenants orobligations regarding non-solicitation of Acquisition Proposals;

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(d) Western terminates the Support Agreement if Western proposes to enter into a definitive agreement, orapprove or recommend a Superior Proposal; provided, however, that Western has not breached certainprovisions of the Support Agreement relating to non-solicitation of Acquisition Proposals; or

(e) the Minimum Tender Condition has not been satisfied or waived at the Expiry Time (other than as a result of afailure by the Offeror to comply with its covenants and obligations under the Support Agreement), anAcquisition Proposal has been publicly announced by any Person prior to the Expiry Time and not withdrawnat least five Business Days prior to the Expiry Time, and:

(i) any Acquisition Proposal is consummated prior to the expiration of 12 months following the terminationof the Support Agreement; or

(ii) the Board of Directors approves the entering into of a definitive agreement with respect to anyAcquisition Proposal prior to the expiration of 12 months following the termination of the SupportAgreement.

If a Termination Payment Event occurs, the Termination Payment shall be payable by Western to the Offeror asfollows:

(a) in respect of a Termination Payment Event described above in (a), (b) or (c), simultaneously with theoccurrence of such Termination Payment Event;

(b) in respect of a Termination Payment Event described above in (d), prior to the entering into of an agreementrelating to, or the approval of recommendation of, a Superior Proposal; and

(c) in respect of a Termination Payment Event described above in (e), concurrently upon the consummation of theAcquisition Proposal referred to therein.

The Offeror and Western also agreed that if the Support Agreement is terminated by the Offeror at any time bywritten notice to Western because:

(a) Western has

(i) breached any of its representations and warranties that are qualified by a reference to materiality or aMaterial Adverse Effect on Western, as of the date of the Support Agreement; or

(ii) breached in any material respect any of its other representations and warranties contained in the SupportAgreement, as of the date of the Support Agreement;

(except to the extent that such representations and warranties speak as of an earlier or later date whichrepresentations and warranties if not true and correct shall not have been true and correct as of such earlier orlater date) and any such breach or failure to be true and correct is incapable of being cured by Western or is notcured within ten (10) calendar days after written notice thereof (or, if the Expiry Time is less than ten(10) calendar days from the date of such notice, such lesser period of time) is delivered to Western by theOfferor; or

(b) Western is in default in any material respect of any covenant or obligation under the Support Agreement (otherthan Westerns’ non-solicitation obligations in respect of Acquisition Proposals) where such default isincapable of being cured by Western or is not cured within ten (10) calendar days after written noticethereof (or, if the Expiry Time is less than ten (10) calendar days from the date of such notice, such lesserperiod of time) is delivered to Western by the Offeror,

then Western will pay to the Offeror all fees and expenses of the Offeror which were incurred in connection with thetransactions which are the subject of the Support Agreement, up to a maximum of $2,000,000.

Termination of the Support Agreement

The Support Agreement may be terminated at any time prior to the Effective Time:

(a) by mutual consent of the Offeror and Western;

(b) by the Offeror, if any condition of the Common Share Offer set out in Section 4 of the Offers is not satisfied orwaived by the Expiry Time, as such Expiry Time may be extended by the Offeror in its sole discretion pursuantto the Support Agreement, and the Offeror has not elected to waive such condition; provided that the Offeror isnot then in breach of the Support Agreement so as to cause any such condition not to be satisfied;

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(c) by the Offeror, at any time if:

(i) Western has breached any of its representations and warranties that are qualified by a reference tomateriality or a Material Adverse Effect, as of the date of the Support Agreement; or

(ii) Western has breached in any material respect any of its other representations and warranties contained inthe Support Agreement, as of the date of the Support Agreement;

(except to the extent that such representations and warranties speak as of an earlier or later date whichrepresentations and warranties if not true and correct shall not have been true and correct as of such earlier orlater date) and any such breach or failure to be true and correct is incapable of being cured by Western or is notcured within ten (10) calendar days after written notice thereof (or, if the Expiry Time is less than ten(10) calendar days from the date of such notice, such lesser period of time) is delivered to Western by theOfferor;

(d) by the Offeror, at any time if: (i) Western is in default of any of its non-solicitation obligations in respect ofAcquisition Proposals; or (ii) Western is in default in any material respect of any other covenant or obligationunder the Support Agreement where such default is incapable of being cured by Western or is not cured withinten (10) calendar days after written notice thereof (or, if the Expiry Time is less than ten (10) calendar daysfrom the date of such notice, such lesser period of time) is delivered to Western by the Offeror;

(e) by Western, at any time if:

(i) the Offeror has breached any of its representations and warranties that are qualified by a reference tomateriality, as of the date of the Support Agreement; or

(ii) the Offeror has breached in any material respect any of its other representations and warrantiescontained in the Support Agreement, as of the date of the Support Agreement;

(except to the extent that such representations and warranties speak as of an earlier date which representationsand warranties if not true and correct shall not have been true and correct as of such earlier date) and any suchbreach or failure to be true and correct is incapable of being cured by the Offeror or is not cured within ten(10) calendar days after written notice thereof (or, if the Expiry Time is less than ten (10) calendar days fromthe date of such notice, such lesser period of time) is delivered to the Offeror by Western;

(f) by Western, at any time if the Offeror is in default in any material respect of any covenant or obligation underthe Support Agreement where such default is incapable of being cured by the Offeror or is not cured within ten(10) calendar days after written notice thereof (or, if the Expiry Time is less than ten (10) calendar days fromthe date of such notice, such lesser period of time) is delivered to the Offeror by Western;

(g) by Western, if the Effective Time has not occurred on or before the Outside Date except that the right toterminate the Support Agreement pursuant to the terms of this paragraph shall not be available to Western if itsfailure to fulfill any of its obligations or breach of any of its representations and warranties under the SupportAgreement has been the cause of, or resulted in, the failure of the Effective Time to occur by such OutsideDate;

(h) by the Offeror upon the occurrence of a Termination Payment Event;

(i) by Western in order to accept, approve, recommend or enter into a binding written agreement with respect to aSuperior Proposal (other than a confidentiality agreement permitted under the Support Agreement), subject tocompliance with the terms of the Support Agreement;

(j) by the Offeror if the Effective Time has not occurred on or before the Outside Date, except that the right toterminate the Support Agreement pursuant to the terms of this paragraph shall not be available to the Offeror ifits failure to fulfill any of its obligations or breach of any of its representations and warranties under theSupport Agreement has been the cause of, or resulted in, the failure of the Effective Time to occur by suchOutside Date; and

(k) by either the Offeror or Western if any Law in force in Canada makes the making or completion of theCommon Share Offer or the Contemplated Transactions illegal or otherwise prohibited.

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Shareholder Rights Plan

Western and the Board of Directors have agreed and covenanted to take all action necessary to waive the applicationof the Shareholder Rights Plan to the Contemplated Transactions and to ensure that the Shareholder Rights Plan does notinterfere with or impede the success of the Common Share Offer. Western shall waive the application of the ShareholderRights Plan to the Contemplated Transactions immediately prior to the Expiry Time.impede the success of the Offer. Western shall waive the application of the Shareholder Rights Plan to the ContemplatedTransactions immediately prior to the Expiry Time.

Treatment of Outstanding Options

The Offeror and Western have agreed that, between the date of the Support Agreement and the Effective Time,subject to the terms of the Option Plan and the receipt of any necessary approvals and to applicable securities laws,Western may take such actions as may be necessary or desirable, including amending the terms of any Options to providethat all Options vest no later than immediately prior to the Effective Time and that each holder of vested Options shall beentitled to, at his or her option: (i) exercise such Options, in accordance with their terms, and thereby acquire CommonShares; (ii) effect a cashless exercise of their Options solely for purposes of tendering to the Common Share Offer allCommon Shares issued in connection with such cashless exercise; or (iii) in lieu of exercising Options, surrender suchOptions to Western, in exchange for a payment by Western in the form of Common Shares having a fair market valueequal to the Cash-Out Amount, in each case, for the purposes of tendering to the Common Share Offer all Common Sharesissued in connection with such exercise or surrender.

Western has agreed that it will use commercially reasonable efforts to allow all outstanding Options to be eitherexercised, terminated, surrendered, cancelled or expire prior to the Effective Time. Western has also agreed that it will useall reasonable commercial efforts to accelerate the vesting of all Options, such that all outstanding Options shall be fullyvested and exercisable prior to the Effective Time and to satisfy all other obligations of Western under the Options so that,upon the acquisition by the Offeror of the Common Shares pursuant to the Common Share Offer, all entitlements under theOption Plan shall terminate. The Offeror has agreed to co-operate and make all such tendering or other arrangements withWestern to facilitate the exercise, conditional exercise, cancellation or surrender of Options and the deposit, pursuant tothe Common Share Offer, of all Common Shares issued in connection therewith prior to the Expiry Time.

Employee Share Ownership Plan

Western has agreed that it will accelerate the vesting of all Common Shares held in trust pursuant to the EmployeeShare Ownership Plan for the benefit of Participants (as such term is defined in the Employee Share Ownership Plan) sothat such Common Shares may be deposited under the Common Share Offer and agrees to use reasonable commercialefforts to enable the Participants to deposit their Common Shares under the Common Share Offer.

Officers’ and Directors’ Insurance

The Support Agreement provides that Western (or at the election of the Offeror made at least 10 Business Days priorto the Effective Time, the Offeror) will secure, on or before the Effective Time, pre-paid, non-cancellable directors’ andofficers’ liability insurance for Western’s present and former directors and officers and those of its Subsidiaries, coveringclaims made prior to and within six years after the Effective Time, on a “trailing” or “run-off” basis, which policy havingscope and coverage substantially equivalent in scope and coverage to that provided by Western’s current directors’ andofficers’ insurance policy, provided that such insurance is available at a one-time cost that is not in excess of 300% of theannual cost to Western of Western’s current directors’ and officers’ insurance policy. If such insurance is not available forthat cost, Western or the Offeror, as applicable, will only be required to maintain that amount of insurance which can bepurchased for 300% of the annual cost to Western of Western’s current directors’ and officers’ insurance policy. Westernand the Offeror have agreed that, from and after the Effective Time, Western or the Offeror, as applicable, will maintain inplace such insurance policy and agree not to take any action, or to cause Western to take any action, to terminate suchdirectors’ and officers’ liability insurance.

The Offeror and Western have also covenanted to ensure that, after the Effective Time, the by-laws of Western andany corporation continuing following any amalgamation, merger, plan of arrangement, consolidation or winding-up ofWestern or a successor thereto with or into one or more other Persons (a “Continuing Corporation”) and theirSubsidiaries shall, subject to applicable Law, contain provisions with respect to indemnification of directors and officersthat are substantially similar to those set forth in Western or its Subsidiaries’ by-laws, as applicable, which provisions shallnot, except to the extent required by Law, be amended, repealed or otherwise modified for a period of six years from the

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Effective Time in any manner that would materially and adversely affect the rights thereunder of individuals who,immediately prior to the Effective Time, were directors, officers or employees of Western or its Subsidiaries, asapplicable, and, subject to applicable Law, the Offeror and Western shall ensure that any indemnification agreementsbetween Western or its Subsidiaries, as applicable, and such individuals continue in place and are assumed, if applicable,by any Continuing Corporation or its Subsidiaries, as applicable, and that the Continuing Corporation or its Subsidiaries,as applicable, indemnifies such individuals to the fullest extent permitted by applicable Law, such by-Laws and suchindemnification agreements.

The Offeror and Western have further agreed that, after the Effective Time, they will or will cause any ContinuingCorporation to agree, to honour and comply with the terms of those existing employment, severance, change of controland indemnification agreements or arrangements of Western which have been disclosed to the Offeror prior to the date ofthe Support Agreement, provided that nothing shall prevent the termination of any agreement that is terminable inaccordance with its terms.

6. PURPOSE OF THE OFFERS AND PLANS FOR WESTERN

Purpose of the Offer

The purpose of the Offers is to enable the Offeror to acquire all outstanding Shares. If the Offeror takes up and paysfor Shares under the Offers, the Offeror’s current intention is to acquire all Shares not deposited under the Offers. SeeSection 15 of the Circular, “Acquisition of Shares Not Deposited Under the Offers”. The exact timing and terms of aCompulsory Acquisition or Subsequent Acquisition Transaction involving Western will necessarily depend upon avariety of factors, including the number of Shares acquired pursuant to each Offer.

Although the Offeror currently intends to propose a Compulsory Acquisition or a Subsequent AcquisitionTransaction generally on the terms described herein, it is possible that, as a result of information hereafter obtainedby the Offeror, changes in general economic, industry or market conditions or in the business of Western, or othercurrently unforeseen circumstances, such a transaction may not be so proposed, may be delayed or abandoned or may beproposed on different terms. The Offeror expressly reserves the right not to propose a Compulsory Acquisition orSubsequent Acquisition Transaction involving Western, or to propose a Subsequent Acquisition Transaction on termsother than those described herein. Specifically, the Offeror reserves the right to propose that the consideration in aSubsequent Acquisition Transaction consist of cash or securities or a combination of cash and securities and that theconsideration in such a transaction have a value more or less than the amount offered under the Offers.

If for some reason the Offeror is unable to effectuate a Compulsory Acquisition or a Subsequent AcquisitionTransaction as outlined above, the Offeror will evaluate other available alternatives. These alternatives could include, tothe extent permitted by applicable Laws, purchasing additional Shares or Convertible Securities: (i) in the open market;(ii) in privately negotiated transactions; (iii) in another take-over bid or exchange offer or otherwise; or (iv) from Western.Any additional purchases of Shares could be at a price greater than, equal to or less than the price to be paid for Sharesunder the Offers and could be for cash or securities or other consideration. Alternatively, the Offeror may sell or otherwisedispose of any or all Shares acquired pursuant to the Offers. These transactions may be effectuated on terms and at pricesthen determined by the Offeror, which may vary from the terms and the price paid for Shares under the Offers.

Plans for Western Following the Completion of the Offers

If the Offeror takes up and pays for Shares under the Offers and the Offeror acquires control of Western as a resultthereof, the Offeror intends to take steps to cause (i) the Board of Directors to be replaced with nominees of the Offeror,(ii) Western to redeem on June 29, 2011 all of its issued and outstanding Series 2 Shares in accordance with the redemptionright attached to the Series 2 Shares, (iii) Western to redeem all of its issued and outstanding Convertible Debentures inaccordance with the redemption right attached to the Convertible Debentures in the event of a “change of control” ofWestern and (iv) Western to acquire or redeem, as applicable, all of its issued Preferred Shares still outstanding uponcompletion of a Compulsory Acquisition or a Subsequent Acquisition Transaction, as the case may be. Following theacquisition of Shares pursuant to the Offers and the Offeror gaining access to more detailed information with respect toWestern, the Offeror will review the assets and operations of Western and consider what changes, if any, are necessary orappropriate. As discussed in Section 10 of the Circular, “Effect of the Offers on Outstanding Indebtedness”, the effect ofthe Offers may be to require Western to retire the Convertible Debentures.

If permitted by applicable law and subject to any obligations with respect to the Preferred Shares and the ConvertibleDebentures, subsequent to the completion of the Offers and any Compulsory Acquisition or Subsequent Acquisition

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Transaction, if any, the Offeror intends to delist the securities of Western from the TSX, and, subject to applicablesecurities laws in provinces where Western is a reporting issuer, to cause Western to cease to be a reporting issuer in suchprovinces.

7. SOURCE OF OFFERED CONSIDERATION

In the event that all of the outstanding Shares on a fully-diluted basis that are subject to the Offers, are tendered to theOffers and are taken up and paid for the Offeror, the total cash consideration payable to such tendering Shareholderswould be approximately $390 million. The Offeror will satisfy or arrange for the satisfaction of such fundingrequirements through (i) credit facilities for up to $200 million for the purposes of financing the Offers as describedbelow; (ii) $75 million equity contributions from a wholly-owned subsidiary of Fédération des Caisses Desjardins duQuébec; and (iii) 170 million from cash on hand. The Offeror’s obligation to purchase the Shares tendered to the Offers isnot subject to any financing condition.

The Offeror has obtained a commitment letter (the “Commitment Letter”) dated January 18, 2011, from CaisseCentrale Desjardins (the “Lender”), also a member of the Desjardins Financial Group and a wholly-owned subsidiary ofthe Fédération des Caisses Desjardins du Québec, pursuant to which the Lender has committed to provide, on a fullyunderwritten basis, a $200 million 5 year term loan (the “Credit Facilities”). The Credit Facilities will bear interest and besubject to fees at levels customary for credit facilities of their type. Under the Credit Facilities, interest will be payablemonthly and the principal amount is payable upon maturity. The obligations of the Lender are subject to conditionscustomary in nature and scope for credit facilities of their type.

8. BENEFICIAL OWNERSHIP OF AND TRADING IN SECURITIES

Beneficial Ownership

None of the Offeror or any of its directors or senior officers or, to the knowledge of such directors and senior officersafter reasonable enquiry: (a) any associate or affiliate of an insider of the Offeror; (b) any insider of the Offeror (other thana director or officer); or (c) any Person acting jointly or in concert with the Offeror, beneficially owns, directly orindirectly, or exercises control or direction over, any of the securities of Western.

Trading in Western Securities

During the six-month period preceding the date of this Circular, no securities of Western have been traded by theOfferor or any of its directors or senior officers, or, to the knowledge of such directors and senior officers after reasonableinquiry: (a) any associate or affiliate of an insider of the Offeror; (b) any insider of the Offeror (other than a director orofficer); or (c) any Person or company acting jointly or in concert with the Offeror.

9. EFFECT OF THE OFFERS ON MARKET AND LISTING

Following the completion of the Offers and a Compulsory Acquisition or Subsequent Acquisition Transaction, as thecase may be, the Offeror will apply to the TSX to de-list the Common Shares and, to the extent permitted, the PreferredShares and the Convertible Debentures from trading.

The purchase of Shares by the Offeror pursuant to the Offers (and the conversion of In-the-Money ConvertibleSecurities for the purpose of depositing the underlying Common Shares to the Common Share Offer) will reduce thenumber of Common Shares, Preferred Shares and Convertible Debentures that might otherwise trade publicly as well asthe number of security holders and, depending on the number of Shareholders depositing Shares and the number of Sharespurchased under the Offers, could adversely affect the liquidity and market value of the remaining Common Shares,Preferred Shares and Convertible Debentures held by the public.

The rules and regulations of the TSX establish certain criteria which, if not met, could lead to the delisting of theCommon Shares, one or more classes of Preferred Shares and the Convertible Debentures from the TSX. These criteriainclude the number of holders of each class of securities and the number and aggregate market value of securities publiclyheld. Depending on the number of Shares purchased pursuant to the Offers, it is possible that one or more of the CommonShares, one or more classes of Preferred Shares and the Convertible Debentures would fail to meet the criteria forcontinued listing on the TSX. If this were to happen, such class or classes of securities could be delisted and that could, inturn, adversely affect the market or result in the lack of an established market for such securities. Delisting could alsoaffect the tax consequences to Shareholders who dispose of Shares pursuant to a Compulsory Acquisition or a SubsequentAcquisition Transaction. See Section 16 of the Circular, “Certain Canadian Federal Income Tax Considerations”.

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Depending on the number of Shares that are validly deposited under the Offers, the Offeror will effect a CompulsoryAcquisition or, if the Offeror is not entitled to effect a Compulsory Acquisition, a Subsequent Acquisition Transaction.The Offeror may also cause Western to redeem all outstanding Preferred Shares and Convertible Debentures inaccordance with the redemption right attached to such securities. See Section 6 of this Circular, “Purpose of the Offersand Plan for Western” and Section 15 of this Circular, “Acquisition of Shares Not Deposited under the Offers”. If aCompulsory Acquisition or a Subsequent Acquisition Transaction is effected, the Common Shares will be delisted fromthe TSX, one or more classes of Preferred Shares and the Convertible Securities may also be delisted as a result of suchtransaction. It is expected that a Subsequent Acquisition Transaction will constitute a “Capital Reorganization” under theterms of Preferred Shares and that, following such Capital Reorganization, a holder of Preferred Shares exercising its rightto convert such securities into Common Shares will be entitled to receive, in lieu of the number of Common Shares towhich it was previously entitled to receive upon conversion, cash consideration equal to the Common Share Considerationmultiplied by the number of Common Shares that such holder is entitled to receive upon conversion.

10. EFFECT OF THE OFFERS ON OUTSTANDING INDEBTEDNESS

Convertible Debentures

As of January 17, 2011, Western had $16,710,000 principal amount of Convertible Debentures outstanding.

In the event of a “change of control”, Western must commence an offer within 30 days of the consummation of thetransaction resulting in such change of control to repurchase all outstanding Convertible Debentures at a price equal (inthe event that such offer is made prior to April 21, 2013) to 102% of the principal amount plus accrued interest to the dateof purchase. A “change of control” will be deemed to have occurred in the event that, among other things, any personacquires voting control or direction over voting securities of Western representing in the aggregate 50% or more of theoutstanding voting securities. If 90% or more in aggregate principal amount of the Convertible Debentures outstanding onthe date of the giving of notice of the change of control have been tendered for purchase, Western will have the right toredeem all the remaining Convertible Debentures on the same terms. The terms of the Convertible Debentures alsoprovide that Western may redeem all the Convertible Debentures at a price equal (if prior to April 21, 2013) to 102% of theprincipal amount plus accrued interest to the date of purchase upon the occurrence of a “change of control”.

In the event that the Offeror takes up and pays for Common Shares under the Common Share Offer and acquires notless than 50% of the Common Shares (including Common Shares held on the date of the Offers by or on behalf of theOfferor), a “change of control” will likely be deemed to have occurred for the above purposes.

Following completion of the Offers, the Offeror intends to cause the exercise, by Western, of the redemption rightattached to the Convertible Debentures in the context of a change of control of Western.

It is expected that a Subsequent Acquisition Transaction will constitute a “Capital Reorganization” under the termsof Convertible Debentures and that, following such Capital Reorganization, a holder of Convertible Debenturesexercising its right to convert such securities into Common Shares will be entitled to receive, in lieu of the numberof Common Shares to which it was previously entitled to receive upon conversion, cash consideration equal to theCommon Share Consideration multiplied by the number of Common Shares that such holder is entitled to receive uponconversion.

Credit Facilities

As of January 17, 2011, Western had credit facilities of $57 million with a Canadian Schedule 1 Chartered Bank. TheOfferor currently intends to maintain these facilities.

11. COMMITMENTS TO ACQUIRE SECURITIES OF WESTERN

Neither the Offeror nor any of its directors or senior officers, nor, to the knowledge of such directors and seniorofficers after reasonable enquiry: (i) any associate or affiliate of an insider of the Offeror; (ii) any insider of the Offeror(other than a director or officer); or (iii) any Person acting jointly or in concert with the Offeror, has entered into anycommitments to acquire any securities of Western.

12. ARRANGEMENTS, AGREEMENTS OR UNDERSTANDINGS, OTHER BENEFITS TO INSIDERS,AFFILIATES AND ASSOCIATES

There are no arrangements or agreements made between the Offeror and any of the directors or senior officers ofWestern and no payments or other benefits are proposed to be made or given by the Offeror by way of compensation for

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loss of office or as to such directors or senior officers remaining in or retiring from office if the Offers are successful. TheOfferor intends to discuss with senior management of Western arrangements with respect to their continued employment.

There are no contracts, arrangements or understandings, formal or informal, between the Offeror and anysecurityholder of Western with respect to the Offers, or between the Offeror and any Person, with respect to anysecurities of Western in relation to the Offers.

Other than the Support Agreement, there is no arrangement, agreement, commitment or understanding madebetween the Offeror and Western relating to the Offers.

There is no agreement, arrangement, commitment or understanding of which the Offeror is aware that could affectcontrol of Western that the Offeror has access to and can reasonably be regarded as material to a tendering Shareholderunder the Offers.

13. MATERIAL CHANGES AND OTHER INFORMATION

Except as disclosed elsewhere in this Circular or as otherwise publicly disclosed by Western or the Offeror, theOfferor has no information which indicates any material change in the affairs of Western since the date of the lastpublished financial statements of Western. The Offeror has no knowledge of any material information concerning theOfferor that has not been generally disclosed or any other matter that has not previously been generally disclosed butwhich would, in the latter case, reasonably be expected to affect the decision of the Shareholders to accept or reject theOffers.

14. REGULATORY MATTERS

The Offeror’s obligation to take up and pay for Shares tendered under the Offers is conditional upon all AppropriateRegulatory Approvals having been obtained on terms satisfactory to the Offeror, acting reasonably. The Offeror is seekingthe following approvals.

Bank Act Approval

Bank West is subject to the Bank Act (Canada). Accordingly, the Offeror’s acquisition of control of Bank West issubject to the written approval of the Minister of Finance (Canada) pursuant to Sections 373(1) and 395(2) of the Bank Act(Canada).

Insurance Companies Act Approvals

Western Life Assurance Company and Western Financial Insurance Company are both subject to the InsuranceCompanies Act (Canada). Accordingly, the Offeror’s acquisition of control of each of Western Life Assurance Companyand Western Financial Insurance Company is subject to the written approval of the Minister of Finance (Canada) pursuantto Sections 407(1) and 419(2) of the Insurance Companies Act (Canada).

Competition Act Approval

Part IX of the Competition Act requires that the parties to certain transactions that exceed the thresholds set out inSections 109 and 110 of the Competition Act (“Notifiable Transactions”) provide the Commissioner of Competition (the“Commissioner”) with prior written notice of the transaction. Subject to certain limited exceptions, the parties to aNotifiable Transaction cannot complete such transaction until they have provided to the Commissioner the informationprescribed pursuant to Subsection 114(1) of the Competition Act and the applicable waiting period pursuant to Section 123of the Competition Act has expired or been terminated. The waiting period is thirty (30) calendar days after the day onwhich the parties to the transaction submit the prescribed information, provided that, before the expiry of this period, theCommissioner has not notified the parties pursuant to Subsection 114(2) of the Competition Act that she requiresadditional information that is relevant to the Commissioner’s assessment of the transaction (a “SupplementaryInformation Request”). If the Commissioner issues a Supplementary Information Request to one or more parties,the parties cannot complete the transaction until thirty (30) calendar days after compliance with the SupplementaryInformation Request, provided that there is no order in effect prohibiting completion of the transaction at that time. Atransaction may be completed before the end of the applicable waiting period if the Commissioner notifies the parties thatshe does not, at such time, intend to challenge the transaction by making an application under Section 92 of theCompetition Act.

Alternatively, or in addition to filing the prescribed information, a party to a Notifiable Transaction may apply to theCommissioner for: (i) an advance ruling certificate (an “ARC”); or (ii) a “no-action” letter advising the parties that the

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Commissioner does not intend to challenge the Notifiable Transaction at that time (but that she retains the authority to doso for one (1) year after completion of the Notifiable Transaction) and an exemption from the pre- merger notificationobligation under paragraph 113(c) of the Competition Act (a “No-Action Letter”). The Commissioner may issue eitheran ARC or No- Action Letter in respect of a proposed transaction if she is satisfied that there are not sufficient grounds onwhich to apply to the Competition Tribunal for an order under Section 92 of the Competition Act.

Upon the Competition Act, the Commissioner may (i) challenge a Notifiable Transaction, if the Commissionerconcludes that it is likely to substantially prevent or lessen competition, and seek an order of the Competition Tribunal(a) prohibiting the completion of the Notifiable Transaction on an interim or permanent basis if the parties insist onproceeding with it without addressing the Commissioner’s concerns, (b) requiring the divestiture of shares or assets or thedissolution of the Notifiable Transaction, if it has been completed, or (c) with the consent of the Person against whom theorder is directed, requiring that Person to take any other action; (ii) seek a consent agreement providing for voluntaryremedies, including divestitures of assets or shares, to resolve any concerns that the Commissioner may have; (iii) issue aNo-Action Letter or (iv) issue an ARC. Where an ARC is issued and the Notifiable Transaction to which the ARC relatesis substantially completed within one (1) year after the ARC is issued, the Commissioner cannot seek an order of theCompetition Tribunal in respect of the Notifiable Transaction solely on the basis of information that is the same orsubstantially the same as the information on the basis of which the ARC was issued.

The purchase of Shares under the Offers is a Notifiable Transaction. The Offeror and Western intend to submit arequest for an ARC or No-Action Letter in respect of the transactions contemplated by the Offer and to file the prescribedinformation if required to do so.

The obligation of the Offeror to take up and pay for Shares under the Offers is conditional upon obtainingCompetition Act Approval.

15. ACQUISITION OF SHARES NOT DEPOSITED UNDER THE OFFERS

Compulsory Acquisition

If, by the Expiry Time or within 120 days after the date of the Offers, whichever is shorter, any of the respectiveOffers are accepted by Shareholders who in the aggregate hold not less than 90% of the issued and outstanding Shares ofany class to which such Offer relates as at the Expiry Time, other than Shares held at the date of the Offers by or on behalfof the Offeror or an Affiliate or associate of the Offeror, and the Offeror acquires or is bound to take up and pay for suchShares tendered to an Offer, the Offeror intends to acquire all Shares of that class (including in respect of the CommonShare Offer, Common Shares that may be issued as a result of the exercise of the rights under any outstanding ConvertibleSecurities) that are held by those Persons who did not accept such Offer (and each Person who subsequently acquires anyof such Shares, collectively, the “Dissenting Offeree”) pursuant to the provisions of Part XVI of the ABCA on the sameterms and for the same consideration as the Shares acquired under the relevant Offer (a “Compulsory Acquisition”). Forgreater certainty, in the event that less that 90% of any of the classes of Shares is taken-up, then a Compulsory Acquisitionwould only apply to the classes of Shares of which 90% or more were taken-up and paid for under the Offer.

To exercise its statutory right of Compulsory Acquisition, the Offeror must send a notice (the “Offeror’s Notice”) toeach Dissenting Offeree and to Western of such proposed acquisition within sixty (60) days after the date of thetermination of an Offer and in any event within 180 days after the date of such Offer. Within twenty (20) days after theOfferor sends the Offeror’s Notice, the Offeror must pay or transfer to Western the consideration the Offeror would have topay or transfer to the Dissenting Offerees if they had elected to accept an Offer, to be held in trust for the DissentingOfferees. In accordance with Section 197 of the ABCA, within twenty (20) days after receipt of the Offeror’s Notice, eachDissenting Offeree must send the certificate(s) representing the Shares held by such Dissenting Offeree to Western andmust elect either to transfer such Shares to the Offeror on the terms of the relevant Offer or to demand payment of the fairvalue of such Shares held by such holder by so notifying the Offeror within twenty (20) days after the Dissenting Offereereceives the Offeror’s Notice. A Dissenting Offeree who does not, within twenty (20) days after the Dissenting Offereereceived the Offeror’s Notice, notify the Offeror that the Dissenting Offeree is electing to demand payment of the fairvalue of the Dissenting Offeree’s Shares is deemed to have elected to transfer such Shares to the Offeror on the same termsthat the Offeror acquired Shares from the Shareholders who accepted such Offer. If a Dissenting Offeree has elected todemand payment of the fair value of such Shares, the Offeror may apply to a court having jurisdiction to hear anapplication to fix the fair value of such Shares of such Dissenting Offeree. If the Offeror fails to apply to such court withintwenty (20) days after it made the payment or transferred the consideration to Western referred to above, the DissentingOfferee may then apply to the court within a further period of twenty (20) days to have the court fix the fair value. If there

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is no such application made by the Dissenting Offeree within such period, the Dissenting Offeree will be deemed to haveelected to transfer such Shares to the Offeror on the terms that the Offeror acquired Shares from the Shareholders whoaccepted such Offer. Any judicial determination of the fair value of the Shares could be less or more than the amount paidpursuant to an Offer.

The foregoing is a summary only of the statutory right of Compulsory Acquisition that may become available to theOfferor and is qualified in its entirety by the provisions of Part XVI of the ABCA. Part XVI of the ABCA is complex andmay require strict adherence to notice and timing provisions, failing which a Dissenting Offeree’s rights may be lost oraltered. Shareholders who wish to be better informed about those provisions of the ABCA should consult their legaladvisors.

See Section 16 of the Circular, “Certain Canadian Federal Income Tax Considerations” for a discussion of the taxconsequences to Shareholders of disposing of Shares pursuant to a Compulsory Acquisition.

Subsequent Acquisition Transaction

If the Offeror takes up and pays for Shares validly deposited under the Offers and a Compulsory Acquisition is notavailable or the Offeror elects not to pursue a Compulsory Acquisition, the Offeror currently intends, depending upon thenumber of Shares taken-up and paid for under the Offers, to take such action as is necessary or advisable, includingcausing one or more special meetings of Shareholders to be called to consider a proposed arrangement, amalgamation,merger, reorganization or other capital reorganization involving Western and/or its Subsidiaries and the Offeror or anAffiliate of the Offeror which, if successfully completed, will result in the Offeror owning, directly or indirectly, all of theShares of any class and provides for consideration per Share that is at least equal in value to and is in the same form as theconsideration per Share offered under the relevant Offer (a “Subsequent Acquisition Transaction”) and suchSubsequent Acquisition Transaction may include, among other things, an amendment to the articles of Western toprovide for (i) the creation of a new class of automatically redeemable preferred shares into which the Shares remainingoutstanding after completion of the Offer would be convertible, and (ii) a modification to the redemption rights attached tothe Series 3 Shares and Series 4 Shares. It is expected that a Subsequent Acquisition Transaction will constitute a “CapitalReorganization” under the terms of Preferred Shares and the Convertible Debentures and that, following such CapitalReorganization, a holder of Preferred Shares or Convertible Debentures exercising its right to convert such securities intoCommon Shares will be entitled to receive, in lieu of the number of Common Shares to which it was previously entitled toreceive upon conversion, cash consideration equal to the Common Share Consideration multiplied by the number ofCommon Shares that such holder is entitled to receive upon conversion.

MI 61-101 may deem a Subsequent Acquisition Transaction to be a “business combination” if such SubsequentAcquisition Transaction would result in the interest of a holder of Shares being, with respect to the Common Shares,terminated without the consent of the holder, irrespective of the nature of the consideration provided in substitutiontherefor. The Offeror expects that any Subsequent Acquisition Transaction relating to Common Shares will be a “businesscombination” under MI 61-101.

In certain circumstances, the provisions of MI 61-101 may also deem certain types of Subsequent AcquisitionTransactions to be “related party transactions”. However, if the Subsequent Acquisition Transaction is a “businesscombination” carried out in accordance with MI 61-101 or an exemption therefrom, the “related party transaction”provisions therein do not apply to such a transaction. The Offeror intends to carry out any such Subsequent AcquisitionTransaction in accordance with MI 61-101, or any successor provisions, or exemptions therefrom, such that the “relatedparty transaction” provisions of MI 61-101 will not apply to such Subsequent Acquisition Transaction.

MI 61-101 provides that, unless exempted, a corporation proposing to carry out a business combination is required toprepare a formal valuation of the affected securities (and, subject to certain exceptions, any non-cash consideration beingoffered therefor) and provide to the holders of the affected securities a summary of such valuation. In connectiontherewith, the Offeror currently intends to rely on available exemptions (or, if such exemptions are not available, to seekwaivers pursuant to MI 61-101 exempting Western and the Offeror or one or more of their respective Affiliates, asappropriate) from the valuation requirements of MI 61-101. An exemption is available under MI 61-101 for certainbusiness combinations completed within 120 days after the expiry of a formal take-over bid where the consideration undersuch transaction is at least equal in value to and is in the same form as the consideration that the tendering Shareholderswere entitled to receive in the take-over bid, provided that certain disclosure is given in the take-over bid disclosuredocuments (and which disclosure has been provided herein). The Offeror currently intends that the consideration offeredunder any Subsequent Acquisition Transaction proposed by it would be equal in value to, and in the same form as, the

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consideration per Share paid to the Shareholders under the respective Offer and that such Subsequent AcquisitionTransaction will be completed no later than 120 days after the Expiry Time and, accordingly, the Offeror expects to rely onthese exemptions or to obtain relief from the relevant valuation requirements of certain other provinces and territories ofCanada, as applicable.

Depending on the nature and the terms of the Subsequent Acquisition Transaction in respect of any class of Shares,the provisions of the ABCA and Western’s constating documents may require the approval of at least 662⁄3% of the votescast by holders of the outstanding Shares at a meeting duly called and held for the purpose of approving a SubsequentAcquisition Transaction. MI 61-101 would also require that, in addition to any other required securityholder approval, inorder to complete a business combination, the approval of a majority of the votes cast by “minority” holders of each classof affected securities must be obtained unless an exemption is available or discretionary relief is granted by the applicableCanadian Securities Administrators. If, however, following an Offer, the Offeror and its Affiliates and associates are theregistered holders of 90% or more of the relevant class of Shares at the time the Subsequent Acquisition Transaction isinitiated, the requirement for minority approval would not apply to the transaction if an enforceable appraisal right orsubstantially equivalent right is made available to “minority” shareholders.

In relation to the Offers and any business combination, the “minority” shareholders will be, unless an exemption isavailable or discretionary relief is granted by applicable Canadian Securities Administrators, all Shareholders other thanthe Offeror, any “interested party” (within the meaning of MI 61-101), certain “related parties” of the Offeror or of anyother “interested party” (in each case within the meaning of MI 61-101) including any director or senior officer of theOfferor, affiliate or insider of the Offeror or any of their directors or senior officers and any “joint actor” (within themeaning of MI 61-101) with any of the foregoing Persons. MI 61-101 also provides that the Offeror may treat Sharesacquired under the Offers as “minority” shares and to vote them, or to consider them voted, in favour of such businesscombination if, among other things: (a) the business combination is completed not later than 120 days after the ExpiryTime; (b) the consideration per Share in the business combination is at least equal in value to and in the same form as theconsideration paid under the Offers; and (c) the Shareholders who tendered such Shares to the Offers were not (i) “jointactors” (within the meaning of MI 61-101) with the Offeror in respect of the Offers, (ii) direct or indirect parties to any“connected transaction” (within the meaning of MI 61-101) to the Offers, or (iii) entitled to receive, directly or indirectly,in connection with the Offers, a “collateral benefit” (within the meaning of MI 61-101) or consideration per Share that isnot identical in amount and form to the entitlement of the general body of holders in Canada of Shares. The Offerorcurrently intends that the consideration offered for Shares under any Subsequent Acquisition Transaction proposed by itwould be equal in value to, and in the same form as, the consideration paid to Shareholders under the Offers and that anysuch Subsequent Acquisition Transaction will be completed no later than 120 days after the Expiry Time and, accordingly,the Offeror intends to cause Shares acquired under the Offers to be voted in favour of any such transaction, as applicable,and, where permitted by MI 61-101, to be counted as part of any minority approval required in connection with any suchtransaction, as applicable. Only the votes attached to any Shares acquired after the date hereof by the Offeror other thanpursuant to the Offers would be required to be excluded in determining whether minority approval for a SubsequentAcquisition Transaction had been obtained for the purposes of MI 61-101.

Any such Subsequent Acquisition Transaction may also result in Shareholders having the right to dissent in respectthereof and demand payment of the fair value of their Shares. If the relevant dissent procedures are complied with, thisright could lead to a judicial determination of the fair value required to be paid to such dissenting Shareholders for theirShares. The fair value of Shares so determined could be more or less than the amount paid per Share under any SubsequentAcquisition Transaction or the Offers.

The timing and details of any Compulsory Acquisition or Subsequent Acquisition Transaction (any one of whichreferred to as a “Second Step Transaction”), as the case may be, involving Western will necessarily depend on a varietyof factors, including the number of Shares acquired under the Offers. Although the Offeror currently intends to proposeone or more Second Step Transactions on the same terms as the Offers, it is possible that, as a result of the number ofShares acquired under the Offers, delays in the Offeror’s ability to effect such a transaction, information hereafterobtained by the Offeror, changes in general economic, industry, political, social, regulatory or market conditions or in thebusiness or prospects of Western or its assets, properties, results of operations or condition (financial or otherwise), orother currently unforeseen circumstances, such a transaction may not be so proposed or may be delayed or abandoned.The Offeror expressly reserves the right to propose other means of acquiring, directly or indirectly, all of the outstandingShares in accordance with applicable Laws, including a Second Step Transaction on terms not described in this Circular.

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If the Offeror is unable to or decides not to effect a Second Step Transaction, or proposes a Second Step Transactionbut cannot promptly obtain any required approval, the Offeror will evaluate its other alternatives. Such alternatives couldinclude, to the extent permitted by applicable Laws, purchasing additional Shares in the open market, in privatelynegotiated transactions, in another take-over bid or exchange offer or otherwise, or from Western, or taking no actions toacquire additional Shares. Subject to applicable Laws, any additional purchases of Shares could be at a price greater than,equal to, or less than the price to be paid for Shares under the Offers and could be for cash, securities and/or otherconsideration. Alternatively, the Offeror may take no action to acquire additional Shares or may even sell or otherwisedispose of any or all Shares acquired under the Offers, on terms and at prices then determined by the Offeror, which mayvary from the price paid for Shares under the Offers. See Section 12 of the Offer, “Market Purchases”.

The tax consequences to a Shareholder of disposing of Shares pursuant to a Subsequent Acquisition Transaction maydiffer from the tax consequences to such Shareholder of disposing of Shares pursuant to the Offers. See Section 16 of theCircular, “Certain Canadian Federal Income Tax Considerations”.

Shareholders should consult their legal advisors for a determination of their legal rights with respect to a SubsequentAcquisition Transaction.

Judicial Developments

Certain judicial decisions may also be considered relevant to any Subsequent Acquisition Transaction that may beproposed or effected subsequent to the expiry of the Offers. Canadian courts have, in a few instances prior to the adoptionof MI 61-101 and its predecessors, granted preliminary injunctions to prohibit transactions involving certain businesscombinations. The current trends in both legislation and Canadian jurisprudence indicate a willingness to permit businesscombinations to proceed, subject to evidence of procedural and substantive fairness in the treatment of minorityshareholders.

Shareholders should consult their legal advisors for a determination of their legal rights with respect to anytransaction that may constitute a business combination.

16. CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS

The following summary describes the principal Canadian federal income tax considerations generally applicable to aShareholder who disposes of Shares pursuant to the Offers (or otherwise disposes of Shares pursuant to certaintransactions described in Section 15 of the Circular, “Acquisition of Shares Not Deposited Under the Offers”) andwho, for the purposes of the Tax Act and at all relevant times, (i) is or is deemed to be resident in Canada, (ii) holds theShares as capital property, and (iii) deals at Arm’s Length and is not affiliated with the Offeror or Western (a “Holder”).

Generally, the Shares will constitute capital property to a Holder unless the Holder holds such Shares in the course ofcarrying on a business or has acquired them in a transaction or transactions considered to be an adventure or concern in thenature of trade. A Holder whose Shares might not otherwise be capital property may, in certain circumstances, be entitledto make an irrevocable election under subsection 39(4) of the Tax Act to deem such Shares and every other “Canadiansecurity” (as defined in the Tax Act) owned by such Holder in the taxation year in which the election is made and in allsubsequent taxation years to be capital property. Holders whose Shares might not otherwise be capital property shouldconsult their own tax advisors regarding their particular circumstances.

This summary is not applicable to a Holder (i) that is a “financial institution” (as defined in the Tax Act for thepurposes of the “mark-to-market” rules), (ii) that is a “specified financial institution” (as defined in the Tax Act), (iii) aninterest in which is a “tax shelter investment” for purposes of the Tax Act, (iv) that has elected under section 261 of the TaxAct to report its Canadian tax results in a currency other than the Canadian currency, or (v) who has acquired CommonShares pursuant to the Option Plan or the Employee Share Ownership Plan. All such Holders should consult their own taxadvisors.

This summary assumes that no payment will be made for any SRP Right and no part of the Common ShareConsideration will be allocated to the SRP Rights.

This summary is based on the current provisions of the Tax Act and counsel’s understanding of the currentadministrative practices and assessing policies of the Canada Revenue Agency (the “CRA”) published in writing prior tothe date hereof. This summary also takes into account all specific proposals to amend the Tax Act publicly announced byor on behalf of the Minister of Finance (Canada) prior to the date hereof (the “Tax Proposals”), and assumes that all TaxProposals will be enacted in the form proposed. However, there can be no assurance that the Tax Proposals will be enactedin the form proposed, or at all. This summary does not otherwise take into account or anticipate any changes in law,

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whether by judicial, governmental or legislative decision or action, or changes in the administrative practices or assessingpolicies of the CRA, nor does it take into account or consider any provincial, territorial or foreign tax considerations,which may differ significantly from the Canadian federal income tax considerations described herein.

This summary is of a general nature only and is not intended to be, nor should it be construed to be, legal or taxadvice to any particular Holder. This summary is not exhaustive of all Canadian federal income tax considerations.Accordingly, Holders are urged to consult their own tax advisors having regard to their own particularcircumstances, including the application and effect of the income and other tax laws of any country, province,territory, state or local tax authority.

Shares Disposed of Pursuant to the Offers

A Holder who disposes of Shares pursuant to the Offers will realize a capital gain (or capital loss) equal to the amountby which the proceeds of disposition of the Shares exceed (or are less than) the aggregate of the adjusted cost base of theShares to the Holder immediately before the disposition and any reasonable costs of disposition. For these purposes, theproceeds of disposition will be equal to the Offered Consideration for the Shares.

Generally, a Holder is required to include in computing its income for a taxation year one-half of the amount of anycapital gain (a “taxable capital gain”) realized in the year. Subject to and in accordance with the provisions of the TaxAct, a Holder is required to deduct one-half of the amount of any capital loss (an “allowable capital loss”) realized in ataxation year from taxable capital gains realized in the year by such Holder. Allowable capital losses in excess of taxablecapital gains for a taxation year may be carried back and deducted in any of the three preceding taxation years or carriedforward and deducted in any subsequent taxation year against net taxable capital gains realized in such year to the extentand under the circumstances described in the Tax Act.

The amount of any capital loss realized by a Holder that is a corporation on the disposition of a Share may be reducedby the amount of any dividends previously received (or deemed to have been received) by the Holder on such Share (and incertain circumstances a share exchanged for such Share), subject to and in accordance with the provisions of the Tax Act.Similar rules may apply where a Share is owned by a partnership or trust of which a corporation, trust or partnership is amember or beneficiary. Holders to whom these rules may be relevant should consult their own tax advisors.

Capital gains realized by individuals and certain trusts may give rise to a liability for alternative minimum tax underthe Tax Act. Holders should consult their own tax advisors in this regard.

A Holder that is throughout the year a “Canadian-controlled private corporation” (as defined in the Tax Act) may beliable to pay an additional refundable tax of 62⁄3% on certain investment income including taxable capital gains.

Compulsory Acquisition

As described in Section 15 of the Circular, “Acquisition of Shares Not Deposited Under the Offers — CompulsoryAcquisition”, the Offeror may, in certain circumstances, acquire Shares not deposited under the Offers pursuant to aCompulsory Acquisition. The tax consequences to a Holder who disposes of Shares pursuant to a Compulsory Acquisitionwill be the same as described above under “Shares Disposed of Pursuant to the Offers”. However, the proceeds ofdisposition for a Holder who has obtained judicial determination of the fair value of its Shares, which could be less ormore than the Offered Consideration, will generally be equal to the amount of fair value fixed by the court.

Subsequent Acquisition Transaction

As described in 15 of the Circular, “Acquisition of Shares Not Deposited Under the Offers — SubsequentAcquisition Transaction”, if the Offeror takes up and pays for Shares validly deposited under the Offers and a CompulsoryAcquisition is not available or pursued by the Offeror, the Offeror may propose other means of acquiring the remainingissued and outstanding Shares. The Offeror may propose to carry out a Subsequent Acquisition Transaction by means of aproposed arrangement, amalgamation, merger, reorganization or other capital reorganization involving Western and/or itsSubsidiaries and the Offeror or an Affiliate of the Offeror. The tax consequences of a Subsequent Acquisition Transactionto a Holder will depend upon the exact manner in which the Subsequent Acquisition Transaction is carried out and mayinclude a capital gain or capital loss and/or a deemed dividend. Holders should consult their own tax advisors foradvice with respect to the tax consequences to them of disposing of Shares pursuant to a Subsequent AcquisitionTransaction.

Subject to the potential application of subsection 55(2) of the Tax Act to Holders that are corporations (discussedbelow), a Holder will be required to include in computing its income for a taxation year any dividends deemed to be

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received on the Shares. Such dividends deemed to be received by a Holder that is a corporation will generally bedeductible in computing the Holder’s taxable income. In the case of a Holder who is an individual (other than certaintrusts), such dividends will be subject to the gross-up and dividend tax credit rules normally applicable to taxabledividends received from taxable Canadian corporations, including the enhanced gross-up and dividend tax credit for“eligible dividends” (as defined in the Tax Act). There can be no assurance that any deemed dividend will be an eligibledividend. A Holder that is a “private corporation” or a “subject corporation” (as such terms are defined in the Tax Act)may be liable under Part IV of the Tax Act to pay a refundable tax of 331⁄3% on dividends deemed to be received on theShares to the extent that such dividends are deductible in computing the Holder’s taxable income.

Subsection 55(2) of the Tax Act provides that, where a Holder that is a corporation is deemed to receive a dividend incertain circumstances, all or part of the deemed dividend may be deemed not to be a dividend and may be treated insteadas proceeds on the disposition of the Shares for the purposes of computing the Holder’s capital gain or capital loss.Accordingly, Holders that are corporations should consult their own tax advisors for specific advice with respect to thepotential application of this provision to them.

Delisting of Shares Following Completion of the Offers

As described in Section 9, “Effect of the Offers on Market and Listing”, the Shares may cease to be listed on the TSXfollowing completion of the Offers and may not be listed on the TSX at the time of their disposition by a Holder pursuantto a Compulsory Acquisition or a Subsequent Acquisition Transaction. Holders are cautioned that the Shares may cease tobe qualified investments for trusts governed by registered retirement savings plans, registered retirement income funds,registered education savings plans, deferred profit sharing plans, registered disability savings plans and tax-free savingsaccounts if the Shares cease to be listed on a “designated stock exchange” for the purposes of the Tax Act (which currentlyincludes the TSX) and Western ceases to be a “public corporation” for the purposes of the Tax Act. Holders should consulttheir own tax advisors in this regard.

17. BUSINESS RELATIONS

There are no material business relationships between the Offeror and Western.

18. DEPOSITARY AND INFORMATION AGENT

The Offeror has engaged Computershare Investors Services Inc. to act as the Depositary for the Offers. TheDepositary may contact Shareholders by mail, telephone and facsimile and may request banks, brokers, investmentdealers and other nominees to forward materials relating to the Offers to beneficial owners of Shares. The Depositary willfacilitate book-entry only transfers of Shares tendered under the Offers. The Depositary will receive reasonable andcustomary compensation from the Offeror for its services in connection with the Offers, will be reimbursed for certainout-of-pocket expenses and will be indemnified against certain liabilities and expenses in connection with the Offers.

The Offeror has also retained Georgeson Shareholder Communications Canada Inc. to act as Information Agent inconnection with the Offers. The Information Agent may contact Shareholders by mail, telephone, other electronic meansor in Person and may request banks, brokers, investment dealers and their nominees to forward materials relating to theOffers to Shareholders. The Information Agent will receive reasonable and customary compensation from the Offeror forits services in connection with the Offers, will be reimbursed for certain out-of-pocket expenses and will be indemnifiedagainst certain liabilities and expenses in connection with the Offers.

Questions and requests for assistance concerning the Offer may be directed to the Depositary or the InformationAgent, Georgeson Shareholder Communications Canada Inc., at 1-866-725-6575 toll free in North America, or at1-781-575-2168 outside of North America, or by e-mail at [email protected]. Further contact details for suchPersons may be found on the back page of this document. Additional copies of this document and related materials may beobtained without charge on request from the Depositary or the Information Agent at their respective offices specified onthe back page of this document. Copies of this document and related materials may also be found on SEDAR atwww.sedar.com.

Except as expressly set forth in the Offers and Circular, no broker, investment dealer, bank or trust company shall bedeemed to be an agent of the Offeror or the Depositary for the purposes of the Offers.

19. DEALER MANAGER AND SOLICITING DEALER GROUP

The Offeror has retained Desjardins Securities Inc. to serve as dealer manager for the Offers in Canada. The DealerManager may form a soliciting dealer group comprised of members of The Investment Industry Regulatory Organization

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of Canada and members of Canadian stock exchanges to solicit acceptances of the Offers. In that event, the Offeror willpay typical soliciting dealer fees in connection with the tender of Shares. Depositing Shareholders will not be obligated topay any fee or commission if they accept an Offer by using the services of the Dealer Manager or transmitting their Sharesdirectly to the Depositary.

20. BENEFITS FROM THE OFFERS

No person will receive any direct or indirect benefit from accepting or refusing to accept the Offers, other than theconsideration available to any Shareholder who tenders Shares to the Offers.

21. LEGAL MATTERS

Certain matters of Canadian law relating to the Offers have been passed upon by McCarthy Tétrault LLP. As of thedate of this Circular, the partners and associates of McCarthy Tétrault LLP beneficially owned, directly or indirectly, lessthan 1% of the outstanding securities of any class of the Offeror or of Western.

22. OFFEREES’ STATUTORY RIGHTS

Securities legislation in the provinces and territories of Canada provides Shareholders of Western with, in addition toany other rights they may have at law, rights of rescission, price revision or damages if there is a misrepresentation in acircular or a notice that is required to be delivered to such Shareholders. However, such rights must be exercised withinprescribed time limits. Shareholders should refer to the applicable provisions of the securities legislation of their provinceor territory for particulars of those rights or consult with a lawyer. Such rights may in certain cases need to be exercisedthrough CDS on behalf of a Shareholder. Shareholders should accordingly also contact their broker or other nominee forassistance as required.

23. DIRECTORS’ APPROVAL

The contents of the Offers and this Circular have been approved and the sending thereof to the Shareholders has beenauthorized by the board of directors of the Offeror.

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GLOSSARY

“ABCA” means the Business Corporations Act (Alberta), as amended from time to time;

“Acquisition Proposal” means any written proposal, offer made to Western or any security holders of Western or thepublic announcement of an intention to do any of the foregoing after December 23, 2010, including any modification afterDecember 23, 2010 of any written proposal or offer made prior to December 23, 2010 (including any take-over bidinitiated by advertisement or circular), that would have the effect of preventing or frustrating the completion of theCommon Share Offer, including without limitation, any (i) issuance, sale or acquisition of securities of Western (includingconvertible securities) or any rights or interests therein; or (ii) any merger, amalgamation, take-over bid, tender offer,arrangement, share exchange, joint venture, partnership, dissolution, liquidation, recapitalization or other businesscombination or transaction that, in either case, if consummated would result in any Person or group of Persons (other thanthe Offeror and its Affiliates) beneficially owning 20% or more of the voting rights attached to any class of securities ofWestern or beneficially owning assets representing 20% or more of the book value or the fair market value of the assets ofWestern (on a consolidated basis);

“Affiliate” means, in respect of any Person, (i) any other Person directly or indirectly controlling, controlled by or undercommon control with that Person, or (ii) any other Person that, directly or indirectly, owns or controls 50% or more of anyclass of equity securities (including any equity securities issuable upon the exercise of any option or convertible security)of that Person; provided that for the purposes of this definition, “control” (including with correlative meanings, the terms“controlling”, “controlled by”, and “under common control with”) as applied to any Person, means the possession,directly or indirectly, of the power to direct or cause the direction of the management and policies of that Person, whetherthrough ownership of voting securities, by contract, voting trust or otherwise;

“allowable capital loss” has the meaning ascribed thereto in Section 16 of the Circular, “Certain Canadian FederalIncome Tax Considerations”;

“Appointee” has the meaning ascribed thereto in Section 3 of the Offers, “Manner of Acceptance — Power of Attorney”;

“Appropriate Regulatory Approvals” means those sanctions, rulings, consents, orders, exemptions, permits and otherapprovals (including the lapse, without objection, of a prescribed time under a statute or regulation that states that atransaction may be implemented if a prescribed time lapses following the giving of notice without an objection beingmade) of Governmental Entities required in connection with the commencement of the Offer or the consummation of theOffer, and including without limiting the generality of the foregoing, the approval of the Minister of Finance (Canada) forthe acquisition of control of Bank West, Western Life Assurance Company and Western Financial Insurance Companyand the Competition Act Approval;

“ARC” means an advance ruling certificate issued by the Commissioner under Section 102(1) of the Competition Act inrespect of the transactions contemplated under the Support Agreement;

“Arm’s Length” has the meaning ascribed thereto under the Tax Act;

“associate”, unless otherwise indicated, has the meaning ascribed thereto in the Securities Act as in effect at the datehereof;

“Board of Directors” means the board of directors of Western;

“Book-Entry Confirmation” means confirmation of a book-entry transfer of a Shareholder’s Shares into theDepositary’s account at CDS;

“Business Day” means any day of the week, other than a Saturday, a Sunday or a statutory or civic holiday observed inMontréal, Québec and Calgary, Alberta;

“Canadian GAAP” means Canadian generally accepted accounting principles, including those set out in the Handbookof the Canadian Institute of Chartered Accountants, applied on a consistent basis;

“Canadian Securities Administrators” means the provincial and territorial securities regulatory authorities in theprovinces and territories of Canada;

“Cash-Out Amount” means an amount equal to the amount by which the Common Share Consideration of the CommonShares which could be acquired pursuant to the exercise of an Option exceeds the aggregate exercise price under suchOption;

“CDS” means CDS Clearing and Depository Services Inc. or its nominee (which is, at the date hereof, CDS & Co.);

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“CDS Participants” means a direct or indirect participant of CDS;

“CDSX” means the computer system by which CDS Participants can deposit book-based shares to the Depository directlyin lieu of completing and depositing a Letter of Transmittal to the Depositary;

“Circular” means the take-over bid circular accompanying the Offers and forming part of the Offers;

“Commissioner” means either the Commissioner of Competition appointed under the Competition Act or any personduly authorized to exercise the powers and perform the duties of the Commissioner of Competition;

“Common Share Consideration” has the meaning ascribed thereto in Section 1 of the Offers, “The Offers”;

“Common Share Offer” means the offer to purchase all of the outstanding Common Shares made hereby, to CommonShareholders (as it may be amended);

“Common Shareholder” means a holder of Common Shares;

“Common Shares” means common shares in the capital of Western;

“Competition Act” means the Competition Act (Canada) as amended and the regulations promulgated thereunder;

“Competition Act Approval” means that: (a) the Commissioner shall have issued an ARC, or (b) the applicable waitingperiod under Section 123 of the Competition Act shall have expired or been terminated by the Commissioner; or theobligation to submit a notification shall have been waived under paragraph 113(c) of the Competition Act, and theCommissioner shall have issued a No-Action Letter;

“Competition Filings” has the meaning ascribed thereto in Section 5 of the Circular, “Agreement Relating to theOffers — Support Agreement”;

“Compulsory Acquisition” has the meaning ascribed thereto in Section 15 of the Circular, “Acquisition of Shares NotDeposited Under the Offers”;

“Contemplated Transactions” means the making of the Common Share Offer and the consummation of the transactionscontemplated herein, including the Common Share Offer, the take-up of Common Shares under the Common Share Offer,any Compulsory Acquisition or Subsequent Acquisition Transaction relating to the Common Shares;

“Continuing Corporation” has the meaning ascribed thereto in Section 4 of the Circular, “Agreement Relating to theOffers — Support Agreement”;

“Convertible Debentures” means the $16,710,000 aggregate principal amount of convertible unsecured subordinateddebentures due June 30, 2014;

“Convertible Securities” means the Options, the Preferred Shares and the Convertible Debentures;

“CRA” has the meaning ascribed thereto in Section 16 of the Circular, “Certain Canadian Federal Income TaxConsiderations”;

“Depositary” means Computershare Investors Services Inc., in its capacity as depositary for the Offers;

“Deposited Shares” has the meaning ascribed thereto in Section 3 of the Offers, “Manner of Acceptance”;

“Depositing Shareholders” means Shareholders whose Shares are deposited to the Offers and are not withdrawn;

“Dissenting Offeree” has the meaning ascribed thereto in Section 15 of the Circular, “Acquisition of Shares NotDeposited Under the Offers”;

“Distributions” has the meaning ascribed thereto in Section 3 of the Offers, “Manner of Acceptance —Dividends andDistributions”;

“Effective Time” means the time that the Offeror first takes up and pays for Common Shares deposited to the CommonShare Offer;

“Eligible Institution” means a Canadian Schedule I chartered bank, a major trust company in Canada, a commercial bankor trust company in the United States, a member of the Securities Transfer Association Medallion Program (STAMP), amember of the Stock Exchange Medallion Program (SEMP) or a member of the New York Stock Exchange Inc.Medallion Signature Program (MSP). Members of these programs are usually participating organizations in a recognizedstock exchange in Canada and/or the United States, members of IIROC, members of FINRA or banks and trust companiesin the United States;

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“Employee Plans” means all plans or arrangements providing for the benefit of employees generally or for any particularexecutive officer including all of the employee benefit, health, welfare, disability, bonus, deferred compensation, stockcompensation, stock option or purchase or other stock- based compensation plans or arrangements, retirement plans, post-retirement benefit plans or arrangements, pension plans or arrangements applicable to present or former employees ordirectors of Western or any of its Subsidiaries which are currently maintained or participated in by Western or any of itsSubsidiaries and under which Western or any of its Subsidiaries has any material obligations or liabilities;

“Employee Share Ownership Plan” means the employee share ownership plan of Western most recently amended inSeptember 2010;

“Expiry Time” means 5:00 p.m. (Montréal time) on February 28, 2011, subject to the Offeror’s right to extend from timeto time the period during which the Shares may be tendered to the Offers (but in any case, not beyond the Outside Date) asdescribed in Section 5 of the Offers, “Extension and Variation of the Offers”;

“Fairness Opinion” means the fairness opinion of TD Securities Inc. that, based upon and subject to the analyses,assumptions, qualifications and limitations discussed therein, as of the date of the Support Agreement, the considerationunder the Common Share Offer is fair, from a financial point of view, to the Common Shareholders;

“FINRA” means the Financial Industry Regulatory Authority;

“Fully-Diluted Basis” means a basis which assumes that the number of Common Shares outstanding is that numberwhich would be outstanding if all Convertible Securities were exercised;

“Governmental Entity” means (a) any multinational, federal, provincial, state, regional, municipal, local or othergovernment, governmental or public department, central bank, court, tribunal, arbitral body, commission, commissioner,board, bureau or agency, domestic or foreign including without limitation OSFI, all provincial insurance regulators and allSecurities Regulatory Authorities; (b) any subdivision, agent, commission, commissioner, board, or authority of any ofthe foregoing; (c) any self-regulatory authority, including the TSX, the TSX Venture Exchange, the Montreal Exchange,IIROC, FINRA and each Canadian provincial insurance council (or equivalent); or (d) any quasi-governmental or privatebody exercising any regulatory, expropriation or taxing authority under or for the account of any of the foregoing;

“Holder” has the meaning ascribed thereto in Section 16 of the Circular, “Certain Canadian Federal Income TaxConsiderations”;

“IFRS” means the International Financial Reporting Standards as issued by the International Account Standards Board;

“IIROC” means the Investment Industry Regulatory Organization of Canada;

“In-the-Money Convertible Securities” means all in-the-money Options, the Series 2 Shares, the Series 5 Shares and theConvertible Debentures;

“Information Agent” means Georgeson Shareholder Communications Canada Inc.;

“insider” has the meaning ascribed thereto in the Securities Act as in effect at the date hereof;

“Insurance Companies Act” means the Insurance Companies Act (Canada), as amended and the regulationspromulgated thereunder, and any successor legislation thereto;

“Jennings Transaction” means the sale of all of Western’s interest in Jennings Capital Inc.;

“Laws” means all laws (including common law), by-laws, statutes, rules, regulations, principles of law, orders,ordinances, judgments, decrees, guidelines, policies or other requirements, whether domestic or foreign, and the termsand conditions of any grant of approval, permission, authority or license of any Governmental Entity and the term“applicable” with respect to such Laws and in a context that refers to one or more Parties, means such Laws as areapplicable to such Party or its business, undertaking, property or securities and emanate from a Governmental Entityhaving jurisdiction over the Party or Parties or its or their business, undertaking, property or securities;

“Letter of Transmittal” means, in the case of Shares, the letter of transmittal (printed on yellow paper) and, in the case ofIn-the-Money Convertible Securities, the letter of transmittal (printed on blue paper), in each case in the formaccompanying the Offers and the Circular and “Letter of Transmittal” means collectively the Letter of Transmittalfor the Shares and the Letter of Transmittal for the In-the-Money Convertible Securities;

“Material Adverse Effect” means any one or more changes, effects, events, occurrences or states of fact, eitherindividually or in the aggregate, that is, or would reasonably be expected to be, material and adverse to the assets,liabilities (including any contingent liabilities that may arise through outstanding, pending or threatened litigation or

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otherwise), business, operations, results of operations, capital, property, obligations (whether absolute, accrued,conditional or otherwise) or financial condition of Western and its Subsidiaries taken as a whole, other than changes,effects, events, occurrences or states of fact consisting of, resulting from or arising in connection with: (i) the publicannouncement of the execution of the Support Agreement or the transactions contemplated hereby or the performance ofany obligations hereunder; (ii) general political, economic, financial, currency exchange, securities or commodity marketconditions in Canada or the United States; (iii) changes generally affecting the banking, life insurance or property andcasualty insurance business in one or more geographic markets where Western or any of its Subsidiaries operates orconducts business; (iv) any change in applicable Laws, regulations or Canadian GAAP, including the change to IFRS;(v) any decrease in the market price or any decline in the trading volume of the publicly traded securities of Western (itbeing understood that any cause underlying such change in market price or trading volume may be taken into account indetermining whether a Material Adverse Effect has occurred); (vi) any failure by Western to meet any forecasts,projections or earnings guidance or expectations provided or released by Western or by equity analysts for any period (itbeing understood that any cause underlying such failure may be taken into account in determining whether a MaterialAdverse Effect has occurred); (vii) any natural disaster; or (viii) any outbreak or escalation of hostilities, declared orundeclared acts of war or terrorism; except, in the case of clauses (ii), (iii) and (iv), to the extent any such change, effect,event, occurrences or state of fact has had a materially disproportionate effect on Western and its Subsidiaries taken as awhole compared to other comparable Persons of similar size operating in the banking, life insurance or property andcasualty insurance business in one or more countries in geographic markets so affected;

“MI 61-101” means Multilateral Instrument 61-101, “Protection of Minority Security Holders in Special Transactions” ofthe Canadian Securities Administrators, as amended or replaced from time to time;

“MI 62-104” means Multilateral Instrument 62-104 “Take-Over Bids and Issuer Bids” of the Canadian SecuritiesAdministrators, as amended or replaced from time to time;

“Minimum Tender Condition” has the meaning ascribed thereto in Section 4 of the Offers, “Conditions of the Offers”;

“No-Action Letter” means a letter from the Commissioner advising either the Offeror or Western (directly or througheither Party’s counsel) in writing that she does not intend to make an application under section 92 of the Competition Actfor an order in respect of the transactions contemplated by the Support Agreement;

“nominee” means a registered broker or investment dealer, financial institution or other intermediary that holds Shares onbehalf of a Person who is not the registered holder of the Shares;

“Notice of Guaranteed Delivery” means the notice of guaranteed delivery (printed on green paper) and, in the formaccompanying the Offers and the Circular;

“Notifiable Transactions” has the meaning ascribed thereto in Section 14 of the Circular, “Regulatory Matters —Competition Act Approval”;

“Offers” means the Common Share Offer, the Series 3 Share Offer and the Series 4 Share Offer and “Offer” means eitherthe Common Share Offer, the Series 3 Share Offer or the Series 4 Share Offer, as the case may be. For greater certainty,each of the Common Share Offer, the Series 3 Share Offer and the Series 4 Share Offer is a separate offer to purchaseCommon Shares, Series 3 Shares and Series 4 Shares, respectively, and each Offer may be extended, varied, changed orterminated and the conditions of each Offer may be waived without similarly extending, varying, changing or terminatingthe other Offers or waiving the conditions of the other Offers;

“Offered Considerations” has the meaning ascribed thereto in Section 1 of the Offers, “The Offers”;

“Offeror” means Desjardins Financial Corporation Inc., a corporation incorporated under the laws of the Province ofQuébec;

“Offeror’s Notice” has the meaning ascribed thereto in Section 15 of the Circular, “Acquisition of Shares Not DepositedUnder the Offers”;

“Option Plan” means the Incentive Share Option Plan (2009) of Western providing for the issuance of options topurchase Common Shares;

“Options” means options to purchase Common Shares pursuant to the Option Plan;

“OSC Rule 62-504” means Ontario Securities Commission Rule 62-504, “Take-Over Bids and Issuer Bids”, as amendedor replaced from time to time;

“OSFI” means the Office of the Superintendent of Financial Institutions (Canada);

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“Outside Date” means April 30, 2011, subject to the right of either Party to postpone the Outside Date on no more thantwo occasions by a period of 30 days if (i) any of the Appropriate Regulatory Approvals has not been obtained, (ii) theOfferor’s take up and payment for Common Shares deposited under the Common Share Offer is delayed by an injunctionor order made by a court or regulatory authority of competent jurisdiction, (iii) Western has not completed the JenningsTransaction, or (iv) an action, suit or proceeding shall have been taken, commenced or threatened before or by anyGovernmental Entity to cease trade, enjoin, prohibit or impose material limitations or conditions on the purchase by orsale to the Offeror of the Common Shares or the rights of the Offeror to own or exercise full rights of ownership of theCommon Shares, to complete a Compulsory Acquisition or Subsequent Acquisition Transaction or which would havesuch an effect and the Party electing to postpone the Outside Date, if that Party is a party to such action, suit or proceeding,is diligently contesting it, by giving written notice to the other Party to such effect no later than 5:00 p.m. (Montréal time)on the date that is five days prior to the then current Outside Date, or such other date as may be agreed to by the Parties;

“Parties” means Western and the Offeror; and “Party” means anyone of them;

“Permitted Distribution” means (i) cash dividends on the Common Shares, and (ii) semi-annual cash dividends on thePreferred Shares, in each case, declared and paid in accordance with the past practice of Western;

“Person” includes an individual, partnership, association, body corporate, joint venture, business organization, trustee,executor, administrator, legal representative, government (including any Governmental Entity) or any other entity,whether or not having legal status;

“Preferred Shares” means, collectively, the Series 2 Shares, the Series 3 Shares, the Series 4 Shares and the Series 5Shares of Western;

“Purchased Securities” has the meaning ascribed thereto in Section 3 of the Offers, “Manner of Acceptance — Power ofAttorney”;

“Representatives” of a Person means such Person’s officers, directors, employees, advisors, representatives and agents;

“Response Period” has the meaning ascribed thereto in Section 5 of the Circular, “Agreement Relating to the Offers —Support Agreement”;

“Second Step Transaction” has the meaning ascribed thereto in Section 15 of the Circular, “Acquisition of Shares NotDeposited Under the Offers”;

“Securities Act” means the Securities Act (Alberta), as amended, and the rules, regulations and published policies madethereunder, as now in effect and as they may be amended from time to time prior to the Effective Time;

“Securities Laws” means the Securities Act and all other applicable securities laws, rules and regulations and publishedpolicies thereunder in Canada;

“Securities Regulatory Authorities” means the applicable securities commission or regulatory authority in eachprovince of Canada;

“SEDAR” means the System for Electronic Document Analysis and Retrieval maintained by the Canadian SecuritiesAdministrators;

“Series 3 Share Consideration” has the meaning ascribed thereto in Section 1 of the Offers, “The Offers”;

“Series 4 Share Consideration” has the meaning ascribed thereto in Section 1 of the Offers, “The Offers”;

“Series 3 Share Offer” means the offer to purchase all of the outstanding Series 3 Shares made hereby to the holders ofSeries 3 Shares;

“Series 4 Share Offer” means the offer to purchase all of the outstanding Series 4 Shares made hereby to the holders ofSeries 4 Shares;

“Series 2 Shares” means the First Preferred Shares Series Two in the capital of Western;

“Series 3 Shares” means the First Preferred Shares Series Three in the capital of Western;

“Series 4 Shares” means the First Preferred Shares Series Four in the capital of Western;

“Series 5 Shares” means the First Preferred Shares Series Five in the capital of Western;

“Shares” means, collectively, all of the issued and outstanding Common Shares, Series 3 Shares and Series 4 Shares;

“Shareholder Rights Plan” means the amended and restated shareholder rights plan agreement entered into betweenWestern and Computershare Trust Company of Canada, as rights agent, dated as of March 31, 2009;

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“Shareholders” means holders of Shares;

“SRP Rights” means the rights issued under the Shareholder Rights Plan;

“Subsequent Acquisition Transaction” has the meaning ascribed thereto in Section 15 of the Circular, “Acquisition ofShares Not Deposited Under the Offers”;

“Subsidiaries” means, with respect to a specified body corporate, any body corporate (other than a mutual fundcorporation) of which more than 50% of the outstanding shares ordinarily entitled to elect a majority of the board ofdirectors thereof (whether or not shares of any other class or classes shall or might be entitled to vote upon the happeningof any event or contingency) are at the time owned, or publicly announced as in the process of being acquired, directly orindirectly, by such specified body corporate and shall include any body corporate, partnership, joint venture or other entityover which such specified body corporate exercises direction or control or which is in a like relation to a subsidiary;

“Superior Proposal” means an unsolicited bona fide written Acquisition Proposal made by a third party afterDecember 23, 2010: (i) that is made available to all Shareholders on the same terms and conditions for all CommonShares (on a Fully-Diluted Basis); (ii) in respect of which any required financing to complete such Acquisition Proposalhas been demonstrated to be available as required by Securities Laws in the context of a take-over bid and to thesatisfaction of the Board of Directors, acting in good faith; (iii) that is not subject to any due diligence and/or accesscondition; (iv) that the Board of Directors has determined in good faith (after receipt of advice from its financial advisorsand its outside legal counsel) is reasonably capable of completion without undue delay taking into account all legal,financial, regulatory (including Appropriate Regulatory Approvals, to the extent applicable) and other aspects of suchAcquisition Proposal and the Person making such Acquisition Proposal; and (v) in respect of which the Board of Directorsdetermines in good faith (after receipt of advice from its outside legal counsel with respect to (x) below and financialadvisors with respect to (y) below) that (x) failure to recommend such Acquisition Proposal to Shareholders would beinconsistent with its fiduciary duties and (y) that such Acquisition Proposal would, if consummated in accordance with itsterms (but not assuming away any risk of non-completion), result in a transaction more favourable to the CommonShareholders from a financial point of view than the Common Share Offer;

“Superior Proposal Notice” has the meaning ascribed thereto in Section 5 of the Circular, “Agreement Relating to theOffers — Support Agreement”;

“Supplementary Information Request” has the meaning ascribed thereto in Section 14 of the Circular, “RegulatoryMatters — Competition Act Approval”;

“Support Agreement” means the support agreement entered into between the Offeror and Western on December 23,2010;

“Tax Act” means the Income Tax Act (Canada), as amended and the regulations promulgated thereunder, and anysuccessor legislation thereto;

“Tax Proposals” has the meaning ascribed thereto in Section 16 of the Circular, “Certain Canadian Federal Income TaxConsiderations”;

“taxable capital gain” has the meaning ascribed thereto in Section 16 of the Circular, “Certain Canadian Federal IncomeTax Considerations”;

“Termination Payment” has the meaning ascribed thereto in Section 5 of the Circular, “Agreement Relating to theOffers — Termination Payment”;

“Termination Payment Event” has the meaning ascribed thereto in Section 5 of the Circular, “Agreement Relating to theOffers — Termination Payment”;

“TSX” means the Toronto Stock Exchange;

“Western” means Western Financial Group Inc., a corporation incorporated under the laws of the Province of Alberta;

47

CONSENT OF MCCARTHY TÉTRAULT LLP

TO: The Board of Directors of Desjardins Financial Corporation Inc. (the “Offeror”)

We hereby consent to the reference to our name and opinion contained under “Certain Canadian Federal Income TaxConsiderations” and our name under “Legal Matters”, in the Circular accompanying the Offers dated January 21, 2011made by the Offeror to the holders of common shares, first preferred shares, series three and first preferred shares, seriesfour of Western Financial Corporation Inc.

(Signed) MCCARTHY TÉTRAULT LLP

January 21, 2011

48

APPROVAL AND CERTIFICATE OF THE OFFEROR

Dated: January 21, 2011

The foregoing contains no untrue statement of a material fact and does not omit to state a material fact that is requiredto be stated or that is necessary to make a statement not misleading in the light of the circumstances in which it is made.

DESJARDINS FINANCIAL CORPORATION INC.

(signed) Marc LaplanteSenior Executive Vice-President

Strategy, Performance and Development

(signed) Raymond LaurinSenior Vice-President

Finance and Treasury Executive Divisionand Office of the CFO

ON BEHALF OF THE BOARD OF DIRECTORS OFDESJARDINS FINANCIAL CORPORATION INC.

(signed) Monique F. LerouxDirector

(signed) Clément SamsonDirector

FÉDÉRATION DES CAISSES DESJARDINS DU QUÉBEC

(signed) Marc LaplanteSenior Executive Vice-President

Strategy, Performance and Development

(signed) Raymond LaurinSenior Vice-President

Finance and Treasury Executive Divisionand Office of the CFO

ON BEHALF OF THE BOARD OF DIRECTORS OFFÉDÉRATION DES CAISSES DESJARDINS DU QUÉBEC

(signed) Monique F. LerouxDirector

(signed) Clément SamsonDirector

49

desjardins financial corporation inc

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