HomeMy WebLinkAbout17 141 Shareholders Declaration (Bruce Telecom Inc.) By-law this declaration version will not be signed THE CORPORATION OF THE MUNICIPALITY OF KINCARDINE
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BY- JAW
NO. 2017 - 141
BEING A BY-LAW TO ENTER INTO SHAREHOLDER DECLARATION WITH
BRUCE TELECOM INC.
WHEREAS pursuant to the Municipal Act 2001, S.O. 2001, c.25, as amended
Section 8 (1)and 9 provide that the powers of a municipality under this or any other
Act shall be interpreted broadly so as to confer broad authority on the municipality
to enable the municipality to govern its affairs as it considers appropriate and to
• enhance the municipality's ability to respond to municipal issues and has the
capacity, rights, powers and privileges of a natural person for the purpose of
exercising its authority under this or any other Act;
AND WHEREAS Bruce Telecom Inc. ("Bruce Telecom") is wholly-owned by The
Corporation of the Municipality of Kincardine and is being converted by Kincardine
from a municipal service board to an incorporated municipal services corporation
pursuant to Section 203 of the Municipal Act, 2001, with Kincardine as sole
shareholder;
AND WHEREAS a Shareholder Declaration is required to set out the requirements
of the Municipality of Kincardine relating to the governance and other fundamental
principles and policies of Bruce Telecom;
AND WHEREAS the Council of The Corporation of the Municipality of Kincardine
has determined that it is advisable to enter into a Shareholder Declaration with
Bruce Telecom Inc.;
NOW THEREFORE the Council of The Corporation of the Municipality of
• Kincardine ENACTS as follows:
1. That the Council of the Municipality of Kincardine enter into a
Shareholder Declaration with Bruce Telecom Inc. regarding the
requirements of the Municipality of Kincardine relating to the governance
and other fundamental principles and policies of Bruce Telecom, in
accordance with the terms and conditions outlined in the agreement
attached hereto as Schedule 'A' and forming part of this by-law.
2. That the Mayor and Chief Administrative Officer be authorized and
directed to execute, on behalf of The Corporation of the Municipality of
Kincardine, the Shareholder Declaration with Bruce Telecom Inc.,
attached to this by-law as Schedule "A".
3. This by-law shall come into full force and effect upon its final passage.
1III
Page 2 of 2
Shareholders Declaration (Bruce Telecom Inc.) By-law
By-law No. 2017 - 141
4. This by-law may be cited as the "Shareholders Declaration (Bruce
Telecom Inc.) By-law".
READ a FIRST and SECOND TIME this 11th day of October, 2017.
READ a THIRD TIME and FINALLY PASSED this 11th day of October, 2017.
Mayor Clerk
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SHAREHOLDER DECLARATION
(BRUCE TELECOM INC.)
THE CORPORATION OF THE MUNICIPALITY OF KINCARDINE
—and—
BRUCE TELECOM INC.
Dated as of•
TABLE OF CONTENTS
1. Definitions and Interpretation 1
2. Purpose 3
3. Shareholder's Expectations 3
4. Principles 4
5. Permitted Business Activities 5
6. Standards of Governance 5
7. Board of Directors and Responsibilities 5
8. Board of Directors 5
9. Qualifications of Directors 7
10. Conflict of Interest Policy 7
11. Direction by the Shareholder 7
12. Decisions of the Shareholder 7
13. Matters Requiring Shareholder Approval 8
14. Audit 9
15. Accounting 9
16. Annual Financial Statements 10
17. Annual meeting 10
18. Reporting 10
19. Revisions to this Shareholder Declaration 12
20. Notices 12
Schedule A: Bruce Telecom Inc. Dividend Policy
Schedule B: Director Compensation Policy
i4
THE CORPORATION OF THE MUNICIPALITY OF KINCARDINE
SHAREHOLDER DECLARATION
RECITALS:
A. Bruce Telecom Inc. ("Bruce Telecom") is wholly-owned by the Corporation of the
Municipality of Kincardine and has been converted by Kincardine from a municipal
services board to an incorporated municipal services corporation pursuant to Section 203
of the Municipal Act, 2001, with Kincardine as sole shareholder;
B. This Shareholder Declaration sets out the requirements of Kincardine relating to the
governance and other fundamental principles and policies of Bruce Telecom.
1. Definitions and Interpretation
1.1 Wherever used in this Shareholder Declaration, the following terms shall have these
respective meanings:
"Auditor" is defined in Section 17(b);
"Board"means the board of directors of Bruce Telecom;
"Book Value" means the book value of Bruce Telecom as at the end of its last completed
Fiscal Year as shown in its audited financial statements;
"Bruce Telecom" is defined in the Recitals;
"Business" is defined in Section 5;
"Business Plan"means a five year business plan and budget for Bruce Telecom prepared
and approved in accordance with Section 18.1;
"CAO"means the chief administrative officer of Kincardine;
"Chair"means the Chair of the Board of Bruce Telecom from time to time;
"Council" means the municipal council of Kincardine;
"Financial Statements" means, for any particular period, audited or unaudited (as
stipulated in this Declaration), comparative financial statements of Bruce Telecom
consisting of not less than a balance sheet, a statement of income and retained earnings, a
statement of changes in financial position, a report or opinion of the Auditor (in the case
of audited Financial Statements) and such other statements, reports, notes and
information prepared in accordance with generally accepted accounting principles
(consistently applied) and as are required in accordance with any applicable law;
14
"Fiscal Year" means, in respect of Bruce Telecom, the annual period of twelve (12)
consecutive months as determined by the Board for tax and accounting purposes,
including the preparation of financial statements;
"Governmental Authority" means any federal, provincial, or municipal government,
parliament or legislature, or any regulatory authority, agency, tribunal, commission,
board or department of any such government, parliament or legislature, or any court or
other law, regulation or rule making entity, having jurisdiction in the relevant
circumstances, including the Canadian Radio-television and Telecommunications
Commission, and any person acting under the authority of any Governmental Authority;
"Kincardine"means the Corporation of the Municipality of Kincardine;
"Laws" means:
(i) applicable Canadian federal, provincial or municipal laws,
orders-in-council, by laws, codes, rules, policies, regulations and statutes;
(ii) applicable orders, decisions, codes, judgments, injunctions, decrees,
awards and writs of any court, tribunal, arbitrator, Governmental
Authority or other person having jurisdiction;
(iii) applicable rulings and conditions of any licence, permit, certificate,
registration, authorization, consent and approval issued by a Governmental
Authority; and
(iv) any requirements under or prescribed by applicable common law;
"Lien" means any mortgage, assignment, encumbrance, security interest, regardless of
form, that secures the payment of any indebtedness or liability or the observance or
performance of any obligation;
"Mayor"means the Mayor of Kincardine;
"Nominating Committee" means a committee of the Board established by the Board for
the purpose set out in Section 8(h)(iii);
"OBCA"means the Business Corporations Act(Ontario);
"Person" means a natural person, firm, trust, partnership, limited partnership, company
or corporation (with or without share capital), joint venture, sole proprietorship,
governmental or regulatory authority or other entity of any kind;
"President and CEO" means the president and chief executive officer of Bruce
Telecom;
"Private Director" means an individual who is not a member of Council or an employee
of, or consultant to, Kincardine or of any agency, board or commission of Kincardine;
"Shareholder Declaration"means this shareholder declaration;
"Shareholder Representative" is defined in Section 12.2;
"Strategic Plan" is defined in Section 3(d);
"Subsidiary"has the meaning given to such term in the OBCA.
1.2 Schedules — The following schedules form a part of this Shareholder Declaration and are
incorporated by reference:
Schedule A: Bruce Telecom Inc. Dividend Policy
Schedule B: Director Compensation Policy
1.3 Headings and Table of Contents — The inclusion of headings and a table of contents in
this Shareholder Declaration are for convenience of reference only and shall not affect
the construction or interpretation of this Shareholder Declaration.
1.4 Number — In this Shareholder Declaration, unless the context otherwise requires, words
importing the singular include the plural and vice versa and words importing gender
include all genders.
1.5 Laws—All references to statutes or Law contained in this Shareholder Declaration means
those statutes or Law in effect from time to time, and all amendments thereto or any
re-enactment thereof or replacement statutes.
2. Purpose
The purposes of this Declaration are as follows:
(a) Subject to the Board's authority to manage or supervise the management of the
business and affairs of Bruce Telecom, to provide the Board with the
Shareholder's expectations relating to the principles of governance and other
fundamental principles and policies regarding the Business;
(b) To inform the residents of the Municipality of Kincardine of the Shareholder's
fundamental principles regarding the Business;
(c) To set out the accountability, responsibility and relationship between the Board
and the Shareholder
Except as provided in Section 13, this Shareholder Declaration is not intended to constitute a
unanimous shareholder declaration under the OBCA or to formally restrict the exercise of the
powers of the Board.
3. Shareholder's Expectations
The Shareholder expects that the Board will establish for itself policies to:
(a) develop and maintain a prudent financial and capitalization structure for
Bruce Telecom consistent with industry benchmarks and sound financial
principles and established on the basis that the Corporation is intended to be a
self-financing entity;
(b) subject to Schedule A, preserve and enhance the value of the Business, and
provide the Shareholder with a commercially reasonable return on equity:
(i) through the payment of dividends or otherwise;
(ii) increase enterprise value over time; and
(iii) consistent with a prudent financial and capitalization structure;
(c) manage all risks related to the business conducted by Bruce Telecom, through
the timely adoption of appropriate risk management strategies and internal
controls consistent with industry norms; and
(d) develop a long range strategic plan("Strategic Plan") for Bruce Telecom which is
consistent with the maintenance of a viable, competitive business and preserves
and enhances the value of the Business.
4. Principles
The following principles will govern the operations of Bruce Telecom:
(a) Bruce Telecom recognizes that it is in the best interests of Bruce Telecom and
the Shareholder that it conduct its affairs:
(i) on a for-profit and commercially prudent basis, and in accordance with the
financial performance objectives of the Shareholder as set out herein; and
(ii) in a manner consistent with policies as may be established by the
Shareholder from time to time,
all of the above giving regard to the highly competitive nature of the
telecommunications market and commercially sensitive nature of the Business.
(b) Bruce Telecom will operate in a safe and environmentally responsible manner.
(c) The Board is responsible for determining and implementing the appropriate
balance among the foregoing principles and for causing Bruce Telecom to
conduct its affairs in accordance with the same.
(d) Shareholder return and benefits will be measured by several metrics, including but
not limited to, dividends and increase in enterprise value over time. In general, a
long term, strategic view will be applied to the measure of shareholder return.
5. Permitted Business Activities
Subject to the restrictions in Section 13, Bruce Telecom may engage in the business (the
"Business") of telecommunications and related services and activities which are permitted by
any Laws applicable from time to time, and as the Board of Bruce Telecom may authorize in
accordance with the terms of this Shareholder Declaration. In so doing, Bruce Telecom shall
comply with all applicable Laws.
6. Standards of Governance
As required by the OBCA, the Board shall supervise the management of the business and
affairs of Bruce Telecom, and, in so doing, shall act honestly and in good faith with a view to
the best interests of Bruce Telecom and shall exercise the same degree of care, diligence and
skill that a reasonably prudent person would exercise in comparable circumstances.
7. Board of Directors and Responsibilities
Subject to any matters requiring approval of the Shareholder pursuant to this Shareholder
Declaration, the Board will supervise the management of the business and affairs of Bruce
Telecom, including the following specific matters:
(a) approving the Business Plan;
(b) approving the Strategic Plan;
(c) approving any dividend payment as provided for in Schedule A;
(d) appointing the President and Chief Executive Officer, Chief Financial Officer
and Chief Operating Officer of Bruce Telecom; and
(e) approving the remuneration of the President and Chief Executive Officer, Chief
Financial Officer and Chief Operating Officer of Bruce Telecom.
8. Board of Directors
(a) Number of Directors — The Board of Bruce Telecom shall consist of no less than
3 directors and no more than 7 directors to be appointed by and approved by the
Shareholder. The first board of directors shall consist of 5 directors.
(b) Composition of the Board — Except for the first Board of directors as
contemplated in Section 8(e), unless otherwise determined by the Shareholder in
its discretion,the Board shall consist solely of Private Directors.
(c) Chair of Bruce Telecom — The Chair of the Board shall not have a deciding vote
in the case of a tie.
(d) President and CEO, Chief Financial Officer and Chief Operating Officer of
Bruce Telecom — The President and Chief Executive Officer, Chief Financial
Officer and Chief Operating Officer of Bruce Telecom shall not be Directors but
may be invited to attend meetings of the Board, at the discretion of the Board.
(e) Term of Directors; Staggered Board — The Shareholder shall elect Directors to
hold office for a term of three (3) years, except that any one or more Directors
may be elected for a one (1) or two (2) year term if necessary and at the discretion
of the Shareholder to provide staggered terms. At the first annual meeting of the
Shareholder, up to two (2) of the Directors may be elected with a one (1) year or
two (2) year term to give effect to a staggered Board, and such Directors may be
selected from the existing board of directors of the pre-incorporation Bruce
Telecom municipal services board. If directors are not elected at an annual
meeting, the incumbent directors continue in office until their successors are
elected.
(f) Successive Terms - Any member of the Board may serve for successive terms as
determined by the Shareholder in its discretion, except for any initial Director that
is not a Private Director.
(g) Vacancies — If a member of the Board ceases to be a director for any reason, the
Shareholder will fill the vacancy created thereby as soon as reasonably possible.
(h) Board Committees—The Board shall establish the following committees:
(i) Audit and Finance Committee to review financial results, which may
comprise only directors of the Board;
(ii) Governance Committee to determine senior management compensation
and the detailed procedures for Director compensation, which may
comprise only directors of the Board; and
(iii) Nominating Committee to identify, evaluate and recommend candidates
for the Board to the Shareholder, which may comprise only directors of
the Board.
(i) Role of Nominating Committee — After the initial Board is appointed, the
Shareholder shall consider candidates nominated by the nominating committee of
the Board (the "Nominating Committee"), but shall not be obliged to select such
candidates. It is expected that the Nominating Committee will develop a process
to identify and evaluate potential Board candidates in order to recommend a slate
of qualified candidates to the Shareholder.
(j) Compensation
(i) Directors — The directors shall receive such remuneration for their service
as directors as determined from time to time by the Shareholder, provided
that each member of the Board shall be entitled to incur reasonable
expenses for travel and/or training in respect of the director's role on the
Board, in accordance with policies established by the Board from time to
time and approved by the Shareholder. Initially, the director
compensation policy will be as set out in Schedule B.
9. Qualifications of Directors
The Board will be residents of Canada. In appointing directors to the Board,the Shareholder will
give due regard to the qualifications of candidates, including experience or knowledge with
respect to:
(a) awareness of commercial and public policy issues related to Bruce Telecom and
the telecommunications market in general;
(b) relevant business expertise and industry knowledge in the telecom sector;
(c) governance experience with private and public boards of directors involved in
significant commercial corporations;
(d) financial, legal, accounting, marketing and/or commercial experience;
(e) knowledge and experience with risk management strategy, including financial
literacy.
10. Conflict of Interest Policy
The directors and officers of Bruce Telecom will strictly abide by the requirements of the
OBCA and Bruce Telecom in respect of conflicts of interest, including any requirements in
respect of disclosure and abstention from voting. A detailed conflict of interest policy will be
established by Bruce Telecom within three (3) months of the date hereof.
11. Direction by the Shareholder
11.1 Direction by the Shareholder — At its sole option and discretion, the Shareholder may
direct Bruce Telecom to carry out certain actions in relation to its Business, subject to
applicable Laws.
11.2 Notification of Shareholder Directions — Directions of the Shareholder shall require a
resolution or bylaw of Council duly passed at a meeting of Council, and any such
direction shall be delivered to the Board by written notice signed by the Shareholder
Representative. The Shareholder Representative shall deliver a copy of each such written
notification delivered to the Board contemporaneously with each notification.
12. Decisions of the Shareholder
12.1 Advance Notice — No required approval or decision of the Shareholder will be given
unless Bruce Telecom has given reasonable advance notice in writing of the need for
approval and has provided such information as is reasonably necessary for the
Shareholder to make an informed decision regarding the subject matter requiring
approval.
12.2 Shareholder Representative—The Shareholder hereby designates the Mayor and the CAO
as the legal representatives of the Shareholder (the "Shareholder Representative") for
purposes of communicating to the Board pursuant to Section 12.3, any consent or
approval required by this Shareholder Declaration or by the OBCA. Bruce Telecom shall
be entitled to rely on any communication received by either the Mayor or the CAO as if
such communication was received by both the Mayor and the CAO.
12.3 Notification of Shareholder Approval — Approvals or decisions of the Shareholder
required pursuant to this Shareholder Declaration or the OBCA shall require a resolution
or bylaw of Council duly passed at a meeting of Council, and any such decision shall be
delivered to the Board by written notice signed by the Shareholder Representative.
13. Matters Requiring Shareholder Approval
The Shareholder hereby directs Bruce Telecom at all times to seek the approval of the
Shareholder in respect of each of the following matters prior to Bruce Telecom undertaking or
causing to be undertaken any of the following matters:
(a) in any one financial year, entry into one or more transactions to acquire or be
acquired, whether by way of purchase or otherwise, of, or merger or
amalgamation with, any one or more Persons, which transactions have a
transaction value of greater than 25% of the Book Value individually, or in the
aggregate;
(b) entry into any joint venture, partnership, strategic alliance or other venture, which
would require an investment, or which would have a financial impact greater than
25% of the Book Value;
(c) in any financial year, enter into one or more transactions which individually or in
the aggregate, except as provided in the Business Plan, result in the disposition,
lease or sale of any part of the business of Bruce Telecom equal to or greater than
25% of its Book Value;
(d) entry into formal or informal discussions or preparation or execution of any letter,
memorandum of understanding or other binding or non-binding document with
any Person in relation to any transaction described in paragraph(a), (b) or (c) of
this Section 13;
(e) changing or removing any restriction on the business of Bruce Telecom;
(0 creating new classes of shares of Bruce Telecom;
(g) enter into one or more amalgamations of Bruce Telecom with any other
corporation(s);
(h) the institution of proceedings for any winding up, arrangement or dissolution of
Bruce Telecom;
(i) appointment of auditors of Bruce Telecom;
(j) an application to continue Bruce Telecom as a corporation under the laws of
another jurisdiction;
(k) issue, or enter into any agreement to issue, any shares of any class, or any
securities convertible into any shares of any class of Bruce Telecom;
(1) redeem or purchase any outstanding shares of Bruce Telecom;
(m) any change in the dividend policy of Bruce Telecom;
(n) engaging in any business activity other than as expressly permitted under
Section 5;
(o) salary, benefits and other compensation of members of the Board;
(p) election, replacement, composition and number of members of the Board;
(q) directors and officers insurance arrangements for Bruce Telecom;
(r) provide any financial assistance, whether by loan, guarantee or otherwise, to any
director or officer of Bruce Telecom;
(s) establish a new Subsidiary; and
(t) enter into any agreement, commitment or investment that creates any Lien or
recourse in favour of any third party to the assets of Bruce Telecom.
For purposes of this Section 13, the Book Value of all assets of Bruce Telecom shall be the
values reported in the audited Financial Statements of Bruce Telecom as at the end of its
most recently completed Fiscal Year. For the purpose of paragraph (r) of this Section 13,
the term "financial assistance" does not include remuneration paid in the normal course
of business to directors, officers or employees, including honoraria, wages, salaries or
bonuses, or any reimbursement for expenses arising from such persons' duties.
14. Audit
Bruce Telecom's Financial Statements will be audited annually. The first Auditor of Bruce
Telecom is KPMG LLP.
15. Accounting
Bruce Telecom will, in consultation with the Auditor, adopt and use the accounting policies and
procedures which may be approved by the Board from time to time and all such policies and
procedures will be in accordance with generally accepted accounting principles and applicable
regulatory requirements.
16. Annual Financial Statements
The Board will cause the Auditor to deliver, as soon as practicable and in any event within ninety
(90) days after the end of each Fiscal Year, the audited Financial Statements of Bruce Telecom
for consideration by the Shareholder.
17. Annual meeting
(a) Within six (6) months after the end of each Fiscal Year, the Board shall report to
the Shareholder at a public meeting of Council and provide such information
concerning Bruce Telecom as the Board considers appropriate.
(b) The Shareholder shall annually, consider candidates for the Board as proposed by
the Nominating Committee and elect the members of the Board, appoint the
auditor (the "Auditor") of Bruce Telecom, receive the audited Financial
Statements of Bruce Telecom for the last completed Fiscal Year, receive a
director meeting attendance record and complete such other business as would
normally be completed at an annual meeting of shareholders under the OBCA.
18. Reporting
18.1 Business Plan
Not later than sixty (60) days prior to the end of each Fiscal Year, the Board will
approve and submit to the Shareholder on a strictly private and confidential basis in
camera and in accordance with applicable law, a business plan for Bruce Telecom for the
next five Fiscal Years (the "Business Plan"). The Business Plan will be prepared on a
consistent basis with the Business Plan then in effect. Bruce Telecom will carry on its
business and operations in accordance with the Business Plan which will include, in respect
of the period covered by such plan:
(a) the strategic direction and any new business initiatives which Bruce Telecom
will undertake;
(b) an operating and capital expenditure budget for the next Fiscal Year and an
operating and capital expenditure projection for each Fiscal Year thereafter,
including the resources necessary to implement the draft business plan;
(c) the projected annual revenues and profits for each Fiscal Year of the Business
Plan for Bruce Telecom;
(d) pro forma consolidated and unconsolidated financial statements, including
projected dividend payments to the Shareholder;
(e) an acquisition budget setting forth the nature and type of capital expenditures
proposed to be made in the following Fiscal Year, supported by explanations,
notes and information upon which the budget was based;
(f) any material variances in the projected ability of any business activity to meet or
continue to meet the financial objectives of the Shareholder; and
(g) any material variances from the Business Plan then in effect.
18.2 Quarterly Reports
Within 60 days after the end of each fiscal quarter, the Board will prepare (on a consistent
basis with the previous fiscal quarter) and submit in writing to the treasury department of
the Shareholder a quarterly report on a strictly confidential basis. The quarterly
report will include, in respect of the immediately preceding fiscal quarter:
(a) quarterly unaudited consolidated and unconsolidated Financial Statements;
(b) such explanations, notes and information as is required to explain and account
for any variances between the actual results from operations and the budgeted
amounts set forth in the current Business Plan, including any material variances
in the projected ability of any business activity to meet or continue to meet the
financial objectives of the Shareholder;
(c) information that is likely to materially affect the Shareholder's financial
objectives;
(d) information that is likely to materially affect customers' perceptions or
opinions regarding Bruce Telecom;
(e) information regarding any matter, occurrence or other event which is a
material breach or violation of any law; and
(0 any such additional information as the Shareholder may specify from time to
time.
18.3 Access to Records
The duly appointed Shareholder Representative shall have unrestricted access to the books
and records of Bruce Telecom during normal business hours. The Shareholder
Representative shall treat all information of Bruce Telecom with the same level of care and
confidentiality as any confidential information of the Shareholder and in compliance with
applicable Laws, having regard to the commercially sensitive and highly competitive nature of
the Business.
18.4 Reporting on Major Developments
In addition to the annual meeting described in Section 17, the Board shall report to the
Shareholder Representative on major business developments or materially adverse results as
the Board, in its discretion, considers appropriate and such reports received may be
considered by the Shareholder Representative in a forum determined to be appropriate by the
Shareholder Representative giving consideration to the Board's recommendation and the
nature of the commercially sensitive and highly competitive nature of the Business.
18.5 Confidentiality
Except as required by applicable Laws or any Governmental Authority and except for the annual
report to Council pursuant to Section 17, the Shareholder shall treat as confidential each
Business Plan and all other information provided to it in confidence pursuant to this Section 18,
subject to the Municipal Act and applicable Laws.
19. Revisions to this Shareholder Declaration
The Shareholder and Bruce Telecom acknowledge that this Shareholder Declaration may be
revised from time to time as circumstances may require and that the Shareholder will consult
with the Board prior to completing any revisions and will promptly provide Bruce Telecom with
a copy of such revisions.
20. Notices
Any notice, designation, communication, request, demand or other document, required or
permitted to be given or sent or delivered to or from the Shareholder or Bruce Telecom shall be
in writing and shall be sufficiently given or sent or delivered if it is:
(a) delivered personally,
(b) sent to the party entitled to receive it by registered mail, postage prepaid, mailed
in Canada, or
(c) sent by email.
Notices shall be sent to the following addresses or email addresses:
(i) in the case of the Shareholder,
The Corporation of the Municipality of Kincardine
1475 Concession 5, R.R. #5
Kincardine, ON N2Z 2X6
Attention: Chief Administrative Officer
Email: schambers@kincardine.net
(ii) in the case of Bruce Telecom,
PO Box 80
Tiverton, ON NOG 2T0
Attention: Chief Executive Officer
Email: president@brucetelecom.com
or to such other address or telecopier number as the party entitled to or receiving such notice,
designation, communication, request, demand or other document shall, by a notice given in
accordance with this Section 20, have communicated to the party giving or sending or delivering
such notice, designation, communication, request, demand or other document.
Any notice, designation, communication, request, demand or other document given or sent or
delivered as aforesaid shall:
(d) if delivered as aforesaid, be deemed to have been given, sent, delivered and
received on the date of delivery;
(e) if sent by mail as aforesaid, be deemed to have been given, sent, delivered and
received (but not actually received) on the fourth Business Day following the date
of mailing, unless at any time between the date of mailing and the fourth Business
Day thereafter there is a discontinuance or interruption of regular postal service,
whether due to strike or lockout or work slowdown, affecting postal service at the
point of dispatch or delivery or any intermediate point, in which case the same
shall be deemed to have been given, sent, delivered and received in the ordinary
course of the mails, allowing for such discontinuance or interruption of regular
postal service; and
(i) if sent by telecopy machine, be deemed to have been given, sent, delivered
and received on the date the sender receives the telecopy answer back
confirming receipt by the recipient.
DATED at Kincardine, Ontario this 11 day of October, 2017.
THE CORPORATION OF THE
MUNICIPALITY OF KINCARDINE
By:
Name:
Title:
By:
Name:
Title:
BRUCE TELECOM INC.
By:
Name:
Title:
By:
Name:
Title:
14
SCHEDULE "A"
BRUCE TELECOM INC.
DIVIDEND POLICY
The dividend policy of Bruce Telecom is predicated on the mandate of the Board which
includes maximizing value to the Shareholder. Such value is generally realized by the
Shareholder through dividends or the appreciation of Shareholder investment. The Board
shall declare and pay dividends from available earnings and cash flow, as follows:
1. Regular Dividends in the amount of at least $500,000 annually, subject to the
Conditions Precedent to the Payment of Dividends set out below. In any given year,
if the financial performance of the Corporation warrants a dividend payment in an
amount greater than $500,000, the Shareholder's expectation is that Board will
declare a higher dividend subject always to the satisfaction of the Conditions
Precedent.
2. Conditions Precedent to the Payment of Dividends
Dividends will be paid to the extent that such payment would not otherwise cause
noncompliance with relevant statutes and regulations.
3. Payment of Dividends
Dividends will be paid quarterly and paid March 1st (or shortly following the
approval of the annual audited financial statements of the preceding year), June 1st,
September 1st and December 1st. The first dividend of the Fiscal Year, targeted for
payment on March 1st, will also include any adjustment to bring the total annual
dividend for the preceding year to the full Dividend Amount in the event that the
previous annual dividend declared and paid was less than $500,000. All of the
foregoing will be subject to the Conditions Precedent.
4. Reporting to Shareholder
In the event that the Board does not approve a payment of a Regular Dividend, the
Board will promptly report the circumstances underlying the non-payment to the
Shareholder and, thereafter, provide progress reports to the Shareholder and, as
applicable to Bruce Telecom on a quarterly basis until such time as the payment of
Regular Dividends resumes.
5. Amendment to Dividend Policy
The Shareholder may amend this dividend policy if business circumstances change to
warrant such change, all in the sole discretion of the Shareholder.
SCHEDULE "B"
DIRECTOR COMPENSATION POLICY
1. COMPENSATION PRINCIPLES
(a) Goals. Bruce Telecom offers remuneration to directors in order to:
(i) attract and retain skilled, productive Board members with core
governance competencies;
(ii) ensure external market competitiveness and equity;
(iii)recognize the additional responsibilities undertaken by the Chair; and
(iv)be fiscally responsible and consistent with corporate governance best
practices.
(b) Review. The Board shall ensure that the compensation of Elected Directors is
reviewed every five years by an independent consultant, using the principles set
out in this section, to ensure compensation practices remain current and in-line
with market practices.
2. COMPENSATION
(a) Components. Compensation of directors may consist of an annual retainer or a
per diem for each meeting attended, or a combination of the foregoing. For
clarity, the Shareholder's expectation is that a director will attend all meetings
in the absence of a valid reason and compensation will be commensurate with
a director's meeting attendance record. Such director meeting attendance
record will be provided to the Shareholder at each annual meeting of the
Shareholder.
(b) Maximum Compensation. The compensation paid to a Director is expected to
comprise a base annual retainer of approximately $20,000 and a per diem fee of
$1,000 per meeting. The compensation paid to a Chair is expected to comprise a
base annual retainer of approximately $25,000 and a per diem fee of$1,000 per
meeting. Quarterly meetings are anticipated.
(c) Reimbursement of Expenses: Directors shall be reimbursed for travel and
accommodation expenses associated with attending Board meetings.
(d) Procedures. The Governance Committee will be charged with determining the
specific details and procedures of Director compensation, subject to the
requirements of this policy.
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