Corporate Governance

State­ment of Cor­po­rate Gov­er­nance Practices

The Company’s Board of Direc­tors (“the Board”) believes that sound cor­po­rate gov­er­nance prac­tices are essen­tial to the well-​​being of the Com­pany and its Share­hold­ers, and that these prac­tices should be reviewed reg­u­larly to ensure that they are appro­pri­ate. In estab­lish­ing cor­po­rate gov­er­nance prac­tices, the Board has reviewed, among other things, the guide­lines for effec­tive cor­po­rate gov­er­nance con­tained in National Instru­ment 58–201 Cor­po­rate Gov­er­nance Guide­lines (the “NI 58–201″) issued by the Cana­dian secu­ri­ties reg­u­la­tors and other rel­e­vant doc­u­men­ta­tion regard­ing cor­po­rate gov­er­nance practices.

Board of Directors

The Board is com­prised of a major­ity of inde­pen­dent direc­tors, which facil­i­tates its exer­cise of inde­pen­dent super­vi­sion over man­age­ment. The com­po­si­tion of inde­pen­dent and non-​​independent direc­tors is as follows:

- Gary Fil­mon — Chair­man (inde­pen­dent)
– Don­ald Streu­ber (inde­pen­dent)
– Gary Buck­ley (inde­pen­dent)
– Dun­can Jes­si­man — Exec­u­tive Vice-​​Chairman (non-​​independent)
– Ser­ena Kraayeveld (inde­pen­dent)
– Michael Pyle (non-​​independent)
– Edward Warkentin (inde­pen­dent)
– William Wehrle (non-​​independent)
– Brad Ben­nett (independent)

Man­date of the Board

The by-​​laws of the Cor­po­ra­tion pro­vides that the Board must act hon­estly and in good faith with a view to the best inter­ests of the Com­pany and in con­nec­tion there­with must exer­cise the degree of care, dili­gence and skill that a rea­son­ably pru­dent direc­tor would exer­cise in com­pa­ra­ble cir­cum­stances. The duties and stan­dard of care of the Board are intended to be in line with those as out­lined in The Canada Busi­ness Cor­po­ra­tions Act. The Com­pany is required to have a min­i­mum of 3 Direc­tors and a max­i­mum of 10 Direc­tors. The Direc­tors are to super­vise the activ­i­ties and man­age the affairs of the Com­pany. Cur­rently, the Board is com­prised of nine Direc­tors. The Com­pany has six com­mit­tees, an Audit Com­mit­tee, a Com­pen­sa­tion Com­mit­tee, a Cor­po­rate Gov­er­nance Com­mit­tee, an Avi­a­tion Sec­tor Com­mit­tee, a Man­u­fac­tur­ing Sec­tor Com­mit­tee, and a Dis­clo­sure and Com­pe­ti­tion Committee.

Rela­tion­ship Between the Board and Management

The Board has in place appro­pri­ate struc­tures to ensure that it can func­tion inde­pen­dently of man­age­ment. The respon­si­bil­i­ties of the Chair­man of the Board include over­see­ing the Direc­tors’ dis­charge of their respon­si­bil­i­ties. The Chair­man of the Board is the Hon. Gary Fil­mon, P.C., O.M.

The Pres­i­dent and Chief Exec­u­tive Offi­cer of the Com­pany is respon­si­ble for the over­all admin­is­tra­tion and man­age­ment of the Com­pany and its sub­sidiaries. All major pol­icy deci­sions relat­ing to the Com­pany and its sub­sidiaries are made by the Board or a com­mit­tee thereof. Each sub­sidiary of the Com­pany has its own man­age­ment team that is respon­si­ble for the day-​​to-​​day man­age­ment of each respec­tive subsidiary.

Audit Com­mit­tee

All mem­bers of the Audit Com­mit­tee are required to be inde­pen­dent and finan­cially lit­er­ate as required by rel­e­vant stock exchange or secu­ri­ties com­mis­sion gov­er­nance poli­cies. The Audit Com­mit­tee con­sists of the fol­low­ing Direc­tors: Gary Fil­mon, Gary Buck­ley, Ser­ena Kraayeveld and Don Streu­ber (chair), each of whom is inde­pen­dent and finan­cially lit­er­ate. The man­date of the Audit Com­mit­tee is set forth in the Audit Com­mit­tee Charter.

Com­pen­sa­tion Committee

The pur­pose of the Com­pen­sa­tion Com­mit­tee is to assist the Board in ful­fill­ing its respon­si­bil­i­ties in rela­tion to fix­ing the com­pen­sa­tion of the Chief Exec­u­tive Offi­cer, offi­cers that report directly to the Chief Exec­u­tive Offi­cer (“Senior Exec­u­tives”) and over­see­ing the plans for (i) com­pen­sa­tion, devel­op­ment and reten­tion of employ­ees, (ii) suc­ces­sion plan­ning for Senior Exec­u­tives, and (iii) gen­eral com­pen­sa­tion and human resource poli­cies and issues.

The Com­pany has adopted a char­ter for the Com­pen­sa­tion Com­mit­tee which sets out the com­po­si­tion of the Com­pen­sa­tion Com­mit­tee as well as its respon­si­bil­i­ties, duties, prin­ci­ples and procedures.

The mem­bers of the Com­pen­sa­tion Com­mit­tee are Gary Buck­ley (chair), Brad Ben­net, Edward Warkentin and William Wehrle.

Gov­er­nance Committee

The pur­pose of the Gov­er­nance Com­mit­tee is to assist the Board in ful­fill­ing its respon­si­bil­i­ties in rela­tion to:

( a ) devel­op­ment of, and com­pli­ance with, cor­po­rate gov­er­nance poli­cies and procedures;

( b ) rec­om­mend­ing can­di­dates for elec­tion to the Board and its com­mit­tees; and

( c ) assess­ing the man­age­ment, devel­op­ment and effec­tive per­for­mance of the Board, its com­mit­tees, and its respec­tive man­dates and char­ters, and ori­en­ta­tion, edu­ca­tion and devel­op­ment of directors.

The Gov­er­nance Com­mit­tee per­forms the duties as set out in its char­ter, as well as such other duties as may be appro­pri­ate under gov­ern­ing law and stock exchange rules, or as may be del­e­gated to the Gov­er­nance Com­mit­tee by the Board from time to time.

The Com­pany has adopted a char­ter for the Gov­er­nance Com­mit­tee which sets out the com­po­si­tion of the Gov­er­nance Com­mit­tee as well as its respon­si­bil­i­ties, duties, prin­ci­ples and procedures.

The mem­bers of the Gov­er­nance Com­mit­tee are Don­ald Streu­ber, Gary Fil­mon, Dun­can Jes­si­man and Ser­ena Kraayeveld (chair).

Avi­a­tion Sec­tor Committee

The pur­pose of the Avi­a­tion Sec­tor Com­mit­tee is to act as a board of advi­sors to the Oper­at­ing Sub­sidiaries in the avi­a­tion sec­tor of the Company.

The Com­pany has adopted a char­ter for the Avi­a­tion Sec­tor Com­mit­tee which sets out the com­po­si­tion of the Avi­a­tion Sec­tor Com­mit­tee as well as its respon­si­bil­i­ties, duties, prin­ci­ples and procedures.

The mem­bers of the Avi­a­tion Sec­tor Com­mit­tee are Don Streu­ber (chair), Mike Pyle, Dun­can Jes­si­man, Brad Ben­nett, Ser­ena Kraayeveld and William Wehrle.

Man­u­fac­tur­ing Sec­tor Committee

The pur­pose of the Man­u­fac­tur­ing Sec­tor Com­mit­tee is to act as a board of advi­sors to the Oper­at­ing Sub­sidiaries in the man­u­fac­tur­ing sec­tor of the Company.

The Com­pany has adopted a char­ter for the Man­u­fac­tur­ing Sec­tor Com­mit­tee which sets out the com­po­si­tion of the Man­u­fac­tur­ing Sec­tor Com­mit­tee as well as its respon­si­bil­i­ties, duties, prin­ci­ples and procedures.

The mem­bers of the Man­u­fac­tur­ing Sec­tor Com­mit­tee are Ed Warkentin (chair), Dun­can Jes­si­man, Michael Pyle, Gary Fil­mon, Al Davis, Ray Moher and Brad Bennett.

Dis­clo­sure and Com­pe­ti­tion Committee

The Dis­clo­sure and Com­pe­ti­tion Com­mit­tee is cur­rently com­prised of two direc­tors and the Chief Finan­cial Offi­cer: Dun­can Jes­si­man, Michael Pyle and Adam Ter­win. The com­po­si­tion of the Dis­clo­sure and Com­pe­ti­tion Com­mit­tee is deter­mined on an annual basis by the Chief Exec­u­tive Offi­cer. The pur­pose of the Dis­clo­sure and Com­pe­ti­tion Com­mit­tee is to estab­lish con­trols and pro­ce­dures to ensure the Dis­clo­sure and Com­pe­ti­tion Pol­icy of the Com­pany is being fol­lowed through­out the orga­ni­za­tion. The Dis­clo­sure and Com­pe­ti­tion Com­mit­tee meets as fre­quently as cir­cum­stances require, and as the mem­bers deem nec­es­sary or appro­pri­ate, to carry out its responsibilities.

Board Infor­ma­tion

The infor­ma­tion which man­age­ment pro­vides to the Board is crit­i­cal. The Board must have con­fi­dence in the data gath­er­ing, analy­sis and report­ing func­tions of man­age­ment. The Board mem­bers have stated that they are pro­vided with all nec­es­sary infor­ma­tion and with a suf­fi­cient amount of infor­ma­tion to facil­i­tate effec­tive deci­sion mak­ing. The Com­pany con­tin­u­ally mon­i­tors the nature of the infor­ma­tion requested by and pro­vided to the Board mem­bers in order to enable them to deter­mine whether they can be more effec­tive in iden­ti­fy­ing prob­lems and oppor­tu­ni­ties for the Com­pany and its Subsidiaries.

Insider Trad­ing Policy

The Com­pany has adopted an Insider Trad­ing Pol­icy that applies to all employ­ees, Direc­tors and offi­cers of the Com­pany, includ­ing the Company’s oper­at­ing sub­sidiaries. The Insider Trad­ing Pol­icy aims to edu­cate mem­bers of the orga­ni­za­tion on the legal oblig­a­tions asso­ci­ated with being deemed an “insider” for the pur­poses of secu­ri­ties leg­is­la­tion. The pol­icy goes fur­ther and estab­lishes rules that help mem­bers of the orga­ni­za­tion avoid a sit­u­a­tion where insider trad­ing laws are inad­ver­tently vio­lated. These include rules regard­ing the dis­clo­sure of con­fi­den­tial infor­ma­tion to out­siders, the impo­si­tion of reg­u­lar and spe­cial trad­ing black­outs around the time of the release of finan­cial infor­ma­tion and a gen­eral pro­hi­bi­tion against spec­u­la­tive trad­ing of the Company’s shares.