ITEM 1. BOARD OF DIRECTORS
The Board of Directors of the Company facilitates its exercise of independent supervision over the Company’s management through frequent meetings of the Board.
Dr. Linda Lakats, and Ms. JoAnne Strongman, directors of the Company, are “independent” in that he or she is independent and free from any interest and any business or other relationship which could, or could reasonably be perceived to, materially interfere with the director’s ability to act with the best interests of the Company, other than the interests and relationships arising from shareholdings. Mr. William A. Hullah is the President and Chief Executive Officer of the Company and is therefore not independent. Mr. Gary R. Hullah, is the Vice-President and Chief Financial Officer of the Company and is therefore not independent.
ITEM 2. DIRECTORSHIPS
The directors of the Company are currently not directors of any other reporting issuers.
ITEM 3. ORIENTATION AND CONTINUING EDUCATION
The Board of Directors of the Company briefs all new directors with the polices of the Board of Directors, and other relevant corporate and business information.
ITEM 4. ETHICAL BUSINESS CONDUCT
The Board has found that the fiduciary duties placed on individual directors by the Company’s governing corporate legislation and the common law and the restrictions placed by applicable corporate legislation on an individual director’s participation in decisions of the Board in which the director has an interest have been sufficient to ensure that the Board operates independently of management and in the best interests of the Company.
Under the corporate legislation, a director is required to act honestly and in good faith with a view to the best interests of the Company and exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances, and disclose to the board the nature and extent of any interest of the director in any material contract or material transaction, whether made or proposed, if the director is a party to the contract or transaction, is a director or officer (or an individual acting in a similar capacity) of a party to the contract or transaction or has a material interest in a party to the contract or transaction. The director must then abstain from voting on the contract or transaction unless the contract or transaction (i) relates primarily to their remuneration as a director, officer, employee or agent of the Company or an affiliate of the Company, (ii) is for indemnity or insurance for the benefit of the director in connection with the Company, or (iii) is with an affiliate of the Company. If the director abstains from voting after disclosure of their interest, the directors approve the contract or transaction and the contract or transaction was reasonable and fair to the Company at the time it was entered into, the contract or transaction is not invalid and the director is not accountable to the Company for any profit realized from the contract or transaction. Otherwise, the director must have acted honestly and in good faith, the contract or transaction must have been reasonable and fair to the Company and the contract or transaction be approved by the shareholders by a special resolution after receiving full disclosure of its terms in order for the director to avoid such liability or the contract or transaction being invalid.
ITEM 5. NOMINATION OF DIRECTORS
The Board of Directors is responsible for identifying individuals qualified to become new Board members and recommending to the Board new director nominees for the next annual meeting of the shareholders.
New nominees must have a track record in general business management, special expertise in an area of strategic interest to the Company, the ability to devote the time required, shown support for the Company’s mission and strategic objectives, and a willingness to serve.
ITEM 6. COMPENSATION
The Board of Directors conducts reviews with regard to directors’ compensation once a year. To make its recommendation on directors’ compensation, the Board of Directors takes into account the types of compensation and the amounts paid to directors of comparable publicly traded Canadian companies.
ITEM 7. OTHER BOARD COMMITTEES
The Board of Directors has no other committees other than the Audit Committee.
ITEM 8. ASSESSMENTS
The Board of Directors monitors the adequacy of information given to directors, communication between the board and management and the strategic direction and processes of the board and committees.