Human Resources and Compensation

HUMAN RESOURCES AND COMPENSATION COMMITTEE CHARTER

Approved by the Board on December 12, 2017

Purpose

The Human Resources and Compensation Committee of the Board of the Company (the “Committee”) will (i) oversee the Company’s compensation and benefits (including retirement and pension) philosophy and policies (collectively, the “Compensation Policies”) generally, (ii) oversee the financial position and performance, governance, administration and compliance with legal requirements of the pension plans of the Company and its subsidiaries, (iii) oversee and recommend to the Board compensation for the President and Chief Executive Officer, (iv) oversee the evaluation process and recommend to the Board a compensation structure for other members of the Company’s executive management, (iv) oversee the Company’s people and talent development philosophies and policies and succession planning for the Company’s executive management, (vi) review proposed appointments to executive management and make recommendations for approval to the Board, and (vii) fulfill the other responsibilities set forth in this Charter.  The Company’s executive management consists of its President and Chief Executive Officer, Chief Financial Officer, Chief Operating Officer (if any) and Vice-Presidents.

Membership

The Committee will consist of at least three members, comprised of independent directors. The Board will recommend nominees for appointment to the Committee annually and as vacancies or newly created positions occur. Committee members will be appointed and the chair of the Committee designated by the Board and may be removed by the Board at any time.

Responsibilities

In addition to any other responsibilities that may be assigned from time to time by the Board, the Committee is directly responsible for the matters described below.

(i) Compensation Policies and Plans

The Committee will review and recommend to the Board the approval of the Compensation Policies generally, including reviewing and recommending to the Board the approval of any incentive-compensation plans and equity-based plans of the Company, and modifications or amendments to such policies or plans. In reviewing the Compensation Policies, the Committee may consider the recruitment, development, promotion, retention, and compensation of members of executive management and other employees of the Company and any other factors that it deems appropriate.

The Committee will also assess on an ongoing basis whether the Compensation Policies are consistent with the sustainable achievement of the Company’s business objectives, the prudent management of its operations and risks, and the promotion of adherence to the Company’s Code of Conduct, its policies concerning safety and environmental stewardship and its other material policies, procedures and controls.

The Committee will also ensure that the Compensation Policies do not encourage unwarranted risk taking and will undertake an annual risk assessment of the Compensation Policies.

(ii) Pension Plans

The Committee is responsible for overseeing the financial position and performance, governance, administration and compliance with statutory and regulatory requirements of the pension plans of the Company and its subsidiaries (the “pension plans”) and for reporting on the same to the Board annually or as the Board may otherwise request.

Except to the extent reserved by the Board, the Committee will

  1. with the Company’s executive management establish and periodically review a reporting and monitoring framework which specifies the major reports and documents that management and the management committees and decision-making bodies with responsibilities over the  pension plans will provide to the Committee to assist it with fulfilling its oversight responsibilities, including annual reports on the financial position, performance relative to objectives, compliance with applicable laws and regulations and key governance activities and bi-annual reports on the investment performance, new or updated actuarial analysis and changes that may impact the funded status of the pension plans,
  2. oversee and monitor the identification of material risks associated with the administration and investment activities of the pension plans and, with the Company’s executive management, the implementation of appropriate systems and processes to identify and manage those risks,
  3. periodically review, with the Company’s executive management, the mandate, terms of reference, duties and responsibilities of the management committees and major decisionmaking bodies with responsibilities over the pension plans (collectively, the “Terms of Reference”) and compliance with the same,
  4. periodically review, with the Company’s executive management, the investment policies and procedures for the pension plans (the “Investment Policies”), the governance structure for the pension plans, the governance policies, funding policies and any other significant policies for the pension plans (collectively, the “Governance/Funding Policies"), and compliance with the same,
  5. review with the Company’s executive management and approve amendments of an administrative nature to the pension plan texts of the pension plans, and recommend any pension plan design changes and pension plan text amendments of a non-administrative nature to the Board for approval.  For greater certainty,(i) pension plan text amendments of a non-administrative nature shall include any amendment that has a significant impact on the cost or design of benefits, unless the amendment is made solely to comply with law, and (ii) pension plan text amendments of an administrative nature shall include any amendment that is made solely to comply with law (regardless of impact on cost or design of benefits), or that is made for any other reason if it has no significant impact on cost or design of benefits,
  6. 6. review with the Company’s executive management and approve any amendments of a non-administrative nature to the Investment Policies or to the Governance/Funding Policies and any new Investment Policies or Governance/Funding Policies including replacements of the existing Investment Policies or Governance/Funding Policies.  Whether an amendment to an Investment Policy or a Governance/Funding Policy is nonadministrative in nature shall be determined in the sole discretion of the management committee or decision-making body with responsibilities over the relevant pension plan(s),
  7. review with the Company’s executive management and approve all amendments to the Terms of Reference and any new Terms of Reference including replacements of the existing Terms of Reference, and
  8. annually recommend to the Board the members and the chair that are to be appointed by the Board to the management committees with responsibilities over the pension plans.

(iii) President and Chief Executive Officer Compensation

The Committee will review and recommend to the Board for the Company’s President and Chief Executive Officer his or her (i) annual base salary level, (ii) annual incentive compensation, (iii) long-term incentive compensation, (iv) employment, severance, and change in- control agreements, if any, and (v) any other compensation, ongoing perquisites, or special benefit items. In so reviewing and recommending the President and Chief Executive Officer’s compensation, the Committee will, among other things:

  1. review and recommend to the Board the value and components of any annual and longterm incentive compensation of the President and Chief Executive Officer, including the stock options, share units and other entitlements to be allocated as part of any long-term incentive compensation, based on the Company’s performance, shareholder return, and the value of similar incentive awards at comparable companies, and such other factors as the Committee deems appropriate and in the best interests of the Company (including the cost to the Company of such compensation); and
  2. when the Committee reviews and recommends compensation for the President and Chief Executive Officer, it will assess the appropriateness of compensation relative to business risks undertaken by considering, among other things, adherence to the Company’s Code of Conduct and generally promoting a culture of integrity, its policies concerning safety and environmental stewardship and its other material policies, procedures and controls.

(iv) Compensation of Other Members of Executive Management

The Committee will oversee the evaluation process and recommend to the Board a compensation structure for other members of the Company’s executive management including the structure of (i) annual base salaries, (ii) annual incentive compensation, (iii) long-term incentive compensation, (iv) employment, severance, and change-in-control agreements, if any, and (v) any other compensation, ongoing perquisites, or special benefit items.

In undertaking such responsibilities, the Committee will review and recommend to the Board the value and components of any annual and long-term incentive compensation for such members of executive management, including the stock options, share units and other entitlements to be allocated as part of any long-term incentive compensation, and may consider the matters identified under President and Chief Executive Officer Compensation, above, as well as any other factors it considers appropriate.

(v) People Development and Succession Planning

The Committee will oversee the Company’s people and talent development philosophies and policies and succession planning for executive management, and report periodically to the Board on such succession planning.

The Committee will review proposed appointments to executive management and make recommendations for approval to the Board.

(vi) Report to Shareholders

The Committee will prepare a report on executive compensation to be included in the Company’s annual Information Circular and will review all executive compensation disclosure before the Company publicly discloses such information.

(vii) Report to Board

The Committee will regularly report to the Board on all significant matters it has addressed and with respect to such other matters that are within its responsibilities.

(viii) Assessment

At least annually, the Committee will review its effectiveness in fulfilling its responsibilities and duties as set out in this Charter and in a manner consistent with the corporate governance guidelines adopted by the Board.  In addition, the Committee will annually review and assess the adequacy of this Charter and will recommend to the Board for approval such changes to this Charter as the Committee deems necessary or appropriate.

Access to Outside Advisors

The Committee may retain any outside advisor at the expense of the Company, without the Board’s approval, at any time and has the authority to determine any such advisor’s fees and other retention terms. For greater certainty, the Committee has sole authority to retain and terminate any consulting firm to be used to evaluate the President and Chief Executive Officer or the compensation of the President, Chief Executive Officer or other executive management.

Delegation

To the extent permitted, the Board may delegate to the Committee such of its other responsibilities related to the Compensation Policies, pension plans and/or director and officer compensation, benefits and incentive awards as the Board, from time to time, determines should be so delegated to the Committee.

The Committee may delegate all or a portion of the authority granted to it by the Board to one or more of its members, a member of executive management or other Board members.

Meetings

Meetings of the Committee may be called by any of its members or by the Board. Meetings will be held in conjunction with regularly scheduled Board meetings as is necessary for the Committee to fulfill its responsibilities. The Committee will appoint a secretary to be the secretary of each meeting of the Committee and to maintain minutes of the meeting and deliberations of the Committee.

The powers of the Committee will be exercisable at a meeting at which a quorum is present. A quorum will be not less than a majority of the members from time to time. Matters decided by the Committee will be decided by majority vote. Subject to the foregoing, the Business Corporations Act (B.C.) and the Articles of the Company, and unless otherwise determined by the Board, the Committee will have the power to regulate its procedure. Notice of each meeting will be given to each member, and to the Chairman of the Board and the President and Chief Executive Officer of the Company. Notice of meeting may be given verbally or by letter, facsimile or telephone not less than 24 hours before the time fixed for the meeting. Members may waive notice of any meeting and attendance at a meeting is deemed waiver of notice. The notice need not state the purpose or purposes for which the meeting is being held.

The Committee may invite, from time to time, such persons as it may see fit to attend its meetings and to take part in discussion and consideration of the affairs of the Committee.