Composition & Size of the Board of Directors

The board of directors of the Company must

  1. examine the size of the board with a view to determining the impact of the number of directors upon the effectiveness of the board,
  2. determine the status of each director as a related or unrelated director1,  based on each director’s relationship with the Company, and
  3. to the extent practicable, take steps to ensure that a majority of the directors qualify as unrelated directors and that a number of directors are appointed who do not have interests in or relationships with either the Company or a significant shareholder2  and which fairly reflects the investment in the Company by shareholders other than a significant shareholder.

The board must disclose annually whether or not the board has a majority of unrelated directors or whether the board is constituted with the appropriate number of directors who are not related to the Company or a significant shareholder.  It must also disclose annually the analysis of the application of the principles it used in supporting its conclusion.

The board is also responsible for annually assessing its own effectiveness and that of its committees.

1 An unrelated director is a director who is independent of management and free from any interest and any business or other relationship that could, or could reasonably be perceived to, materially interfere with the director’s ability to act with a view to the best interests of the Company, other than interests and relationships arising from the holding of shares of the Company.

2 A significant shareholder is a shareholder (alone, or jointly or in concert with another shareholder) able to exercise a majority of the votes for the election of the board of directors.