Dividend Reinvestment Plan
Enercare Inc. (the “Company”) has established this dividend reinvestment plan to provide all resident Canadian registered holders (the “Shareholder”) of common shares (the “Common Shares”) of the Company with a means to reinvest some or all of the cash dividends (“Dividends”) declared by the board of directors of the Company in additional Common Shares (the “Plan Shares”) on a monthly basis without payment of brokerage commissions or service charges, on the terms described herein (the “Plan”).
Dividends on Common Shares (and on Plan Shares) will be reinvested on behalf of those shareholders who participate in the Plan (“Plan Participants”) by Computershare Trust company of Canada, as agent under the Plan (the “Plan Agent”) on the terms and conditions contained in a dividend reinvestment plan services agreement (the “Services Agreement”) entered into between the Company and the Plan Agent, the material provisions of which are summarized below.
Certain Defined Terms
Where used herein, the following terms shall have the following meanings:
“Beneficial Shareholders” means a beneficial owner of Common Shares that are registered in the name of CDS, or a broker, investment dealer, financial institution or other nominee;
“Business Day” means any day other than a Saturday or a Sunday on which Schedule I Canadian chartered banks are open for business in Toronto, Ontario;
“CDS” means CDS Clearing and Depository Services Inc.;
“CDS Participant” means a participant in the CDS clearing and depository service;
“Dividend Date” means each date on which the Company pays a Dividend to Shareholders;
“Enrollment Form” means the reinvestment enrollment participant declaration form, approved by the Company in consultation with the Plan Agent, to be completed by a Shareholder to participate in the Plan;
“Record Date” means the date designated by the Company as a record date for the determination of Shareholders entitled to receive a Dividend;
“Termination Price” means the prevailing market price of the Plan Shares at the time of sale, which is to be used by the Plan Agent for calculating the value of any fractional Plan Shares following receipt by the Plan Agent of a termination notice; and
“TSX” means the Toronto Stock Exchange.
Participation in the Plan
Shareholders may elect to become Plan Participants with respect to all or a stated number of their Common Shares commencing on any Record Date occurring at least five (5) Business Days following the Effective Date. In order to become a Plan Participant, a Shareholder must provide a duly completed Enrollment Form to the Plan Agent or enroll online at the Plan Agent’s web portal www.investorcentre.com no later than five (5) Business Days prior to a Record Date in order to be enrolled in the Plan as of such Record Date. Any Enrollment Form received following such date shall be considered for enrollment in the Dividend next following such Record Date.
A person who is a Beneficial Shareholder and not an owner of record who wishes to participate in the Plan and is eligible to do so should make arrangements with their broker, investment dealer, financial institution or other nominee to enroll such Common Shares in the Plan on behalf of such Beneficial Shareholder. If the Beneficial Shareholder wishes to participate in the Plan but is unable to do so, the Beneficial Shareholder will be required to become a registered Shareholder by transferring such Common Shares into his or her own name and then enroll such Common Shares in the Plan by duly completing the Enrollment Form and returning it to the Plan Agent.
In the event that CDS is a Plan Participant, CDS must provide the Plan Agent notification of the number of Common Shares held by or through CDS for reinvestment by a time decided upon by CDS and the Plan Agent. Once complete, the Plan Agent will enroll the CDS Participants in the Plan with respect to such Common Shares.
Once enrolled, participation will continue automatically unless terminated in accordance with the terms of the Plan. Participation in the Plan is exclusively available to all Shareholders who are residents of Canada for the purposes of the Income Tax Act (Canada). Upon becoming a non-resident, a Plan Participant must notify the Plan Agent and terminate his or her participation in the Plan. Upon notification of non-residency, participation in the Plan will be terminated immediately by the Plan Agent. The Plan Agent does not have any duty to inquire into the residency status of Plan Participants.
The Company shall pay to the Plan Agent, on behalf of the Plan Participants, all Dividend amounts paid on Common Shares (including Plan Shares) for which Plan Participants are the owners on the Record Date and which are subject to the Plan. The Company will pay each Dividend on a Dividend Date if, as and when declared by the Company’s board of directors. The Plan Agent shall purchase Plan Shares on the terms and conditions set out below under “Purchase of Plan Shares by Plan Agent” and in the Services Agreement.
Plan Shares purchased pursuant to the Plan will be registered in the name of the Plan Agent, as agent of the Plan Participants. Accounts under the Plan will be maintained in the names in which Common Shares were registered at the time the Plan Participants enrolled in the Plan.
Plan Shares may not be sold, transferred, pledged or otherwise disposed of by Plan Participants while such Plan Shares remain in the Plan. A Plan Participant who wishes to sell, transfer, pledge or dispose of any Plan Shares must first instruct the Plan Agent to withdraw such Plan Shares from the Plan. A Plan Participant may withdraw his or her shares on the terms and conditions set out below under “Withdrawal of Plan Shares” and in the Services Agreement.
Purchase of Plan Shares by Plan Agent
Unless otherwise notified, the Plan Agent will purchase Plan Shares from the Company’s treasury, in which case the Plan Shares shall be issued from the Company on the Dividend Date through treasury direction. If notified by the Company no later than the Record Date, the Plan Agent will purchase Plan Shares on the Canadian open market, including through the facilities of the TSX and/or any other applicable Canadian stock exchange or alternative Canadian trading system.
Default Treasury Purchase
If Plan Shares are issued from treasury by the Company (which will always be the case unless instructed otherwise from the Company), the Company will instruct the Plan Agent to purchase Plan Shares at a price that will be equal to 95% of the volume weighted average trading price of the Common Shares on the TSX (or such other stock exchange on which the Common Shares are listed if the Common Shares are no longer listed on the TSX) for the five (5) consecutive trading days immediately prior to the applicable Dividend Date.
Instructed Market Purchase
If Plan Shares are purchased on the Canadian open market, the Plan Agent will purchase Plan Shares through a broker-dealer designated by the Plan Agent, unless otherwise instructed by the Company to utilize an alternate broker-dealer. The price of such Plan Shares will be the average of the applicable best efforts open market purchase prices paid (excluding brokerage commissions, fees and all transaction costs) per Plan Share for all Plan Shares purchased by the Plan Agent in respect of the Plan at any time during the three (3) Business Days following the relevant Dividend Date.
Fractional Plan Shares
Each Plan Participant’s account will be credited with the number of Plan Shares purchased under the Plan for such Plan Participant, including fractional Plan Shares computed to six decimal places, which is equal to the amounts to be invested for each Plan Participant divided by the applicable purchase price. In the case of Beneficial Shareholders who participate in the Plan, this account will be maintained by CDS or the Beneficial Shareholder’s broker, investment dealer, financial institution or other nominee holding Plan Shares as registered shareholder. Beneficial Shareholders should contact their broker, investment dealer, financial institution or other nominee as to the manner in which fractional entitlements may be held.
Participants’ Accounts, Reports and Certificates
An account will be maintained by the Plan Agent or its nominee for each Plan Participant. These reports will be the only record for Plan Participants of the cost of each purchase of Plan Shares on their behalf. All such reports should be retained by Plan Participants for income tax purposes. In addition, each Plan Participant will receive annually the appropriate tax information for recording Dividends paid to them. The automatic reinvestment of Dividends under the Plan will not relieve Plan Participants of any income tax applicable to such Dividends.
Voting of Plan Shares
Plan Shares held on a Record Date for a vote of Shareholders may be voted in the same manner as the Plan Participants’ other Common Shares may be voted, either in person or by proxy (or voting instruction form, as applicable). Plan Shares representing fractional interests in Common Shares will not be voted.
Commissions and Administrative Costs
There will be no commissions or brokerage charges payable on the purchase of Plan Shares. Administrative costs associated with the operation of the Plan will be borne by the Company as set out in the Services Agreement.
Responsibilities of the Company and the Plan Agent
Neither the Company nor the Plan Agent shall be liable for any act done by any of them in good faith or for any good faith omission to act in connection with the operation of the Plan. In particular, neither the Company nor the Plan Agent shall have any liability to Plan Participants with respect to:
Plan Participants should recognize that neither the Company nor the Plan Agent can assure a gain or protect against a loss as a result of Plan Participants holding Plan Shares.
Termination of Participation
Plan Participants may voluntarily terminate their participation in the Plan by written notification to the Plan Agent or online at the Plan Agent’s web portal www.investorcentre.com no later than five (5) Business Days prior to a Record Date. Upon such instructions, the Plan Agent will (i) deliver a DRS Advice, if available, or share certificate for the whole number of Plan Shares held as soon as practicable after terminating the account, subject to such fees and expenses as are normally charged by the Plan Agent for preparation and delivery of such certificate, and (ii) based upon the Termination Price, issue a cheque for any fractional Plan Shares. Any notification received following the time specified herein shall be processed after the Dividend Date. Participation by a Beneficial Shareholder in the Plan may be terminated by giving notice to his or her broker, investment dealer, financial institution or other nominee.
Withdrawal of Plan Shares
Plan Participants may voluntarily withdraw whole Plan Shares from a plan Participant’s account by written notification to the Plan Agent or online at the Plan Agent’s web portal www.investorcentre.com. Upon such instructions, the Plan Agent will deliver a DRS Advice, if available, or share certificate for the specified whole number of Plan Shares held as soon as practicable, subject to such fees and expenses as are normally charged by the Plan Agent for preparation and delivery of such DRS Advice, if available, or share certificate. Any notification received following the time specified herein shall be processed after the Dividend Date.
Amendments, Suspension or Termination of Plan and Plan Agent
The Company may, in its sole discretion, upon prior notice to the Plan Agent and Plan Participants, suspend or terminate the Plan at any time. The Company may also amend the Plan at any time with the prior consent of the TSX (if required) and the Plan Agent, such consent by the Plan Agent not to be unreasonably withheld or delayed. In the event of a suspension or termination of the Plan by the Company, no purchases of Plan Shares will be made by the Plan Agent on the Dividend Date immediately following the effective date of such suspension or termination. Dividends which are subject to the Plan and which are paid after the effective date of such suspension or termination will be remitted by the Plan Agent to the Plan Participants to whom they are due.
The Company may remove the Plan Agent or the Plan Agent may resign at any time upon not less than sixty (60) days prior written notice to the Plan Agent or the Company, as the case may be, or upon such lesser period as may be otherwise provided in the Services Agreement or as mutually agreed to by the Company and the Plan Agent. On or prior to the end of such notice period, the Company may appoint a successor to the Plan Agent to act as the administrative agent for the Plan and to which the Plan Agent shall, at the request of the Company, deliver the property and records held in connection with the Services Agreement.
No Assignment of Participation Rights
The right to participate in the Plan may not be assigned by a Shareholder.
Rules and Regulations
The Company, in conjunction with the Plan Agent, may from time to time adopt rules and regulations to facilitate the administration of the Plan. The Company reserves the right to regulate and interpret the Plan as it deems necessary or desirable to ensure the efficient and equitable operation thereof.
This Plan will be governed and construed in accordance with the laws of the Province of Ontario and the laws of Canada applicable therein.
Rights Offerings, Stock Dividends and Stock Splits
In the event that the Company offers rights to subscribe for additional Common Shares or other securities of the Company to its Shareholders, rights certificates will be issued to Plan Participants in respect of their whole Plan Shares as of the record date of the rights issue. Where a Plan Participant would be entitled to receive a fractional interest in a right as a result of the ownership of a fractional interest in a Plan Share, such fractional interest in the right will be sold by the Plan Agent, on a commingled basis, together with other fractional interests in rights held on behalf of other Plan Participants and the proceeds, less brokerage commissions, will be issued to the Participants.
Any Common Shares distributed pursuant to a stock dividend or a stock split on Plan Shares held by the Plan Agent for Plan Participants will be retained by the Plan Agent and credited (net of any applicable withholding taxes) to the account of the Plan Participant in accordance with their entitlement under the Plan.
References in this Plan to the delivery of instructions, notices or other documents in writing will be deemed to include, subject to the adoption of rules or regulations by the Company, delivery of electronic means, including the Internet.
Subject to receipt of all required regulatory approvals, the Plan shall be deemed effective for any Record Date after the date set out below (the “Effective Date”).
All notices required to be given to Plan Participants will be mailed to them at the address shown on the records of the Plan Agent. Plan Participants must notify the Plan Agent of any change of address.
Communication with the Plan Agent shall be addressed to:
Computershare Trust Company of Canada
100 University Avenue, 8th Floor, North Tower
Attention: Dividend Reinvestment Department
Or the National Contact Centre toll-free at 1-800-564-6253 or by visiting www.investorcentre.com/service
Written communications to the Company should be addressed to:
7400 Birchmount Rd.
Attention: Chief Legal Officer
Fax No: 905-649-1964
Email: [email protected]
Effective Date of the Plan
The effective date of the Plan is November 15, 2016.