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Corporate Governance

Parkland's Board of Directors and Management embrace their corporate governance obligations  and are committed to sound governance practices. Both the board and management welcome ongoing input on Parkland's governance practices from interested investors and investor advocates.  Parkland's Governance policy documents are provided below for your review.

Code of Conduct and Conflict of Interest

Guidelines for Directors, Officers and Senior Managers

1. Introduction

IMPORTANT: In the following, and for simplicity purposes, the word: (i) “Parkland” designates Parkland Fuel Corporation and includes, where the context dictates, its subsidiaries and affiliates; and (ii) “Individual” designates a Director of Parkland and/or an Officer and/or a Senior Manager of Parkland.

Each Director owes Parkland a fiduciary duty, including the obligation to act honestly and in good faith with a view to the best interests of Parkland. This Code of Conduct and Conflict of Interest Guidelines outlines a framework of guiding principles for Individuals. As with any statement of policy, the exercise of judgment is required in determining applicability of this Code to each individual situation.

2. Conflicts of Interest
  1. Individuals shall avoid situations that may result in a conflict or perceived conflict between their personal interests and the interest of Parkland and situations where their actions as Individuals are influenced or perceived to be influenced by their personal interests.
  2. In general, a conflict of interest exists for Individuals who use their position at Parkland to benefit themselves, friends or families.
  3. Full disclosure enables Individuals to resolve unclear situations and gives an opportunity to dispose of conflicting interests before any difficulty arises.
3. Compliance with Law
  1. Each Individual must at all times comply fully with applicable law and should avoid any situation which could be perceived as improper, unethical or indicate a casual attitude towards compliance with such law.
  2. The Individuals are expected to be sufficiently familiar with any legislation that applies to their position and shall recognize potential liabilities, seeking legal advice where appropriate.
4. Professional and Courteous Behavior
  1. Individuals will interact on a daily basis with each other and with other members of industry, government authorities and agencies, community stakeholders, contractors, vendors, customers, investors, unions, trade associations, professional associations, and the general public. It is essential that the Individuals be and be perceived to be honest, fair, courteous and respectful and that he or she conduct Parkland’s business fairly, professionally, ethically and with integrity.
5. Outside Business Interests
  1. No Individual may hold a significant financial interest, either directly or through a relative or associate, or hold or accept a position as an officer or director in an organization which is in a relationship with Parkland, whereby virtue of his or her position in Parkland the Individual could in any way benefit the other organization by influencing the purchasing, selling or other decisions of Parkland unless that interest has been fully disclosed to the Board of Directors.
  2. A significant financial interest is any interest substantial enough that decisions of Parkland could result in material gain for the Individual.
6. Confidential Information and Securities Trading
  1. Each Individual must comply with Parkland’s Confidential Information Policy (Appendix A).
  2. Each Individual must comply with Parkland’s Securities Trading and Reporting Policy for Restricted Persons (Appendix B).
  3. Each Individual must comply with Parkland’s Insider Transactions Policy (Appendix C).
  4. Individuals must comply with Parkland’s Blackout Periods (Appendices D).
7. Entertainment, Gifts and Favors
  1. Individuals may not offer or solicit gifts or favors in order to secure preferred treatment for themselves or Parkland.
  2. Gifts and entertainment may only be accepted or offered by an Individual in the normal exchanges common to established business relationships. An exchange of such gifts shall create no sense of obligation.
8. Non-profit and Professional Association
  1. Parkland supports its Individuals who contribute to their communities through involvement with charitable, community service and professional organizations.
  2. An Individual should ensure that he or she is seen as speaking for the organization as an individual and not in his or her capacity as an Individual or spokesperson of Parkland.
9. Use of Parkland Property
  1. Individuals should not make use of any significant Parkland property or resources for their own personal benefit or purposes.
10. Political Participation
  1. Individuals engaging in the political process must take care to separate their personal activities from their association with Parkland.
11. Disclosure
  1. Each individual being considered as a director of Parkland must disclose to the Compensation and Corporate Governance Committee all interests and relationships of which the proposed director of Parkland is aware of at the time of consideration; which will or may give rise to a conflict of interest.
  2. If such an interest or relationship should arise while the individual is an Individual, the individual shall make immediate disclosure of all relevant facts to the Chairman of the Board of Directors.
  3. If the Board of Directors is making decisions that may provide a benefit to an Individual’s private interests, the Individual shall withdraw from the deliberations altogether and leave the meeting for the duration of the discussion.
  4. Disclosure may address a conflict of interest as it may allow Parkland to appropriately avoid a potential conflict. However, a conflict may be so severe as to only be resolved by the Individual’s resignation from one or both of the conflicting positions. Each Individual agrees that if the Board of Directors determines that a material conflict cannot be cured, the Individual will resign.
12. Responsibility
  1. Each Individual must adhere to the standards described in this Code of Conduct.
  2. Each Individual shall annually review, sign and deliver to the Chairman of the Board of Directors a signed copy of this Code of Conduct.
13. Reporting a Concern
  1. Any Individual who knows or suspects a breach of this Code of Conduct must report it to the Chairman of the Board of Directors as soon as possible. Failure to report will be considered unethical.
  2. Where an Individual reports such information in good faith, Parkland will take all reasonable steps to prevent the individual who has made the report from being harassed, discriminated against, or the subject of retaliation or any other unsuitable action by other individuals. Any such harassment, discrimination or retaliation will be considered unethical.
  3. If a report is found to be vexatious or made in bad faith or intentionally brought on fabricated grounds, appropriate disciplinary action will be taken, up to and including termination of employment.
14. Violation of this Code
  1. If the Board determines that an Individual has breached this Code of Conduct, the Board may sanction the Individual, including asking for the Individual’s resignation.
  2. Each Individual agrees that when the Board determines that the Individual has violated this Code of Conduct and requests the Individual’s resignation, the Individual shall resign.
15. Clarification
  1. An Individual should seek clarification of the Code of Conduct policy, where necessary, from the Chair of the Compensation and Corporate Governance Committee.

Whistle Blower Policy

Parkland works with an external third party to provide confidential, anonymous reporting for employees (CARE) services.

CARE services provides an effective way for employees to efficiently and anonymously report concerns regarding inappropriate activity in a corporation. The reported event could relate to questionable accounting matters or fraud but also workplace harassment, violence, substance abuse, discrimination, conflicts of interest, safety concerns, or other concerns the employee may have relating to the conduct of business. Our third party provider undertakes to provide CARE services to Parkland and its affiliates.

Specifically, the third party will:

  1. Provide a monitored toll free CARE number 24 hours a day, 7 days a week, 365 days a year;
  2. Provide a CARE website and email access directly to the third party, monitored regularly by trained investigators, for employee use;
  3. Present information obtained from an employee through a phone call or email directly to your designated representative within one (1) business day of receiving the call or email from the Parkland employee; and
  4. Produce reports every three months capturing the frequency and types of calls received.

If requested, the third party will also provide assistance to deal with the concerns raised by the reported event using investigative professionals in one of their strategically positioned offices across the country. 

Remember - it's right to report a wrong

Compensation and Corporate Governance Mandate

Overall Purpose / Objective

The Compensation and Corporate Governance Committee is appointed by the Board of Directors to assist the Board in carrying out its responsibility for the stewardship of the Corporation as well as in meeting its disclosure and continued listing requirements. In terms of Human Resources, the Committee will examine the nomination of Directors and appointment of senior managers of the Corporation as well as their overall compensation and make appropriate recommendations to the Board; it will also lead in the development and review of a succession plan. With regards to Corporate Governance, the Committee has the general responsibility for developing the Corporation's approach to governance issues and recommending an effective corporate governance process to the Board consistent with the TSX guidelines.

In performing its duties, the Committee will maintain effective working relationships with the Board of Directors, management, and other Committees of the Board. To perform his or her role effectively, each Committee member will need to develop and maintain his or her skills and knowledge, including an understanding of the Committee's responsibilities and the Corporation's business operations and risks.

Authority

The Board authorizes the Compensation and Corporate Governance Committee, within the scope of its responsibilities, to:

  1. Perform activities within the scope of its Mandate;
  2. Ensure the attendance of Corporation officers at meetings, as appropriate;
  3. Request and gain access to members of management, employees and relevant information;
  4. Select, retain and terminate a compensation consultant to assist in the evaluation of the Chief Executive Officer or members of senior management compensation and to approve any compensation payable by the Corporation to such consultant, including the fees, terms and other conditions for the performance of such services;
  5. Obtain such advice and assistance from outside accounting, legal or other advisors as the Committee determines to be necessary or advisable in connection with the discharge of its duties and responsibilities hereunder;
  6. Pay to any compensation consultant or outside accounting, legal or other advisor retained by the Committee pursuant to the preceding paragraph such compensation, including, without limitation, usual and customary expenses and charges, as shall be determined by the Committee; and
  7. Establish procedures for dealing with the various aspects of their mandate.

Organization

Membership
  1. The Board of Directors will nominate the Compensation and Corporate Governance Committee members and the chairman of the Committee who will be an independent Director. In the absence of the Chairperson, a member of the Committee can act in the capacity of the Chair provided the quorum is maintained.
  2. The Compensation and Corporate Governance Committee shall consist of not less than three nor more than five members. There shall be a majority of independent, non-executive Directors of the Corporation. Replacements are appointed by the Board in case of resignation or vacancy.
  3. A quorum of any meeting will be two members by telephone or in person.
  4. Each member should have skills and experience commensurate with the discharge of such duties and responsibilities.
  5. Members will be appointed for a one-year term of office. However the Board of Directors may, by resolution, from time to time, remove any member of the Compensation and Corporate Governance Committee, with or without cause, or add to or otherwise change the membership of the Committee. A member of the Committee shall ipso facto cease to be a member of the Committee upon ceasing to be a director of the Corporation.
  6. If and whenever a vacancy shall exist on the Committee, the remaining members may exercise all its powers so long as a quorum remains.
  7. The secretary of the Committee will be the meeting secretary, or such other person as nominated by the Board.
Meetings
  1. Notice of the time and place of every meeting may be given orally, in writing, by facsimile or by other electronic means to each member of the Committee at least 48 hours prior to the time fixed for such meeting. A member may in any manner waive notice of the meeting. Attendance of a member at a meeting shall constitute waiver of notice.
  2. Meetings shall be held not less than twice a year at the call of the Chair. Teleconferences, although not the preferred meeting method, are acceptable.
  3. Special meetings may be called by the secretary of the Committee on the direction of the Chief Executive Officer and one member or any two members of the Committee.
  4. The secretary shall circulate the Agenda and supporting documentation to the Committee members a reasonable period in advance of each meeting.
  5. The Committee invites the Chief Executive Officer, the Board Chair and, as necessary, any other resource person except during a camera period where only the Committee members are entitled to attend. The Chair shall have the right to determine who shall and who shall not be present at any time during a meeting of the Committee.
  6. The secretary of the Committee shall circulate the minutes to members of the Board after approval of such minutes by the Chair.
  7. As a minimum, the Chair of the Committee (or another member of the Committee) shall attend the Board meeting at which a Committee report is tabled.

Roles and Responsibilities

The Compensation and Corporate Governance Committee will:

Human Resources
  1. Review the Human Resources policies and the organization of the Corporation, including employment, compensation, training and development;
  2. Review and approve corporate goals and objectives relevant to the compensation of the Corporation's President and Chief Executive Officer, evaluate the performance of the Chief Executive Officer in light of those goals and objectives, report the results of such evaluation to the Board and set the Chief Executive Officer's compensation level based on this evaluation;
  3. Oversee the engagement and termination, and the promotion and compensation of Senior Management reporting directly to the Chief Executive Officer and appointment of all officers of the Corporation, except for the Chief Executive Officer for whom the Committee shall make recommendations to the Board of Directors for its approval;
  4. Review, once a year or as needed, the human resource and succession planning for the Chief Executive Officer;
  5. Oversee the Corporation's regulatory compliance with respect to compensation matters;
  6. Oversee, if and to the extent required by applicable rules and regulations of any securities regulator or stock exchange, a report regarding executive compensation for inclusion in the Corporation's annual proxy circular or other public disclosure documents before the Corporation publicly discloses this information;
  7. Ensure that the Corporation's governance practices are fully disclosed in the management information circular or AIF, as appropriate;
  8. Take all reasonable steps to ensure that the Corporation's governance documents, specifically including the Corporation Policies on Business Conduct, the annual management information circular, and all Terms of References and Position Descriptions set out in the Terms of Reference for the Board, this Committee and the other committees are made available to any shareholder on request;
  9. Review and recommend to the Board the granting of options under any Options or Long-term Incentive Plans;
  10. Annually review all aspects of remuneration received by Board members, considering peer practices and the duties and responsibilities of the directors;
  11. Annually review, with the Chief Executive Officer, the Terms of Reference for the Chief Executive Officer and recommend any changes to the Board for consideration; and
  12. Review and recommend to the Board for consideration any significant changes to the overall compensation program and the Corporation's objectives related to executive compensation.
Corporate Governance
  1. Annually review Board processes and recommend changes to the Board where appropriate. This includes, but would not be limited to, reviewing the following:
    1. the strategic direction processes of the Board;
    2. the processes for monitoring performance of the Board;
    3. the adequate number and duration of Board meetings;
    4. the appropriateness of the annual schedule for regular Agenda items for Board meetings; and
    5. the appropriateness of the information provided to Directors both before and during Board meetings.
  2. Regularly review and assess the Corporation's policies on business conduct and ethics and recommend any changes to the Board for consideration;
  3. Once or more annually, review and assess the position descriptions for the Board Chair, each committee chair and the Chief Executive Officer and, in the Committee's discretion, recommend any changes to the Board for consideration;
  4. Once or more annually, review and assess the mandate for the Board and each Board committee and recommend any changes to the Board committees or Board, as applicable, for consideration;
  5. Ensure that all Directors receive the orientation and ongoing training necessary to effectively carry out their responsibilities; and
  6. Maintain a summary of legislation and other developments affecting the duties and responsibilities of Directors. Review and approve the annual regulatory disclosure of corporate governance compliance, as required.
Board and Committee Structure and Appointments
  1. Annually review the size, composition, scope, duties and responsibilities of the Board and its members, Board Chair and Board Committees and recommend any changes where advisable;
  2. Recommend the establishment or disbanding of Board Committees;
  3. Recommend the appointment of Board Committee members and Committee Chairs;
  4. Recommend candidates to fill Board, Committee and Committee Chair vacancies;
  5. Recommend, when required, a candidate for appointment to the office of Board Chair considering the performance, independence, competencies, skills, financial acumen, and ability to devote sufficient time and resources to his or her duties of the candidate and the Board, as a whole, to ensure effective governance and satisfy applicable law and make recommendations to the Board for consideration;
  6. Maintain an ongoing succession plan for Board members that takes into consideration the desired composition of the Board; the strengths, skills and experience of current Directors, expected retirement dates; the strategic direction of the organization and the financial market's need for strong independent representation;
  7. Develop and maintain a process and criteria for identifying, recruiting and appointing new Directors;
  8. Recommend to the Board nominees for election to the Board at the Annual meeting of Shareholders; and
  9. Advise the Board when an issue of conflict or potential conflict arises which may result in the tendering of a resignation by a Director.
Board Member Effectiveness
  1. Establish a process to review and monitor the effectiveness of the Board as a whole, its committees, individual Board members, the Chair of the Board, and chairs of Board Committees and make recommendations to the Board to enhance the development of corporate governance.
Reporting Responsibilities
  1. At each regular meeting, update the Board about Committee activities and make appropriate recommendations; and
  2. Ensure the Board is aware of matters that may significantly impact on the affairs of the business.
Other
  1. Review and make recommendations on functional and operational matters relating to the Board such as the requirement for Board meetings without management present;
  2. Monitor the quality of the relationship between management and the Board and recommend improvements deemed necessary or advisable;
  3. Generally, discuss recommendations with the Chief Executive Officer before making such recommendations to the Board;
  4. After consulting with the Chairman, consider and approve, in advance and if considered appropriate, reasonable requests from individual Directors to engage outside advisors in accordance with the organization's policy on the use of outside advisors;
  5. Annually review Directors and Officers third party liability insurance coverage;
  6. Exercise such other powers and perform such other duties and responsibilities as are incident to the purposes, duties and responsibilities of the Committee specified herein or as may from time to time be delegated by the Board;
  7. Review the Committee mandate at least annually or, where circumstances warrant, at such shorter intervals as is necessary, and discuss any required changes with the Board; and
  8. Ensure that the mandate is approved or re-approved by the Board.

 

Audit Committee Mandate

Overall Purpose/Objective

The Audit Committee is appointed by the Board of Directors of Parkland (the "Corporation") to assist the Board in discharging its oversight responsibilities. The Audit Committee will oversee the financial reporting process with a goal of ensuring the balance, transparency and integrity of published financial information of Parkland. The Audit Committee will also review: the effectiveness of Parkland's internal financial control and risk management system; the effectiveness of the internal audit function; the independent audit process including recommending the appointment and assessing the performance of the external auditor of Parkland; the Corporation's process for monitoring compliance with laws and regulations affecting financial reporting.

Parkland will comply with the policies and procedures overseen or reviewed by the Audit Committee and use their best efforts to ensure that these policies and procedures are implemented.

In performing its duties, the Audit Committee will maintain effective working relationships with the Board of Directors, management and the external auditors. To perform his or her role effectively, each Audit Committee member will need to develop and maintain his or her skills and knowledge, including an understanding of the Audit Committee's responsibilities and of the Corporation's business operations and risks.

The members of the Audit Committee will be financially literate and independent as defined by National Instrument 52-110. Audit Committee (NI 52-110)

Although the Audit Committee has the powers and responsibilities set forth in this Mandate, the role of the Audit Committee is oversight. The members of the Audit Committee are not full-time employees of the Corporation and may or may not be accountants or auditors by profession or experts in the fields of accounting or auditing and, in any event, do not serve in such capacity nor are they experts in performing other tasks they are called on to perform by this Mandate. Consequently, it is not the duty of the Audit Committee to conduct audits or to determine that the Corporation's financial statements and disclosures are complete and accurate and are in accordance with generally accepted accounting principles ("GAAP") and applicable rules and regulations. These are the responsibilities of management and the external auditor.

Authority

The Board authorizes the Audit Committee, within the scope of its responsibilities, to:

  1. Perform activities within the scope of this Mandate;
  2. Engage and compensate independent counsel and other advisers as it deems necessary to carry out its duties;
  3. Ensure the attendance of Corporate Officers at meetings as appropriate;
  4. Request and gain access to members of management, employees and relevant information to perform this Mandate;
  5. Establish procedures for dealing with the confidential, anonymous submissions by employees of the Corporation regarding accounting, internal control or auditing matters;
  6. Establish procedures for the receipt, retention and treatment of complaints received by the Corporation regarding accounting, internal controls or auditing matters;
  7. Approve the appointment, compensation, retention and annual scope of work of the external auditor;
  8. Approve all engagement fees and terms as well as reviewing policies for the provision of audit and non-audit services by the external auditors and the pre-approval of such non-audit work as required by NI 52-110; and
  9. Communicate directly with the internal and external auditors.

Organization

Membership
  1. The Board of Directors will appoint the Audit Committee members and the Chair of the Audit Committee.
  2. The Audit Committee will comprise at least three members and all members will be independent within the meaning set forth in NI 52-110 as amended from time to time, non-executive Directors of the Corporation.
  3. A quorum for any meeting of the Audit Committee will be two members.
  4. Each member should have skills and experience appropriate to the Corporation's business.
  5. Each member will be financially literate as defined by NI 52-110.
  6. Members will be appointed for a one year term of office.
  7. Each member of the Audit Committee shall be financially literate within the meaning set forth under NI 52-110.
  8. A member of the Audit Committee shall ipso facto cease to be a member of the Audit Committee upon ceasing to be a director of the Corporation.
Meetings
  1. Only Audit Committee members are entitled to attend meetings. The Audit Committee may invite such other persons to its meetings as it deems necessary.
  2. The external auditors will be invited to make presentations to the Audit Committee as appropriate.
  3. Meetings will be held not less than four times a year and should correspond with the Corporation's financial reporting cycle.
  4. Other meetings may be convened as required by the Audit Committee or the external auditors.
  5. The secretary of the Audit Committee will circulate the agenda and supporting documentation to the Audit Committee members at a reasonable period in advance of each meeting.
  6. The secretary of the Audit Committee will circulate the minutes of meetings to members of the Board, members of the Audit Committee, and where appropriate to the external auditors.
  7. At least one member of the Audit Committee will attend the Board meeting at which the financial statements are approved.
  8. Members of the Audit Committee should make every attempt to be available for every meeting of the Audit Committee in person or by conference call.
  9. The Audit Committee may call a meeting with outside legal counsel if it is deemed necessary.
  10. The Audit Committee will meet with the external auditor without management present at each meeting of the Audit Committee that the external auditor attends. Even if this meeting is only to determine that there are no issues that need to be discussed without management.
  11. The Audit Committee shall meet with the external auditors at least quarterly and otherwise as it deems appropriate to consider any matter that the Audit Committee or the external auditors determine should be brought to the attention of the Board or shareholders.

Roles and Responsibilities

The Audit Committee will:

Internal Control
  1. Have oversight responsibility for management reporting on internal controls;
  2. Review with the internal and external auditors of the Corporation the adequacy of internal control procedures and management information systems and make inquiries to management of the Corporation and the internal and external auditors of the Corporation about significant risks and exposures to the Corporation that may have a material adverse impact on the Corporation's financial statements and about the efforts of the management of the Corporation to mitigate such risks and exposures;
  3. Review recommendations made by the internal and external auditors; and
  4. Monitor policies and procedures relating to directors' and officers' expenses and the reimbursement thereof and relating to any perquisites paid to directors and officers.
Financial Reporting
  1. Gain an understanding of the current areas of greatest financial and internal control risk and of how these are being managed;
  2. Review significant accounting and reporting issues, including recent professional and regulatory pronouncements, and understand their impact on financial reports;
  3. Oversee the periodic financial reporting process implemented by management and review the interim financial statements, annual financial statements MD & A, and relevant news releases or announcements and any other financial information related to the Corporation to be provided to shareholders prior to their release;
  4. Recommend for approval to the Board the Corporation's audited annual and interim financial statements, related management's discussion and analysis and earnings news releases;
  5. Meet with management and the external auditors to review the financial statements and the key accounting policies and judgments;
  6. Review with the external auditors of the Corporation and/or management of the Corporation the results of the annual audit, and make appropriate recommendations to the Board having regard to, among other things:
    1. the financial statements;
    2. management's discussion and analysis and related financial disclosure contained in continuous disclosure documents;
    3. significant changes, if any, to the initial audit plan;
    4. accounting and reporting decisions relating to significant current year events and transactions;
    5. the management letter, if any, outlining the external auditors' findings and recommendations, together with management's response, with respect to internal controls and accounting procedures; and
    6. any other matters relating to the conduct of the audit, including such other matters which should be communicated to the Committee under generally accepted auditing standards.
  7. Review significant adjustments, material unadjusted differences, significant disagreements with management and critical accounting policies and practices and the Corporation's responses to these queries; and
  8. Ensure its compliance with all of the applicable requirements of NI 52-110 and for reporting any non-compliance with such requirements to the Board, including the reasons for such non-compliance.
Annual Operating and Capital Budgets
  1. Review the annual operating and capital budgets and recommend approval to the Board.

Compliance with Laws and Regulations

  1. Review the effectiveness of the system for monitoring compliance with laws and regulations;
  2. Obtain regular updates from management regarding compliance matters that may have a material impact on the Corporation's financial statements or compliance policies;
  3. Review the reports of management on regulatory compliance matters related to the business of the Corporation in the preparation of the financial statements; and
  4. Review the findings of material reports by regulatory agencies.
Working with Auditors
  1. Advise the external auditors of their accountability to the Audit Committee and the Board as representatives of the shareholders of the Corporation to whom the external auditors are ultimately accountable. The external auditors of the Corporation shall report directly to the Audit Committee;
  2. Review the professional qualification of the auditors, including background and experience of partner and auditing personnel;
  3. Ensure compliance by the Corporation's external auditors with the requirements set forth in National Instrument 52-108 Auditor Oversight;
  4. Ensure that the Corporation's external auditors are participants in good standing with the Canadian Public Accountability Board ("CPAB") and participate in the oversight programs established by the CPAB from time to time and that the external auditors have complied with any restrictions or sanctions imposed by the CPAB as of the date of the applicable auditor's report relating to the Corporation's annual audited financial statements;
  5. Obtain from the external auditors of the Corporation a formal written statement describing in detail all of the relationships between the external auditors and the Corporation, determine whether the non-audit services performed by the external auditors during the year have impacted their independence, ensure that no relationship between the external auditors and the Corporation exists which may affect the independence of the external auditors and take appropriate action to ensure the independence of the external auditors;
  6. Review on an annual basis the performance of the external auditors and make recommendations to the Board for the appointment, reappointment or termination of the appointment of the external auditors;
  7. Review all correspondence and memoranda relating to all audit and non-audit engagements provided by external auditors in relation to the Corporation's present circumstances and changes in regulatory and other requirements;
  8. Discuss with the external auditor any audit problems encountered in the normal course of audit work, including any restriction on audit scope or access to information;
  9. Ensure that significant findings and recommendations made by the external auditors and management's proposed response are received, discussed and appropriately acted on;
  10. Discuss with the external auditor the appropriateness of the accounting policies applied in the Corporation's financial reports and/or any significant changes to the Corporation's accounting policies, principles or practices;
  11. Meet separately with the external auditors to discuss any matters that the Audit Committee or auditors believe should be discussed privately. Ensure the auditors have access to the Chair of the Audit Committee when required;
  12. Review policies for the provision of non-audit services by the external auditors and, if required, the pre-approval of such non-audit work;
  13. Review and approve the Corporation's hiring policies regarding partners, employees and former partners and employees of the present and former external auditors of the Corporation;
  14. Review management's proposed internal control plan for the coming year and ensure that there is appropriate co-ordination with the external auditor; and
  15. Perform all other functions required of Audit Committees by applicable regulatory authorities in connection with the termination or resignation of an auditor;
Reporting Responsibilities
  1. Regularly update the Board about Audit Committee activities and make appropriate recommendations;
  2. Ensure the Board is aware of matters brought to the attention of the Audit Committee that may significantly impact on the financial condition or affairs of the Corporation;
  3. Prepare any reports required by regulations on the Audit Committee's Mandate and activities to be included in the section on Corporate Governance in the Annual Report; and
  4. Review the disclosure contained in the Corporation's annual information form as required by Form 52-110F1 Audit Committee Information Required in an AIF (“Form 52-110F1”)attached to NI52-110. If management of the Corporation solicits proxies from shareholders of the Corporation for the purpose of recommending persons to be elected as directors of the Corporation, the Audit Committee shall be responsible for ensuring that the Corporation's information circular includes a cross-reference to the sections in the Corporation's annual information form that contain the information required by Form 52-110F1
  5. Ensure the preparation and filing of each annual certificate in Form 52-109F1 Certification of Annual Filings full Certificate and each interim certificate in Form 52-109F2 Certification of Interim Filings ful Certificate to be signed by each of the Chief Executive Officer and Chief Financial Officer of the Corporation in accordance with the requirements set forth under NI 52-109 as amended from time to time;
  6. Ensure that management of the Corporation establishes and maintains disclosure controls and procedures for the Corporation that are designed to provide reasonable assurance that material information relating to the Corporation, including its consolidated subsidiaries, is made known to management of the Corporation by others within those entities, particularly during the period in which the annual filings or interim filings are being prepared and that management of the Corporation establishes and maintains internal control over financial reporting for the Corporation that has been designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the Corporation's generally accepted accounting principles. In respect of annual filings only, the Audit Committee is also responsible for ensuring that management of the Corporation evaluates the effectiveness of the Corporation's disclosure controls and procedures as of the end of the period covered by the annual filings and has caused the Corporation to disclose in the annual management's discussion and analysis its conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by the annual filings based on such evaluation. The terms "annual filings," "interim filings," "disclosure controls and procedures" and "internal control over financial reporting" shall have the meanings set forth under NI 52-109 -; and
  7. Monitor any changes in the Corporation's internal control over financial reporting and for ensuring that any change that occurred during the Corporation's most recent interim period that has materially affected, or is reasonably likely to materially affect, the Corporation's internal control over financial reporting is disclosed in the Corporation's annual management's discussion and analysis.
Evaluating Performance
  1. Evaluate the Audit Committee's own performance, both of individual members and collectively, on an annual basis; and
  2. Assess the achievements of the duties of the Audit Committee specified in the Mandate and report the findings to the Board.

Review of the Audit Committee Mandate

The Compensation and Corporate Governance Committee, with input by all Board members and management, will review these terms of reference at least annually or, where circumstances warrant, at such shorter intervals as is necessary, to determine if further additions, deletions or other amendments are required.

Appendix A

Confidential Information Policy

An underlying principle of securities legislation is that the public should have the opportunity to decide whether to buy or sell securities on the basis of information equally available to all. Directors, officers and employees of a corporation sometimes acquire knowledge of material information concerning the business and affairs of the corporation (or a related corporation) which has not yet been disclosed to the public. If that is the case, they have an unfair advantage in purchasing or selling securities because the seller or purchaser on the other side of the transaction may have made a different investment decision had they been aware of that information.

Similarly, if such a person informs another person of undisclosed material information, and such person purchases or sells securities on the basis of that information, the seller or purchaser on the other side of the transaction is, once again, at a disadvantage.

Certain securities laws in Canada have been enacted so as to prevent and deter such inequitable trading in securities. Parkland has formulated a policy to assist directors, officers and employees of Parkland in complying with these laws. The purpose of this memorandum is to advise directors, officers and employees of Parkland of such policy and some of the legal repercussions of failing to adhere to this policy. Persons who are “insiders” of Parkland and other persons who regularly come into contact with confidential information must also adhere to Parkland’s Securities Trading and Reporting Policy for Restricted Persons.

Italicized terms used in this Policy have the meaning set forth in the Definitions section of this Policy.

  1. Access to Undisclosed Material Information shall be limited to employees who have a “need to know” such information.
  2. No Employee or other Restricted Person having knowledge of Undisclosed Material Information relating to, or involving Parkland or another party involved in an activity or a negotiation with Parkland shall:
    1. disclose such information to a Tippee other than in the necessary course of business with the express written consent of the director, officer or manager of Parkland responsible for the activity or negotiation;
    2. buy or sell, or acquire an option to buy or sell, any of Parkland’s securities or securities of a third party involved in such activity or negotiation; or
    3. participate in discussions regarding decisions by others about investments in Parkland or other companies involved in the matter;
    4. before such material information has been fully disclosed to the public and a reasonable period of time for dissemination has passed (which for the purposes of this policy shall be considered to be at least two clear days following the day of the disclosure to the public) or until the activity or negotiation giving rise to the Undisclosed Material Information has terminated.
  3. The director, officer or employee of Parkland responsible for an activity or negotiation which, if known, might reasonably be expected to affect the market price or value of Parkland’s securities or that of other parties involved in such activity or negotiation shall be responsible for initiating adequate procedures and controls to restrict the knowledge of such event in accordance with this policy and applicable laws, including:
    1. restricting participation or knowledge of such project to the minimum number of Employees practicable;
    2. notifying all involved Employees and Restricted Persons of their “insider status” and confidentiality obligations in writing;
    3. maintaining a list of all persons who are aware of the activity; and
    4. instituting necessary controls to provide adequate security and to monitor the observance of such controls.
  4. In addition to any precautions which may be imposed on Employees and Restricted Persons by the person responsible for a matter, the following general precautions shall be adopted:
    1. ensure all correspondence concerning the matter is labeled “CONFIDENTIAL”;
    2. refrain from open discussions concerning the matter where other persons not “in the know” are in the vicinity;
    3. do not leave correspondence and other documents concerning the matter in view in your working area and keep them in a secure area;
    4. if the matter has been assigned a code name, use the code name on all correspondence and refrain from using specific corporate names whenever possible; and
    5. report any information leaks or suspected information leaks to the person responsible for the matter.
Consequences of Non Compliance with Policy
  1. Employees, Restricted Persons or Tippees may, under some circumstances, be subject to prosecution which may result in fines or imprisonment or both. In addition to fines, violation may result in liability to shareholders affected.
  2. Parkland may be held liable for damages resulting from misleading or untrue statements or the failure to disclose information on a timely basis, and the reputation and standing of Parkland and its Employees in the community may be tarnished.
  3. Securities’ exchanges could require the untimely disclosure by Parkland of information to stop or confirm rumors.

Strict compliance with this Policy is required. An Employee who fails to adhere to this Policy may be subject to disciplinary action by Parkland, which could result in termination of employment.

Definitions

The following definitions are used in the Policy on confidential information:

Employee means all officers, employees and agents of Parkland, whether such employees and agents be managers, accountants, maintenance and support personnel, salesmen, secretaries, clerks, drivers or independent contractors;

Restricted Person includes all directors, officers and other insiders of Parkland as determined from time to time in accordance with Canadian Securities laws;

Tippee means an individual who obtains or receives Undisclosed Material Information from an Employee or Restricted Person and any persons who substantially receive such information, where such persons knew or ought reasonably to have known that the information originated from an Employee or Restricted Person;

Undisclosed Material Information means any information relating to the business and affairs of Parkland that when released would result in or would reasonably be expected to result in significant change in the market price or value of Parkland’s shares (or the securities of other companies with whom Parkland may be conducting confidential negotiations). Examples of information which may be Undisclosed Material Information include:

  1. changes in share ownership that may affect control of Parkland;
  2. changes in corporate structure, such as amalgamation;
  3. take-over bids in respect of Parkland’s securities or securities of another company or bids by Parkland for its own securities;
  4. major corporate acquisitions or dispositions;
  5. change in capital structure of Parkland and distributions decisions;
  6. borrowing of a significant amount;
  7. public or private sale of additional securities of Parkland;
  8. significant development affecting Parkland’s resources, technology, products or markets;
  9. entering into or loss of significant licenses or contracts;
  10. firm evidence of significant increases or decreases in near term earnings prospects;
  11. changes in capital investment plans or corporate objectives;
  12. significant changes in management;
  13. significant litigation;
  14. major disputes with major contractors, suppliers or customers;
  15. events of default under financing or other agreements; and
  16. any other developments relating to the business and affairs of Parkland that would reasonably be expected to significantly affect the market price or value of any of Parkland’s securities or that would reasonably be expected to have a significant influence on a reasonable investor’s investment decision.

Appendix B

Securities Trading and Reporting Policy for Restricted Persons 

This policy applies to all employees, in certain specified circumstances, and to insiders in all circumstances.

1. Definition of Insider

The definition of an “insider” in is set out in the Business Corporations Act (Alberta), under which Parkland Fuel Corporation (herein defined as the "Corporation" in this Appendix B) was incorporated, which is quite broad. However, because prospectuses covering public offerings of Parkland’s securities have been filed in other jurisdictions, Parkland and its insiders are subject to securities laws of those jurisdictions which include, amongst others, Alberta, Saskatchewan, Manitoba, British Columbia, Ontario and the Atlantic Provinces. The ‘insider” definition may vary from statute to statute. Please be cautioned, however, that the definition will encompass directors, officers and certain employees of the subsidiary companies of the Corporation.

2. Insider Reporting

Initially, a report is required to be filed within five (5) calendar days after the person becomes an insider. Thereafter, a “change” report is required to be filed within five (5) calendar days after any change takes place. The reports require disclosure as to direct or indirect holdings and as to options rights, etc.

It is the practice of the Corporation for the insiders to complete the insider reports and file the signed copies with the securities commissions and any other regulatory bodies concerned, directly. However, some directors and officers of the Corporation have appointed an agent to complete and file the reports on their behalf. The agent cannot assume any responsibility attached to any insider in affording the service; it is the responsibility of each insider to determine whether to report, what to report and when to report.

Filings are made electronically via SEDI. There are, of course, penalties prescribed for default in filing, consisting of fines or imprisonment or both. For example, failure to file insider reports as prescribed under the Securities Act (Alberta) can lead to a fine or imprisonment, or both.

3. Tipping and Special Relationship Trading

There are other statutory provisions dealing with prohibitions against and penalties pertaining to trading or tipping under Canadian securities laws, which includes, among other things, persons or corporations in a special relationship with the Corporation.

4. Insider Information and Disclosure

Employees and insiders are prohibited from using “material information” which has not been made public to trade in securities. This prohibition applies to all employees and insiders of Parkland.

“Material changes” are changes in the business, operations or affairs of an issuer that are likely to affect significantly the market price or value of its securities. Such changes trigger a timely disclosure obligation. The issuer must publish a news release and file a material change report.

“Material facts” are facts that are likely to have a similar effect on the issuer’s securities as material changes, but they need not constitute a change in its business, operations or affairs. It also includes information that is likely to affect the issuer’s share price but that is not a change in its business or affairs.

Material changes and material facts are “material information” under stock exchange and timely disclosure policies and under the securities commissions’ National Instrument 51-201. Securities laws prohibit any trading by anyone who has knowledge of a material change or a material fact about an issuer or its securities. An underlying principle of securities legislation is that the public should be able to make a decision to buy or sell an issuer’s securities on the basis of information equally available to all.

5. Insider Trading and Blackout Periods

Employees and insiders may trade in securities of the Corporation’s securities directly or indirectly, or in securities of the Corporation over which they exercise control or direction except as follows:

  1. Trading by employees and insiders is prohibited when the employee or insider is in possession of material information which is being kept confidential and which has not been disclosed to the public.
  2. The appropriate person with overall responsibility for a project will consult with the President and CEO, Vice President and CFO or the General Counsel and Corporate Secretary to determine if a blackout period should be imposed and which employees would be affected by such a blackout period. The President and CEO, Vice President and CFO or the General Counsel and Corporate Secretary will, by email or other form of written communication, advise all directors, officers and those employees deemed to be in possession of undisclosed material information to refrain from trading until otherwise advised, or two (2) business days after the release of the appropriate news release, whichever is the earlier.

    Except as set out in Section 5.6 below, no trading will take place by directors, officers, management personnel or optionholders beginning ten (10) business days prior to and ending two (2) complete business days after the release of the financial results of the Corporation through the appropriate news release for the quarter.

    An insider who is in possession of undisclosed material information that may affect current or future earnings of the Corporation, will consult with the President and CEO, Vice President and CFO or the General Counsel and Corporate Secretary to determine if a blackout period should be imposed and which employees would be affected by such a blackout period. The President and CEO, Vice President and CFO or the General Counsel and Corporate Secretary will, by email or other form of written communication, advice all directors, officers and those employees deemed to be in possession of the undisclosed material information to refrain from trading until two (2) complete business days after the release of the appropriate news release.
  3. In circumstances where the Corporation is contemplating a major transaction or activity that could raise the Corporation’s profile in the marketplace, the President and CEO, Vice President and CFO or the General Counsel and Corporate Secretary will, by email or other form of written communication, advice all directors, officers and if deemed advisable or necessary, all or certain employees to refrain from trading.
  4. Employees who feel they are in possession of material undisclosed information should consult with the President and CEO, Vice President and CFO or the General Counsel and Corporate Secretary, prior to trading in securities of the Corporation.
  5. Exercising options will constitute a trade for the purposes of this policy and accordingly, no option will be exercised during a blackout period. If the expiry of an option falls within the blackout period, then the expiry date will be adjusted to accommodate the exercise of the option so that the person has at least 30 days from the expiry of the blackout period to exercise their option.
  6. An insider who is not in possession of any undisclosed material information may, with the prior written consent of the President and CEO, Vice President and CFO or the General Counsel and Corporate Secretary, trade securities during a blackout period. An insider may also trade securities during a blackout period where the trade is simply a transfer of shares from a non-registered account to a registered account of, or controlled by, the insider.  
6. Summation

The ability to capitalize on insider knowledge pertaining to the Corporation is not one of the perquisites of our respective positions. Insiders have an obligation to anticipate the market response to events involving or affecting the Corporation, to advise the appropriate employees and for all insiders and employees to govern their professional behavior and dealings in securities of the Corporation in such manner as to preclude the exposure of themselves or the Corporation to penalty or adverse publicity.

Appendix C

Related Parties Transactions Policy

Context

From time to time and for various reasons, it may be beneficial to Parkland Fuel Corporation (herein referred to as the “Corporation” in this Appendix C) to enter into agreements with suppliers, customers or others that are “related” to the Corporation.

It is the Corporation’s objective to maintain the trust and confidence of its shareholders, customers, suppliers and the public in general with regard to the fairness of those transactions, and to ensure proper public disclosure of related party transactions.

Goal

The goal of this policy is to ensure the integrity of any transactions of the Corporation and its various subsidiaries involving related parties, as well as ensuring compliance with laws and regulations that pertain to those transactions.

This policy is intended to raise awareness of the Corporation’s approach to related party transactions and to assist in maintaining the Corporation’s adherence to the best corporate governance practices.

Definitions

In this policy, the following terms have the following meanings:

  • Board of Directors” means the Board of Directors of Parkland.
  • Committee” means the Audit Committee of the Board of Directors.
  • Management” means the President and CEO, the Vice President and CFO and any of the other officers or senior managers of Parkland.
  • Parkland” means Parkland Fuel Corporation and its affiliates.
  • Parties are said to be “related parties” when one party has the ability to exercise, directly or indirectly, control, joint control or significant influence over the other.
  • A “related party transaction” may generally be defined as any transaction, regardless of whether any consideration is exchanged, between, on the one hand, the Corporation, Parkland or any of their affiliates, and on the other hand, any of their respective directors, officers, senior employees or significant shareholders, or any individuals or entities affiliated or associated with such persons, including immediate family. 
  • Required Disclosure” means all continuous and timely disclosure documents required to be filed by the Corporation pursuant to applicable securities laws, and includes all news releases and material change reports, financial statements and management’s discussion and analysis of financial results.
Review Process

All related party transactions must be reviewed and approved by the Committee in accordance with the terms of this policy. Where it is unclear whether a transaction is a related party transaction, the transaction should be referred to the Committee for its review and determination.

The Committee shall ensure that, for each such transaction:

  1. all applicable laws, rules, regulations and policies are fully met;
  2. the contract governing the transaction contains all appropriate and customary terms to properly protect Parkland; and
  3. the consideration to be paid by Parkland is fair and reasonable in the circumstances.

Management shall be responsible for evaluating the proposed transaction against alternative arm’s length transactions, negotiating the transaction, and preparing a report to the Committee with sufficient detail so as to permit the Committee to fulfill its duties.

The report from Management to the Committee shall include:

  1. a description of the transaction under consideration, with a description of the payment terms (including form of payment) and timing;
  2. confirmation that the transaction meets the standards outlined above and a summary of the analysis leading to that conclusion, including, as appropriate, any arm’s length comparisons which may be available;
  3. any additional or supporting documents deemed appropriate; and
  4. the final recommendation from Management to the Committee.

The Committee shall review the report with Management and any other advisors it considers necessary, and shall make its final recommendation to the Board of Directors.

Disclosure

The Committee shall determine if any given related party transaction should be disclosed by the Corporation to the public. The Committee shall review all Required Disclosure relating to related party transactions prior to its public dissemination.

Distribution of Policy

This policy extends to all of Parkland’s directors, officers and employees. New directors, officers, senior management, as well as employees who are or may be directly involved in disclosure decisions shall be provided with a copy of this policy and shall be informed about its importance. This policy shall be circulated to all such personnel initially and whenever changes are made. Written confirmations of receipt may be required in the discretion of Management.

Amendments

This policy may be amended from time to time by approval of the Committee and the Board of Directors. Any amendments to this policy shall be provided to persons subject to the policy.

Review of Policy

This policy shall be reviewed by the Committee on at least an annual basis with the assistance of outside legal counsel, as appropriate, to ensure its continued compliance with applicable securities laws, regulations and policies and to otherwise ensure that it reflects the best interests of the Corporation and best corporate governance practices.

Appendix D

Blackout Period Summary

When trading (buying or selling) in the corporation's shares is prohibited

1. Trading by any director or employee is prohibited when such director or employee is in possession of material undisclosed information until two (2) complete business days after the appropriate news release disseminating the information has been made.

2. The financial results of the Corporation are made public after the Audit Committee and the Board of Directors have approved the financial statements of the Corporation. Except as set out in the policy, no trading will take place by directors, management personnel and optionholders beginning ten (10) business days prior to and ending two (2) complete business days after the release of the financial results through the appropriate news release for the quarter. The next financial quarter release date is known by reference to the latest quarterly report and a schedule of yearly release dates will be circulated.

3. In circumstances where the Corporation is contemplating a major transaction or activity that could raise the Corporation’s profile in the marketplace, the President or the President and CEO, Vice President and CFO or the General Counsel and Corporate Secretary will, by email or other form of written communication, advise all directors, management personnel and if deemed advisable or necessary, all or certain employees to refrain from trading.

4. Employees who feel they are in possession of material undisclosed information should consult with the President and CEO, Vice President and CFO or the General Counsel and Corporate Secretary, prior to trading in securities of the Corporation.

5. Exercising options will constitute a trade for the purposes of this policy and accordingly, no option may be exercised during a blackout period. If the expiry date of an option falls within the blackout period, then the expiry date will be adjusted to accommodate the exercise of the option.

6. An insider who is not in possession of any undisclosed material information may, with the prior written consent of the President and CEO, Vice President and CFO or the General Counsel and Corporate Secretary, trade securities during a blackout period. An insider may also trade securities during a blackout period where the trade is simply a transfer of shares from a non-registered account to a registered account of, or controlled by, the insider.