ZCL COMPOSITES INC.
For the Annual General and Special Meeting
to be held on August 18, 2003
This Information Circular is furnished in connection with the solicitation of proxies by the management
of ZCL Composites Inc. (the “Corporation”) for use at the Annual General and Special Meeting of the
Corporation (the “Meeting”) to be held at The Westin Edmonton, British Columbia Conference Room, 2nd
Floor, 10135 – 100 Street, Edmonton, Alberta, on Monday, August 18, 2003 at 1:00 p.m. (Edmonton time) and
at any adjournment or adjournments thereof, for the purposes set forth in the accompanying Notice of Annual
General and Special Meeting (the “Notice”). Except as otherwise stated, the information contained herein is
given as of June 30, 2003 and all amounts are reported in Canadian dollars.
BUSINESS TO BE TRANSACTED
Election of Directors
The affairs of the Corporation are managed by a Board of Directors who are elected annually for a one year
term at each Annual General Meeting of the shareholders and hold office until the next Annual General
Meeting, or until their successors are duly elected or appointed or until a director vacates his office or is
replaced in accordance with the by-laws of the Corporation.
The shareholders are entitled to elect the directors of the Corporation. The persons named below have been
nominated for election and have consented to such nomination.
Unless authority to vote on the election of directors is withheld, it is the intention of the persons named in
the accompanying instrument of proxy to vote for the election of such nominees as directors. In the
event that a vacancy among the nominees occurs for any reason prior to the Meeting, the proxy shall not
be voted with respect to such vacancy.
The following are the names and municipalities of residence of the proposed nominees for election as
directors of the Corporation:
NAME AND OFFICE PRINCIPAL OCCUPATION DIRECTOR NUMBER OF
MUNICIPALITY SINCE COMMON SHARES
OF RESIDENCE HELD DIRECTLY OR
Venence G. Côté President, Chief Mr. Côté is the Corporation's September 14, 118,912(4)
Beaumont, Alberta Executive Officer President (since April 12, 1989) and 1987
and Director Chief Executive Officer (since
October 3, 1987); prior thereto Mr.
Côté was a manager of CAE
The Honourable James S. Director, Mr. Edwards is presently the August 19, 2002 5,000
Edwards, P.C. Edmonton, Chairman of the Chairman of the Board of Governors
Alberta Board for the University of Alberta, the
Chair for the Strategy Council for
the Alberta Cardiac Centre of
Excellence and a member of the
Board of Trustees for the Alberta
Ingenuity Fund; prior thereto he was
President and CEO of Economic
Development Edmonton and from
1984 to 1993 was an Edmonton
Member of Parliament wherein he
was sworn to the Privy Council
when he joined the Federal Cabinet
as President of the Treasury Board.
Simon Sochatsky Director Mr. Sochatsky has been President of March 7, 2000 2,028,823(5)
Sherwood Park, Alberta the Northern Industrial Carrier
Group of Companies since 1988.
Fred J. Dyment(1) Director Fred Dyment is an independent September 18, 250,000
Calgary, Alberta businessman. From November 2002
2001 to May 2002, he was
President & CEO of Maxx
Petroleum. For 9 years prior, he
was President & CEO of Ranger
Oil Ltd. He currently serves on the
Boards of ARC Resources, Tesco
Corporation and other private
Roderick W. Graham(1) Director Mr. Graham is presently a Senior September 18, Nil
Calgary, Alberta Vice-President (Service, New 2002
Energy & Technology Group) at
ARC Financial Corporation; prior
thereto he was an Oil and Gas
Research Analyst with RBC
Dominion Securities; and prior
thereto he was a Senior Investment
Analyst with ARC Financial
(1) The Audit Committee currently consists of John (Ian) Brown, Raymond Desormeaux, Fred J. Dyment and Roderick W.
Graham. John (Ian) Brown and Raymond Desormeaux are not standing for re-election at the upcoming Meeting.
(2) Information as to shares beneficially owned, directly or indirectly, or over which control or direction is exercised, is based
upon information furnished to the Corporation by the nominees.
(3) Certain of the directors of the Corporation hold options to acquire common shares which have not been included in
determining the number of common shares held, directly or indirectly, by the directors.
(i) 42,300 common shares held by Côté Holdings Ltd., of which Mr. Côté shares voting and investment power with
(ii) 1,200 shares held by Mr. Côté's spouse; and
(iii) 75,412 common shares held directly.
(i) 676,630 common shares held directly; and
(ii) 1,352,193 common shares held by Quattro Capital Inc., an Alberta corporation controlled by Mr. Sochatsky.
All of the nominees have held the principal occupations set forth above for at least the past five years.
Appointment and Remuneration of Auditors
The shareholders will be asked at the Meeting to vote for the appointment of Ernst & Young LLP, Chartered
Accountants, of Edmonton, Alberta, as the auditors of the Corporation, for the ensuing year and to authorize the
directors to fix their remuneration.
Ernst & Young LLP have been the auditors of the Corporation since first appointed on August 12, 1994.
Reduction of Stated Capital
The Corporation is desirous of eliminating the deficit to the Corporation’s retained earnings. As such, the
Corporation requests that the shareholders consider, and if thought fit, approve at the Meeting of the
Shareholders, a special resolution substantially in the form set forth below:
“BE IT RESOLVED AS A SPECIAL RESOLUTION THAT:
(i) The contributed surplus and stated capital accounts of the Corporation be reduced by $745,000 and
$8,298,566 respectively, in order to eliminate the Corporation's deficit as at March 31, 2003, and (ii) the
directors of the Corporation may revoke this special resolution before it is acted upon without further
approval of the Shareholders."
On September 27, 2002 the Corporation completed a private placement equity financing with ARC Energy
Venture Fund 3 ("ARC") of 7,368,422 units ("Unit") at $0.95 per Unit for total proceeds of $7,000.000.
Each Unit was comprised of one Common Share and 0.5 of a Performance Warrant (the "Warrant"). Each
whole Warrant entitles the holder to subscribe for one Common Share at a price of $0.95 for a period of up
to five years subject to a performance vesting provision. The Warrants vest in one-third intervals upon the
weighted-average trading price of the Common Shares reaching thresholds, for a period of twenty trading
days, of $1.90, $2,85 and $3.80 per Common Share.
ARC is contractually committed to transferring 1,842,105 of the Warrants (the "Transferred Warrants") to
management of the Corporation, in amounts and to persons to be approved by the Board of Directors,
subject to the Corporation's complying with the Toronto Stock Exchange's ("TSX") requirement that the
shareholders approve, by ordinary resolution at the Meeting, the transfer of such Warrants to insiders of the
Corporation. Subject to the foregoing, the Board of Directors has approved and is committed to the transfer
of 750,000 Warrants to Mr. Ven Côté, 400,000 Warrants to Mr. Tony Barlott, 175,000 Warrants to Mr. Fink
and 150,000 Warrants to Mr. Gary Steadman which totals 1,475,000 of the Transferred Warrants. The
remaining 367,105 Transferred Warrants shall be transferred to members of management, as the Board of
Directors considers appropriate in the future. ARC has further committed to voting its Common Shares in
favour of this resolution. Messrs. Côté, Barlott, Fink and Steadman will not be voting any Common Shares
that any of them beneficially own in favour of this resolution.
As such, the Corporation requests that the shareholders consider, and if thought fit, approve at the Meeting
of Shareholders, an ordinary resolution substantially in the form set forth below:
"BE IT RESOLVED AS AN ORDINARY RESOLUTION THAT:
The shareholders hereby approve and authorize the Board of Directors to transfer the Transferred Warrants
to members of management of the Corporation as the Board of Directors considers appropriate and
advisable in their discretion."
STATEMENT OF CORPORATE GOVERNANCE PRACTICES
The TSX has guidelines which require that all TSX listed companies disclose on an annual basis their approach
to corporate governance (the “Guidelines”). The Corporation’s Board of Directors endorses the practice of
sound corporate governance.
Mandate of the Board
The Corporation’s Board of Directors has the duty to oversee the management of the business and the affairs of
the Corporation. In addition to fulfilling all statutory requirements, the Board of Directors oversees and reviews
either directly or through committees:
(i) strategic planning matters and review of and guidance for corporate objectives and strategies;
(ii) the identification of the principal risks of the Corporation and the adequacy of risk-management
(iii) senior management performance and succession planning;
(iv) the structure which ensures effective communication between the Corporation, its shareholders and the
(v) the system that is in place for monitoring the implementation of corporate objectives; and
(vi) the integrity of the Corporation's internal control and management information systems.
Composition of the Board
The Guidelines focus on the constitution and independence of boards of directors. The term ( “unrelated
director” means a director who is independent of management and is free from any interest and any business or
other relationship which could, or could reasonably be perceived to, materially interfere with the director’s
ability to act with a view to the best interests of the Corporation, other than interests and relationships arising
from shareholdings; and (ii) “outside director” means a director who is independent of management.
The Board of Directors has reviewed its size and composition on an on-going basis and has agreed that the
present constitution (i.e. seven Board members) of the Board should be reduced as such size does not facilitate
effective decision making. Accordingly, the Board recently passed a resolution to reduce its size from seven to
five members effective as at the Meeting.
The Board presently has six unrelated directors and one related director. The proposed nominees, if elected,
would result in the Board having four unrelated directors and one related director. In deciding whether a
particular director is or is not a "related director" the Board examined the factual circumstances of each director
and considered them in the context of many factors.
The Corporation does not have a significant shareholder as defined by the Guidelines. Shareholders holding
more than 10% of the common shares are identified under Voting Shares and Principal Holders Thereof below.
The committees of the Board consist of an Audit Committee (which is comprised exclusively of unrelated
directors), a Compensation Committee (which is comprised of a majority of unrelated directors) and a
Governance Committee (which is comprised exclusively of unrelated directors). As and when required, ad hoc
committees of the Board will be appointed. As the Board has plenary power, any responsibility which is not
delegated to management or a Board committee remains with the Board. Occasionally an individual member
of the Board has retained outside advisors at the expense of the Corporation. The Board and management
consider such requests on their merits.
The Board, either directly or through a committee, has on an ongoing basis addressed certain governance and
other issues such as:
(i) monitoring the quality of the relationship between management and the Board;
(ii) reviewing and monitoring the organizational structure and succession planning matters;
(iii) assessing the need for new or replacement directors and providing orientation and education to new
recruits to the Board;
(iv) assessing the effectiveness of the Board and its committees;
(v) developing and recommending general policies and objectives;
(vi) reviewing the Corporation’s approach to corporate governance;
(vii) reviewing requests from board members or committees to obtain outside advisors at the Corporation’s
(viii) developing terms of reference for the committees of the Board and senior management.
The Audit Committee reviews, reports and, where appropriate, makes recommendations to the Board on:
(i) the terms of engagement of the auditors, the external audit plan and the results of the audit;
(ii) the integrity of the financial reporting process including ensuring compliance with accounting
principles, the reasonableness of judgments and estimates, and appropriate internal controls;
(iii) appropriateness of significant accounting policies;
(iv) all material public disclosure documents, including quarterly and annual financial reports and
(v) auditor independence issues including non-audit services and fees.
The Audit Committee is presently composed of John (Ian) Brown, Raymond Désormeaux, Fred J. Dyment
and Roderick W. Graham. All four members of the Audit Committee are outside and unrelated directors.
Expectations of Management
The Board expects management to develop and implement strategic and operational plans for the Corporation
and to achieve the objectives of ensuring the realization of maximum profits compatible with the best interests
of employees, consumers and shareholders, and to ensure the security and growth of invested capital.
VOTING SHARES AND PRINCIPAL HOLDERS THEREOF
There are 17,716,920 common shares of the Corporation issued and outstanding, each such common share
carrying the right to one vote on a ballot at the Meeting.
Set out below are the names of all persons or companies who, to the knowledge of the directors or senior
officers of the Corporation, beneficially own, directly or indirectly, or exercise control or direction over, voting
securities carrying more than 10% of the voting rights attached to all issued and outstanding voting securities of
ame and Type of Number of Shares Percentage of
Municipality Ownership Beneficially Owned Directly or Outstanding Voting
Indirectly, Controlled or Directed Securities
ARC Energy Venture Beneficial and of 7,768,422 43.85%
Fund 3 (1) record
Simon Sochatsky See footnote (2) below 2,028,823 11.45%
(1) ARC Energy Venture Fund 3 has 1,842,106 Warrants that can be exercised into common shares of the Corporation. In
addition, Roderick W. Graham, a senior officer of an affiliate of ARC Energy Venture Fund 3, holds 75,000 options.
(2) Mr. Simon Sochatsky holds 676,630 common shares directly and 1,352,193 common shares are held by Quattro Capital
Inc., an Alberta corporation controlled by Mr. Simon Sochatsky.
STOCK OPTION PLAN
As of June 30, 2003, 1,185,000 options to acquire common shares were issued and outstanding to eligible
employees, officers and directors of the Corporation in accordance with the 1996 Stock Option Plan as
amended August 19, 2002.
Pursuant to a Stock Option Plan which was adopted by the Directors on September 16, 1996 (the “1996
Plan”) and was approved, ratified and confirmed by the Shareholders on September 16, 1996, and
subsequently amended August 19, 2002, the Directors may, from time to time, grant options to purchase
common shares to eligible directors, officers and employees of the Corporation and persons who provide
on-going management or consulting services to the Corporation or its subsidiaries (“service providers”).
The number of such options may not exceed 1,500,000 common shares. Options may not be granted at
exercise prices less than those provided for in the 1996 Plan and, in any event, not at exercise prices less
than those permitted by the applicable rules and regulations of all regulatory authorities to which the
Corporation is subject. The 1996 Plan provides that the term of options granted may be up to a five year
period commencing 12 months after the date that such option is granted.
Further, pursuant to contractual commitments with ARC, the Corporation has agreed that the maximum
term of options would be no greater than 5 years, the exercise price shall not be less than the price received
by the Corporation upon the completion of the most recent offering of common shares (at the time of the
grant), and such options shall vest as to one-third per year, commencing on the first anniversary of the date
Options granted under the 1996 Plan are non-transferable and subject to early termination in the event of the
death of the optionee or the optionee ceasing to be a director, officer or employee of the Corporation.
Pursuant to the 1996 Plan the exercise price for options must be paid in full at the time of exercise; however,
the directors may authorize the Corporation to loan money to optionees on such terms and conditions as the
directors may, in their sole discretion, determine in order to assist such persons in the exercise of options
held by them.
There are currently 1,185,000 options to acquire common shares issued and outstanding under the 1996
Plan. Approximately 225,000 of these options have been granted to employees and the remainder of the
options are held by directors and officers of the Corporation.
INDEBTEDNESS OF SENIOR OFFICERS AND DIRECTORS
None of the directors of the Corporation or senior officers or any associate or affiliate of any such individual
were indebted to the Corporation at any time during the fiscal year ended March 31, 2003.
DIRECTORS AND OFFICERS INSURANCE
The Corporation carries on its own behalf a directors and officers liability insurance policy. This policy has
a coverage limit of $20,000,000. The annual premium paid by the Corporation in the last completed fiscal
year in respect of its directors and officers liability insurance as a group was $34,950 covering the period
July 1, 2002 to June 30, 2003.
INTEREST OF INSIDERS IN MATERIAL TRANSACTIONS
There were no material interests, direct or indirect, of directors and senior officers of the Corporation,
nominees for director, any shareholder who beneficially owns more than 10% of the shares of the
Corporation, or any known associate or affiliate of such persons in any transaction since the commencement
of the Corporation’s last completed fiscal year or in any proposed transaction which has materially affected
or would materially affect the Corporation or any of its subsidiaries, other than the Northern Industrial
Carrier Group of Companies (which are controlled by Mr. Sochatsky) were paid $318,000 by the
Corporation for trucking services which were supplied to the Corporation at normal commercial rates.
The following table sets forth all annual and long term compensation for services in all capacities to the
Corporation for the last fiscal year (to the extent required by the applicable securities legislation) in respect
of the Chief Executive Officer and each of the Corporation’s compensated executive officers as required
(the “named executive officers”):
Summary Compensation Table
Annual Compensation Long-Term Compensation
Name and Year(1) Salary Bonus Other Annual Securities Restricted LTIP All Other
Principal ($) ($) Compensation Under Shares or Payouts Compensation
Position (2) Options/ restricted ($) ($)
($) SARs Share Units
2001 200,000 Nil see Note 3 N/A N/A N/A N/A
Côté 2002 200,000 90,000(4) N/A N/A N/A N/A N/A
President and 2003 200,000 Nil N/A 275,000 N/A N/A N/A
Tony G. Barlott 2001 175,000 Nil 15,874(5) N/A N/A N/A N/A
Chief Financial 2002 175,000 Nil N/A N/A N/A N/A N/A
Officer and 2003 175,000 35,000 26,920(5) 100,000 N/A N/A N/A
Ronald Fink 2001 105,000 Nil N/A N/A N/A N/A N/A
National 2002 105,000 5,000 N/A N/A N/A N/A N/A
2003 108,069 10,000 N/A 50,000 N/A N/A N/A
(1) The Corporation became a reporting issuer upon its filing of a Prospectus dated September 15, 1995 and its latest
financial year end is March 31, 2003.
(2) The named executive officers received non-cash compensation including group insurance benefits, perquisites, automobile
allowances and club dues which were no greater than the lesser of $50,000 or 10% of the total annual salary and benefit paid
to the named executive officers.
(3) Pursuant to a renegotiation of Mr. Côté 's employment contract that was finalized on March 12, 2001, Mr. Côté received a
one time lump sum payment of $225,000. From such monies, a loan owing by Mr. Côté to the Corporation was repaid in
(4) Mr. Côté's employment contract entitled Mr. Côté to receive this bonus as a result of the Corporation's achieving certain
financial performance criteria during the fiscal year ending March 31, 2002. The bonus was paid to Mr. Côté in June of
(5) Monies paid to Mr. Barlott in respect of past vacation entitlement.
Long-Term Incent ive Plans -Awards In Most Recently Completed Fiscal Year
Messrs. Côté, Barlott and Fink were each respectively granted 275,000, 100,000 and 50,000 options during
the most recently completed fiscal year. Such options have an exercise price of $0.95 per common share,
are for a term of five years and vest one-third per year, commencing on the first anniversary of the date of
Aggregated Option/SARs Exercised During the Most Recently Completed Financial Year and
Financial Year-End Option/SAR Values
Name Securities Aggregate Unexercised Options/SARs Value of Unexercised in-the-
Acquired Value Realized at Financial Year-End (#) Money Options/SARs at Financial
on Exercise ($) Exercisable/Unexercisable Year-End ($)(1)
Venence G. Côté Nil Nil Nil/275,000 Nil / Nil
Tony G. Barlott Nil Nil 15,000/100,000 Nil / Nil
Ron Fink Nil Nil Nil/50,000 Nil / Nil
(1) The closing price of the Corporation’s common shares on The Toronto Stock Exchange on March 31, 2003 was $0.55.
Termination of Employment, Change in Responsibilities and Employment Contracts
Mr. Venence Côté, entered into a three year employment contract effective September 27, 2002. Under the
contract, Mr. Côté is entitled to incentive compensation, in each of the Corporation's fiscal years,
commencing with the fiscal year ending March 31, 2003, based upon certain financial performance criteria
of the Corporation and incentive compensation at the discretion of the Board of Directors.
Mr. Côté’s employment agreement expires on September 26, 2005, but may be automatically renewed on a
yearly basis. The employment contract provides that, in the event of his employment being terminated for
any reason other than primarily just cause or employee notice, he shall receive all base salary and incentive
compensation accrued and payable to the date of termination and severance compensation equal to two
years' base salary.
Mr. Tony Barlott entered into a three year written employment contract effective September 27, 2002
pursuant to which Mr. Barlott is entitled to receive incentive compensation, in each of the Corporation's
fiscal years, commencing with the fiscal year ending March 31, 2003. The receipt of such incentive
compensation is based upon certain financial performance criteria of the Corporation and the discretion of
the Board of Directors. Mr. Barlott’s employment contract provides that, in the event of his employment
being terminated for any reason other than primarily just cause or employee notice, he shall receive all base
salary and incentive compensation accrued and payable to the date of termination and severance
compensation equal to two years' base salary.
Mr. Ron Fink entered into a three year written employment contract effective September 27, 2002 pursuant
to which Mr. Fink is entitled to receive incentive compensation, in each of the Corporation's fiscal years,
commencing with the fiscal year ending March 31, 2003. The receipt of such incentive compensation is
based upon certain financial performance criteria of the Corporation and the discretion of the Board of
Directors. Mr. Fink's contract provides that if Mr. Fink's employment is terminated for any reason other
than primarily just cause or employee notice, Mr. Fink is entitled to receive all base salary and incentive
compensation accrued and payable to the date of termination and severance compensation equal to one
year's base salary.
Composition of the Compensation Committee
This function was performed by the Compensation Committee during the fiscal year ending March 31,
2003, although Mr. Côté excused himself from participating in any decisions relating to his employment.
Report on Executive Compensation
The purpose of the Corporation’s executive compensation policy is to attract and retain individuals of high
caliber to serve as executive officers and employees of the Corporation, to motivate their performance in
order to achieve the Corporation’s strategic objectives, and to align the interests of executive officers and
employees with the long-term interests of the Corporation’s shareholders. The Corporation’s primary policy
is to pay for performance and, accordingly, performance of the Corporation and of the President as an
individual are examined by the Board.
Executive officer and employee compensation consists of essentially three components: (1) base salaries
and bonuses; (2) employee benefits; and (3) stock options.
The Board has established the following policy with regards to executive compensation:
(1) The Corporation shall provide compensation which is competitive with a representative sample of
Canadian manufacturing and distribution companies.
(2) Compensation shall be provided in three basic forms: salary and bonuses, employee benefits (which
consists primarily of health care and insurance benefits and automobile allowance) and stock
(3) Salary compensation shall be set depending on individual performance and career progression,
corporate results, general economic factors (e.g. inflation) and competitive survey information.
(4) The Corporation shall from time to time grant stock options and Warrants to executive officers to
provide incentive compensation based on the performance of the Corporation. These options and
Warrants shall be granted in blocks as determined by the Board of Directors.
Submitted by the Compensation Committee.
The table and graph below compare the percentage change in shareholder return with the cumulative total
return of The Toronto Stock Exchange Composite Index for the period March 29, 1998 to March 31, 2003.
The Corporation’s common shares commenced trading on The Toronto Stock Exchange on September 24,
1995 after being offered to the public at $5.00 per common share. Returns are based upon the closing
values on the last day of trading in each month indicated and the value on March 29, 1998 has been
arbitrarily designated as 100.0.
ZCL COMPOSITES INC. SHAREHOLDER RETURN PERFORMANCE GRAPH COMPARISON
OF MARCH 29, 1998 TO MARCH 31, 2003 CUMULATIVE TOTAL RETURN ON COMMON
SHARES OF THE CORPORATION IN RELATION TO THE TSX COMPOSITE INDEX
March March March March March March
1998 1999 2000 2001 2002 2003
TSX Composite 100 87.29 125.19 100.65 103.88 83.92
ZCL Composites 100 72.00 36.00 32.00 37.60 22.00
Cumulative Returns ($)
1998 1999 2000 2001 2002 2003
TSX Composite Index ZCL Composites Inc.
COMPENSATION OF DIRECTORS
During the most recently completed fiscal year, the Corporation paid the following compensation to the
Directors for their services as Directors and the following options to purchase common shares of the
Corporation have been issued pursuant to the 1996 Plan:
DIRECTOR TOTAL COMPENSATION OPTIONS GRANTED (1)/
($) (TOTAL HELD)
Venence G. Côté N/A 275,000/(275,000)
James S. Edwards 10,000 75,000/(75,000)
Fred Dyment 5,500 75,000/(75,000)
Raymond Désormeaux 16,000 75,000/(75,000)
Roderick W. Graham 5,500 75,000/(75,000)
Simon Sochatsky 14,500 75,000/(145,000)
Ian Brown 17,000 75,000/(75,000)
Gilles Voyer 7,500(2) Nil/(Nil)
(1) These options were granted to directors in the fiscal year ending March 31, 2003, pursuant to the 1996 Plan.
(2) Gilles Voyer was not re-appointed as a director of the Corporation at its Annual General and Special Meeting held on
August 19, 2002.
Cash remuneration paid to the non-management directors of the Corporation in their capacity as directors
during the fiscal year ended March 31, 2003 was based on an annual retainer of $10,000 (being $2,500 per
quarter) and an additional payment of $500 per meeting attended during the fiscal year ending March 31,
2003. No director received additional remuneration for chairing a committee of the Board, however, the
Chairman of the Board received an additional sum of $1,250 per quarter.
Instruments of proxy must be addressed to the Secretary of the Corporation and reach Computershare
Investor Services Inc., Proxy Department, 100 University Avenue, 9th Floor, Toronto, Ontario, M5J 2Y1
not later than 48 hours before the time for the holding of the Meeting or any adjournment thereof. Only
shareholders of the Corporation of record at the close of business on July 11, 2003 are entitled to receive
notice of and to vote at the Meeting unless after that date a shareholder of record transfers its shares and the
transferee, upon producing properly endorsed certificates evidencing such shares or otherwise establishing
that it owns such shares, requests at any time prior to the Meeting that the transferee’s name be included in
the list of shareholders entitled to vote, in which case, such transferee is entitled to vote such shares at the
The instrument appointing a proxy shall be in writing and shall be executed by the shareholder or his
attorney authorized in writing or, if the shareholder is a company, under its corporate seal or by an officer or
attorney thereof duly authorized.
THE PERSONS NAMED IN THE ENCLOSED FORM OF PROXY ARE DIRECTORS OR
OFFICERS OF THE CORPORATION. A SHAREHOLDER SUBMITTING THE PROXY HAS
THE RIGHT TO APPOINT A PERSON TO ATTEND THE MEETING AS THE
SHAREHOLDER’S REPRESENTATIVE (WHO NEED NOT BE A SHAREHOLDER OF THE
CORPORATION) OTHER THAN THE PERSON DESIGNATED IN THE FORM OF PROXY
FURNISHED BY THE CORPORATION. TO EXERCISE SUCH RIGHT, THE NAMES OF THE
PERSONS DESIGNATED BY MANAGEMENT SHOULD BE CROSSED OUT AND THE NAME
OF THE SHAREHOLDER’S APPOINTEE SHOULD BE LEGIBLY PRINTED IN THE BLANK
Revocability of Proxy
A shareholder or intermediary who has submitted a proxy may revoke it at any time prior to the exercise
(1) depositing an instrument in writing executed by him or by his attorney authorized in writing:
(a) at the registered office of the Corporation at any time up to and including the last business
day preceding the day of the Meeting, or an adjournment of the Meeting, at which the proxy
is used; or
(b) with the chairman of the Meeting on the day of the Meeting or an adjournment of the
(2) in any other manner permitted by law.
Persons Making the Solicitation
THE SOLICITATION IS MADE ON BEHALF OF THE MANAGEMENT OF THE
CORPORATION. The costs incurred in the preparation and mailing of the Form of Proxy, the Notice and
this Information Circular will be paid by the Corporation. In addition to the mailing of these materials,
proxies may be solicited by personal interviews, telephone or telegraph by directors and officers of the
Corporation, who will not be remunerated therefore.
Exercise of Discretion by Proxy
The shares represented by proxy in favour of management nominees shall be voted on any ballot at the
Meeting and where the shareholder specifies the choice with respect to any matter to be acted upon, the
shares shall be voted on any ballot in accordance with the specification so made.
IN THE ABSENCE OF SUCH SPECIFICATION, SHARES WILL BE VOTED IN FAVOUR OF
THE PROPOSED RESOLUTION. THE PERSONS APPOINTED UNDER THE FORM OF
PROXY FURNISHED BY THE CORPORATION ARE CONFERRED WITH DISCRETIONARY
AUTHORITY WITH RESPECT TO AMENDMENTS OR VARIATIONS OF THOSE MATTERS
SPECIFIED IN THE PROXY AND NOTICE OF THE ANNUAL GENERAL AND SPECIAL
MEETING. AT THE TIME OF MAILING OF THIS INFORMATION CIRCULAR,
MANAGEMENT OF THE CORPORATION KNOWS OF NO SUCH AMENDMENT,
VARIATION, OR OTHER MATTER.
Voting by Non-Registered Shareholders
Only registered shareholders or the persons they appoint as their proxies are permitted to vote at the
Meeting. However, in many cases, common shares owned by a person (a "non-registered holder") are
registered either (a) in the name of an intermediary (an "Intermediary") that the non-registered holder deals
with in respect of the common shares (Intermediaries include, among others, banks, trust companies,
securities dealers or brokers and trustees or administrators of self-administered registered savings plans,
registered retirement income funds, registered education savings plans and similar plans); or (b) in the name
of a clearing agency (such as the Canadian Depository of Securities Limited ("CDS")) of which the
Intermediary is a participant. In accordance with the requirements of National Instrument 54-101 of the
Canadian Securities Administrators, the Corporation has distributed copies of the Management Information
Circular and the accompanying Notice of Meeting together with the form of proxy and the Annual Audited
Financial Statements (collectively the "Meeting Material") to the clearing agencies and Intermediaries for
onward distribution to non-registered holders of common shares.
Intermediaries are required to forward the Meeting Materials to non-registered holders unless a non-
registered holder has waived the right to receive them. Very often, Intermediaries will use service
companies to forward the Meeting Materials to non-registered holders. Generally, non-registered holders
who have not waived the right to receive Meeting Materials will either:
(a) be given a form of proxy which has already been signed by the Intermediary (typically by a
facsimile stamped signature), which is restricted as to the number and class of securities
beneficially owned by the non-registered holder but which is not otherwise completed.
Because the Intermediary has already signed the form of proxy, this form of proxy is not
required to be signed by the non-registered holder when submitting the proxy. In this case,
the non-registered holder who wishes to vote by proxy should otherwise properly complete
the form of proxy and deliver it as specified above under "Appointment of Proxies"; or
(b) be given a form of proxy which is not signed by the Intermediary and which, when properly
completed and signed by the non-registered holder and returned to the Intermediary or its
service company, will constitute voting instructions (often called a "Voting Instruction
Form") which the Intermediary must follow. Typically the non-registered holder will also be
given a page of instructions which contains a removable label containing a bar code and
other information. In order for the form or proxy to validly constitute a Voting Instruction
Form, the non-registered holder must remove the label from the instructions and affix it to
the Voting Instruction Form, properly complete and sign the Voting Instruction Form and
submit it to the Intermediary or its service company in accordance with the instructions of the
Intermediary or its service company.
In either case, the purpose of this procedure is to permit non-registered holders to direct the voting of
common shares they beneficially own. Should a non-registered holder who receives either form of proxy
wish to vote at the Meeting in person, the non-registered holder should strike out the persons named in the
form of proxy and insert the non-registered holder's name in the blank space provided. Non-registered
holders should carefully follow the instructions of their Intermediary including those regarding when
and where the form of proxy or Voting Instruction Form is to be delivered.
The foregoing contains no untrue statement of a material fact and does not omit to state a material fact that
is required to be stated or that is necessary to make a statement not misleading in the light of the
circumstances in which it was made. The directors of the Corporation have approved the contents and
sending of this information circular.
DATED: July 3, 2003
(signed) "Venence Côté” (signed) "Tony Barlott"
Venence G. Côté Tony G. Barlott
President, Chief Executive Officer and Director Chief Financial Officer