Charter of the board of directors
Statement of purpose
The Board of Directors (the “Board”) of Cymbria Corporation (the “Corporation”) is elected by the Corporation’s voting shareholders. The Board is responsible for overseeing the management of the Corporation’s business and affairs.
The Board shall review and reassess the adequacy of this Charter on an annual basis and at such other times as it considers appropriate.
Duties of directors
Pursuant to the Business Corporations Act (Ontario), in discharging his or her duties, each Director shall act honestly and in good faith with a view to the best interests of the Corporation and exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances. In determining whether Directors have fulfilled their duties, both procedural and substantive aspects of their conduct are relevant. The procedural aspect requires Directors to make reasonable inquiry into all relevant information available to them (informed decisions) and from a substantive aspect requires decisions to have been made honestly, prudently, in good faith and on reasonable grounds (business judgment rule).
Disclosure of interest in material contract or transaction
Directors are required to disclose to the Corporation, in writing or by requesting to have it entered into the minutes of meetings of the Board, the nature and extent of any personal interest in any material contract or transaction made or proposed with the Corporation. In the event the Board determines that a conflict of interest exists, then the Director with such conflict shall refrain from voting on any resolution related to such contract or transaction.
Specific duties and responsibilities
In adopting this Charter and in order to carry out its statutory responsibilities within the defined duty of care, the Board shall assume the following principal duties and responsibilities:
monitor EdgePoint Investment Group Inc. (the “Manager”) in its capacity as manager and investment advisor of the Corporation including adherence to investment mandate;
oversee the Corporation’s key agreements;
review the Manager’s recommendations regarding major decisions and action outside of the ordinary course of business, including acquisitions and divestitures, financings and capital expenditures;
review key policies developed by the Corporation, the Manager and Investment Advisor on various issues such as ethics, compliance, communications and public disclosures and review and monitor compliance with such policies;
retain the auditor for the Corporation;
monitor financial reporting and disclosure of the Corporation with a view to obtaining reasonable assurance that:
o the Corporation complies with all applicable laws and regulations of governments, regulatory agencies and stock exchanges relating to financial reporting and disclosure, and
o the accounting policies and practices, significant judgments and disclosures which underlie or are incorporated in the Corporation’s financial statements are appropriate having regard to the Corporation’s business.
review and approve the financial statements and review and obtain reasonable assurance as to the integrity of the Corporation’s internal controls and management systems;
review and approve any related-party transactions conducted by EdgePoint Wealth Management Inc.
For these purposes, “related-party” shall have the meaning ascribed thereto under applicable securities laws.
The essence of the Board’s responsibility is one of reviewing, and monitoring to gain reasonable assurance (but not to ensure) that the business and affairs of the Corporation are being conducted properly and effectively.
The Board is responsible for developing and implementing the Corporation’s overall approach to governance issues. In connection therewith, the Board shall:
review at least annually the size and composition of the Board;
review at least annually the compensation of Board members (with management representatives not receiving compensation for acting in a Board capacity);
developing corporate governances policies appropriate to the Corporation and monitoring their effectiveness;
reviewing proposed annual corporate governance disclosure; and
considering and assessing new nominees to the Board.
Board structure and composition
The Board shall consist of such members that, from time to time, have an appropriate mix of skills and experience to guide the long-term strategy and ongoing business operations of the Corporation.
The Board shall consist of such number of Directors as the Board may determine from time to time, provided that such number shall be within the minimum and maximum number of Directors set out in the Corporation’s articles of incorporation and giving consideration to the role of the Manager in administering the day to day business of the Corporation.
The Board shall be comprised of a majority of Directors that are independent of the Corporation as determined in accordance with applicable law and regulatory guidelines or standards.
Meetings of the Board
A quorum of the Board shall be a majority of its Members.
The Board shall meet as often as may be required to carry out its duties.
Notice of the principal matters to be addressed at all Board meetings shall be distributed to Directors in advance of each meeting. In addition, the Directors shall be provided with sufficient materials in order to appropriately consider such matters.
Management and Others at Board Meetings
The Board may request any officer or employee of the Corporation, the Manager, or other outside advisors to attend meetings of the Board or to meet or provide consultations to the Board or any member thereof.
Representatives of the Manager shall normally attend meetings of the Board unless otherwise requested by the Board.
Resolutions of the Board passed at a meeting shall require approval by a simple majority of members voting on such resolution.
Any decision or determination of the Board reduced to writing and signed by all of the members of the Board shall be fully as effective as if it had been made at a meeting duly called and held.
The Board may, but need not establish standing committees. The entire Board shall constitute the governance committees for the purposes of applicable law.
The Board will establish an audit committee comprised of three independent members.
Directors shall maintain the absolute confidentiality of the deliberations and decisions of the Board and information received in respect thereof, except as may be specified by the Chair or if the information is otherwise publicly disclosed by the Corporation.
The Board shall have the authority to consider and, if appropriate, approve the engagement of outside advisors at the Corporation’s expense.
The Board’s mandate
The essence of the Board’s responsibility is one of reviewing, overseeing and monitoring to gain reasonable assurance that the business and affairs of Cymbria are being conducted properly and effectively. This includes:
contributing to the formulation of, and overseeing the implementation of Cymbria’s strategic and business operating plans;
overseeing EdgePoint Investment Group Inc. in its capacity as Cymbria’s manager and investment advisor;
reviewing the manager’s recommendations regarding major decisions and actions;
reviewing key policies developed by Cymbria and manager and monitoring compliance with such policies;
retaining the auditor for Cymbria;
overseeing Cymbria’s financial reporting and disclosure;
reviewing and approving certain transactions conducted by EdgePoint Wealth.
The audit committee’s primary function is to assist the Board of Directors in fulfilling their oversight responsibilities by reviewing the selection, independence and effectiveness of the external auditors; financial statements and other financial information and reports which will be provided to the shareholders and others, the financial reporting process, and Cymbria’s system of internal controls and disclosure.
The external auditors’ ultimate responsibility is to the Corporation and the audit committee, as representatives of the shareholders. These representatives have the ultimate authority to evaluate and, where appropriate, recommend replacement of the external auditors. The audit committee shall be given full access to the Corporation’s records and access to the external auditors as necessary to carry out these responsibilities.
Although the audit committee has the powers and responsibilities set forth in this Charter, the role of the audit committee is oversight. 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 International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board. These are the responsibilities of the executive officers. The external auditors’ responsibility is to perform an audit to determine whether the financial statements prepared by the executive officers are, in all material respects in accordance with IFRS.
Qualification of members
Audit committee members shall be three or more in number and be “independent” as defined in NI 52-110 of the Canadian securities regulators. “Independent” for this purpose means that a member has no direct or indirect material relationship with Cymbria which could, in the view of the Board of Directors, reasonably interfere with his or her independent judgment. Committee members shall not receive any remuneration other than for acting as a member of the committee or another committee or as a Board member.
All committee members shall, as stipulated in NI 52-110, be “financially literate”, that is to say have the ability to read and understand financial statements and related notes that present a breadth and level of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by Cymbria’s financial statements.
The audit committee is currently comprised of independent members Ugo Bizzarri, James MacDonald, Edward J. Waitzer and Reena Carter, who also serves as its Chair.
Articles of incorporation
Liquidity Realization Opportunity (LRO)
As liquidity needs and investment horizons vary from investor to investor, Cymbria's LRO offers the ongoing potential for shareholders to take advantage of the option to sell their shares to the company at a price close to net asset value (NAV).
Investigations and compliant escalation policy
As a responsible business enterprise and corporate citizen, Cymbria Corporation is committed to conducting its affairs to the highest standards of ethics, integrity, honesty, fairness and professionalism – in every respect, without exception, and at all times. Cymbria takes its reputation very seriously and while reaching our business goals is critical to our success, equally important is the way we achieve them. Our policy on fraud is one of zero tolerance. Therefore we will not tolerate acts by any director, officer, individual or group of individuals representing Cymbria, or engaged in activities on its behalf that are illegal, unethical, misrepresentative, or a violation of any regulation or established company policy.
What to report
Cymbria is responsible for and committed to providing accurate and reliable financial reporting. To support that goal, we have established this communication channel for employees and other stakeholders to report their concerns regarding the integrity of Cymbria accounting, internal accounting controls or auditing matters. Employees may also use this communication channel to report concerns relating to ethical business or personal conduct, integrity and professionalism. This reporting system does not replace the other methods employees or other stakeholders have traditionally used to communicate with Cymbria. You are encouraged to continue using our existing communication channels.
How and where to report
Reporting via email
Cymbria employees and other stakeholders may make disclosures by sending an email to firstname.lastname@example.org.
You are protected
This reporting system is confidential and anonymous so you should feel comfortable using it. Cymbria employees are protected against termination, demotion or any other adverse consequence to their employment when making a valid report.