HomeMy WebLinkAboutCS 23-02
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REPORT TO COUNCIL
Report Number: CS 23-02
Date: October 2,2002
From:
Gillis A. Paterson
Director, Corporate Services & Treasurer
Subject:
Veridian - Return of Capital to Shareholders
Recommendation:
1. That Report CS 23-02 from the Director, Corporate Services & Treasurer be
received and that
2. The attached Resolution be approved and the Mayor be authorized to take the
appropriate action on behalf of the City of Pickering;
3. Funds be deposited to the credit of the Corporation and a transfer be made to the
Reserve for Replacement of Capital Equipment; and,
4. The appropriate officials of the City of Pickering be given authority to give effect
thereto.
Executive Summary: The Board of Directors has considered the matter of a $1
million return of capital invested in Veridian Corporation to its shareholders.
Under the Business Corporations Act, a Shareholder Resolution is required when a
return of capital is considered.
Financial Implications: Approval of the Recommendations will provide for a return of
capital from Veridian to the City of Pickering of approximately $410,000 in 2002.
Background: On September 25, 2002 I received the attached Resolution from
Veridian together with a request that it be executed by the City of Pickering. The
Mayor, as a City Shareholder representative and as the Mayor of the City, is requested
to sign the Resolution on behalf of the City. The same request is being made to each
shareholder.
The Board of Directors has considered the matter of a $1 million return of capital
invested in Veridian Corporation to its shareholders. The Board approved a return of
capital on the basis that Veridian Corporation has posted favourable financial results to
plan and to also reflect the $648,000 in proceeds received by Veridian from the class
action suit settlement between the former municipal utilities and the former Ontario
Hydro.
Report CS 23-02
Date: October 2, 2002 0 n 9
Page 2
Subject: Veridian - Return of Capital to Shareholders
Under the Business Corporations Act, a Shareholder Resolution is required when a
return of capital is considered. Accordingly, the Mayor, as shareholder representative
for the City, is required to sign the attached resolution.
Approval of the Recommendations will provide for a return of capital from Veridian to
the City of Pickering of approximately $410,000 in 2002. This is a one-time transaction
and will reduce the value of the City's ownership of shares by the same amount. The
financial effects will be proportionately identical for each of the other partners. When
the funds are received they will be deposited in the City's bank account. An
appropriation to the Reserve for Replacement of Capital Equipment was decided as
the balance has been significantly reduced over the last few years through the Capital
Budget. Since this is a one-time infusion of funds it should go towards future capital
requirements.
This request is being put forth as a Confidential Report given the subject matter. It is
also being sent directly to Council as I wish to expedite the return of capital to the City
and all shareholders will be doing the same thing at approximately the same time.
Attachments:
1.
Veridian Corporation Shareholder Resolution
Prepared I Approved I Endorsed By:
- ~~ ~~
Gillis A. Paterson
Director, Corporate Services & Treasurer
GAP:vw
Attachment
Copy: Chief Administrative Officer
Recommended for the consideration of
Pickering City Council
"
n10
ATTACHMENT#-L- TO REPORT#~ ~3-o~
Vendian Corpomtion
Shareholder Resolurion
Septembe.t 25, 2002
..
'!'hit the Sha.rehoJ4ers of Vetidian Co.1:po:ation approve a $1. :ttrli1.io'ii dolW: tetcim of capital
to shaxebolde:s of record as at Aupt 29 t 2002 with such retUrn of apital reducing the
stated capit2l ofVt:.tidW:l Co1poratìon. Disc:ibution to each shareholder of Veri diaD
Co.1:pomtion will be payable to shareholders September 3D, 2002 as £oD.ows:
Town of Ajax
City 0 f B eD.eviJle
Mtmicip:ility of C1arington
City of Picketing
'Total
$321,000
135tOOO
156,000
410.QQQ
$1.000.000
MayoI Steve Parish,
Town of Ajax
Ma.YOf Gc:orge Zegow:as,
City of Belk:vi11e
MayO! John Mutton,
Mucicipality of Clarington
Mayor Wayne Arthun.
City of :Pickering