Corporate Governance Guidelines
The following Corporate Governance Guidelines have been adopted by the Board of Directors (the "Board") of the TC PipeLines GP, Inc. (the "Corporation"), on its own behalf and in its capacity as the general partner of TC PipeLines, LP (the "Partnership"). These guidelines, which assist the Board in its corporate governance responsibilities should be read in conjunction with the Second Amended and Restated Agreement of Limited Partnership of TC PipeLines, LP, as amended, (the "Partnership Agreement") and other applicable constating documents of the Partnership and the Corporation.
At least three members of the Board must qualify as independent directors in accordance with the applicable provisions of the Securities Exchange Act of 1934 (the "Act"), the rules promulgated thereunder and the applicable rules of the New York Stock Exchange (the "NYSE"). As the general partner of a publicly-traded limited partnership, the Corporation is not required to have a majority of independent directors. Directors of the Board may not serve as a director on more than four other public company boards.
The Board reviews the general and specific criteria, and attributes, skills and experience applicable to candidates to be considered for nomination to the Board.
The business of the Partnership is managed by or under the direction of the Board of the Corporation, as the general partner of the Partnership. Directors should exercise their business judgment to act in what they reasonably believe to be in the best interest of the Partnership and in a manner consistent with the Partnership Agreement and applicable law. Directors should attend regularly scheduled and special meetings of the Board and its committees on which they serve, and prepare for such meetings by undertaking a thorough review of the briefing materials sent to them in advance.
Independent directors shall hold executive sessions without management participation during or after the Audit Committee meetings of the Board. The Chairman of the Audit Committee shall preside as Chairman during such sessions.
The Board shall at all times maintain an Audit Committee and from time to time as required, a Conflicts Committee, which shall consist solely of independent directors and otherwise meet the criteria mandated under applicable law and the rules of the Securities and Exchange Commission and the NYSE. The Board may also establish such other committees as it deems appropriate and delegate to such committees the authority permitted by applicable law and the Corporation's by-laws as the Board sees fit.
Directors shall have complete access to management of the Corporation upon advance notice. The Board and its committees have the right to consult and retain independent legal and other advisors at the expense of the Corporation.
The Board shall review and determine the form and amount of director compensation, including cash, equity-based awards and other director compensation on an annual basis. In connection with the determination of director compensation, the Board shall have regard to the fact that questions may be raised when directors' fees and benefits exceed what is customary. Similarly, the Board will be aware that the independence of directors could be questioned if substantial charitable contributions are made to organizations in which a director is affiliated. The Board will critically evaluate each of these matters when determining the form and amount of director compensation, and the independent status of a director.
New directors are provided with an orientation program that includes written information about the business and operations of the Partnership, copies of the Partnership Agreement, Corporate Governance Guidelines, Charter of the relevant Committee (if applicable) and documents from recent board/committee meetings. The new director will also have the opportunity for meetings and discussions with other directors and senior management. The details of the orientation of each new director are tailored to that director’s individual needs and areas of interest. The Board is fully supportive of on-going education programs for directors and the Corporation will reimburse directors who take advantage of appropriate educational opportunities. The Board will consider continuing education opportunities for Board members to increase the directors' knowledge about specific areas of importance to the operations of the Partnership.
The Board shall approve by a majority vote of the independent directors the portion of the President's compensation to be allocated to the Partnership's costs.
The Board will conduct an evaluation of its performance annually to determine whether it and its committees are functioning effectively. The Board will discuss the evaluation to determine what, if any, action could be taken to improve Board and Board committee performance. The Board shall review these Corporate Governance Guidelines on an annual basis to determine whether any changes are appropriate.
The Board believes that succession planning and management development are key to the ongoing process that contributes substantially to the Partnership's success. The Board, in consultation with TransCanada Corporation, periodically reviews the succession plan for the President and other senior executives both in the event of an emergency and in the ordinary course of business.
These Guidelines may be amended, modified or waived by the Board, subject to the disclosure and other provisions of the Act, the rules promulgated thereunder and the applicable rules of the NYSE..
Our general partner, TC PipeLines GP, Inc., is wholly-owned by TransCanada Corporation (TransCanada), one of the largest energy infrastructure companies in North America