e x e c u t i v e COMPENSATION

All employees of The ENWIN Group are employed by ENWIN Utilities Ltd. On behalf of all its companies and employees, ENWIN is committed to providing a competitive total compensation strategy that will allow the organization to attract and retain talented employees, who align with the corporate vision and values and contribute to the success of the Company. At the same time, ENWIN is cognizant of the fiscal responsibility to rate payers.

The utility seeks competitiveness in the employment market through compensation and benefits practices that are equitable, consistent, practical and in accordance with the legal requirements of the Employment Standards Act, Pay Equity Act, Canada Revenue Agency Act and other applicable legislation.

ENWIN is also committed to developing and maintaining salary and benefit practices, policies and procedures that provide an effective means of controlling expenditures, and are responsive to the changing conditions within the community. All compensation and benefits programs are influenced by the economic health of the company and our community.

The Governance and Human Resources Committee, comprised of members of the Board of EWU, is responsible, in concert with the Executive Committee, for providing direction to management in development of the compensation framework and recommending

the approval of the compensation framework for management.

The committees are guided by the need to provide a total compensation package that will attract and retain qualified and experienced executives and by the best practice of linking compensation to performance.

Additionally, ENWIN strives to offer a total compensation package that is competitive with other organizations of similar size, scope and geographic and economic composition.

A market comparison, aided by an independent consultant, was performed in 2016, and comparators from both the public sector and private sector, as well as direct industry comparators, were sought. Findings indicated that compensation was comparable.

Executive compensation is ultimately approved by the Board of Directors. In making its recommendations to the Board, the Committee examines the responsibilities and performance of individual executives, and considers the recommendations of the President and Chief Executive Officer.

Total cash compensation for Executives consists of two components: base salary and a variable performance incentive opportunity. Total cash compensation is benchmarked to companies of comparable size and scope in both the Ontario and national markets.

The variable performance incentive opportunity is paid on an annual basis and is expressed as a percentage of base salary. It is designed to ensure alignment with corporate objectives, retain and motivate executives, and to reward them for their performance during the preceding year.

Payments are based on the achievement of both corporate and individual stretch objectives, both financial and non-financial, which are established each year and approved by the Board of Directors from time to time.

Non-financial targets are designed to achieve continuous improvement in relation to a number of strategic themes including, but not limited to, customer service, safety, innovation, leadership, accountability and integrity, as well as specific objectives established by the board

Management and executives participate in a benefits program, which includes extended health care, dental care, basic and optional life insurance, and short-term and longterm disability insurance.

All employees also participate in the OMERS pension plan. This plan is a multi-employer, contributory, defined benefit pension plan established by the Province for employees of municipalities, local boards and school boards in Ontario.

Pension benefits are determined by a formula based on the highest