40-F

40-F 1 d107147d40f.htm 40-F 40-F

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 40-F

¨	REGISTRATION STATEMENT PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE ACT OF 1934

x	ANNUAL REPORT PURSUANT TO SECTION 13(a) OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


For the fiscal year ended December 31, 2015		Commission File Number 001-36115

Hydro One Inc.

(Exact name of Registrant as specified in its charter)

Ontario, Canada

4911

Not Applicable

(Province or other jurisdiction of

incorporation or organization)

(Primary Standard Industrial

Classification Code Number)

(I.R.S. Employer

Identification Number)

483 Bay Street

South Tower, 8th Floor

Toronto Ontario M5G 2P5

Canada

(416) 345-6301

(Address and telephone number of Registrant’s principal executive offices)

CT Corporation System

111 Eighth Avenue, 13^th Floor, New York, NY 10011

(212) 894-8700

(Name, address, (including zip code) and telephone number (including area code)

of agent for service in the United States)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

2.78% Medium-Term Notes due 2018

4.59% Medium-Term Notes due 2043

Title of Class: Medium Term Notes

Name of Exchange where Securities are listed: New York Stock Exchange, Inc.

Securities registered or to be registered pursuant to Section 12(g) of the Act: Not applicable

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

Not applicable

Information filed with this Form:


x Annual Information Form				x Audited annual financial statements

Number of outstanding shares of each of the issuer’s classes of

capital or common stock as of December 31, 2015:

142,239 Common Shares outstanding

0 Class A Preference Shares

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

x Yes ¨ No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files).

x Yes ¨ No

CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The United States Securities and Exchange Commission (the “Commission”) defines “disclosure controls and procedures” as controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms.

After evaluation of the effectiveness of the Registrant’s disclosure controls and procedures as of the end of the fiscal year covered by this report, the Registrant’s Chief Executive Officer and its Chief Financial Officer have concluded that the Registrant’s disclosure controls and procedures were effective as of end of the fiscal year covered by this report.

Management’s annual report on internal control over financial reporting and attestation report of the registered public accounting firm.

The Company’s management is responsible for establishing and maintaining internal control over financial reporting. The Company’s management assessed the effectiveness of the Company’s internal control over financial reporting as at December 31, 2015. The Company’s management used the Internal Control – Integrated Framework (2013) as issued by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission to evaluate the effectiveness of the Company’s internal control over financial reporting. Based on management’s assessment, the Company’s internal control over financial reporting is effective as at December 31, 2015.

This annual report does not include an attestation report of the Registrant’s registered public accounting firm regarding internal control over financial reporting.

Changes in Internal Control Over Financial Reporting

During the year ended December 31, 2015, there was no change in the Registrant’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting.

IDENTIFICATION OF THE AUDIT COMMITTEE

The Registrant has a separately-designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act (the “Audit Committee”). The Audit Committee comprises Philip Orsino (Chair), Charles Brindamour, George Cooke, James Hinds, Roberta Jamieson and Frances Lankin. The board of directors of the Registrant has determined that each member of the Audit Committee is “independent” as defined in the Exchange Act and the New York Stock Exchange’s listing standards applicable to the Registrant. Each of the Audit Committee members has an understanding of the accounting principles used to prepare the Registrant’s financial statements and varied experience as to the general application of such accounting principles, as well as an understanding of the internal controls and procedures necessary for financial reporting.

AUDIT COMMITTEE FINANCIAL EXPERT

The board of directors of the Registrant has determined that it has four audit committee financial experts serving on its audit committee. Charles Brindamour, George Cooke, James Hinds and Philip Orsino have each been designated as an audit committee financial expert and are each independent, as such term is defined in the New York Stock Exchange’s listing standards applicable to the Registrant. The Commission has indicated that the designation or identification of an audit committee financial expert does not deem an “expert” for any purpose, impose any duties, obligations or liability on such expert that are greater than those imposed on members of the audit committee and board of directors who do not carry this designation or identification, or affect the duties, obligations or liability of any other member of the audit committee or board of directors.

AUDIT COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES

The charter of the Audit Committee requires that the Audit Committee review and approve all policies and procedures for the pre-approval of services to be rendered by external auditors. All permissible non-audit services to be provided to the Registrant or any of its affiliates by external auditors or any of their affiliates that are not covered by pre-approval policies and procedures approved by the Audit Committee, are subject to pre-approval by the Audit Committee. During the fiscal year ended December 31, 2015, the waiver of pre-approval provisions set forth in the applicable rules of the Commission were not utilized for any services related to Audit-Related Fees, Tax Fees or All Other Fees and the Audit Committee did not approve any such fees subject to the waiver of pre-approval provisions.

PRINCIPAL ACCOUNTANT FEES AND SERVICES

The aggregate fees billed by KPMG LLP to Hydro One Inc. and its subsidiaries in 2015 and 2014 for professional services are presented below (in Canadian dollars):


	Year ended December 31, 2015			Year ended December 31, 2014
Audit Fees	$	784,300		$	723,745
Audit-Related Fees	$	392,200	⁽¹⁾	$	139,083	⁽²⁾
Tax Fees	$	90,000	⁽³⁾		—
All Other Fees		—			—
Total	$	1,266,500		$	862,828

Notes:

(1)	The nature of the services rendered was: due diligence, translations, and audit of the Hydro One Pension Plan and related matters.

(2)	The nature of services rendered was: translations, executive expense reviews, audit of the Hydro One Pension Plan and related matters.

(3)	The nature of the services rendered was: procedures in connection with scientific research and experimental development tax credit claims.

CODE OF ETHICS

The Code of Business Conduct (the “Code”) applies to all directors, officers and employees of the Registrant, including the Chief Executive Officer and Chief Financial Officer. A copy of the Code has been posted on the Registrant’s website at http://www.hydroone.com/InvestorRelations and has also been furnished to the Commission as Exhibit 99.1 to Form 6-K dated November 12, 2015.

OFF BALANCE SHEET ARRANGEMENTS

The disclosure provided under the heading “Other Obligations—Off Balance Sheet Arrangements” on page 12 of Exhibit 99.3, the Registrant’s Management’s Discussion and Analysis (the “MD&A”), is incorporated by reference herein.

TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS

The tabular disclosure provided under the heading “Other Obligations—Summary of Contractual Obligations and Other Commercial Commitments” on page 12 of Exhibit 99.3, the MD&A, is incorporated by reference herein.

INTERACTIVE DATA FILE

Concurrent with this filing, the Registrant has submitted to the Commission and posted on its corporate website an Interactive Data File.

MINE SAFETY DISCLOSURE

Not applicable.

UNDERTAKING AND CONSENT TO SERVICE OF PROCESS

Undertaking

Registrant undertakes to make available, in person or by telephone, representatives to respond to inquiries made by the Commission staff, and to furnish promptly, when requested to do so by the Commission staff, information relating to the securities in relation to which the obligation to file an annual report on Form 40-F arises.

Consent to Service of Process

The Registrant has previously filed a Form F-X in connection with the class of securities in relation to which the obligation to file this report arises.

Any change to the name or address of the agent for service of process of the Registrant shall be communicated promptly to the Commission by an amendment to the Form F-X referencing the file number of the relevant registration statement.

SIGNATURES

Pursuant to the requirements of the Exchange Act, the Registrant certifies that it meets all of the requirements for filing on Form 40-F and has duly caused this annual report to be signed on its behalf by the undersigned, thereto duly authorized.

DATED this 22^nd day of March, 2016.


HYDRO ONE INC.

By:		/s/ Mayo Schmidt
Name:		Mayo Schmidt
Title:		President and Chief Executive Officer

EXHIBIT INDEX


Exhibit Number		Description

99.1		2015 Annual Information Form dated March 22, 2016 for the fiscal year ended December 31, 2015.

99.2		Consolidated Financial Statements as at December 31, 2015 and December 31, 2014 and for the years then ended, and the accompanying auditors’ report.

99.3		Management’s Discussion and Analysis for the fiscal year ended December 31, 2015.

99.4		Consent of KPMG LLP.

99.5		Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the U.S. Securities Exchange Act of 1934, as amended.

99.6		Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the U.S. Securities Exchange Act of 1934, as amended.

99.7		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

99.8		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101		Interactive Data File.